MIT Sydney, through my association with the University of Ballarat (site of the ICSL) asked me to be the occasional speaker at their Graduation Celebration today. I was terrified, but agreed. Here’s what I said.

Vice-Chancellor, members of the formal party, Ladies and Gentlemen, graduates; thank you for the opportunity to address you today.

Graduates, today we’re gathered in this place to undertake a ritual; a ceremony full of strange clothes and esoteric activities. This ritual exists to celebrate you and your achievements, and to induct you into a centuries-long fellowship of learned people. Today, is about you.

I want you to pause for a moment, and consider what has brought you here. You’ve spent years dedicated to acquiring skills, knowledge and abilities; but also you’ve developed your ability to think, to remember, and to focus. You’ve made a great investment in yourself. Whatever else happens today, please spend a few minutes dwelling on your experiences and what you’ve learned, not just about your subject matter, but about yourself.

But, what happens tomorrow?

Once you leave this place, freshly graduated and re-energised to face the world, what else will you need to know and do, to convert this great foundation into success?

To succeed, I believe you will need three attributes: capability, credibility and courage.

Capability

By capability I mean noting as mundane as an IQ test score or a completed sudoku puzzle, but rather something closer to knowledge, wisdom and ingenuity.

If you accept that the individual human brain is a finite store of information, then the growth in human knowledge poses a problem for us: what do we choose to store in our minds? Do we seek deeply to specialise in a narrow field, or attempt to capture the breadth of experience shallowly? The society in which we live is obsessed with specialisation; with knowing a lot about little, rather than a little about a lot. Fields of research and knowledge are narrowing rapidly as they increase in depth, and fragmenting. Take accounting - what largely originated as a 13th Century innovation in structuring information has now expanded into a profession with sub-fields; one can be a forensic accountant, or a taxation accountant, a management accountant or a financial accountant.

By contrast, I’d counsel you to fill your brain with a broad understanding of how the world works, that the safer strategy is breadth, not depth, of knowledge. A breadth strategy protects you against shifts in your specialisation, or worse, it becoming uninteresting to you; current research suggests that, for most of you, the job you will have thirty years from now doesn’t yet exist. But a breadth strategy also marks you out among your peers; if your knowledge is broad, you have a much wider range of metaphors and approaches available in your toolkit, in order to take on unexpected problems.

Some of the most promising approaches to fraud and spam detection today come from the field of artificial immune systems; that is, computers attempting to mimic the behaviour of human cells. Surely, no immunobiologist investigating the action and role of T-cells dreamt that their work would ultimately be adapted to filter their email, but a broadly-read computer scientist made that link.

So read broadly; learn at every opportunity. Remember that education is a habit, rather than a life stage.

But spend time, too, learning about yourself. At the risk of sounding overly philosophical, don’t assume that you know who you are and what you like, but find out! There is both a formal and informal approach here.

Formally, you can (privately and discretely) subject yourself to psychometric testing. Seek out inventories that provide feedback about your preferences than then try to find work that is most likely to satisfy you. For example, my Myers-Briggs profile is INTP, which tells me that I like consuming information and building abstractions. The Herman Brain Dominance Indicator suggests that I prefer creative and logical work to managing execution or thinking about emotions. Gallup’s Strengths model suggests I like to be analytical, come up with new ideas, compete, adapt things to situations, and be strategic (which seems to be code for fretting about the future). This information, taken together, has guided my choice of job, and helped me adapt my job to my preferences; I’m a trouble-shooter with an eye to the future, with explicit support from others to provide execution of the answers I find. This knowledge has made all the difference in making my job enjoyable, and helping me be effective.

In addition, spend some time thinking quietly about yourself; carve out moments in which to consider what happened each day, and how you reacted. What was enjoyable, what made you angry, and why. Pondering these things well help you understand your values, your preferences and your abilities. That knowledge will help you to make better choices in the heat of the moment.

So, being capable means seeking a broad range of skills, knowledge and abilities, coupled with a greater understanding of yourself. This together, will help you spot opportunities you would otherwise have missed, and find new, innovative solutions to your problems.

Credibility

But, knowledge alone isn’t enough to make you successful. The vast majority of human endeavour involves working with other people. So, in order to succeed, you’re going to need to harness others to your causes; for that you’ll need credibility.

Credibility can be thought of as a bit like a credit score. When you want someone to help you, they tend to instinctively calculate whether you’re worth helping . Much like your credit score, sometimes you will need to use your credibility to make something important happen; make sure it’s there when you need it. Surprising amounts of work is done through negotiation, and this can be your greatest strength. By diligent consistency, you can top up your own credibility; or you can erode it by calling for favours and debts from others, without paying them back. Much like a credit score, others discuss it in order to come to a consensus view.

So, how do you build a healthy level of credibility? It comes down to consistency of two key behaviours: keep your promises and relate to people fairly.

Every time you agree to do something, you’re actually making a promise. Generally, the recipient of that commitment tracks that commitment, often unconsciously. If you don’t deliver, they might not notice immediately, but when they do remember, they won’t feel good about you. Alternatively, whenever you do deliver something, the recipient will generally feel a bit better about you, particularly if you’ve gone beyond their needs. Therefore, deliberately track every commitment you make, and do your best to either satisfy or renegotiate those commitments before they’re due. If you can, try to ensure you promise less than you intend to deliver, and deliver more than you’ve promised.

When negotiating, it’s all too easy to fall into the trap of thinking that your counterpart is wrong, but this is very rarely the objective truth. Quite often, you will be arguing about the same fact by from completely different points of view; debating the facts, therefore isn’t helpful. Instead, try to understand his or her perspective - what are their assumptions about the way things should work, and what are the gaps between their understanding and yours. Listen closely and carefully to what people say to you, and how they say it. Look for insights into what’s important to them, and how you can help them get what they want.

Think too about the incentives they’re operating under; people will generally act in enlightened self-interest, and their incentives act as boundaries on their behaviour. In the corporate world, this often means their Key Performance Indicators or KPIs. Take for example a negotiation between a project manager and a security consultant; the security consultant is trying to meet her objective of increasing the level of security in the project, but the project manager’s only KPI is whether the project is on time and on budget. In this scenario, no matter how much the project manager wants to help, she would be crazy to help the security consultant if it compromised her KPIs. So, what do you do? If you just push through, you’ll be drawing down on your credibility, but might be able to get the outcome you want. Alternatively, you can work with the PM and her boss to get her objectives changed; that way, everyone gets what they want, and your credibility goes up, not down.

But don’t just take my word for it; these suggestions are empirically verifiable. In the early 1980s David Axelrod ran a competition, consisting of a tournament of artificial intelligence systems playing an iterated prisoner’s dilemma, a game with rewards for co-operation and for cheating. Most successful programs satisfied four conditions: (1) they were nice - they never attack until attacked, they never cheat unless cheated; (2) they retaliate when attacked; (3) they forgave as soon as their opponent started playing by the rules; and (4) they were non-envious, refusing to cheat just because their opponent was doing better than they were. I submit that these are good rules to live by, and they help build your credibility.

Courage

So, your capability will help you find opportunities; your credibility will mean people will help you execute; what remains? Courage. Courage means both a willingness to take risk, and to be patient.

There’s no escaping the fact that most people estimate risk poorly; trust me: I do it for a living, and it’s a lot more complicated than it looks. Ask most people whether they’re more scared about driving a car or getting into an aeroplane, and most will tell you that the plane is more scary; in reality, many more people are injured by cars than planes every year. The same is true of sharks and stepladders; statistically, the stepladder is much riskier. So, why the disparity? It turns out that people overestimate risks they don’t control - the shark and the aeroplane - but consistently underestimate the risks they think they have some control over; and it’s the perception of control that matters.

So, how should this affect you?

Many of the risks that scare you are, in fact, quantitatively less risky than you imagine, whether it’s starting a new business, pitching a proposal to your manager, or moving to another country. If you do fail, make sure you take the lesson, and learn as much as possible from your mistakes.

I used to work with the Trust Centre, a start-up business incubated within Westpac. Something entirely new was being created, and some of the brightest minds in the world had been flown in to make it happen. They had hired the best financial manager, the best technology architect, the best marketer, and so on. I was truly intimidated. One morning, as I was sitting quietly, one of the senior managers arrived, and asked the floor whether they too had that nightmare that today was the day that someone worked out they had no idea what they were doing; the room was flooded with affirmation. Now the case was clearly over stated, but the point remained - one never ceases being a beginner, a learner; you will never feel like an expert, even though you become one.

Remember, most billionaires have also been bankrupts at some point. So, act boldly, and act safe in the knowledge that failure is the surest path to success.

But don’t confuse boldness for haste.

Sometimes the most courageous course of action is to be patient, to hold your nerves and wait. That patience can pay off in droves. Take, for example, the history of the value investors, famously including Warren Buffet. In the manic world of investing, constantly obsessed with getting rich quick, these patient, counter-cyclical souls have consistently outperformed those who rush. Or the famous adage so beloved of carpenters to “measure twice and cut once.” Don’t be afraid to stumble around a little until you find your passion; Steve Jobs famously did before founding Apple, as did Sergey Brin before Google. Broader demographic factors mean that talent is in demand, and will increasingly be; that seller’s market for labour has resulted in a War for Talent, and you are the precious resource. Be therefore unafraid!

Closing and thanks

So, my exhortation to you: invest in your capability, steward your credibility faithfully, and pluck up your courage. Pursue balance. Remember that the best luck is made, and the harder you work the more opportunities you will find.

Congratulations again on your achievements, and good luck for the future.