January 25, 2009
The dying breed analyzed from angle of other benefits we often forget before they go extinct. In Uganda (remember the infamous Idi Amin), farmers prefer western breed of cow – Holsteins rather than their local breed – Ankole.
In one side, Ankole cows is a beacon of their culture (President Yoweri Museveni once imposed a ban on imported semen of Holstein as part of protecting their culture), but on the other side, its output is between a quarter & half gallon of milk a day where Holstein cows produce 6 gallons of milk. So it is a matter of choice between culture and stomachs. When farmers tasted money, they are excited about having these big earnings and they are forgetting cultural aspect.
In the past, number of cows was a status symbol (owner of 100 cows would not even talk to owner of 30 cows), but with introduction of Holstein, the status symbol is elevated to how much quantity of milk they produce.
The principle of the ‘tragedy of the commons’ perhaps the most famous metaphor in ecology, is a cattle parable. Garrett predicted ‘ each man is locked into a system that compels him to increase his herd without limit – in a world that is limited and would inevitable be picked clean.
Holstein is descended from Chief and Elevation and that 30% of the all Holstein genes in the world are traceable back to those 2 bulls. That has created a serious problem with in breeding that has adverse effects on fertility and mortality. In order to maintain Holstein cows, Ugandans need to import medicine, as these cows are susceptible to local disease/infections. Resistance power of Ankole breed now seems to be very important where no one knows, what are the powers these dying breeds can offer to the humanity.
Kenya used to have several millions of Red Maasai sheep and indiscriminate crossbreeding with woollier imported sheep nearly drove them out of existence. But the wool sheep fared poorly in the Kenyan environment, in part because of intestinal parasites to which the Red Maasai were almost impossible to find.
When certain part of Uganda faced severe drought in 1999, none of the Holstein cows could not survive, but Ankole breed did survive. As the world’s climate warns, and the environment becomes more inhospitable to the major breeds, humanity might need the genes that allow animal like the Ankoles to flourish in the African heat.
The challenge is to safeguard the resources of all breeds which may not be the best breed for their primary purpose, but also needs to consider secondary benefits which often get forgotten.
Tx n Rd
January 22, 2009
The American businessman was at the pier of a small coastal Mexican village when a small boat with just one fisherman docked. Inside the small boat were several large yellowfin tuna. The American complimented the Mexican on the quality of his fish and asked how long it took to catch them.
The Mexican replied, “only a little while.”
The American then asked why didn’t he stay out longer and catch more fish?
The Mexican said he had enough to support his family’s immediate needs.
The American then asked, “but what do you do with the rest of your time?”
The Mexican fisherman said, “I sleep late, fish a little, play with my children, take siesta with my wife, Maria, stroll into the village each evening where I sip wine and play guitar with my amigos, I have a full and busy life, senor.”
The American scoffed, “I am a Harvard MBA and could help you. You should spend more time fishing and with the proceeds, buy a bigger boat with the proceeds from the bigger boat you could buy several boats, eventually you would have a fleet of fishing boats. Instead of selling your catch to a middleman you would sell directly to the processor, eventually opening your own cannery. You would control the product, processing and distribution. You would need to leave this small coastal fishing village and move to Mexico City, then LA and eventually New York City where you will run your expanding enterprise.”
The Mexican fisherman asked, “But senor, how long will this all take?”
To which the American replied, “15-20 years.”
“But what then, senor?”
The American laughed and said “that’s the best part. When the time is right you would announce an IPO and sell your company stock to the public and become very rich, you would make millions.”
“Millions, senor? Then what?”
The American said, “Then you would retire. Move to a small coastal fishing village where you would sleep late, fish a little, play with your kids, take siesta with your wife, stroll to the village in the evenings where you could sip wine and play your guitar with your amigos.”
Tx n Rd
It is weird book that proclaim people can be a millionaire by working 4-hour workweek. I did not read this book, not because of the title, but because of its listed in BW’s bestseller list for 22 weeks. It also warns “ DO NOT READ THIS BOOK UNLESS YOU WANT TO QUIT YOUR JOB”. IMO, that is his short cut to sell more books, nothing else.
Even though he got into Princeton, despite SAT scores 40% lower than the average and other wonderful short cuts throughout his life, I do not want to follow that method. I just do not want to change my game plan in the middle of the game. However, there are some interesting pointers that could help though.
I like some of the phrases he listed from others (will paste some of them here) and I shall try to read some of his recommended books as well.
“Anyone who lives within their means suffers from a lack of imagination – Oscar Wilde”. Guess what, author asks you to break out from your comfort zone and explore.
“Everything popular is wrong – Oscar Wilde”
“I can’t give you a surefire formula for success, but I can give you a formula for failure: try to please everybody all the time – Herbert Bayard Swope”
“Action may not always bring happiness; but there is no happiness without action – Benjamin Disraell”
The DEAL of deal making is also an acronym for the process of becoming a member of the New Rich (NR).
D for definition turns misguided common sense upside down and introduces the rules and objectives of the new game. This defines the overall lifestyle design recipe. Request to define your dream, goal and esp. set for unrealistic goals which is easy to meet.
E for Elimination kills the obsolete notion of time management once and for all (Pareto Principle kicks-in here – 80/20 rule).
A for Automation puts cash flow on autopilot using geographic arbitrage, outsourcing and rules of nondecision.
L for Liberation is the mobile manifesto for the globally inclined.
“ An expert is a person who has made all the mistakes that can be made in a very narrow field – Niels Bohr”.
“These individuals have riches just as we say that we “have a fever”, when really the fever has us – Seneca”
Author even created an audio book – “How I beat Ivy league”
“ Would you tell me, please, which way I ought to go from here?
- that depends a good deal on where you want to go, said the Cat.
“ I don’t much care where ….’ Said Alice
- Then it does not matter which way you go , said the cat” – Lewis Carroll, Alice in Wonderland.
“ The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself. Therefore all progress depends on the unreasonable man – Bernard Shaw, Maxims for revolutionists.?
99% of people in the world are convinced they are incapable of achieving great things, so they aim for mediocre. The level of competition is thus fiercest for realistic goals. It is easier to raise$10 million than $1 million. If you are insecure, guess what? The rest of the world is, too. Do not overestimate the competition and underestimate yourself.
Doing unrealistic is easier than doing the realistic. To have an uncommon lifestyle, you need to develop the uncommon habit of making decision, both for yourself and for others.
Excitement is the more practical synonym for happiness and it is precisely what you should strive to chase. It is the cure for all.
E for Elimination is for increasing productivity to 500% times.
Being effective vs. being efficient.
Effectiveness is doing the things that get you closer to your goals and efficiency is performing a given task in the most important /economical manner possible. Being efficient without effectiveness is the default mode of the universe.
1. Doing something unimportant well does not make it important
2. Requiring a lot of time does not make a task important.
Vilfredo Pareto principle – 80% of the output comes from 20% of the input.
e.g. 80% of all stock market gains are realized by 20% of the investors
80% of company profit comes from 20% of the products and customers.
(Interestingly 80% of the beer drinks by 20% of the people J
Hence follow these guidelines
1. Limit tasks to the important to shorten work (80/20 rule_
2. Shorten work time to limit tasks to the important (Parkinson’s law)
Parkinson’s law dictates that a task will swell in (perceived) importance and complexity in relation to the time allotted for its completion (in other means, the end product of the shorter deadline is almost inevitably of equal or higher quality due to greater focus.
Suggestions – stop asking for opinion and start proposing solutions. (Here are few lines of proposing
1. Can I make a suggestion
2. I propose
3. I’d like to propose…
4. I suggest that… What do you think?
5. let‘s try .. and then try something else , fi that does nto work…
“What information consumes is rather obvious: it consumes the attention of its recipients. Hence, a wealth of information creates a poverty of attention and a need to allocate that attention efficiently among the overabundance of information sources that might consume it – Herbert Simon”
“Reading after a certain age, diverts the mind too much from its creative pursuits. Any man who reads too much and uses his own brain too little falls into lazy habit of thinking. – Albert Einstein”
How to read fast – please visit www.Pxmethod.com
“Learning to ignore things is one of the great paths to inner peace – Robert Sawyer, Calculating God”
Time wasters: become an ignoramus
1. Turn off the audible alert in Outlook (to turn off automatic send/receive which delivers e0mail to your inbox as soon as someone send them)
2. Check email twice per day
3. Send calls to voicemail and leave cell number in the voice mail greetings for emergency contact
4. Respond to voice mail via email – this trains people to be concise
5. Meeting should only be held to make decision about a predefined situation, not to define the problem.
6. Define end time in any meetings. Do not leave discussions open-ended and keep them short.
7. Cubicle is your temple – don’t permit causal visitors. Pretend that you are on a phone while these people pop-up.
8. Use the Puppy Dog Close to help your superiors and others develop no-meeting habits. (The Puppy dog close is invaluable whenever you face resistance to permanent changes. Get your foot in the door with a “let’s just try it once” reversible trial.
9. Batch activities to limit setup cost and provide more time for dream-line milestones (check specific group/persons email in batches)
10. Set or request autonomous rule with occasional review of the result.
Some important links –
Writersmarket.com (writer’s market
Srds.com (standard rate and data services)
Market sizing and keyword suggestions
freestickphotos.com (stock photos)
getty.com (good pictures)
aweber.com (email tracking and scheduled autoresponders)
Visiting places – sites
Orbitz.com (airline tickets cheap pnes)
Top 13 New Rich Mistakes.
1. Losing sight of dreams and falling into work for work’s sake
2. Micromanaging and e-mailing to fill time
3. Handling problems your outsource or co-workers can handle
4. Helping outsources or co-workers with the same problem more than once or with non-crisis problems
5. Chasing customers (esp. unqualified) when you have sufficient cash flow to finance your nonfinancial pursuits
6. Answering email that not result in a sale
7. Working where you live, sleep or should relax
8. Not performing a thorough 80/20 analysis every 2 to 4 weeks for your business and personal life
9. Striving for endless perfection rather than great or simply good enough whether in your personal or professional life
10. Blowing minutiae and small problems out of proposition as an excuse to work
11. Making non-time-sensitive issues urgent in order to justify the work
12. Viewing one product, job or project as the end-all and be-all of your existence
13. Ignoring the social rewards of life.
Favorite reads of 2008:
Zorba the Greek - Nikos Kazantzakis
Letters from a Stoic – Seneca. These are two of the most readable books of practical philosophies I’ve ever had the fortune to encounter. If you have to choose one, get Zorba, but Lucius Seneca will take you further. Both are fast reads of 2-3 evenings.
The magic of Thinking Big – David Schwartz
How to make Millions with your ideas – An Entrepreneurs’ guide – Dan S. Kennedy
The E-myth revisited: Why most small business doesn’t work and what to do about it – Michael E. Gerber
Vagabonding: An uncommon guide to the art of long-term world travel – Rolf Potts
Reducing emotional and material baggage
Walden – Henry David Thoreau
Less is more: the art of voluntary poverty – An anthology of ancient and modern voices in praise of simplicity – Golden Vandenbroeck
The monk and the riddle: the education of a Silicon Valley entrepreneur – Randy Komisar
The 80/20 principle: The secret to success by achieving more with less – Richard Koch
Secrets of power negotiating: Inside secrets from a master negotiator – Roger Dawson
Response Magazine – responsemagazine.com
Small Gigantic: Companies that choose to be great instead of big – Bo Burlingham
Tx n Rd
January 10, 2009
After reading this book, I think the title of the book is not appropriate, it should be wonderful if it says – from ‘Code Red to Code Green’ – as mentioned many times in the book and mainly on “Green Energy and how to make it green”.
I like the first few chapters, which are very informative, compared to the later portion of the book.
Where Bird’s don’t fly.
Talks about the US consulate in Istanbul, which was headquartered in Palazzo Corpi, a grand and distinctive old building in the heart of the city’s bustling business district. As part of security upgrade due to 9/11 incident, it was decided to close the consulate at Palazzo Corpi and built new one at a remote area with high-secured architecture (they could have filmed the Turkish prison movie ‘Midnight express thereJ). It was so well guarded they don’t even let birds fly.
Because a place where birds don’t fly is a place where people don’t mix, ideas get sparked, friendship don’t get forged, stereotypes doesn’t get broken, collaboration does not happen, trust does not get built, and freedom doesn’t ring. That is not the place we want America to be. It cannot play the vital role it has long played for the rest of the world – as a beacon of hope and the country that can always be counted on to lead the world in response to whatever is the most important challenge of the day. We need that America more than ever today.
This is a book about why.
World has problems. World is getting hot flat and crowded. That is global warning, the stunning rise of middle classes all over the world and rapid population growth have converged in a way that could make our planet dangerously unstable.
The simple name for the new project I am proposing is ‘Code Green’.
Americans intuit that we’re on the wrong track and that we need a course correction and fast. In the Italian film, ‘The leopard’ Prince Salina is bitter ad uncompromising – “ We were the leopards, the lions; those who take our place will be jackals and sheep”. The wisest advice he gets comes from his nephew Tancerdi who marries a wealthy shopkeeper’s daughter from the new moneyed middle class and along the way cautions his uncle – “ If we want things to stay as they are, things will have to change”.
One disturbing trend: Post –9/11, we as a nation have put up more walls than ever and in the process we have disconnected ourselves emotionally, if not physically, from many of our natural allies and our natural instincts to embrace the world.
The other disturbing trend has been building slowly since the 1980s. It is a ‘dump as we wanna be’ mood that has overtaken our political elite, a mood that says we can indulge in pretty red state – blue state fights for as long as we want. The prevailing attitude on so many key issues in Washington today is “ We’ll get to it when we feel like getting to it and it will never catch up to us, because we are America.
(The proposal of both McCain and Clinton during 2008 election, to suspend the federal tax on gasoline, was the epitome of ‘dumb as we wanna be’ politics.).
Our youth people are so much more idealistic than we deserve them to be and they want our country to matter again, they want to be summoned, not just to do nation-building in Iraq or Afghanistan, but to do nation-building in America – to restore and revitalize something they cherish but feel is being degraded.
Well-known Indian author – Gurucharan Das- has been forced by border security control agents to explain why he was visiting. They “make you feel so wanted now and that was always reinventing itself.”; he added, because it was a country that always welcomed ‘all kinds of oddballs’ and had this wonderful spirit of openness”. American openness has always been as inspirations for the whole world, he told me. “If you go dark, the world goes dark.”
In Dec. 2007, I was visiting Bahrain and we (author and Crown Prince Salman) were at a bistro having pizza where Salman mentioned about the American school which was opened for American military dependants while nearly 70% were tuition-paying non-Americans primarily the sons and daughters of Bahrain’s business and political elite, including the crown prince of his day. Added Crown Prince Salman: “ The American school was the best advertisement the Americans ever had. It made more friends than the American embassy”.
[The book goes into great details on failure of previous administration on finding alternate energy to petrol. He blasts Regan administration for not continuing Carter’s alternate-energy initiative. Not only American became heavily depended on Middle East, but also put earth into dangerously hot. Our new fuel economy standard up to 35 miles per gallon by 2020, roughly where Europe and Japan are already today.]
European government imposed heavy tax on gasoline and taxes on engines size and kept imposing them and hence European customers demanded smaller and smaller cars. In US, Detroit companies introduced the SUV and successfully lobbied the government to label these as light trucks so they would not have to meet the 27.5mpg needed for standard cars.
David Rothkopf, an energy expert “ Green is not simply a new form of generating electric power, it is a new form of generating national power.”
As per ideafinder.com (another good site mentioned infoplease.com) , the first automobile to be produced in quantity was the 1901 Curved Dash Oldsmobile which was built in US by Ransom E. Olds. Modern automatic mass production and its use of the modern industrial assembly line is credited to Henry Ford (Model T car).
[Book again goes in detail on countries that benefited from huge petroleum price and used that money for anti-American activities. It is equally interesting and alarming to find how some nations controlling the culture of other poor countries in that process. Fall of Soviet is related the fall of oil price from $70 per barrel in 1970s to $10 in 1980s.
Saudi Arabia hiked their oil production 4 times which resulted in brining down the oil price to $10 which put USSR in jeopardy as it could not continue to provide subsidy to people and allies.
For democracy to rule in other parts, it would be faster, if the oil price is around $10 per barrel as per the author; including normalization of muscle power exhibited by Russia & Venezuela].
“Does oil hinder democracy’ by Michael L. Ross a UCLA political scientist demonstrates this point with many examples from history. The motto of the American Revolution was “No taxation without representation”. The motto of the petro-list authoritarian state is “ No taxation, so no representation either “. When oil price became higher, the reforms became slower.
Up until 9/11, America treated the Arab world basically as a collection of big gas stations – the Saudi station, the Libyan station, the Kuwait station. “Guys” we told them – it was only guys we talked to – “here is the deal. Keep your pumps open, keep your price low, and don’t bother the Jews too much, and you can do whatever you want out back. You can treat your women badly. You can deprive your people of whatever civil rights you like. You can print whatever crazy conspiracy theories about us you like. You can educate preach from your mosques any venom that you care to….
The person who best described the critical importance that relative price play in stimulating innovation in renewable energy was none other than the late great Saudi Arabian oil minister Sheikh Ahmed Zaki Yamani. Back in the 70s as OPEC was just starting to feel its oats, Yamani used to warn his colleagues not to raise oil prices too high, too fast, for fear of causing a government and market reaction in the West that would trigger massive innovation in wind, solar and other forms of the renewable energy.
He mentioned, “Remember boys, the Stone Age didn’t end because we ran out of stones”. It ended because people invented alternative tools made of bronze and then iron.
Yamani knew that the price signal – the price of oil versus the price of renewable- was everything. And OPEC needed to keep its crude prices exactly at the level where the cartel could earn the maximum returns without spurring the West to innovate any scale alternate to oil.
Our goal needs to be to make Yamani’s nightmare true.
Author’s favorite passage in Prince goes like this. “It ought to be remembered that there is nothing more difficult to take in hand, more perilous to conduct or more uncertain in its success than to take the lead in introducing a new order of things, because the innovator has for enemies all those who have done well under old conditions, and lukewarm defenders in those who may do well under the new. This coolness arises partly from fear of the opponents – who have the laws in their side – and partly from the incredulity of men who do not readily believe in new things until they have had a long experience of them”.
Tx n Rd
The Innovator’s Dilemma – Clayton M. Christensen.
This is a management book and also well thought out book from a Harvard research on why successful companies fail.
PS - This book provides abstraction that helps much.
For most of the explanation the author used Disk drive industry and I like the reason for selecting this industry, provided by his friend.
“Those who study genetics avoid studying humans, because new generations come along only every thirty years or so. It takes long time to understand the cause and effect of any change. Instead they study fruit flies because they are conceived, born, mature, and die all within a single day. If you want to understand why something happens in business, study the disk drive industry. Those companies are closest things to fruit flies that the business world will ever see”.
The thesis is based on the factor that companies who don’t see & act on disruptive innovations, would fail miserably.
Harness the principle of disruptive innovation.
1. Companies depend on customers and investors for resources.
2. Small markets don’t solve the growth needs of large companies .
3. Markets that don’t exist can’t be analyzed .
4. An organization’s capabilities define its disabilities.
5. Technology supply may not equal market demand .
Some examples of disruptive technologies:
Author accentuate the importance of triple factor in any corporation . RPV – Resources, process and value.
Well-managed companies are excellent at developing the sustaining technologies that improve the performance of their products in the ways that matter to their customers. This is because management practices are biased toward:
1. Listening to customers
2. Investing aggressively in technologies that give those customers what they say they want.
3. Seeking higher margins
4. Targeting larger markets rather than smaller ones.
Disruptive technologies however are distinctively different from sustaining technologies. Disruptive technologies change the value proposition in a market. When they first appear they almost always offer lower performance in terms of the attributes that mainstreams customers care about. But disruptive technologies have other attributes that a few fringe (generally new) customers value. They are typically cheaper, smaller, simpler and frequently more convenient to use. Therefore they open new markets. Further because with experience and sufficient investment, the developers of disruptive technologies will always improve their product’s performance, they eventually are able to take over the older markets. This is because they are able to deliver sufficient performance on the old attributes, and they add some new ones.
The ‘Innovator’s Dilemma’ describes both the process through which disruptive technologies supplant older technologies and the powerful forces within well-managed companies that make them unlikely to develop those technologies themselves.
Author offers a framework of 4 principles (listed at the beginning of this page) to explain why existing technologies are anti-productive when it comes for exploiting disruptive ones. And finally, he suggests ways that managers can harness these principles so that their companies can become more effective at developing for themselves the new technologies that are going to capture their markets in the future.
1. Companies depend on customers and investors for resources.
In order to survive, companies must provide customers and investors with the products, services and profits they they require. The highest performing companies, therefore, have well-developed systems for killing ideas that their customers don’t want. As a result, these companies find it very difficult to invest adequate resources n disruptive technologies – lower margin opportunities that their customers don’t want – until their customers want them. And by then, it is too late.
2. Small markets don’t solve growth needs of large companies.
To maintain their share price and create internal opportunities for their employees, successful companies need to grow. It isn’t necessary that they increase their growth rates, but increasing amounts of new revenue just to maintain the same growth rate. Therefore it becomes progressively more difficult for them to enter the newer, smaller markets that are destines to become the large markets of the future. To maintain their growth rates. They must focus on large markets.
3. Markets that don’t exist can’t be analyzed
Sound market research and good planning followed by execution according to plan are the hallmarks of good management. But companies whose investment process demand quantification of market size and financial returns before they can enter a market get paralyzed when faced with disruptive technologies because they demand data on markets that don’t yet exist.
4. Technology supply may not equal market demand
Although disruptive technologies can initially be used only in small markets, they eventually become competitive in mainstream markets. This is because the pace of technological progress often exceeds the rate of improvement that mainstream customers want or can absorb. As a result the products that are currently in the mainstream eventually will overshoot the performance that mainstream, markets demand while the disruptive technologies that underperform relative to customer expectations in the mainstream market today may become directly completive tomorrow. Once two or more products are offering adequate performance, customers will find other criteria for choosing. These criteria tend to more toward reliability, convenience and price, all of which are areas in which the newer technologies often have advantages.
A big mistake that managers make in dealing with new technologies is that they try to fight or overcome the principle of disruptive technology. Applying the traditional management practices that led to success with sustaining technologies always leads to failure with disruptive technologies. The productive route that often leads to success is to understand the natural always that apply to disruptive technologies and to use them to create new markets and new products. Only by recognizing the dynamics of how disruptive technologies develop can managers respond effectively to the opportunities that they present.
Following are his recommendations
1. Give responsibility for disruptive technologies to organization whose customers need them so that resources will flow to them.
2. Set up a separate org. small enough to get excited by small gains
3. Plan for failure. Don’t bet all your resources on being right the first time. Think of your initial efforts at commercializing the first time. Think of your initial efforts at commercializing a disruptive technology as learning opportunities. Make revisions as you gather data.
4. Don’t count on breakthrough. Move ahead early and find the market for the current attributes of the technology. You will find it outside the current mainstream market. You will also find that the attributes that make disruptive technologies unattractive to mainstream markets are the attributes on which the new markets will be built.
Tx n Rd
January 6, 2009
The Tipping Point – Malcolm Gladwell
The Tipping Point is the biography of an idea. Ideas and products and messages and behaviors spread just like viruses do. The rise of hush Puppies and the fall of New York's crime rate are textbook example of epidemics in action.
There are three characteristics –
- The fact that little causes can have big effects
- That change happens not gradually but at one dramatic moment
These three principles that define how measles moves through a grade-school classroom or the flu attacks every winter.
The possibility of sudden change is at the center of the idea of Tipping Point and might well be the hardest of all to accept. The expression first came into popular use in the 1970s to describe the flight to the suburbs of whites living in the older cities of the American Northeast. When the number of incoming African American in a particular neighborhood reached a certain point, sociologist observed that the community would 'tip' most of the remaining whites would leave almost immediately. The Tipping Point is the moment of critical mass, the threshold, the boiling point.
This behavior repeated in Hush Puppies huge demand, NY sudden crime rate reduction, Baltimore syphilis spreading, use of FAX machine, Cell phone, etc.
Sharp introduced low cost fax in 1984 and sold around 80,000 in US. For the next three years, business slowly and steadily bought more and more faxes until 1987, enough people had faxes that it made sense for everyone to get a fax.
Kevin Kelly, one of the gurus of the New Economy has written, for example, of what he calls the 'fax effect'. The first fax machine ever made was the result of millions of dollars of R&D and cost about $2000 at retail. But it was worth nothing because there was no other fax machines made the first fax more valuable and the third fax made the first two more valuable and so on. "Because fax machine are linked to a network, each additional fax machines that is shipped increases the value of all the fax machines operating before it" Kevin writes. When you buy a fax machine, then, what you are really buying is access to the entire fax network – which is infinitely more valuable than the machine itself.
Kelly calls this the 'fax effect' or the law of plenitude, and he considers it an extraordinarily radical notion. The traditional economy value comes from scarcity – diamonds, gold, oil etc- it has more value when they are rare. But logic on network is the reverse. Power and value now come from abundance.
Chapter 1 – The three rules of Epidemics.
In 1964 young Queen woman by the name of Kitty Genovese was chased by her assailant and attacked three times on the street over the course of half-an-hour as thirty-eight of her neighbors watched from their windows and during this time, none of the 38 called police.
It can be assumed that their apathy was indeed one of the big city varieties. It is almost a matter of psychological survival, if one is surrounded and pressed by millions of people, to prevent them from constantly impinging on you and the only way to do this is to ignore them as often as possible. Indifference to one's neighbor and his troubles is a conditioned reflex in New York as it is in other big cities. This is called bystander problem.
The three rules of Tipping Point
- The law of the few
- The stickiness factor
- Power of context
Offer a way of making sense of epidemics.
Chapter 2 – The law of the few.
Explains from history – April 18th 1775 when British was planning for attacking Concord to seize the stores of guns and ammunition that some of the colonial militia stored there. Paul Revere got to know about this incident and he spread the news across the colonies by riding at night. Other gentleman –William Dawes – also spread the news, but he could not make any effect in his message compared to Revere's.
Paul Revere's influence is explained with the context of the ' low of the few'.
In the law of the few, author further divides them into three categories.
Revere belongs to the first category and Connectors have special gifts for bringing the world together. What makes someone a Connector? Criterion is that Connectors know lot of people and they are the kinds of people who knew everyone.. Their importance is also a function of the kinds of people they know. Word-of-mouth epidemics are the work of Connectors. Revere was a Connector, but William Dawes was just an ordinary man.
The word Maven comes from Yiddish and it means, one who accumulates knowledge. For example from everyday's life, they would know which gas station sells cheapest oil, or which supermarket sells low price stuff or which stuff is being sold in which super market etc.
A Connector might tell ten friends where to stay in LA and half-of-them might take his advice. A Maven might tell five people where to stay in LA, but all of them would take his advice. These are different personalities at work, acting for different reasons. But they both have the power to spark word-of-mouth.
(Some people can be both – Connector as well as Maven)
Some books on salesmanship recommended that persuaders try to mirror the posture or talking styles of their clients in order to establish rapport. But that's shown not to work. It makes people more uncomfortable not less and it is too obviously phony.
However some people has skill to harmonize others. As per Joseph Cappella, "Skilled musician and good speakers know this and they know when the crowds are with them, literally in synchrony with them, in movements and nods and stillness in moments of attention". The essence of a Salesman is that one some level they can not be resisted. They can build of trust and rapport in 5 to 10 min that most people will take half an hour- to one hour to do so. They also carriers who are very expressive and can inject emotions to the others faster than the rest.
In their brilliant 1994 book 'Emotional Contagion', mimicry is one of the means by which we infect each other with our emotions. In pother words, if I smile and you see me and smile in response – even a micro smile that takes no more than several milliseconds – it's not just you imitating or empathizing with me. It may also be a way that I can pass on my happiness to you. Emotions are contagious. In a way, this is perfectly intuitive. All of us have had our spirits picked up by being around somebody in a good mood. We normally think of the expression on our face as the reflection of an inner state and Emotions goes inside-out and emotions can goes outside-in.
(If I can make you smile, I can make you happy. If I can make you frown, I can make you sad).
Howard Friedman, a psychologist, has developed what he calls the Affective Communication Test to measure this ability to send emotions to be contagious. The test is a self-administrated survey with 13 questions relating to things like whether you can keep still when you hear good dance music, etc.. the highest score is 117 and average score around 71. Some of the people author tested for the category of Salesman got highest scores.
Chapter 3 – Stickiness factor.
When most of us want to make sure what we say is remembered, we speak with emphasis. We speak loudly and we repeat what we have to say over and over again. Marketers feel the same way. There is a maxim in the advertising business that an advertisement has to be seen at least 6 times before anyone will remember.
Author goes into great detail by using the success story of 'Sesame street" and to emphasis the 'stickiness factor'.
There is a simple way to package information that under the right circumstances can make it irresistible. All you have to do is find it.
Chapter 4 – The power of Context.
Author uses NY city crime rate reduction for explaining this topic.
During the 1990s violent crime declined across US for number of fairly straightforward reasons. The illegal trade in crack cocaine began to decline. Second is economic's dramatic recovery began to many people who might have been lured into crime got legitimate jobs instead and the general aging of the population meant that there were fewer people in the age range that is responsible for the majority of all violence.
New York city's crime rate reduction case was different.
The most intriguing candidate is called the 'Broken windows' theory. Broken Windows was the brainchild of the criminologist James Q Wilson and George Kelling. They argue that crime is the inevitable result of disorder. If a window is broken and left unrepaired, people walking by will conclude that no one cares and no one is in charge. Soon, more windows will be broken and the sense of anarchy will spread from the building to the street on which it faces, sending a signal that anything goes. In a city, relatively minor problems like graffiti, public disorder, and aggressive panhandling, they write, are all the equivalent of broken windows, invitations to more serious crimes.
(MTA authority as a first step, took care of dirty graffiti every day at their yard, and secondly, they added more police to catch people who cross the bar without sweeping tokens and gradually build up the structure. When Julianne became NYC mayor, he brought MTA police chief as NYC commissioner who followed the same technique by catching people doing silly mistakes – peeing on the street etc )
People's behavior changes with context. Some will cheat at house, but not outside (vice versa), some people help friends, but not relatives(vice versa), some people is honest in the office, but in their personal life (vice versa), etc..
Consider the following brainteaser. Suppose I give you a 4 cards labeled with the letter A & D and the numerals 3 and 6. The rule of the game is that a card with a vowel on it always has an even number on the other side. Which of the cards would you have to turn over to prove this rule to be true? The answer is two (A Card and three card). The overwhelming majority of people gives this test, don't get it right. However, if we rephrase it this way, majority gets it right.
Suppose four people are drinking in a bar. One is drinking Coke. One is sixteen. One is drinking beer and one is twenty-five. Given the rule that no one under twenty-one is allowed to drink beer, which of these people's IDs do we have to check to make sure the law is being observed? Now the answer is easy (beer drinker and the 16 year old boy).
The difference is that it is framed in a way that makes it about people, instead of about numbers, and as human beings we are a lot more sophisticated about each other than we are about the abstract world.
Princeton university professors – John Darley and Daniel Batson – conducted a study based on Biblical story (Gospel of Luke tells of a traveler who has been beaten on his way to Jericho – Good Samaritan) and they proved that people at different context, behaved differently in those situations.
Judith Harris has convincingly argued that peer influence and community influence are more important than family influence in determining how children turn out. We spend so much time celebrating the importance and power of family influence that it may seems, at first blush, that this can't be true. But reality it I no more than an obvious and commonsensical extension of the Power of Context, because it says simply that children are powerfully shaped by their external environment that the features of our immediate social and physical world – the streets we walk down the people we encounter – play a huge role in shaping who we are and how we act.
Chapter 5 – Power of Context –Part 2.
Explained from the context of success of Rebecca Wells's Divine Secrets of the ya-ya Sisterhood'. Rebecca Wells says that what she began to realize as the ya-Ya epidemic grew was that it wasn't really about as her or even about her book: it wasn't one epidemic focused on one thing. It was thousands of different epidemics, all focused on the groups that had grown up around Ya-Ya. "I began to release that these women had built their own Ya-Ya relationship not as much to the book but to each other".
If we are interested in starting an epidemic – in reaching Tipping Point – what are the most effective kinds of group's? Is there a simple rule of thumb that distinguishes a group with real social authority from a group with little power at all? As it turns out, there is. It is called the rule of 150 and it is a fascinating example of the strange and unexpected ways in which context affects the course of social epidemics.
There is a concept in cognitive psychology called the channel capacity that refers to the amount of space in our brain for certain kinds of information. As a human being we can only handle so much information at once. What I am describing here is an intellectual capacity – our ability to process raw information.
Same way we have social channel capacity limits. Humans socialize in the largest groups of all primates (monkeys, chimps, baboons, humans) because we are the only animals with brains large enough to handle the complexities of the social engagement. If you plug in the neocortex ration of Homo sapiens, you get a group estimate of 147.8 – or roughly 150. "The figure of 150 seems to represent the maximum number of individuals with whom we can have a genuinely social relationship, the kind of relationship that goes with knowing who they are and how they relate to us. Putting it another way, it is the number of people you would not feel embarrassed about joining uninvited for a drink if you happened to bump into them in a bar".
Same rule is applies to work. In military, the rule is 200 men form a unit.
Chapter 6 & 7 are Case Studies, which further clarifies the above points.
Simply by finding and reaching those few special people who hold so much social power, we can shape the course of social epidemics. In the end, Tipping Points are a reaffirmation of the potential for change and the power of intelligence action. Look at the world around you. It may seem like an immovable implacable place. It is not. With the slightest push – in just the right place – it can be tipped.
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January 5, 2009
Outliers – Malcolm Gladwell
The true story of success is very different. Author says, no one can says, they did it all themselves. Hard work is unequivocally a main factor, but opportunity (fate, luck, blessing?) is also plays major role in anyone’s success.
Biologists often talk about the ‘ecology’ of an organism: the tallest oak in the forest is the tallest not just because it grew from the hardiest acorn; it is the tallest also because no other trees blocked its sunlight, the soil around it was deep and rich, no rabbit chewed through its bark as sapling and no lumberjack cut it down before it matured.
In Outliers, author wants to convince you that these kinds of personal success (person who proclaims or owed nothing to parentage or patronage) don’t work. People don’t rise from nothing. We do owe something to parentage and patronage.
Chapter 1 – The Mathew Effect
Success of Canadian A team.
Most of the Canadian Hockey team players are born in the first part of the calendar year. 40% of the players will have been born between Jan & March, 30% between April & June and 20% between July & Sept, 10% between October & December.
It’s simply that in Canada the eligibility cut-off for age-class hockey is Jan 1. So people born in last quarter will get less training /coaching compared to kids born in 3rd quarter, who gets less than compared to kids born in 2nd quarter and so on.
As per Roger Barnsley that these kinds of skewed age distribution exist whenever three things happen: selection, streaming, and differentiated experience.
Same in US sports, EU sports, and even in TIMSS (Trends in International mathematics and Science Study – math & science tests given every 4 years to children in many countries around the world) the oldest children scored somewhere between 4 & 12 % points better than youngest children.
The sociologist Robert Merton famously called this phenomenon the “Mathew Effect” after the New Testament verse in the Gospel of Mathew “ For unto everyone that hath shall be given and he shall have abundance. But from him that hath not shall be taken away even that which he hath”. It is those who are successful are most likely to be given the kinds of special opportunities that lead to further success. It’s the rich who gets the biggest tax breaks. Success is the result of what sociologist like to call “accumulative advantage’.
Chapter 2 – 10,000 hour rule.
For successful person have had around 10,000 hours of hard work to excel in their field.
Bill Joy who sometimes called Edison on Internet. At University of Michigan, he was probably programming 8 – 10 hours a day and by the time he was at Berkeley, he was doing it day & night. He had around 10,000 programming experience when he went to rewrite Unix.
At the same time, he got many opportunities to help him. He got into a university that had one of the better computer lab (compared to card reader computing, University of Michigan has time share OS based computing), which helped him to carry his work without wait for computer resources. He and his friends hacked the system so that they could work on computers without paying additional hours and so on.
Same story with Beatles success with 10,000-hour rule. By the time they landed in US (so called invasion of the American music scene), they had 10,000 hours of hard work behind the scene. Secondly they had opportunity to get selected. In 1960 while they were still just a struggling high school rock band, they were invited to play in Hamburg, Germany. It is well written in Beatle’s biography – Shout. There was one particular club owner called Bruno. He had the idea of bringing in rock group to play various clubs and it was a huge nonstop show, hour after hour with lot of people lurching in and the other lot lurching out. And the bands would play all the time to catch passing traffic. Bruno went to London and happened to meet an entrepreneur who introduced Beatles and Beatles made connection not just with Bruno, but with other club owners as well. They kept going back because they got a lot of alcohol and a lot of sex.
As John Lennon says, “ We got better and got more confidence. We could not help it with all the experience playing all night long. We had to try harder, put our hearts and soul into it to get ourselves over. In Liverpool, we’d only ever done one-hour session and we just used to do our best numbers, the same ones at everyone. In Hamburg, we had to play for 8 hours so we really had to find a new way of playing”.
Beatles not only did the hard work, but also lucky enough to be selected by Bruno.
Bill Gates success story goes with 10,000-hour rule in addition to opportunity that followed him. Bill Joy got opportunity to learn programming on a time-share system as a freshman in college and Bill Gates got to do real-time programming as an 8th grader.
Opportunities that Bill Gates blessed with are the following
1. It was that Gates got sent to Lakeside private school that has a rare distinctive advantage of having real-time computer system.
- When money ran out, one of the parents happened to work at C-Cubed which happened to need someone to check its code on the weekends and which also happened not to care if weekends turned into weeknights.
- It was that Gates just happened to find out about ISI and ISI just happened to need someone to work on its payroll software
- It was Gates happened to live within walking distance of the University of Washington
- It was that the university happened to have free computer time between 3 & 6 in the morning.
- It was TRW happened to call Bud Pembroke
- It was that the4 best programmers Pembroke knew for that particular problem happened to be 2 high school kids.
- It was that Lakeside was willing to let those kids spend their spring term miles away writing code.
All the outliers we’ve looked at so far were the beneficiaries of some kind of unusual opportunity. Same is clear in case of the 75 richest people in the human history. The net worth of each person is calculated in current US dollars. As you can see, it includes queens and kings and pharaohs from centuries past as we as contemporary billionaires
No. Name Wealth in $Bn Origin Company/Source of wealth.
Genghis khan 700 Mongolia Mongol Emprie
1. John D. Rockefeller 318.3 US Standard Oil
2. Andrew Carnegie 298.3 Scotland Carnegie Steel Company
3. Nicholas II of Russia 253.5 Russia House of Romanow
4. William Henry Vanderbilt231.6 US Chicago/Burlington &
5. Osman Ali Khan, 210.8 Hyderabad Monarchies
Asaf Jah VII
6. Andrew W. Mellon 188.8 US Gulf Oil
7. Henry Ford 188.1 US Ford Motor Company
8. Marcus Licinius Crassus 169.8 Roman Republic Roman Senate
9. Basil II 169.4 Byzantine Empire Monarchy
10. Corelius Vanderbilt 167.4 US NY & Harlem Railroad
11. Alanus Rufus 166.9 England Investment
12. Amenphis III 155.2 Ancient Egypt Pharoah
20. Cleopatra 95.8 Ancient Egypt
Historians start with Cleopatra and the pharaohs and comp through every year in human history ever since looking in every corner of the world for evidence of extra ordinary wealth, and almost 20 % of the names they end up with come from a single generation in a single country. In the 1860s and 1870s, the American economy went though perhaps the greatest transformation in its history. Most of the people in the list from US are born in narrow 9 year window that was just perfect for seeing the potential that the future held (born in 1931-1940).
Same is again in computing world where most of the successful people were born in 1950s (Bill Gates(1955), Paul Allen (1953), Steve Ballmer (1956), Steve Jobs (1955), Eric Schmidt(1955), Bill Joy (1954), Scott McNealy (1954), Vinod Kholsa(1955), Andy Bechtolsheim(1955)
Chapter 3 – The trouble with Geniuses, Part I.
In the same line of thought, persons with high IQ may not reach the top, unless he/she bless with opportunities.
Some people got all the luck, but not this guy - Chris Langan who has the highest IQ in the world (200 compared to Einstein's IQ of 150), but making a living by working in a violent bar. There is a three part video available in the link below - http://www.youtube.com/watch?v=-ak5Lr3qkW0&feature=related
In a devastating critique, the sociologist Piririm Sorokin once mentioned, “By no stretch of the imagination or of standards of genius is the gifted group’ as a whole ‘gifted”.
By the time Lewis Terman (who researched for genius and published his finding in book entitled “ Genetic Studies of Genius”) came out with his 4th volume, he concluded, “ intellectuals and achievements are far from perfectly correlated”.
(At Microsoft, job applicants are asked a battery of questions designed to rest their smarts, including the classic “Why are manhole covers are round?. The answer is that a round manhole cover can’t fill into the manhole, no matter how much you twist and turn it. A rectangular cover can. All you have to do is tilt it sideways)
Chapter 4 – The trouble with Geniuses, Part II
As per Robert Sternberg, practical intelligence includes things like “knowing what to say to whom, knowing when to say it and knowing how to say it for maximum effect”. It is procedural: it is about knowing how to do something without necessary knowing why you know it or being able to explain it.
Some of the mastery comes from cultural advantage. This chapter compares Chris Langan with Robert Oppenheimer. Oppenheimer was raised in one of the wealthiest neighborhoods in Manhattan and his childhood was the embodiment of concerted cultivation. He attended Ethical Culture School on Central Park West, perhaps the most progressive school in the nation where students were infused with the notion that they were being groomed to reform the world. Chris Langan by contrast, had only the bleakness of Bozeman and a home dominated by an angry drunken stepfather. Due to stepfather’s ill-treatment, the kids all have a true resentment of authority. That was the lesson Langan learned from his childhood: distrust authority and be independent. He never had a parent teach him on how to speak for himself or how to reason and negotiate with the position of authority. He did not learn entitlement and he only learned constraint.
Chapter 5 - The Three Lessons of Joe Flom.
This chapter examines the success story of Jews in US compared to other Europeans.
Jewish immigrants were not like the other immigrants who came to America in the 19th and early 20th centuries. The Irish and Italians were peasants, tenant farmers from the impoverished countryside of Europe. Not so Jews. For centuries in Europe, they had been forbidden to own land so that had clustered in cities and towns taking urban trades and professions. 70% of the Eastern European Jews came through Ellis Island in the 30 years of so before the fist world war had some kind of occupational skill. They had owned small groceries or jewelry stores. They had been bookbinders or watchmakers and tailors.
The conventional explanation for Jewish success, of course, is that Jews came from a literate, intellectual culture. They are famously ‘ the people of the book’. But it was not the children of rabbis who went to law school. It was the children of garment workers. Their critical advantage in climbing the professional ladder wasn’t the intellectual rigor you get from studying the Talmud. It was the practical intelligence and savvy you get from watching your parents selling merchandize in the market place.
Jewish doctors and lawyers did not become professionals in spire of their humble origins. They became professionals because of their humble origins.
Part 2 – Legacy.
Chapter 6 – Harlan, Kentucky.
“To the first settlers, the American backcountry was a dangerous environment, just as British borderlands” says historian David Hackett Fischer in his book titled “Albion’s Seed.
“Much of the southern highlands were “debatable land’ in the border sense of contested territory without established government or the rule of the law”
Fisher argues that there were 4 distinct British migrations to America in its first 150 years. First the Puritans, in the 1630 who came from East Anglia to Massachusetts; then the Cavaliers and indentured servants who came from southern England to Virginia in the mid 17th century; then the Quakers from North Midland to the Delaware Valley between late 17th and early 18th century. Fischer argues brilliantly that those 4 cultures – each profoundly different – characterize those 4 regions of US even to this day.
In the early 1990s 2 psychologists at the University of Michigan – Dov Cohen & Richard Nisbett – decided to conduct an experiment on the culture of honor. If a person is insulted, the behavior was different from different regions of America.
Most of the young men from Northern part of US treated the incident with amusement.; Southern were angry who acted like they were living 19th century Harlan, Kentucky where clashes and feuds were quite common.
Cultural legacies are powerful forces. They have deep roots and long lives. They persist, generation after generation, virtually intact even as the economic and social and demographic conditions that spawned them have vanished and they play such a role in directing attitudes and behavior that we cannot make sense of our world without them.
So far in Outliers we’ve seen that success arises out of the steady accumulation of advantages; when and where you are born, what your parents did for a living and what the circumstances of your upbringing were all make a significant difference in how well you do in the world.
Chapter 7 – The Ethnic Theory of Plane Crash.
Plane crashes are much more likely to be the result of an accumulation of minor difficulties and seemingly trivial malfunctions. It’s true of virtually all industrial accidents including the near meltdown at Pennsylvania’s Three Mile Island nuclear station incident (no single big thing went wrong at Three Mile island, rather 5 completely unrelated events occurred in sequence each of which had it happened in isolation would have caused no more than a hiccup in the plant’s ordinary operation.)
Mitigated speech - a term used by linguists to describe to any attempt to downplay or sugarcoat the meaning of what is being said. We mitigate when we’re being polite or when we’re ashamed or embraced or when we’re being deferential to authority.
Dutch psychologist Geert Hofstede developed an enormous database for analyzing the ways in which cultures differ from one another. (the database is called “Hofstede’s Dimensions”)
He defined ‘individualism-collectivism’ scale, ‘uncertainty avoidance’ & ‘Power Distance Index (PDI) to differentiate different culture and its characteristics
If you compare PDIS by country to the ranking of plance crashes by country, they match up very closely.
Top 5 pilot PDIs by country.
- South Korea
The 5 lowest pilot PDI by country
- South Africa
- New Zealand
Chapter 8 – Rice Paddies and math Tests
Take a look at the following list of numbers – 4,8,5,3,9,7,6. If you speak English, you have about 50% chance of remembering that sequence perfectly. If you are a Chinese, you are almost certain to get it right every time; because their language allows them to fit all those 7 numbers into 2 seconds.
Secondly the number system in English is highly irregular. Not so in China, Japan and Korea. They have a logical counting system. Eleven is ten-one, tweleve is ten-two, twenty four is two-ten-four and so on. These regularity of their number system also means that Asian children can perform basic functions such as addition far more easily. The Asian system is transparent and unlike translation needed in English for basic math, it is not needed in those languages.
Asian children can hold more numbers in their heads, and do calculations faster and the way fractions are expressed in their languages corresponds exactly to the way a fraction actually is. In short, when it comes to math, Asian has a built-in advantage.
Third aspect is a culture that has a history of hard work. As per Francesca Bray (anthropologist) “throughout the history the people who grow rice have always worked harder than almost any other kind of farmer”.
On the other side, life of a peasant in 18th century in Europe, men and women in those days probably worked from dawn to noon 200 days a year; it was essentially brief episodes of work followed by long periods of idleness 9due to winter – weather). In Chine, peasant will be working 365 days of a year.
Peasant in Europe worked essentially as low-paid slaves of an aristocratic landlord with little control over their own destinations. But China and Japan never developed that kind of oppressive feudal system because feudalism simply can’t work in a rice economy. Landlord collect fixed rent and let farmers go about their business. So when harvest comes out well, the farmers gets bigger share.
Chinese proverbs (No one who can rise before dawn three hundred sixty days a year fails to make his family rich”) are striking in their beliefs that “ hard work shrewd planning and self-reliance are cooperation with a small group will in time bring recompense”.
The numbering system, and hard work makes Asians better in Math.
Schools in Asian countries has more number of working days than in US (180 vs 240)
Chapter 9 – Marita’s Bargain.
In the mid-1990s an experimental public school called the KIPP Academy. In the classroom they are taught to turn and address anyone talking to them in a protocol known as SSLANT – Smile, sit up, listen ask questions, nod when being spoken to and track with your eyes. KIPP is famous for mathematics that helped kids from poor families to excel in math. KIPP class start at 7:25am and they all do a course called thinking skills until 7:45am. They do 90 min of English, 90 min of math everyday. Everyone does orchestra and they leave at 7:oopm. In this way, their learning time is 50-60% more than traditional public school student. In Saturday, they come from 9-1:00 pm and during summer, it is 8-2:00pm. In order to reach school by 7:25 am, kids wake up at 5:45 am and after coming back from school, they study for 3 hours to do their homework.
With hard work as seen in Asian students, KIPP repeated the same success in poor neighborhood in Bronx, NY.
Poor kids may out-learn rich kids during school year, but during the summer, they fall far behind.
Imagine every year there was a Math Olympics and which places are at the top of the list? The answer should not be surprise you: Singapore, South Korea, China(Taiwan), Hong Kong and Japan. What those 5 have common? They are all cultures shaped by the tradition of wet-rice agriculture and meaningful work.
Virtually every success story we’ve seen in this book so far involves someone or some group working harder than their peers.
Book ends with author’s own story and also Collin Powell – A Jamaican success story that further accentuates the value of opportunity and hard work..
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