Book Summary 5: The 7 Habits of Highly Effective People

Posted by in Startup

OK, this is book 5 of 26 in my startup book summary series. This one’s not limited to startups, but it is a timeless book on principles for success which certainly do apply to startups.

Why has it been on the bestseller list for all these decades? I could think of at least two reasons.

  • It works.
  • Seriously, it works.

Introductory Ideas

Here’s briefly what Stephen Covey talks about in the book:

  • Covey believes how we see the world depends entirely on our perceptions. In order to change any situation, we have to change ourselves, or the “paradigm” out of which we operate.
  • He differentiates between the ‘character ethic’ and the ‘personality ethic’. The character ethic emphasizes things like humility, hard work, patience, courage, simplicity etc. The personality ethic emphasizes personality, attitudes, dressing, public image and behaviours. While Covey does not find anything wrong with the personality ethic (eg. learning some technique to deal with people can be useful), he emphasizes first working on the character ethic.
    Personality ethic emphasizes “quick fix” for success, whereas character ethic emphasizes an inside-out approach. The book is primarily about building the character ethic upon timeless principles.
  • Covey emphasizes the P/PC balance. P stands for productivity, PC for production capacity. For example, if you continue to work 20 hours a day for a week you may receive high productivity in the short-term, but your PC (production capacity) will decline as you ignore your health and other aspects of your life. On the other hand, excessive emphasis on PC can keep you stagnated with ‘learning’ without any ‘doing’.

The Seven Habits:

The first three habits are about personal victory, the next three about interpersonal victory, and the last one about continuous growth and improvement.


Habit 1: Be Proactive

If this is the only habit you learn, you’ve learned enough. It is the foundation for the other habits. In simple words, this habit says “we are in charge”. We choose the scripts by which to live our lives. Take responsibility for your choices.

A reactive person, as opposed to a proactive one, sees himself/herself as a result of external circumstances beyond his or her control. They say things like “if only my mom had been nicer to me when I was growing up”, or “if only I was born in another country”, or even “That’s just the way I am”, placing the blame for their life’s circumstances to something they cannot change.

For them, the problem is always ‘out there’- and they feel victimized.

7 habits circles

The more you focus on the circle of influence, the more it expands. But focus on your circle of concern outside your influence, and your influence will reduce.

Proactive people realize their responsibility, or response-ability. They realize that between the stimulus of the external world, and their response to it, is a space where they can choose their response.
Clearly, we cannot control or even influence everything around us. For example, we can do pretty much nothing about the weather. Proactive people, instead of complaining about this, work on the areas that they can influence. Over time, these areas increase. Covey calls this the “circle of influence”, which is always a subset of the “circle of concern” (all the things we are worried about).

Try this: write down three ideas where you tend to be reactive. (what do you often complain about?) Now think of three ways for each where you could handle the situation proactively instead.


Habit 2: Begin with the end in mind

The first habit is to convince you that you are the programmer of your life. The second habit is about now writing the program.

Start with a clear destination in mind. Covey says we can use our imagination to build our vision, and then use our values (from our conscience) to guide us in realizing this vision.

Most of us start running the race before realizing why we are in it, or whether we even care about winning that particular race. Job promotions, higher income, bigger funding – these ideas pull us without leaving time to question their worth to us.

Habit 2 suggests that we should first have a clear end in mind. This applies to your startup, or your job, or every day of your life, or to your life as an entirety. Don’t get caught up in being busy with little things. Write your own values, so that with habit 3 you can live them.

Be clear about what you want.

Try this: Break down different long-term goals for your life – professional or personal, and write three one-year goals for each one. Your headings could include career, personal, health, finances, etc.


Habit 3: Put first things first

Habit 1 says you’re the programmer, habit 2 says ‘write the program!’, habit 3 says: now live it.

We must have the discipline to prioritize our day-to-day life based on what is most important to us (which we evaluate using habit 2).

Covey categorizes all activities into: urgent/ not-urgent; and important/not-important.

We react to urgent matters. We spend a lot of time doing things that are, in the long term, not important. We neglect Quadrant II, which is the most crucial of them all. If you spend more time in Quadrant II, you will require less time in the other quadrants. It is the heart of effective time management.

Note that the same activity can be in different quadrants depending on the context. For example, resting and relaxing are important for rejuvenation, and in appropriate levels would fall in quadrant II. However if we are lazing around all day, it’d be a not-important & not-urgent Quadrant IV activity.

The key is not to prioritize your schedule, but to schedule your priorities.

Division of our activities into four quadrants.

Try this: Identify a quadrant II activity that you’ve been neglecting (Something which is important but not urgent.) Commit to implementing it or at least starting it by end of this week. (eg. Perhaps you’re putting off your gym membership – which you may decide to renew before end of the week)

Habit 4: Think win-win

There are six paradigms of human interaction, according to Covey.

  1. Win-Win: Both people win. Agreements or solutions are mutually beneficial and satisfying to both parties.
  2. Win-Lose: “If I win, you lose.” Win-Lose people are prone to use position, power, credentials, and personality to get their way.
  3. Lose-Win: “I lose, you win.” Lose-Win people are quick to please and appease, and seek strength from popularity or acceptance.
  4. Lose-Lose: Both people lose. When two Win-Lose people get together — that is, when two determined, stubborn, ego-invested individuals interact — the result will be Lose-Lose.
  5. Win: People with the Win mentality don’t necessarily want someone else to lose — that’s irrelevant. What matters is that they get what they want.
  6. Win-Win or No Deal: If you can’t reach an agreement that is mutually beneficial, there is no deal.

The best is option 6, you either find something that is beneficial for all parties involved, or you have “no deal”. This requires an abundance mentality – the belief that there is plenty for everyone. A scarcity mindset, on the other hand, thinks that life is zero-sum (i.e. if you get it, I don’t.)

Strive to achieve win-win with your family, your customers, your partners. The focus must be on results, not methods. This kind of mindset doesn’t work when the environment is excessively competitive, which is why finding systems to enable cooperation over competition in the worlplace are so important.

Try this: Think of any important interaction you will be having in the near future. Instead of just obsessing over what you want, write down what you think the other party wants. Then think of how you can meet those needs while also achieving your own needs.


Habit 5: Seek first to understand, then to be understood

We are trained in school or home to read, to write, and to talk. However, an important aspect of communication which we are usually never taught is to listen. Most people listen while preparing their reply in their head, without giving full attention.

Let’s say you go to an optometrist and tell him that you’ve been having trouble seeing clearly, and he takes off his glasses, hands them to you and says, “Here, try these — they’ve been working for me for years!” You put them on, but they only make the problem worse. What are the chances you’d go back to that optometrist?

Unfortunately, that’s what we do often in our everyday interactions – we prescribe a solution before we diagnose the problem.

Covey says only 10% of our communication is conveyed by words, 30% is tone and 60% is body language. To be able to first understand, we have to be willing to invest time in people around us. However, in the long term this only saves time; as it leads to less confusion, less arguments, and more clarity.

The second part of Habit 5 is “ … then to be understood.” This is equally critical in achieving Win-Win solutions. You do not need to become a martyr for the other person. When we’re able to present our ideas clearly, and in the context of a deep understanding of the other person’s needs and concerns, we significantly increase the credibility of your ideas.

Try this: Next time you talk to someone, try to use empathetic listening. Try to understand their deepest concerns, fears and aspirations; without being in a rush to answer or advise them. Write down what you notice.  
Habit 6: Synergize

Instead of hating others for being different, by understanding and valuing the differences in another person’s perspective we have the opportunity to create synergy. This allows us to uncover new possibilities through openness and creativity.

It is the culmination of all the previous 5 habits. Synergy is when one plus one is not two but three, four or even more, the whole is greater than the sum of the parts.

For example, if you plant two plants close together, their roots will co-mingle and improve the quality of the soil, so that both plants will grow better than they would on their own.

Defensive interaction is win-lose or lose-win, where 1+1=1. Respectful interaction is where 1+1 could equal 1.5, where there is some form of compromise achieved. But synergistic interaction will always give results to both parties better than they would have received on their own. By putting forth a spirit of trust and safety, we will prompt others to become extremely open and feed on each other’s insights and ideas, creating synergy. The real essence of synergy is valuing differences instead of persecuting others for them.

Try this: Think of someone that irritates you. How are their views different? If you could drop your ego, your need to be ‘right’, what could you learn from this person’s perspective?


Habit 7: Sharpen the Saw

To remain effective, we must renew ourselves in the four areas of life- physical, mental, social/emotional, and spiritual. Renewal allows us to synergistically use each of the habits.
For each dimension, there are universal ideas which one could incorporate into every day life.

Physical: eat well, sleep well, exercise.

Spiritual: meditate, communicate with nature, immerse yourself in great literature/music

Mental: read, keep a journal, watch programs which increase your knowledge

Social:   make contributions to others life, take time to connect with people and build a community

The real beauty of the 7 Habits is that improvement in one habit synergistically increases our ability to improve the rest. Daily renewal allows us to continuously move along the upward spiral, improving every area of our life.

Try this: Commit to writing down at least one daily activity in each of the four dimensions to ‘sharpen the saw’.