Eleven Maxims From Francesco Guicciardini

Eleven maxims from Francesco Guicciardini that offer helpful advice for entrepreneurs on making decisions and managing risk.

Eleven Maxims From Francesco Guicciardini

Eleven Maxims from Francesco Guicciardini in Maxims and Reflections (Ricordi) that are still relevant today. Guicciardini was an Italian writer, historian and politician who lived from 1483 to 1540. He was a contemporary of Niccolò Machiavelli, and engaged in an ongoing exchange of letters with him. Italy in this time period was characterized by intense political turmoil and sudden changes in fortune for the rulers of the various city-states, the eleven maxims I selected are focused on risk management, maintaining situational awareness, and persevering then blindsided. Unless otherwise noted all quotations are from Francesco Guicciardini in Maxims and Reflections

Deal With Things as They Are, Not as You Wish Them To Be

70 The truest test of a man’s courage is his behavior when overtaken by unforeseen dangers. He who shows a good front to those, as we find very few do, may deservedly be pronounced resolute and intrepid.

283 Things we do not anticipate move us beyond comparison more than those that are foreseen. Wherefore I pronounce that to be a great and resolute spirit which stands undismayed amid sudden dangers and disasters; for this in my judgment is the rarest excellence.

These two struck me as related. How you handle getting blindsided is the true measure of your ability to persevere. Guicciardini faced a number of reversals in his lifetime but managed to retire in comfort and write a “History of Italy” that was published after his death. One way to prepare is to remain mindful of the fact that you never have perfect information: the past is often poorly understood and can be source for mistaken analogies, the present remains in motion and hard to understand, and the future is impossible to predict. We can be guided by intuition formed from past experience, a working consensus that represents a blending of perspectives on your team, and we can have a sense of trends and emerging possibilities. But surprise is inevitable.

Expect the Unexpected, Be Wary of Hearing Only What You Anticipated

89 When it comes from a doubtful source, I am slow to believe news that in itself seems likely. For what men’s minds are already prepared to accept as true may easily be feigned, whereas things in themselves improbable and unlooked for are not so often invented. Accordingly, when I hear unlikely news, I am less apt to discredit it.

I think there are two critical points here about maintaining situational awareness. First, things that are genuinely new developments or events are often confusing and perhaps incomprehensible. When we speak of “news,” it often falls into the category of anticipated outcomes. But true harbingers can disrupt your ability to orient, risking a rejection of a significant development as noise. You must remain open to the unanticipated; if you don’t “expect the unexpected” or at least allow for it, you can be slower to react.

The second point is to avoid fitting fragmentary news or data points into what you were expecting: be careful of hearing what you want to hear and leaping too firmly to a conclusion based on desire or previous predictions. A related observation is that people are more likely to try to mislead you by telling you what you want to hear.

Prudent Risk Taking

96 It is an old saying that all wise men are timid, and for this reason, that perceiving all dangers, they have more cause to be afraid. I believe the saying to be false, since he is not to be reckoned a wise man who thinks more of a danger than he should. I would rather call him wise who rightly estimates the degree of the danger and fears it no more than he ought. It is the brave man, therefore, rather than the timid who is to be accounted wise. And assuming both to be equally discerning, the distinction between the two lies in this, that the timid man takes into account all the dangers which he knows may possibly arise, and always anticipates the worst; whereas the other, though he too discerns all dangers, yet reflecting how many of them may be escaped by proper precautions, and how many come to nothing of themselves, does not suffer himself to be dismayed, but goes boldly forward in the hope and confidence that everything will not happen that might.”

This is a recommendation for prudent risk-taking. All new ventures face many possible setbacks and failures, a few of which will come to pass, but not all. When planning for network reliability at Cisco, we would design in two connections to make an edge node reliable and simulate all combinations of three simultaneous link failures in the core to ensure the network would not partition. I think a baseline assumption that you have to try a new approach at least three times to assess it correctly is a reasonable assumption. The flip side is that you should plan for any prospect to have at least three positive experiences with your product or service before they make a purchase.

Vigilance, Skill, Courage, and Contingency Plans

“312 Many imagine that the wise man, since he discerns all dangers, can never be brave. I, on the contrary, am of opinion that no timid man can be wise. For he who thinks more of a danger than he ought must lack sense. But to clear up the point, which is somewhat obscure, I say that not all dangers are realized; for some a man will escape by his vigilance, address, or valor, while chance will dispose of others in a thousand accidental ways. Accordingly he who discerns dangers is not to assume them all as certain; but prudently distinguishing which of them he may hope to overcome by himself and against which of them he may hope to be aided by Fortune, should be of good heart, nor ever withdraw from an honorable and manly enterprise through fear that he will encounter all the perils which he knows to lie on the road.”

For me, this is a fundamental insight: “Not all dangers are realized; for some a man will escape by his vigilance, address, or valor, while chance will dispose of others in a thousand accidental ways.” Vigilance allows us to avoid a danger close at hand. Address is used in an archaic sense here as a synonym for skill or dexterity; it allows us to manage risks or setbacks. Valor combines honor and dignity, blending courage with fair dealing. To the extent that we can address problems directly and deal with others forthrightly, we can often reduce the impact of challenges and perhaps convert some opponents into at least a neutral attitude, if not an ally.

Finally, chance cuts both ways: many of the risks we foresee do not come to pass. That does not mean we should not proceed, but prepare contingencies in the same way that a spare tire is a better strategy for road hazards than staying home. The challenge is to see the likely risks and develop a contingency plan with explicit tripwires and triggers for appropriate responses. It’s hard to thread the needle between acting with vigilance and engaging in undue worry; rehearsal and deliberate practice can help. You also need to calculate the efforts you will need to make and the costs you can afford to pay to realize a significant opportunity or avoid a severe setback.

“A good story was told of an old man who had endured many of the ills of life in his long journey. His friends upon one occasion, more trying than usual, condoled with him, saying that he really had more troubles than other men. “Yes, my friends, that is too true. I have been surrounded by troubles all my life long, but there is a curious thing about them—nine-tenths of them never happened.”
Andrew Carnegie in “An American Four-in-hand in Britain” (1883) [Gutenberg]

In the Long Run, Luck is the Residue of Prudence

136 The fool will sometimes accomplish greater things than the wise man. For the latter, unless otherwise constrained, will trust much to reason and little to fortune, while the other trusts much to fortune and little to reason. But the things seconded by fortune have often a success past belief.

Sometimes it’s better to be lucky than smart, but in the long run luck is the residue of prudent plans that allow for likely contingencies. I think the real risk that Guicciardini neglects is not realizing that you have been fortunate. Here are two related modern observations on the risk of confusing luck with knowledge, skill, or wisdom.

“It’s hard to detect good luck–it looks so much like something you’ve earned.”
Frank A. Clark

“Those who mistake their good luck for merit are inevitably bound for disaster.”
J. Christopher Herold in “Bonaparte In Egypt“

Don’t Give Up Before You Are Beaten

162 Both in wars and in many other affairs of moment I have often seen preparations neglected under an impression that they were too late; and yet it has been seen afterwards that they would have been in time, and that the omission to make them has occasioned much loss. This results from the movement of things being much slower than we think for; so that often what you imagined would be over in one month, is not ended in three or four. This is an important reflection, and one whereof to take heed.

Keeping your emotions on an even keel is critical to managing unexpected losses and setbacks. Planning and vigilance are essential elements of success, but so is the ability to take a punch and come back. Startups discover what competition really means when larger competitors organize an effective counter to what has allowed them some early successes. You can feel you are beating the competition when they have simply ignored you.

Secondly, avoid getting caught up in the desire for a fast response when a slower but effective one is more likely to prevail. If you take the time to look, a surprising move by a competitor or a sudden reversal with a prospect often has more information below the surface. This deeper understanding allows for more effective responses than a reflex abandonment or rapid but ultimately poorly thought effort.

Judge a Leader By Whom He Relies on and Promotes

171 It was a saying of Duke Lodovico Sforza that princes and crossbows were to be tried by the same test Whether a crossbow were a good one or no could be known by the bolts it carried; and the worth of a prince was seen in the men he sent to represent him abroad.

Who you hire, who you partner with, who you promote are decisions that will differentiate your business–or cripple it. Especially when you delegate responsibility for situations where you must rely on the character and sound judgment of those you select because there won’t be time or opportunity to review at least their first response. A salesperson talking to a prospect can lose a sale before you can correct their mistake. Service and support personnel can convince a customer to stop using your product with a poor answer or a poorly thought-out approach. Managers can demotivate talented employees. I am not advocating that you should be a solo entrepreneur or otherwise refuse to trust or delegate to others. But it’s worth giving a lot of care to training, rehearsal, monitoring without micromanaging, and maintaining open lines of communication

Maintain a Margin for Error and Unknown Unknowns

182 I have noticed that men of great sagacity, when they have to resolve on any business of moment, almost invariably fall to distinguishing the various courses the thing may take, and after considering two or three probable contingencies, form their final resolve on the footing that some one of these will happen. Be warned that this is a dangerous method to follow; for often, and indeed almost always, some other contingency, not taken into account in your deliberations and not met by your resolve, will turn up. Accordingly, it is your safer plan, in resolving, to assume that things you think unlikely may well come about, and never where you can help it to limit the scope of your deliberations.

You can map out a course of action that takes into account what you are confident of and provides a margin for “known unknowns” that you have identified and placed a bound on. But you can still find yourself “off the map” due to unforeseen contingencies or other surprises. I studied optimization theory in college and was very excited by the ability to simulate complex systems with probabilities. I worked in risk management and then electronic design automation, where I had a chance to put many of those shiny tools to good use. And they were not a waste of time: they prevented many problems. But I also learned the value of having at least three alternatives available:

New tools that could provide considerable improvements in capacity but always came with defects yet to be discovered.
The current tools that were more reliable because their capabilities and shortcomings were better understood.
The old tools that were much less capable but rarely failed in new ways and could provide slow but steady progress when all else failed.

These were complemented by detailed analysis of errors and failures so that the new tools could move into production, the current tools could be moved into the box marked “old and reliable,” and the old tools could be safely retired–for the most part, they would sometimes still come in handy.

Decide Carefully, But Act Quickly Once You Decide

191 We cannot blame those who are slow in resolving. For although occasions do sometimes come wherein it is necessary to resolve quickly, still, as a rule, he makes more mistakes who resolves quickly than he who resolves slowly. What is in the highest degree to be blamed is slowness in execution after a resolve is taken; for this it may be affirmed, always hurts, and never helps except by accident. I mention this that you may be on your guard against it; for I see that many, either from indolence and to avoid trouble,or from other causes, are guilty of this error.

I see startup teams avoid problems when faced with an important decision using the following approach:

They agree on goals and what they are trying to achieve–or avoid–that is consistent with their values.
They decide when they need to take action, when inaction will have led to an unsatisfactory outcome.
They frame a default approach that will likely to lead to an acceptable outcome if it suddenly becomes clear they have less time than they anticipated.
They huddle and collect what they know and map what they don’t know what is likely to be relevant. They mix research and brainstorming for new alternatives and re-evaluate the default decision in light of new information.
They pull the trigger on their current best approach before they are overtaken by events.

Follow Up and Make Mid-Course Corrections

192 In matters of business take this as a maxim, that it is not enough to give things their beginning, direction, or impulse; we must also follow them up, and never slacken our efforts until they are brought to a conclusion. Whoso conducts business on this system contributes in no small measure to its settlement; while he who follows a different plan will often assume things to be ended which in truth are hardly begun, and the difficulties whereof are not yet reached; such are the heedlessness, futility, and perversity of men, and such the lets and hindrances that things present in their own nature. Follow this rule; the doing so has sometimes gained me great honor, as a contrary course will bring him who adopts it great disgrace.

Don’t assume that no news is good news. Build the checkpoints and follow up into the original action plan. Effective follow-up is about keeping people on the same page and maintaining shared situational awareness, not micro-management. Checkpoints should involve not just an assessment of how much of the schedule and budget have been consumed but also what risks have been eliminated or minimized and any new developments that may necessitate a re-plan.

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Eleven Maxims From Francesco Guicciardini