First Principles: The Foundations of Innovation

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A first principle is a basic proposition that cannot be deduced from any other proposition or assumption.

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First principles thinking is one of the best ways to reverse engineer complicated problems and unleash creativity, innovation and new opportunities.

Sometimes called “reasoning from first principles”, the idea is to break down complicated problems into basic elements and then reassemble them from the ground up.

It’s one of the best ways to learn to think for yourself, unlock your creative potential, and move from linear to non-linear results.

“The first principle is that you must not fool yourself - and you are the easiest person to fool” - Richard Feynman

What are First Principles?

By definition, a first principle is a basic proposition that cannot be deduced from any other proposition or assumption. In philosophy, first principles are from First Cause attitudes.

Over two thousand years ago Aristotle defined a first principle as “the first basis from which a thing is known”.

This approach has been used by philosophers, scientists and mathematicians for many centuries.

More recently, first principles have become popularised by successful entrepreneurs and investors, namely Elon Musk. All great thinkers’ approach problem-solving in this manner.

Are you the Chef or the Cook?

Tim Urban describes the nuance between a Cook (analogy) and a Chef (first principles).

The chef is a trailblazer, the person who invents recipes. They know the raw ingredients and how to combine them. For the chef, the first principles are raw edible ingredients. Those are the puzzle pieces, the building blocks, and they work their way upwards from there, using experience, instincts, and their taste buds.

The cook, who reasons by analogy, uses a recipe, working off of some version of what’s already out there — a recipe of some kind, a meal they tried and liked, a dish that they watched someone else make. They create something, perhaps with slight variations, that’s already been created, producing an iteration of some form of burger, pizza or cake. Even the innovative cook, making one of their own concoctions is baking an apple, cinnamon, walnut, banana, maple syrup and flax seed cake.

The difference between reasoning by first principles and reasoning by analogy is like the difference between being a chef and being a cook. If the cook misplaced the recipe, they’d be lost. The chef, on the other hand, understands the flavour profiles and combinations at such a fundamental level that they don’t even use a recipe. They have real knowledge as opposed to know-how.

There’s nothing wrong with being a cook. Some people don’t aspire to write recipes. However, when a problem needs to be solved, and creative, innovative solutions generated, operating on auto-pilot doesn’t really suffice.

Creating always wins out over copying.

Be more like an inquisitive child

One of the challenges with building knowledge and understanding is that much of what we’re told comes from authority figures, whether that be a teacher, business leader or politician (yikes!).

It’s easy to fall into the trap of accepting what we’re told is true, rather than conducting our own inquiry and thoughtful investigation.

Children are naturally inquisitive and ask a myriad of questions as they try to understand reality and build their mental models and theories of how the world works.

The challenge with inquiry and reasoned investigation is that it is often perceived to be dogmatic and difficult. Children are often told to “stop asking questions” and “stop being so annoying”.

In the workplace, persistent questioning is often frowned upon and is met with “let’s take it offline” or “that’s how we’re going to do it”.

It’s like questioning gets beaten out of us due to its perception as anti-social or rude, rather than a way that we understand, analyse and validate ideas.

As adults, it becomes increasingly rare that we take the time to pull something apart to get under the hood, understand how it works, then create an alternate reality of the existing model, one that’s order of magnitudes better.

Our thinking can become narrow and shallow, if we don’t make a concerted effort to go broad and deep. Going broad and deep is harder, takes a lot more focus, mental energy, and time.

I know that I certainly don’t have all of the answers to my daughters’ questions. Rather than say I don’t know, or, tell her to stop asking questions, we’ll always open up Google and research together to learn and build our understanding.

Our most recent research thesis - What’s inside the stomach of a great white shark?

Getting started with First Principles

You’ve likely already applied some of the techniques of first principles thinking, and you didn’t even know it.

One of the best ways to get started with establishing the foundational elements of a problem that you’re trying to solve is through Socratic questioning.

Socratic questioning:

The Socratic approach to questioning is based on the practice of disciplined, thoughtful dialogue. Basically, it’s about discovering answers by asking questions. It’s a great way to explore ideas in depth, in a logical and thoughtful way.

Socratic questioning may be used to explore complex ideas, get to the bottom of a problem, open up issues or discover assumptions.

Types of socratic questions and examples:

1.     Clarification questions:         What do you mean by?

2.     Issue questions:                      Why do you think that?

3.     Assumption questions:           Why would you make that assumption?

4.     Evidence questions:               Why do you think this is true?

5.     Source questions:                   What caused you to think that way?

6.     Consequence questions:       What effect would that have?

7.     Viewpoint questions:              How would others think about this question? Why?

Applying the technique of Socratic questioning requires practice, however, it’s worth the effort. It’s a great way to develop higher level thinking skills to debate, analyse, evaluate and validate problems.

If you’re after an even easier on-ramp to first principles thinking, you can use the Five Whys. WHY, WHY, WHY, WHY, WHY.

First Principles in action

Elon Musk is arguably the leading inventor of the modern generation. He’s managed to positively impact some of the biggest challenges facing humanity – online payments, sustainable energy consumption and production, space exploration and multi-planetary living.

Perhaps there’s no one who embodies first principles thinking more than Musk.

For Musk, first principles thinking means boiling things down to the “most fundamental truths” and then reasoning up from there.

On Tesla, broadly:

In an interview with Kevin Rose, Musk said that if he hadn’t used first principles thinking to advance Tesla technology, he would have been stuck in the horse and carriage stage of the transportation revolution.

 “You can’t say: nobody wants a car because horses are great, and we’re used to them. They can eat grass (and) there’s lots of grass all over the place, and there’s no gasoline that people can buy, so people are never going to get cars. People did say that, you know.”

On building a superior, cheaper Electric Vehicle battery:

 Musk used the cost of batteries as an example “People would say, historically it costs $600 per kilowatt-hour, and so it’s not going to be much better than that in the future. And you say, No, what are the batteries made of? First principles mean you say, Okay, what are the material constituents of the batteries?”

“What is the spot market value of the material constituents? It’s got cobalt, nickel, aluminium, carbon, and some polymers for separation, and a steel can. So, break them down on a material basis, if we bought that on a London Metal Exchange, what would each of these things cost? Oh jeez, it’s $80 per kilowatt hour”.

“You just have to think of clever ways to take those materials and combine them into the shape of a battery cell, and you can have batteries that are much, much cheaper than anyone realises”.

Using First Principles to drive breakthrough innovation

As stated, a first principle is a foundational proposition that cannot be deduced any further by another proposition or assumption. When you dig deep enough into a problem-solving activity, all you’re left with are the foundational or core elements.

Rene Descartes, the French philosopher and scientist, embraced this approach through a method now known as Cartesian Doubt in which he would “systematically doubt everything he could possibly doubt until he was left with what he saw as purely indubitable truths”.

It’s not necessary to go down to cellular level to understand the underlying first principles, it’ more about extending out to second and third order levels of thinking. Most people just stop at first order thinking.

John Boyd, famous fighter pilot and military strategist, created the following thought experiment which showcases how to use first principles thinking in a practical way.

Imagine that you have three things:

1. A motorboat with a skier

2. A military tank

3. A bike

Now, let’s break these items down into their constituent parts:

• Motorboat: motor, hull and pair of skies

• Tank: metal treads, steel armour plates and a gun

• Bike: handlebars, wheels, gears and a seat

Now, what can you create from all of these individual parts?

One option would be to create a snowmobile by combining the handlebars and seat from the bike, the metal treads from the tank and the motor and skies from the boat.

Thinking better, to innovate better

The quality of your thinking is proportionate to the models and frameworks in your head.

In business, thinking can be heavily influenced by organisational legacies, historical ways of doing things and the thinking of others.

Analogy is often the path of least resistance. While reasoning from analogy and prior experiences is faster, it can lead to sub optimal outcomes due to a narrow and shallow perspective.

This can lead to decision making blind spots which, can really bring you unstuck. Quibi spending $1B before deciding to intersect their product with customers resulted in massive blind spots and failure. Hollywood should have imitated Silicon Valley in this instance.

“As to methods, there may be a million and then some, but principles are few. The man who grasps principles can successfully select his own methods. The man who tries methods, ignoring principles, is sure to have trouble.” - Harrington Emerson

Reasoning from first principles is harder and takes more time but produces a much deeper understanding of the problem by breaking things down into its core elements.

When you can understand the underlying principles at play, it is much easier to understand if the existing methods or models make sense. Quite often they don’t, presenting an opportunity for innovation or disruption.

Analogies can’t replace understanding.

Aspire to be the Chef.

Want to find out more?

If you’d like to learn more about how to apply these principles in your business connect with First Principles

References:

Kevin Rose Tim Urban Shane Parrish James Clear Wikipedia Taylor Pearson Steve Jurvetson