two

Temporal Punctuation

”The reason he [Jared L. Loughner, who shot Representative Gabrielle Giffords] was able to be tackled was he had to pause to reload,” said Dennis Henigan, vice president of the Brady Center to Prevent Gun Violence…. ”The problem is, he didn't have to pause to reload until he'd already expended 30 rounds.” [italics mine]

—Jo Becker and Michael Luo¹

Temporal punctuation refers to how we divide the continuous flow of time into separate units by creating steps, stages, beginnings, endings, midpoints, and deadlines. Similar to the commas and periods in a sentence, these marks of temporal punctuation tell us where we are and when to start, stop, or pause. For example, a company will use the end of the calendar or fiscal year to time the beginning and end of its strategic planning process. Every industry has an annual trade show or an important convention or sales meeting, which affects when new products are introduced. Money managers who are sitting on cash may be required by their funds to be fully invested, so they will jump back into the market by the end of the quarter.

Examples of temporal punctuation are everywhere, part of everyday life. Think of that special interval we call “now,” which perpetually separates past from future. The numbered dials on our watch and the dates on our calendar are marks of punctuation. So are the moments of sunrise and sunset that mark the beginning of the day and night, or the fleeting expression of fatigue in a host's face that tells us it is time to leave. Individual marks of temporal punctuation are important because they can tell us a lot about timing. The trouble is, we often don't notice them.

Here's an example. A young man working as a grocery clerk was interested in advancing his career. He was able to secure a new job at a high-tech company by promising not to cash any of his paychecks until he had proven that he was the best keypunch repairer in the business. If we ask ourselves when he would be able to prove he was best, most of us would throw up our hands and say that it's impossible to know. As it turned out, the young man got the job, worked hard, and, as he promised, didn't cash his paychecks. But when the accounting department tried to close its books for the quarter, it found it couldn't because of all the uncashed checks. At that point, the branch manager, who had forgotten the deal he had made, released the young man from his promise.

That is how James Cannavino, the chief strategist at IBM, who retired in 1995 after thirty-two years with the company, got his first job with Big Blue.² Neither the branch manager who hired him nor Mr. Cannavino himself thought about the punctuation mark (quarter-end) when the accounting department would need to close its books.

There are two reasons why punctuation marks supply useful clues in matters of timing. First, many actions are coordinated with specific times and dates on the calendar. We know, for example, that there will be a party on New Year's Eve. Other events will only happen after a known punctuation mark. When would President Obama have flexibility in negotiating a reduction in nuclear missiles with Russia? We know the answer because an open mike picked up part of his conversation with Prime Minister Medvedev of Russia on March 26, 2012. He told Medvedev that he could be more flexible after his reelection. Presumably, concessions before then would be used against him: his opponents would portray him as weak. The second reason is that people like to appear rational. They want to be able to give objective reasons why they acted when they did. Rather than admit they did something on a whim or for emotional reasons, they will point to a mark of punctuation. They will say, for example, I chose that time because it was

• Before something that just started or ended
• After something that just started or ended
• In between two recognized points in time
• During a pause in the action

We all need to be able to explain (to our boss, the board, an external stakeholder, and even to ourselves) why we chose one time over another. And that is not always easy. This is particularly true when a decision is based on what I call a magnitude rule. A magnitude rule is one in which the timing of an action is triggered whenever a state or process reaches a certain magnitude or threshold. “I'll do that when costs are too high, when the market is too small, or when my patience runs out.” A timing rule like that is difficult to implement, except arbitrarily. After all, how high is too high, how small is too small, and how long is too long? It is often impossible to tell. Therefore, people use temporal punctuation marks to decide when to act: We will look at costs at the end of the quarter, they say. We'll judge whether a market is too small after we have one full year of sales, and so on. Because we know that others will use punctuation marks to time and justify their actions, we can use that knowledge to predict when they will act, and hence better time our own actions.

Punctuation marks can also explain why an action wasn't taken at a particular time, because punctuation marks keep together whatever is between them. For example, a meeting begins and ends. Those two punctuation marks separate the events of the meeting from what went on before and after. But they also group, and therefore bind together, the events that constitute the meeting. Leaving in the middle of a meeting feels disruptive. When there is no pause, no beginning or ending, then there is no easy way in or out. The converse is also true: punctuation makes entrances and exits possible. Television programs tend to begin and end on the hour or half hour, not a few minutes before or after.

John Goode, a portfolio manager at Smith Barney, carried out a research project in early 2000 with analysts at Sanford C. Bernstein. The project involved a specific temporal punctuation mark. Using publicly available data for the year, they looked at the amount of money raised in initial public offerings and calculated how much stock owned by insiders might be coming into the market once the “lockups” (the amount of time officers must hold their stock) expired. They determined that as much as $150 billion in insider shares could be freed up from March 30 to June 30 of 2000.

Goode received that report on March 16, a week before the NASDAQ hit what would prove to be its all-time high. The findings—what Goode felt represented a tsunami of stocks available to come to market—were all that he needed to put his fund on what he calls a “technology-free diet.” Most of us who were in the market at the beginning of January 2000 weren't thinking about how beginnings or endings would affect stock prices. By examining a punctuation mark (lockup expirations), Goode was able to avoid the bloodbath that ensued.

“It was basic Economics 101,” he says.³

Actually, it wasn't basic economics. You won't find an explicit discussion of temporal punctuation or, for that matter, many references to the term lockup period in most beginning texts on economics. Like their linguistic counterparts, marks of temporal punctuation can easily get lost amid other concerns. But putting them to use can make a big difference. When we know the location of punctuation marks, we can use them to make predictions and decisions.

CHARACTERISTICS OF TEMPORAL PUNCTUATION

As with all of the timing elements, using temporal punctuation to make decisions about timing begins with knowing what to look for. Here are eight characteristics that are important.

1. Type. There are many kinds of punctuation marks.
2. Strength. Some are strong; others are weak.
3. Objective or subjective. When something is over in reality and when it is perceived to be over need not be the same.
4. Meaning. What does a given mark of temporal punctuation mean? How do different stakeholders interpret it?
5. Location. Where a punctuation mark is placed within a process matters.
6. Number. There is often more than one.
7. Spacing. How much time separates them?
8. Alignment. Which ones occur at the same time?

Type

Specific times and dates can serve as punctuation marks. To find them, look at different calendars. Most of us in business watch the economic calendar, when the Federal Reserve will meet to determine interest rates, for instance. But we also need to think about other time lines—the political calendar, for example, when an election will occur that could alter the balance of power at the state or federal level. When we are planning a product launch, we need to consider religious and secular holidays, such as Christmas, New Year's Day, and July 4. We need to think about the legislative calendar, when bills affecting our business may be acted on.

We also need to pay attention to internal and external punctuation. The schedules and timetables associated with projects inside our own organization are right there in front of us. But we need to be aware that external stakeholders will have their own deadlines and sense of when to begin or postpone an activity. We also need to know when events in the wider world are beginning or ending. Are we at the dawn of a recession? If so, then it's probably not the right time to expand payroll.

We can't spend every moment monitoring time lines and temporal punctuation (football coaches sometimes assign a specific person to keep track of the clock and help make decisions about time-outs), but remember that there are many types of time lines, each with its own punctuation.

Strength

Punctuation marks can differ in terms of function or strength.

The Period

Of all the types of temporal punctuation, periods have the most power. In most hierarchical organizations, we can debate, ponder alternatives, and even object to a course of action. But once our boss has made a decision, the moment for debate and deliberation is over. To continue to argue beyond that point is risky. Like running a stop sign, it can put your life (within that organization) in jeopardy.

An important decision can function as a period. Whereas the logical function of a decision is to choose among alternatives, the temporal function of a decision is to separate the present from the past. There is a time before the decision, and a time after. That is one reason we value decisiveness. Decisions free the future from the grip of the past in the same way that a period at the end of a sentence prevents the old sentence from running on. In addition, by stopping the past, a period creates space for something new to begin.

The Comma

NATO was fifty years old in April 1999. The Soviet Union, one of the main reasons NATO existed, had collapsed. Still, as events all around the world continue to show, the alliance is not going out of business just yet. Alexander M. Haig Jr., a former NATO commander, treated the anniversary more as a comma than a period. In a speech, he described the moment as a time to reflect on the past and envision the future. His choice of comments made it clear that NATO was not at an end, but instead was at an inflection point.

All of us, managers included, have choices to make about punctuation. Whenever a mark of punctuation is called for, we can decide whether the time is right to declare an end, to permanently terminate what has been going on, or simply insert a comma, a brief pause to evaluate the immediate past and plan for the future.

Some punctuation marks are perceived as more significant than others—the “big Five-O” for baby boomers, for example. The end of the fiscal year is usually more important than the end of the second quarter, and so on. When a deadline is imposed, we need to know whether it is a hard or soft deadline. Must it be met, or can it be treated as just another step along the way, more of a comma than a period?

Objective or Subjective

It is important to look for subjective as well as objective punctuation. Objective punctuation refers to events in the real world, the time when a contract expires or a website goes live. There is no debate over objective punctuation. Subjective punctuation, by contrast, is, well, subjective. We feel that something is over or is beginning, regardless of the objective facts. Everyone may know that a project or business relationship is over before it is officially declared dead. Similarly, an activity may seem like a “new beginning” without anyone making a formal announcement to that effect.

Meaning

The question of whether a punctuation mark is objective or subjective is closely tied to the question of meaning. Do different stakeholders interpret the same mark in the same way? One person's comma, or pause, can be another person's period, and vice versa. If someone doesn't respond to your email for a certain period of time, does that mean that he or she wants to end the relationship?

Location

Exactly where a punctuation mark is inserted into an ongoing process or sequence of events is critical.

A punctuation mark can be inserted too early. When a person has just hit his thumb with a hammer, what should he do? We know the answer: put ice on it. But using ice to treat bumps and bruises was not something earlier generations would have done. They would have said that healing requires heat. But they were making a timing error. Just because the hammer is no longer in contact with the person's thumb does not mean that the injury is over; it is not. It continues, and ice slows its progress. After that, heat can be applied.

One reason that we declare something (such as a recession) over is that we want to distance ourselves from the pain it has caused. But there is another reason: we need the past to be over to create the possibility of a new and better future.

A punctuation mark can also be inserted too late. Consider an old police interrogation tactic. Here's how it worked before the Supreme Court declared it unconstitutional. The police first questioned a suspect without telling him that he had the right to remain silent and consult a lawyer. The police were aware that they couldn't use what the suspect said in court. After a break, the police came back and then read the subject his rights. Suspects usually simply repeated what they said earlier.⁴ The punctuation mark in this case (the Miranda warning) was inserted late on purpose to make the suspect feel that it was too late to take back what he or she said. The Supreme Court subsequently invalidated the general use of this tactic.

Number

Pay attention to the number of punctuation marks that are or will be present in any time-extended process. An excessive number can slow things down. We have all been on a short flight, only to find that the drive home—exiting the parking ramp, pausing at stop signs, halting for traffic lights, and getting on the highway—took longer than the flight itself. We underestimate how long a task will take to accomplish because we fail to consider all of the punctuation marks, the various borders and boundaries that we will have to cross en route, even though we know about most of them in advance. That is why it is so important to include them in our planning.

There are a number of reasons why we don't. First, some punctuation marks, such as an unexpected delay, can't be predicted. Second, some are unpleasant. We want the drive home from the airport to be short and sweet. Punctuation marks slow us down. Third, when there are a lot of punctuation marks, it is not easy to keep them all in mind. For example, when you drive home from the airport, think about how many stops and starts you have to make—and that's the point. You have to stop and think. We are not used to taking punctuation into account.

Neither IBM's Cannavino nor his boss were thinking about punctuation—namely, that by the end of the quarter all those uncashed checks would pose a problem for the accounting department. If it's easy to ignore a single punctuation mark, what should we do when there are dozens of beginnings, endings, pauses, and stops and starts, as in most projects? One of the difficulties in dealing with large numbers of punctuation marks is that we don't have a place to put them, so that when we need to find them, we don't know where to look. One solution is to think of the future as a set of parallel lines or tracks, one line for each event, process, or course of action. We could then, for example, put all the times and dates of the legislative calendar that affect our business on one line, all the dates of important industry events on another, the times and dates of our company's strategic planning process on another, and so on. That way we could keep track of all the punctuation marks that matter.

Spacing

Spacing, the time between punctuation marks, allows us to predict events that would otherwise be unpredictable. As an example, let's consider Attorney General Janet Reno's decision to storm the compound of the Branch Davidians on April 19, 1993. Located in Waco, Texas, the compound had been under siege for over a month. The standoff began February 28, when agents of the Bureau of Alcohol, Tobacco, and Firearms attempted to serve David Koresh, the religious head of the Branch Davidians, with a warrant. Heavily armed Davidians fired on federal agents, killing four officers and wounding sixteen. The government began negotiating with Koresh in an attempt to convince him to surrender. Koresh had twice indicated that he would leave the compound, but reneged each time. Finally, after weeks went by, Koresh said that he would exit the compound at the end of Easter/Passover. When that date came and went and Koresh did not surrender, the government made its move. The timing rule they followed was the same as in the first Gulf War: when negotiation fails, use force.

Punctuation entered into the government's decision in two ways. First, Koresh was a religious figure, and the selection of a religious date for a resolution of the crisis had a certain rationality to it (an action was aligned with a punctuation mark of the same “type”). But when he failed to come out at Easter/Passover as promised, the government lost hope, hope that had been raised precisely because the time of exit seemed understandable in a situation ruled by unpredictability and violence. When a time that appeared to be rational did not produce the desired result, the government lost hope of a reasonable outcome, and so acted with force.

There is another way timing came into play. The next time the crisis might be resolved by using a major religious holiday was Christmas, but Christmas was still eight months away. If Christmas were celebrated in May rather than December, the government might have paused. Its negotiators could have tried to build a story around Christmas as a “logical” time when the crisis could be resolved. Only an accident of the calendar (the long interval between Easter/Passover and Christmas) prevented it. That is one reason we sometimes say that timing is a matter of luck; but this is exactly the wrong conclusion. The fact that Christmas is celebrated in December rather than May is precisely what we needed to know to predict when the government would act. The spacing of these two punctuation marks decided the question of timing.⁵

The Waco example introduces an important principle: the more it seems impossible to predict when an event will occur or a decision will be made, the more its timing will be determined by the location of temporal punctuation. When will David Koresh promise to leave the compound? Answer: at the end of Easter/Passover. Koresh was a religious figure, and the selection of a religious date had a certain logic to it. When will the State of Minnesota Supreme Court decide the contested senate race between Norm Coleman and Al Franken in 2009? Answer: right before the Fourth of July weekend so that the results of the election wouldn't be left hanging and prove an embarrassment during the Fourth of July parade. When will Cannavino prove that he is the best keypunch repairer? Answer: at the end of the quarter. When will most people start an exercise program? Answer: right after New Year's. So if we can determine which punctuation marks are salient for decision makers, we have found an important clue about the timing of their actions, especially when it appears that they have no other grounds on which to make a decision.

Alignment

When a number of similar punctuation marks occur at the same time, our sense of a border or boundary is strengthened. The power to change an organization is strongest, for example, when a new leader arrives, because two punctuation marks are aligned: a new leader and a new direction. They occur at the same time.

One particular alignment of temporal punctuation is so common it deserves a name. I call it the no gap, no overlap rule. This rule suggests that the next step or stage should begin immediately after the cessation of the previous one, with no gap or overlap between them—the termination of an existing product with the launch of its replacement, for example, or the resignation of a key leader with the appointment of his or her successor. The rule—expressing a kind of temporal agoraphobia—requires that there be no empty or “dead” space between the end of one event and the beginning of another. The rule also requires that two processes or events not overlap, which might cause one to compete or interfere with the other, such as when one product cannibalizes another. The exception to the no-overlap component arises when continuity is important. For example, a company might ask a retiring employee to train her successor.

We generally think that alignment is good, and misalignment bad, but not always. Looking as old as we are or feel may or may not be a good thing. The ability to intentionally align (or misalign) one's actual age with one's psychological age and the age that one presents to the world is what keeps the health and beauty industry alive and profitable. The ability to align the outcome of a project with the time when it will be evaluated turns out to be a powerful motivator.

In general, misalignment raises questions. Regularly scheduled meetings act as a form of punctuation. When a decision comes at a different time, we wonder why. In October 1998, for example, the Federal Reserve cut two key interest rates. The market soared, but because the move occurred in between regularly scheduled Fed meetings, it “served to make already-battered bond investors more nervous than ever.”⁶ Bystanders wondered whether the timing of the action was a signal that the looming recession was closer than anticipated. As this example illustrates, misalignment can have unintended consequences.

TEMPORAL PUNCTUATION RISKS

There are a number of risks associated with missing or misreading this element of timing.

Missing Punctuation

Perhaps the greatest risk is failing to note that an ongoing activity will have punctuation marks. Their presence and location can have a major impact on a decision. For example, researchers followed eight Israeli judges for ten months, making note of their rulings on the one thousand prisoners who applied for parole during that time. What they found was that prisoners were far more likely to be granted parole if their applications crossed the judges' desks at the beginning of the day. As the hours passed, however, fewer and fewer requests were granted. The number rose significantly again following two daily breaks, during which the judges stopped for food. But then, as the day wore on, the approvals once again plummeted.⁷ So if you want to get out of jail, make sure your application is considered early in the day. Knowing where a punctuation mark is placed and understanding its effect can provide important information about timing.

A similar lesson can be drawn from the Dow's thousand-point plunge and subsequent recovery in May 2010, in what was known as the Flash Crash. One primary cause of the plunge was a computerized trading glitch that prompted a sale of $4.1 billion in shares. The algorithm responsible was designed to execute a trade regardless of price or time, which meant that it continued to sell even as prices dropped sharply.⁸ The unintended consequence of automatic, high-frequency trades placed at the wrong moment can be a market downdraft or plunge. After the Flash Crash, part of the solution by regulators was to expand trading curbs (or circuit breakers). They essentially inserted punctuation where it was missing, so that stock trading is halted for five minutes if the price moves by 10 percent or more in a five-minute period.

Fortunately, the temporal punctuation lens is one of the easiest to use because it involves looking for familiar categories: beginnings, pauses, midpoints, endings, known dates on the calendar, and so on. As I indicated earlier, we simply need a place to put the marks so that we can keep them in mind and use the information they contain to make better decisions.

Questions to ask: Have I anticipated all the steps and stages, stops, starts, and pauses that will punctuate an event or situation? What impact will each have on my progress and final results?

Conflicting Interests

Mistakes and oversights occur when we feel obliged to focus on one kind of punctuation and then forget or downplay another as a result. For example, all executives live with inherent conflicts between the realities of the financial calendar—Wall Street's focus on results and measurement—and the need for projects to develop at their own pace if they are to be successful. As a result, projects may be rushed or cut short to meet immediate needs, such as quarter-end accounting and earnings reports.

Question to ask: If a situation has multiple punctuation marks, which will take precedence, and why?

Misreading Temporal Punctuation

Problems arise when we mistake a comma for a period: we thought that something was over when it was not, or vice versa. Misreading temporal punctuation happens all the time. In November 2007, for example, Tom Lauricella wrote in the Wall Street Journal that “after successfully dodging the bond market storm earlier this year, several big mutual funds thought the worst was over. It was a bad call, and now they're feeling the pain.”⁹

Questions to ask: Have I correctly interpreted temporal punctuation? Is it possible that what I think is a full stop is really just a brief pause?

Disregarding Temporal Punctuation (and Whether It Can Be Changed)

The present, which separates past from future, is a punctuation mark. We hope we can change the future, and we know we can't change the past. The practice of “backdating,” however, disregards this fundamental idea. In backdating, a company pretends that the options it gave executives had been issued at an earlier date when the stock price was lower, which ensures that the person receiving them makes a profit. If we fail to pay attention to where and when things start or stop, and whether anything about those facts can be changed or seen differently, we may find ourselves facing risks we didn't anticipate. Although backdating is not in and of itself illegal, the SEC found some cases of backdating to be fraudulent when they were in violation of tax rules.

Questions to ask: Am I ignoring or disregarding temporal punctuation for convenience's sake? If so, what might be the effect?

Simultaneous Punctuation

Mistakes occur when we don't consider what will happen if punctuation marks coincide. Pharmaceutical companies, for example, must plan for the times when patents on multiple drugs expire simultaneously, or pay a high price for that oversight. They need to be ready with new drugs to fill the revenue gap, or have a brand strategy that allows them to rise above the flood of competition. Likewise, if all the bonds in a portfolio mature at the same time, we have to hope that interest rates and our need for cash are exactly what we thought they would be when we bought the bonds. To avoid that risk, financial advisers often recommend a bond ladder, in which different bonds mature at different times, thus minimizing the risk of a forecasting error. The classic solution to synchronous risk, the risk that several events will occur at the same time, is an asynchronous strategy, a plan to keep them apart.

Questions to ask: Are several punctuation marks, such as deadlines, occurring simultaneously? If so, do I have a plan to manage their co-occurrence?

Inserting a Period Too Soon

Similar to using heat instead of ice on a wound, a common timing error is to be too quick to insert a period—concluding erroneously that something is over when it is not. President Bush's “Mission Accomplished” banner during the Iraq War is one example. The tendency to treat an event as concluded when it is not is quite common. In January 2007, it looked as if the housing market might be recovering from its slump, but financial writer Daniel Gross added a cautionary note having to do with how the Census Bureau calculates the supply and demand for housing. He noted that a percentage of the home sales finalized in December are in fact cancelled in early January. Yet the number is never right-sized, and the December figures are reported without correction.¹⁰

A sale isn't a sale if it is cancelled, but the Census Bureau still counts it. The mistake is to think of a sale as a single event, when it is really a time-extended sequence.

Question to ask: Is this really an ending, or is the event still under way?

Spacing Risks

Spacing risks occur when we fail to measure or account for the time in between punctuation marks. For example, if a family had a dozen children in as many years, I think it is safe to say that we would find the parents physically exhausted, not to mention financially stressed. Paying attention to starts and stops allows one to better allocate one's resources.

Question to ask: Have I built enough time in between events to prepare for what comes next?

Pattern Risks

Pattern risks arise when we fail to anticipate the shapes and patterns that are predictably associated with a punctuation mark—for example, the hockey stick jump in effort that occurs right before a deadline, as everyone works around the clock to meet it, or the lowering of expectations right before quarterly earnings are made public, so that the company can beat them. There are often patterns surrounding punctuation marks. We need to plan for them.

Question to ask: What predictable patterns of behavior are associated with different marks of punctuation, and have I taken these patterns into account?

Misinterpreting Temporal Punctuation

There is always a risk that someone may misinterpret a mark of punctuation. In a business negotiation, for example, one side may pause for what seems a very long time. Does the length of the pause suggest a lack of interest, or does it simply reflect the time the other side needs to resolve internal differences?

In 2008, Michael Gordon, writing in the New York Times, wondered how the U.S. exit from Iraq would be interpreted. “If the Iraqis know that American forces are on their way out, regardless of what they do, would they be more likely to respond by overcoming their differences or by preparing for the sectarian bloodbath that might follow?”¹¹ Different parties can interpret a mark of punctuation differently.

Likewise, when a traffic light (the punctuation mark) turns yellow, drivers respond in varying ways. A study of fifteen hundred drivers in Ohio found that “truckers tend to speed through, as do cars travelling in the right-hand lanes.”¹² In this case, different interpretations of a punctuation mark can literally cause accidents.

Questions to ask: Can a mark of temporal punctuation be interpreted in more than one way? Is there a right interpretation or a reasonable difference of opinion?

TEMPORAL PUNCTUATION OPTIONS AND OPPORTUNITIES

There are many opportunities to use temporal punctuation in our own lives and work. We can use a pause or a period to start a new relationship or introduce a different idea, terminate a project that has gone on for too long, create or diminish a sense of urgency, and perform a wide variety of other actions for which temporal punctuation is the right tool. Often it is not merely what we do but how we do it that determines success or failure. The greatest opportunity to use punctuation in business occurs in managing change, particularly the timing of entrances and exits (inserting a period).

Create Exit Strategies

Creating an exit strategy is essentially the same as adding a period. Let's assume that we are in the midst of a particular course of action—funding a research project, developing a business, or maintaining a long-term relationship. It could be anything. Now assume that things are not working, and we know that it is time to end our present commitment. Every situation is unique, of course, and there are always a multitude of factors to consider. But what is important for our purposes is how questions of time and timing enter into planning an exit strategy.

Unfortunately, unless it is a major undertaking, and even then, exit strategies are rarely discussed before a project or activity is begun. Doing so would be perceived as a lack of confidence in the new venture. It is hard to think about an exit when one is getting ready to launch a project. One solution is to make the discussion of exit strategies, and their timing, into a ritual. Rituals have the right temporal properties: they are time limited, so they won't interrupt the launch, and they are safe because they are rituals, as opposed to the real thing. And they can be practiced, and thus performed flawlessly even under stress. Because of these characteristics, rituals can be inserted into any activity at almost any time to achieve what would otherwise be time consuming or difficult.

These are some of the factors to take into account when considering an exit:

1. Permanence and reversibility. Is the situation that raises the question of an exit permanent or temporary, and would additional resources turn the situation around within a reasonable period of time?

2. The timing of alternatives. When will alternative opportunities be available? It is not uncommon to delay an exit until a viable alternative is present—even when it is obvious that continuing the present course of action makes no sense. If a project is evaluated solely against a set of internal benchmarks, a timely exit is unlikely. Someone must be given the task of identifying alternative opportunities and monitoring when the window opens and closes for pursuing them.

3. The timing of costs and benefits. When we talk about the costs and benefits of an exit, we usually think in terms of type and size. What costs or benefits do we anticipate? Will they be large or small? A timing analysis adds a third consideration: When will they occur? When most of the costs of a project are incurred at the beginning and most of the benefits are expected to come only at the end, a timely exit will prove difficult. Managers will be tempted to wait for the benefits, if only to justify the costs that have already been incurred. An obvious solution, when feasible, is to structure the project so that benefits track costs.

Most discussions surrounding an exit also include closing costs (as if that phrase somehow takes timing into account). We need to remember to ask how large closing costs will be at each point in the future, and how those costs will be evaluated when they are incurred. Costs that are acceptable when times are good may look excessive when times are tough.¹³

4. The temporal pattern of success and failure. Might a project show initial signs of success, but then seem to stall? If so, it is easy to become trapped. The British philosopher and social critic Bertrand Russell once remarked that the importance of early religious experience is not that it is religious but that it is early. The same is true of early success. Early success has the power to draw us in, to keep us committed until, like a gambler at a slot machine, we have lost everything. Managers should forecast the shape of possible time-extended patterns of success and failure that are associated with their projects and discuss how each might result in a timing error. These discussions should take place early, before problems emerge.

5. A shift in motivation over time. Over time, there can be a shift in motivation from seeking gain to avoiding loss, as illustrated in the box “The Dollar Auction.”

If you think about it, many business situations have this dynamic in fast-moving markets and highly competitive industries where events change quickly. We invest in real estate hoping to make a profit, but then the bubble bursts, and our only concern is how to avoid a complete loss.

6. Blame and responsibility. How will blame be assigned if the decision is to exit at a given time? The natural question to ask is, Who will be held accountable? But it is not merely who will bear the responsibility, but what that individual's world will be like at the time an exit is required. If everything else is going well, it will be easier to take responsibility for what isn't working. But if times are bad, we can expect those in charge to delay an exit in the hope that the situation will improve. Hence we need to anticipate the context in which an exit decision is required, or we will find ourselves surprised that it was made too early or, more likely, too late.

7. Identity, status, and reputation. The more an individual's or firm's identity, reputation, or status is closely linked to a project or activity, the more the decision to exit will be postponed, particularly if the same group who began the project is responsible for ending it.¹⁴

8. Language and culture. Timing an exit is influenced by an organization's culture.¹⁵ Some organizations prize persistence, staying the course. Others value speed. The former will be late; the latter will jump the gun. One clue to an organization's culture is how it views costs and benefits. If a cost is considered an investment rather than an expense, questionable returns will be viewed with less alarm. The firm will be slow to exit from an unprofitable venture. Attitudes and expectations about measurement are another clue. If an organization places a high value on quantification, anything that cannot be counted will be suspect. The firm will delay its decision to exit while waiting for greater precision and proof, which may be impossible to obtain. Many economic indicators are revised months or even years later. If we need to wait for perfect data before making a decision, we might have to wait a very long time.

9. Prior commitments. The greater one's prior commitment to a project, the more difficult it will be to exit. In other words, we need to know what relationships or interests will be threatened if the project is terminated. The more numerous and important they are, the more an exit will be delayed.

10. The multidimensionality of endings. Endings are difficult in complex situations because the right time to exit on one dimension may not be the right time on another. Think of the war in Afghanistan, or any war for that matter. When will the various missions be accomplished (nation building, defeating the Taliban, securing key parts of the country, and so on)? When can troops be withdrawn safely? When will our obligations to others be discharged? When will we know that past achievements will be sustained? And how do the answers to these questions depend on eroding popular support for the war?

Bioethicist Daniel Callahan illustrates the many dimensions of an ending in the way he defined natural death:

Because exits involve many dimensions, it is important to explore the conflicts that arise among them. What would be too early on one dimension might be too late on another. Because these are difficult conflicts to resolve, it is best to identify them in advance and leave enough time to think them through.

Successful exit strategies are complex achievements. The ten issues I've discussed here, merely a starting point, should help you think through some of the timing issues involved. If we decide that an exit is needed, the next question is how to do it.

Speeding the Pace of Change: Subtract a Period

Thus far we have discussed adding a mark of punctuation, in this case a period. But, put, a, comma, after, every, word, in, this, sentence, and, reading, it, will, feel, like, swimming, against, a, choppy, sea. Exhausting. So sometimes the task is not to add a period but to subtract one—or at least improve the flow by replacing a period with a comma.

The end of a television show, for example, can be construed as either a period or a comma. The network, of course, prefers the comma. It wants viewers to stay tuned for the next program. There was a time in fall 1994 when every network except Fox tried to completely eliminate punctuation in between shows.¹⁷ Instead of appearing between shows, the commercials were to be moved into the body of the programs. Eliminating a period between the end of one program and the beginning of another was intended to keep interest high. The same reasoning was applied to yacht racing. Larry Ellison, head of BMW Oracle Racing, and Ernesto Bertarelli, head of the Alinghi syndicate, made sure that there would be races every summer in the years between formal cup races.¹⁸

One way to increase productivity is to eliminate interruptions—that is, remove unnecessary punctuation. In 2007, Wall Street Journal columnist Sue Shellenbarger noted that Dow Corning had a “no-meeting week” once a quarter, calling a halt on all nonessential internal meetings. This allowed employees to reduce travel and to work without interruption. Similarly, IBM rolled out company-wide “Think Fridays,” a block of Friday afternoon time free of nonessential meetings and interruptions.¹⁹

Choose the Right Location

Where we place a period or comma can make all the difference. Consider a team that has been working on a new product for many years. Pressure is growing to bring the product to market; as a result, the group may be tempted to jump the gun and rush to launch before either the product or the market is ready. To prevent that error, the group needs to find a way to counter the pressure it is feeling. Placing a punctuation mark in the right place can help.

Most of us think of the world as being composed of three separate time periods arranged in a sequence: the past, the present, and the future.

There are two ways we can punctuate this sequence. We can put an imaginary period after the present, which groups (brackets) it with the past, like this:

[PAST PRESENT]. FUTURE

Or we can put a period before the present, which makes the present the first step of a new future, like this:

PAST. [PRESENT FUTURE]

If the present is grouped with the past, the past becomes the reference point. Someone will say, “This product has been under development for over a decade. When are we going to get it to market?” In contrast, if the present is grouped with the future, the future becomes the reference point. Then the need to move quickly will be tempered by the need to make sure that we create the right first impression. Someone will remind us that if the launch is botched, it can take a very long time to recover.

By changing the location of a period, one can alter the timing of a decision by making the decision appear to be urgent or one that can and should be delayed.

Postponing Punctuation—Controlling Tension

Temporal punctuation can be used to control events and situations in some interesting ways. In fact, the marketer and catchphrase specialist Arthur Schiff created a number of ingenious advertising slogans based on this principle. In his work promoting Ginsu knives, he raised doubts and expectations with hyperbole: “It's a knife that will last forever. … It's a product no kitchen should be without. … It's the most incredible knife offer ever.” And then, right on cue, the memorably repetitive refrain: But wait, there's more. As journalist Rob Walker explained in the New York Times: “In addition to making the offer more desirable, Schiff builds tension by continually postponing the end of the sales pitch, tension that he hoped customers would relieve by picking up the phone and ordering the knives. Many did. “But wait, there's more,” sold a lot knives.”²⁰

Notice the use of the same principle of tension reduction that was involved in the discussion of premature closure. We want the injury to our thumb to be over. President Bush wanted the war in Iraq to be over. Punctuation influences and is influenced by the need for release. When tension is high, we can reduce it by inserting a period, whether or not the time is right to declare an ending. The ability to see the relationship between the “Mission Accomplished” banner and an advertising pitch for a set of knives is what I mean by training our eye to look beneath the surface.

Rethink Your Use of Punctuation

By simply reimagining how we think of beginnings and endings—and how we use temporal punctuation in a business setting—we can open the door to innovating everyday processes. At the very least it helps us look at things differently. Here are a few specific ideas.

Type

There are many types of punctuation that one can choose or reference. Instead of paying attention to an external clock or calendar when setting a deadline, for example, ask a team to report back when they think they are half done, leaving the exact time up to them. That will focus their attention on time and efficiency in a way that having them report on progress after a fixed interval won't. Selecting a different external reference point to time our activities—the date of a religious holiday, such as Christmas, rather than the end of the fiscal year, for example—can provide a fresh perspective.

Strength

Choose between punctuation marks of different strengths. Replace a period with a comma, or vice versa. Deciding on a punctuation mark based on strength is one way to control the meaning of an action. Putting a project on hold instead of cancelling it, for example, sends an entirely different message.

Number

Intentionally increase or decrease the number of punctuation marks. Pause more frequently in meetings, for example, to give other people time to respond to what you are saying. Replace a timing rule based on magnitude with one based on punctuation—for example, “We will terminate the project by the end of the year if it is not successful by then,” rather than “We will terminate it when costs become prohibitive.” Delete a punctuation mark: run two activities together without a break, or start an activity without formally acknowledging that something new has begun. Each of these opportunities to increase or decrease the number of punctuation marks will have a different impact on outcomes.

Location

Adjust the alignment of multiple punctuation marks. For example, make sure that all relevant events and activities start and stop at the same time, or don't stop and start at the same time. Reposition a punctuation mark. For example, set an early deadline or extend an existing one. Place a period before the present moment in order to define the present as the first step of a new future, rather than the last step of a long past. Change the spacing between punctuation marks. Decrease the time between performance evaluations, for example, in order to offer more detailed feedback.

Finally, remember that the sections on risks and opportunities that I have placed at the end of each chapter have a dual use. They can be used before you act, as part of a process of due diligence to help you identify pitfalls and choices in advance. They can also be used after the fact to learn went right or wrong, and why.

THE TEMPORAL IMAGINATION

When a period is required, timing is everything.

A performance ends, and the performer leaves the stage. The audience bursts into applause. The performer returns, bows, leaves the stage, and after an interval returns. Each time she returns, she benefits from the rise in tension that is created: Will she will come back and perform an encore? If we applaud loudly enough, the audience reasons, maybe she will. The audience is well aware that the game is drawing to an end. Everyone is standing, and some call out. Will the performer reject the audience's expression of appreciation? Will she return, but decline the request for an encore? Uncertainty fuels the applause, which increases in intensity. But what is so intense cannot be sustained. Past a certain point, pleasure becomes pain. As a result, the number of departures and returns that applause can fuel is limited. And that limitation solves a timing problem. If the performer remained on stage until the applause died down, at what moment would she choose to leave? If she left prematurely, the audience would feel cheated. But if she waited too long, she would have overstayed her welcome. She would be demanding more than the audience was prepared to give. The invention of the curtain call, with its rhythm of departure and return, was an act of genius. It solved a difficult problem. When is enough, enough? When is the right time for an exit?

At a macro timescale, we notice only that a performance ends. But at a more micro timescale, we see the sequences, rates, intervals, and so on that are involved in creating that moment. A period seems simple, but it is really a complex achievement. That is why it is important to look at any issue that requires a period or other punctuation mark at different timescales to see the time-related processes that are required.