6 Examples of Underpants Gnomes

John Spacey, October 23, 2019

An underpants gnome is a plan that is missing an important step such that it is out of touch with reality. This originated with an episode of the American animated television series South Park wherein a group of gnomes develops the business plan above whereby they collect underpants and expect to profit without any explanation of how. This type of plan is surprisingly common in business, politics and life in general. The following are illustrative examples.

Technology

Implementing technologies without being able to explain in a concrete way how they will benefit an organization.

Phase 1	Implement technology
Phase 2	?
Phase 3	Improve operational efficiency

Vanity Metrics

Vanity metrics are measurements that produce big numbers but don't map well to goals.

Phase 1	Get social media followers
Phase 2	?
Phase 3	Increase revenue

Business Models

In some cases, a business is able to grow revenue quickly by selling things for less than they cost. This can create a business that has high growth and feels trendy but has no ability to make money.

Phase 1	Lease office space to freelancers at less than cost.
Phase 2	?
Phase 3	Profit

Politics

Politicians commonly implement underpants gnome policies whereby they claim it is self-evident that one thing leads to another without any evidence or supporting argument.

Phase 1	Close a high performing high school with an impressive legacy and history that dates back to 1770 and build a new school for $35 million.
Phase 2	?
Phase 3	Improve education

Political Participation

Political participation may have value absent of achievable goals. For example, just having your voice heard or starting on the path to an active political life. However, it is common for organizers of events to state overly broad goals that may limit the actual impact of an effort as it is unclear what is meant to be achieved.

Phase 1	Protest
Phase 2	?
Phase 3	Save world

In this case, saving the world is an admirable goal but it could be more useful to have a concrete goal such as passing a bill into law. For example:

Phase 1	Protest
Phase 2	Build support to get Bill _____ passed.
Phase 3	Reduce the microplastics in cosmetic products by 95% in 5 years.

Mission & Vision

The underpants gnome analogy can only be applied to concrete plans such as a business plan, project plan, program plan or activity planning. As such, it doesn't apply to long term planning such as a mission statement or vision statement. It is perfectly normal and healthy for an organization to have a brave mission and vision of its future. These may serve as an inspiration and set direction for an organization such that they have value even if they aren't achievable.

Mission	Work to reduce ocean plastic
Future	?
Vision	A world without plastic waste in oceans, lakes, rivers and other waterways.

Overview: Underpants Gnomes
Type	Failure Types
Definition	A plan that is missing an important step such that it is out of touch with reality.
Related Concepts	Failure Types » Business Plan » Vanity Metrics » Business Models » Vision Statement »