Create a Pragmatic Investment Plan

Now that you have your goals well in hand, you need something like a plan to help execute them.

Back in The Pragmatic Programmer: From Journeyman to Master [HT00], we suggested you consider your skills and talents as a knowledge portfolio. That is, the skills you learn and the knowledge you master all become part of your portfolio. And like any portfolio—financial or artistic—it must be managed as time goes by.

For several years, Dave Thomas and I have presented the Pragmatic Investment Plan as part of our consulting practice, and I’m including a shortened version of it here for you. The Pragmatic Investment Plan is based on a very simple but effective idea: model your knowledge portfolio with the same care as you would manage a financial investment portfolio.

Just having a plan is an incredibly effective step toward achieving any goal. Too often, most of us slip into a kind of default learning schedule: you might take some time to learn a new language when you have a free moment or to look at that new library in your spare time. Unfortunately, relegating learning activities to your “free time” is a recipe for failure.

As you soon discover, you really don’t have any “free” time. Time, like closet space or disk-drive space, will get filled up much too quickly. The expression “to make time for” is a bit of a misnomer; time can’t be created or destroyed. Time can only be allocated. By being deliberate about your learning, by allocating appropriate time, and by using that time wisely, you can be much more efficient in your learning.

Time can’t be created or destroyed, only allocated.

There are several major points involved in maintaining your knowledge portfolio:

• Have a concrete plan.

• Diversify.

• Make an active, not passive, investment.

• Make a regular investment.

We’ll take a look at each of these Pragmatic Investment Plan (PIP) points in turn.

PIP: Have a Concrete Plan

Just having a plan is a huge step forward. Be very specific in your plan; use the idea of SMART objectives and goals, and devise different levels of goals over time. For instance:

• Now (what’s the next action you can take)

• Goals for next year

• Goals for five years out

The next action you can take might be something such as downloading a product or buying a book. Goals for next year might be specific indicators of proficiency (being able to do xyz in a given language or tool) or completing a specific project. Goals for five years out might be wider ranging and include things such as speaking at a conference or writing articles or a book.

This time frame is arbitrary; you might do better with now, three months out, and six months out. Or perhaps now, three years, and ten years if you’re working in a slow-moving industry.

And remember what General Eisenhower advised us: the planning is far more important than the plan. The plan will change, as we’ll see next. But getting in tune with your goals is invaluable.

PIP: Diversify

When choosing areas to invest in, you need to make a conscious effort to diversify your attention—don’t have all your eggs in one basket. You want a good mix of languages and environments, techniques, industries, and nontechnical areas (management, public speaking, anthropology, music, art, whatever).

Part of diversification is considering the risk vs. return ratio. Any area you decide to invest in may be high or low risk and high or low return on investment. For instance, learning a popular technology such as .NET is fairly low risk—many legions of programmers are doing it, so there is plenty of support, published books, courses, job openings, and so on. But that also means it’s fairly low return on investment—there are many legions of programmers doing it, so there’s a lot of competition for those job openings. The fact that you do it isn’t so special.

On the other hand, there are high-risk technologies. In the days when Oak first became Java, it was a high-risk choice. Maybe it would become popular, maybe not. When Java then did explode on the scene, those who had taken the risk were rewarded handsomely. It was a high-risk, high-reward choice.

Today, any number of technologies on the horizon are high risk and potentially high reward. They may go nowhere—that’s the risk. Erlang or Haskell may be the next major language breakthrough. Or not. Ruby may be the next Java. Or not. Perhaps the iPhone will be the dominant platform.

One major difference between knowledge investments and financial investments is that all knowledge investments have some value. Even if you never use a particular technology on the job, it will impact the way you think and solve problems. So, anything you learn will have value; it just may not be direct, commercial, on-the-job value. Perhaps it will help develop your R-mode or improve your R-mode to L-mode flow.

All knowledge investments have value.

And speaking of value, don’t forget that time is not the same as value. Just because you spend a lot of time doing something doesn’t mean that it’s adding value to your knowledge portfolio. Watching a football game or playing a video game might be relaxing and entertaining, but it doesn’t add value (unless you’re a quarterback or game developer).

PIP: Active, Not Passive, Investment

Another main topic from The Pragmatic Programmer is the idea of feedback. In this case, you want to always evaluate your plan in the cold light of day and realistically judge how it’s going.

In the financial world, the keyword is active investment. You don’t just sit around on your assets. You have to deliberately stop and reevaluate your portfolio. Is it performing as expected? Have key technologies or major players in the world changed since you started?

Perhaps it’s time to add a few new elements that you hadn’t considered previously or scrap a few plans that just aren’t working out. You may have to revise your objectives or change your goals in the light of new developments.

PIP: Invest Regularly (Dollar-Cost Averaging)

Finally, you need to invest regularly. In financial terms, this lets you do dollar-cost averaging. That means that if you buy stock on a regular basis, sometimes you’ll pay too much, and sometimes you’ll get a great deal. But over the long-term, these differences smooth out, and in general you end up getting a good bargain.

It’s the same here. You need to make a commitment to invest a minimum amount of time on a regular basis. Create a ritual, if needed. Escape to your home office in the attic or down to the coffee shop that has free wi-fi. Not all your sessions will be equally productive, but by scheduling them regularly, you will win out in the long run. If instead you wait until you have time or wait for the muse, it will never happen.

Create a ritual.

To help make the most of your investment, plan what to do before you sit down at your appointed time. There’s nothing more frustrating than clearing the calendar, escaping from the daily pressures of job and family, only to sit down in front of a blank screen and wonder what to do next.

Get the planning out of the way before you get there so that when you have your time, you can get right to it.

For example, if I wanted to learn the FXRuby GUI toolkit, I’d be sure to get the book first, download the components I need, and have an idea for something I want to write using FXRuby before sitting down and working with it in earnest. I’d also have enough time scheduled to actually dig into it; one Saturday afternoon or Tuesday night is probably not enough.

Next Actions

• Write down concrete goals for now, the short-term, and long-term.

• Add two new areas that you haven’t explored to help diversify your portfolio.

• Block out time each week to devote to your investment.

• Set up reminders to reevaluate your portfolio on a regular, periodic basis. What changed, and what didn’t work out? What will you do now?