as simple as can be

Albert Einstein is credited with saying, “Everything should be as simple as it can be, but not simpler.”

And of course, from the mind that gave us the theory of relativity, it shouldn’t surprise you to hear that simplicity itself is a relative term.

I put “simple” to the test every Thursday afternoon while coaching second grade baseball. A game, a competition, or a drill is as simple as it can be, or so I think. We quickly find out how confused a young mind can get. I’ll wonder if I’m even speaking the same language, and I have no doubt that the kids are wondering the same thing.

Science, communication, and business work this way as well.

Warren Buffett said, “I don’t like difficult problems. I mean, we’d rather multiply by three than by Pi. It’s just easier for us.”

Warren doesn’t dislike problems all together, but he’d prefer to work on the simple ones.

“It’s just easier for us,” is about matching problems with interests. The interests of Buffett and his old partner Charlie Munger. Buffett was Johnny-on-the-spot, jumping in (begrudgingly) as CEO when he had $700 Million on the line during the Solomon Brothers Treasury Bond Scandal in 1991.

That doesn’t sound simple to me.

To most, that would be a problem much closer to Pi than three.

On the flip side, Buffett has commented on Elon Musk‘s ability to make progress on electric vehicles and reusable rockets, saying, “better him than me.”

But if you were to ask Musk, I’m sure he would trade out rocket problems for treasury bond problems any day of the week.

The ownership of See’s Candies and Acme Brick Company (Berkshire subsidiaries) might be more than Musk could take. I’m sure he could get behind the ownership of some railroads, but the slow compounding of assets and the sitting on your hands approach to management, well, that would be the equivalent of multiplying by Pi for Musk and his leadership team.

Simple is relative.

What is easy for you? And how can you simplify from Pi?

SpaceX is designing rockets to deliver payloads to space and return home. Nothing fancy. It’s like Berkshire Hathaway’s BNSF Railroads business, except the going up part.

BNSF, a simple not easy business. Get stuff from here to there.

The engineering on these rockets is impressive, but the team has worked hard to simplify at every turn.

Their process? Clarify, simplify, optimize, accelerate, automate.

As simple as it can be, but not simpler.

But even smart people can get things twisted up in their heads. Take NASA for example, an organization with a reputation for unnecessary complexity. Complexity that made room for SpaceX, Blue Origin, and other new entrants to the industry.

As the story goes, early in the space program NASA discovered that ballpoint pens would not work in zero gravity. NASA scientists spent a decade, and a decade’s worth of cash, developing a pen that wrote in space, on any surface. It worked at low temperatures and in any position the astronaut might find themselves in.

The Russians instead used a pencil.

What’s easy for Buffett might not be so easy for you. What’s obvious for Musk might seem like an obscure corner of the universe to Berkshire Hathaway.

Why go to the moon when we’ve got insurance and candy to sell??

A lot of accomplished companies had challenges to overcome. That’s the value that they created. But keep in mind, the truly successful ones simplify at every turn. They worked within their interests, their core competencies. And they multiplied by three instead of Pi.

When they could, they leveraged successful models that were already established.

SpaceX decided, you know, having these ships drop into the ocean just like they did in the sixties is all right with us.