Compound Interest Theory & Why You Should Work Even Harder

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“Knowledge and productivity are like compound interest.” Given two people of approximately the same ability and one person who works ten percent more than the other, the latter will more than twice outproduce the former. The more you know, the more you learn; the more you learn, the more you can do; the more you can do, the more the opportunity – it is very much like compound interest. I don’t want to give you a rate, but it is a very high rate. Given two people with exactly the same ability, the one person who manages day in and day out to get in one more hour of thinking will be tremendously more productive over a lifetime.

The importance of working even harder is very well known. But this ‘Compound Interest‘ theory in work I found very interesting. This simple mathematical figure shows bluntly how just doing little less could create super big differences. But working just 10% every day, working a little harder will take you very far!

If you want to know more here is the main research paper –

This is by J. F. Kaiser from Bell Communications Research, and this is a transcript of the Bell Communications Research Colloquium Seminar  on 7 March 1986 by  Dr. Richard W. Hamming, a Professor at the Naval Postgraduate School in Monterey, California and a retired Bell Labs scientist.

Credit: Thanks to John for bringing this to attention. The graphic is by me, based on my Eiffel Tower image, could be found here.

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