The book “Confidence” by Rosabeth Moss Kanter is about winning streaks and losing streaks. The big idea of the book is that winning creates more winning, and losing creates more losing.

The reason? Winning creates optimistic expectations that more winning is possible. When players and coaches (or employees and managers) believe that more winning is possible, they work harder and take more initiative, and that creates more winning. Also, it’s easier to recruit great players and get support from investors when you’re winning, and hence more winning follows.

The same things happen in reverse with losing streaks.

One application: Don’t lose twice in a row.

Broader application: Create a culture of confidence where team members feel a shared sense of winning.

If you’re in a losing streak: Actions speak louder than words. Create visible evidence of a turnaround that your team can see and believe in.

When there’s change in a company, most employees think about it in terms of job security.

As an owner, I’m usually focused on the change itself and the exciting benefits I see for the future of the company. When I communicate I need to remember that employees may see it as a threat to their job security, even when I know there’s nothing to worry about.

As a manager, err on the side of sensitivity to job security concerns. And if possible, help employees see where job security truly comes from.

Job security comes from happy customers. If the customers aren’t happy, no company can provide job security. If the customers are very happy, the company will grow, and that increases job security.

Job security comes from individual performance. High performers should feel very secure in their jobs, and low performers should be very worried about their jobs.

No employee should be surprised to find out their job is in danger unless the company was surprised by an unforeseen event. And no high-performing employee in a high-performing company should live in fear of randomly losing their job. Employees deserve to know where they stand based on known and predictable factors. I think good managers provide that.

[It’s been pointed out to me that a lot of managers let people go for other, less-honorable reasons than those mentioned here. Unfortunately, that’s true. If you are a manager, you don’t have to be one of those. If you are a high-performing employee who works for one of those, I hope you feel empowered enough to look for a job at a healthier company.]

When you are creating something, like a business, an invention, or a screenplay, you don’t know the hourly rate you’re working for. It could be negative, it could be higher than any reasonable salary.

Monty didn’t know the hourly rate he was working for when he started creating MySQL in 1995. I guesstimate he spent at least 26,000 hours coding MySQL before he sold it to Sun thirteen years later. That’s over 3,000 work days filled with problem solving, fatigue, doubts, and no guarantees.

On top of that, Monty was giving MySQL away as free open-source software the whole time. He saw the long view. He wasn’t playing for a paycheck at the end of the week. He lived with the risk that events out of his control might mean the long view never even came true.

In 2008 he finally knew the hourly rate. His capital gains from the sale were roughly $26 million dollars. That’s $1,000 an hour. On top of that the software he created became a staple of the Internet software world, used by Facebook, Twitter, Google, WordPress (including this blog), and more.

If he had approached any software company in 1995 and said “I’d like you to pay me $1,000 an hour to write database software.” would any owner have agreed to that deal? No, he had to be his own owner, take a lot of risk, and show a lot of perseverance to make that deal come true.

When you don’t limit yourself to projects with a known hourly rate, you open up a big world of possibilities.

Habit #7: Sharpen the Saw

This habit is named after the popular illustration about taking time off from woodcutting in order to sharpen the saw. Of course, this time off spent sharpening will increase the amount of woodcutting you can do in a day. This habit is about allocating a portion of your time to develop and renew yourself, so you will be more effective the rest of the time.

In practice this is a CEO taking one day a month away from the business to attend a development group. It’s a professional attending continuing education. It’s making your workday a little shorter to make room for exercise.

That’s it for my review of Covey’s book of broad and timeless wisdom. You can buy it on Amazon.

Habit #6: Synergize

When you trust the people you are interacting with…

When you believe that the whole is greater than the sum of its parts…

When anticipate that other people will add good things to the mix, but don’t know what those additions will be,

Then you can interact in a state of creative cooperation to bring about a result that no one person in the group could have done on their own.

This is about discovering what each person has to contribute, and connecting those contributions together into something bigger.