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BROWNOUT: Van Halen's brown-M&M test acted as a diagnostic, allowing the band to spot problems early. | Photograph from Wikimedia Commons

Business Advice From Van Halen

Dan Heath and Chip Heath go to eighth grade, Google, and a Van Halen concert to find early-warning signals for big problems.

Walk into an urban high school and look around at the kids. Roughly half of them will drop out of school. If you knew which ones, you might be able to steer them toward a different path. But you can't solve a problem until you can spot it, and how do you spot a future dropout?

Some Johns Hopkins University researchers, frustrated by the high-school-dropout rate, went looking for early-warning signs among students in Philadelphia. What were the telltale markers of a student who wouldn't graduate? Their analysis came back with astonishing clarity. Poring over eighth-grade attendance records, they found hundreds of students who had missed more than one out of every five class days. Of those frequent absentees, 78% eventually quit high school. Similarly, of the eighth graders who had failed either English or math, three out of four dropped out. No other factor -- gender, race, age, or standardized-test scores -- had the predictive power of those two patterns.

The researchers concluded that the school district could identify more than half of the students who would be likely to drop out before they even set foot in high school.

The early-warning flags didn't solve the dropout problem, of course, any more than a smoke alarm can put out a fire. But policy analysts at the National High School Center, armed with this information, were then able to review almost a dozen dropout-prevention programs with documented success that could be targeted toward the most at-risk kids.

What if you could identify the early-warning signs of a business problem? What if, in fact, the red flags are there right now, waving at you unheeded from information you've already collected?

Credit-card companies, for instance, have learned that by charting the "normal" spending habits of their cardholders, they can quickly spot fraudulent use. (Though sometimes the warnings of fraud can feel uncomfortably like character judgments, as when Dan bought flowers for his wife and AmEx, incredulous, immediately blocked his account.)

Google executives realized in November 2008 that flu outbreaks could be detected early by monitoring the number of times people searched for terms such as "flu" and "influenza." Because the searches are logged instantly, epidemiologists can spot flu outbreaks a full one to two weeks faster than they could have before. Perhaps someday Google might reconfigure this technology to spot and quash boy bands before they can infect your daughters.

Sometimes, though, there's simply no data available. Think about infrastructure problems, such as when a bridge collapses. The bridge will go down with nary a word of forewarning. To predict the collapse, you'd need a useful data stream. That's why engineers are designing sensors that would allow bridges to notify authorities of problems such as cracks, corrosion, or the loosening of bolts. You read that right: Bridges will soon be tweeting their every activity. (One suspects the Golden Gate will be insufferable.)

Your source of data doesn't need to be high tech. In fact, it doesn't even need to be numerical. Consider Van Halen. (We have been waiting years for a chance to write that sentence.) In its 1980s heyday, the band became notorious for a clause in its touring contract that demanded a bowl of M&Ms backstage, but with all the brown ones removed. The story is true -- confirmed by former lead singer David Lee Roth himself -- and it became the perfect, appalling symbol of rock-star-diva behavior.

Get ready to reverse your perception. Van Halen did dozens of shows every year, and at each venue, the band would show up with nine 18-wheelers full of gear. Because of the technical complexity, the band's standard contract with venues was thick and convoluted -- Roth, in his inimitable way, said in his autobiography that it read "like a version of the Chinese Yellow Pages." A typical "article" in the contract might say, "There will be 15 amperage voltage sockets at 20-foot spaces, evenly, providing 19 amperes."

Van Halen buried a special clause in the middle of the contract. It was called Article 126. It read, "There will be no brown M&Ms in the backstage area, upon pain of forfeiture of the show, with full compensation." So when Roth would arrive at a new venue, he'd walk backstage and glance at the M&M bowl. If he saw a brown M&M, he'd demand a line check of the entire production. "Guaranteed you're going to arrive at a technical error," he wrote. "They didn't read the contract.... Sometimes it would threaten to just destroy the whole show."

In other words, Roth was no diva. He was an operations expert. He couldn't spend hours every night checking the amperage of each socket. He needed a way to assess quickly whether the stagehands at each venue were paying attention -- whether they had read every word of the contract and taken it seriously. In Roth's world, a brown M&M was the canary in the coal mine.

Like Roth, none of us has the time and energy to dig into every aspect of our businesses. But, if we're smart, we won't need to. What if we could rig up a system where problems would announce themselves before they arrived? That may sound like wishful thinking, but notice that it's exactly what Roth achieved. Surely, you won't be outwitted by the guy who sang "Hot for Teacher."

Where's the brown M&M in your business?

Dan Heath and Chip Heath are the best-selling authors of Made to Stick: Why Some Ideas Survive and Others Die. Their new book, Switch: How to Change Things When Change Is Hard, is available now.

BROWNOUT: Van Halen's brown-M&M test acted as a diagnostic, allowing the band to spot problems early. | Photograph from Wikimedia Commons

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23 Comments

  • alec

    ..and the "brown M&M's" strategy had the added advantage of generating TONS of publicity. It came to typify rock & roll excess and cemented VH's reputation as the kings of decadence. as Fast Company would say, GREAT branding!

  • alec

    I can attest to my days working at Dicesare Engler Productions and later at Warner Bros. Records that this is a true story. But, all credit should go to Production Manager (at the time) Pete Angelus and band manager (at the time) Ed Leffler. I'm sure that Diamond Dave had better things to do than worry about production riders.

  • Mark Phifer-Houseman

    It's interesting to me that none of us leadership junkies/gurus commented at all on the problem of high school drop-outs and "solving" that social Rhino of a problem. David Lee Roth as operations expert is "cuter" and stickier. Our national epidemic of "idiocracy" is far more vital for us to focus our time/energy/talent on. What might it mean if we got personally involved w/an at risk 7th grader? Some problems require top to bottom personal involvement. Putting a bunch of money into research won't do it. Putting sensors in 7th graders so they can tweet their problems to us won't keep them from dropping out, getting pregnant, neglecting/abusing their kids, and breaking the bank of our social services not to speak of living miserable lives and passing that legacy on to the next generation. Why not look at what the bright spots are? Generally they are faith based inner city schools, churches, and other non-profits that connect to kids and provide mentoring, etc. Follow the bright spots! Why is it that the Catholic schools spend so much less per pupil than the New York City public schools and yet don't have this drop out rate even with the same population of kids?

  • Jake Kennedy

    Thanks for highlighting a great example of simplified performance measurement. As a planner, I'm often looking for examples of good performance measurement to help illustrate to program managers what I'm looking for. I've already used a Van Halen video clip (to some giggles) a few times in sessions.

    The Planning Cycle
    http://planningcycle.blogspot....

  • Jake Kennedy

    Thanks for highlighting a great example of simplified performance measurement. As a planner, I'm often looking for examples of good performance measurement to help illustrate to program managers what I'm looking for. I've already used a Van Halen video clip (to some giggles) a few times in sessions.

    The Planning Cycle
    http://planningcycle.blogspot....

  • Jake Kennedy

    Thanks for highlighting a great example of simplified performance measurement. As a planner, I'm often looking for examples of good performance measurement to help illustrate to program managers what I'm looking for. I've already used a Van Halen video clip (to some giggles) a few times in sessions.

    The Planning Cycle
    http://planningcycle.blogspot....

  • Jake Kennedy

    Thanks for highlighting a great example of simplified performance measurement. As a planner, I'm often looking for examples of good performance measurement to help illustrate to program managers what I'm looking for. I've already used a Van Halen video clip (to some giggles) a few times in sessions.

    The Planning Cycle
    http://planningcycle.blogspot....

  • Jake Kennedy

    Thanks for highlighting a great example of simplified performance measurement. As a planner, I'm often looking for examples of good performance measurement to help illustrate to program managers what I'm looking for. I've already used a Van Halen video clip (to some giggles) a few times in sessions.

    The Planning Cycle
    http://planningcycle.blogspot....

  • Ann Stone

    This article rocks! I ended up posting a written piece myself on two aspects of this finding http://cisjustaletter.com/2010...

    thanks to Fast Company and the Heath's for making one of my fave 1980's bands now a good reminder of attention to detail and positioning!

  • Jason Kasper

    Public Infrastructure is ready to Tweet its status, but are we ready to listen?

    77,000 US bridges are labelled structurally deficient, many are 40-50 years old nearing the end of their life. It is estimated by the EPA that 40% of the nations water infrastructure is 40+ years old (10% is over 80!), some city water authorities, like San Francisco estimate that 50% of water is lost through leaky pipes before reaching the customer.
    In order to address these issues, we need a more proactive way to monitor the status of public infrastructure in order to create a prioritized and actionable process to maintain assets. There has been so much emphasis as of late to make our Electric Utility grids “smart”, this is a great start, but the rest of our world’s infrastructure wants to talk to us too!
    We have the capability today to add monitoring devices or monitoring processes to our infrastructure to allow it to “tweet” its status. If 4.2 million of us are willing to follow Britney Spears, how difficult can it be to have an Enterprise Asset Management system listen to the assets it is managing every day? Well, it can be daunting! Monitoring devices can “tweet” constantly, and we really don’t want to listen all the time, the key is to filter out the irrelevant data and create correlations that lead to such critical tweets like:
    “Hello, I am a critical part of bridge XYZ, carrying 100,000 people every day, I have corroded to a point that I need to be fixed, if you wait much longer, I will fail, costing you $100M, and the potential of loss of life”
    “Dear Maintenance Manager – please note that my connection point at the corner of Main Street & Oak Street has weakened, you may want to check me out in the near future. Did you know that I am the main connection providing water services for 10,000 homes?”
    With good Maintenance Management business processes and an Enterprise Asset Management system that can listen and correlate what its infrastructure is telling it, the benefits are tremendous. This moves organizations to proactive and preventative maintenance which can lead to lower the total cost of ownership and increase the asset life of public infrastructure.
    So, when public infrastructure tweets to you in the future, will you listen?

  • David Boyd

    Love the book. Love the band.

    A couple of things to think about. First, it was always the Promoters you had to keep an eye on, not the Stagehands! Some promoters are unsavory characters who are are famous for cutting corners - thus sometimes the absence of the brown M&Ms was a good sign that you were dealing with a promoter who cared and that at the end of the night, the band would get paid!

    But most importantly, since a typical bag of M's is what, 70% brown, where do you think all those extra M's went to? The Road Crew and Stagehands! Mmmmm! Nothing like a handful of M's and a cold Heineken after a night of banging out the gear!

    On a more serious note - anyone have any other interesting tests they want to share? (Todd Rundgren used to require a gallon of orange juice, freshly squeezed and no older than 2 hours old...)

  • Ross Gott

    Fascinating insight, really. Though I must admit I'm a little troubled that you read David Lee Roth's autobiography in your quest for potential insight.

    --
    Ross - ZeroCelsius Wealth Studio

  • Chris Reich

    Please all. Read The Checklist Manifesto. The M&M story is covered in that just released book as well as many other concepts that can greatly improve thinking.

    I recently built a marketing plan around a commercial flight manual. The plan boosted business immediately and lowered cost of operations.

    For years I've been screaming that we need to start thinking inside the box. We've gone so far out of the box toward metrics and supply chains we've neglected the goals of sales and profit.

    Chris Reich
    www.TeachU.com

  • David Molden

    Terrific article from the Heath bro's - I'm now looking for the brown M&M in our business, or maybe the blue and orange pens which are just about to run out ... or juggling balls just about to split ....

    David

    www.quadrant1.com

  • Dan Rockwell

    Rafael,

    Great technique! Thanks for adding it.

    I don't use brown M&M's. I find a detail person who does it for me. Then I keep an eye on him. :-)

    Regards,

    Leadership Freak
    Dan Rockwell
    Recent Blog - The power of calm
    http://leadershipfreak.wordpre...