November 27, 2010

Your creative brain by Shelly Carson

Your creative brain by Shelly Carson

Seven steps to maximize imagination, productivity, and innovation in your life.

[This book gives many methods/exercise to work on your creativity; type-casting what type of creative brain you have...]

The seven steps are CREATES -Connect, Reason, Envision, Absorb, Transform, Evaluate, Stream]

Connect Brianset :

When you access the connect brainset, you enter a defused state of attention that allows you to see the connection between objects or concepts that are quite disparate in nature. You are able to generate multiple solutions to a given problem rather than focusing on a single solution. This type of cognition is called divergent thinking and a condition known as synaesthesia.

Reason Brianset:

When you access the reason brainset, you consciously manipulate information in your working memory to solve a problem. When you are thinking, you are using this brainset.

Envision Brianset:

In this brainset, you think visually rather than verbally.

Absorb Brainset:

You open mind to new experience and ideas everything fascinates you and attracts your attention

Transform Brainset:

You find yourself in a self-conscious and dissatisfied state of mind. In this state you are painfully vulnerable but you are also motivated to express (in creative form) the pain, the anxieties and the hope that we all share as part of human experience.

Evaluate Brainset:

You consciously judge the values of ideas, concepts, products, behaviors, or individuals. This is the 'critical eye' of mental activity.

Stream Brainset:

Your thoughts and actions begin to flow in a steady harmonious sequence, almost as it they were orchestrated by outside forces.

What is creativity?

First, the creative idea or products needs to be novel or original.

Second, it has to be useful or adaptive to at least a segment of the population.

How brain communicate with itself:

Your brain contains around 10 bn nerve cells called neurons and each of which can form up to 10,000 connections with other neurons making a total of 100 trillion connections - that is the strange capacity of your brain. When you learn something new or form a new memory, new connections are made between neurons. The more you learn,, the richer and denser your 'neural forest' will become. If you revisit those memories or bits of learning, you will increase the speed and strength of these connections. It is like building highways between cities.

A memory is not stored in one specific location in the brain. Parts of the memory are stored in different locations.

Geography of Brian:

The right and left hemispheres:

The left hemisphere is for - letters, words, language, verbal memory, speech, reading, writing, arithmetic, objective processing, systematic problem solving, abstract thinking, sequential processing analysis, logical problem solving & approach emotions.

The right hemisphere is for - geometric pattern, face recognition, environmental sounds, melodies, musical chords, nonverbal memory, sense of direction, mental rotation of shapes, avoidance emotions, concrete thinking, parallel processing, & holistic picture versus details.

Frontal lobs - motor movement, planning, decision making, working memory, self-awareness, attention, reasoning, and problem solving.

Parietal lobs is for - sensory perception, sensory integration, spatial skills, body awareness in space

Temporal Lobe is for - language comprehension, face recognitions, memory function and emotion function

Occipital lobe - vision processing.

Creative 'Hot Spots in the brain:

Executive center (scientific name DLPFC) is for - planning, reasoning, decision-making, visualizing future.

The "me' brain is for - self-awareness, social understanding, social comparison, determining how events affect you personally, autobiographical memory

The judgment center - conforming to social demands, inhibition (embarrassment) of inappropriate behavior, judgment of positive or negative impact of an event

The reward center - internal rewards that make you feel self-confident and good about you

The fear center - appraisal of fear-related events and other highly emotional stimuli.

The association center - integration of sensory information & connecting meaning with words

Opening mind- Accessing the absorb brainset.

The first and arguably most important strategy for thinking and acting creatively is to develop your ability to absorb information nonjudgmentally. A second result of accessing the absorb brainset is that you are more receptive to seeing association between things in the environment and problem that you are trying solve. This is called 'opportunistic association'. The third result of the absorb brainset is that you remain receptive to ideas originating in your unconscious (eureka moments)

This is associated with such as words as autohypnosis, trance, alpha state, absorption, mindfulness, primary process thinking, openness to experience, disassociation and translimilariity. Three princiapl factors define the absorb brainset: attraction to novelty, delayed judgment, and mental or cognitive dis-inhibition.

The state of cognitive disinhibition and receptivity that we are calling the absorb brainset is so important to the creative process that people from all creative walks of life seek it out through a number of methods. (The easy way to have this is through the influence of alcohol, drugs). Roman poet Horace wrote:"no poem can please for long or live that are written by water drinkers"

Imaging the possibilities: accessing the envision brainset:

Imagination is more important than knowledge - Einstein.

Mental imaginary or thinking without words is a type of cognition that employs the perceptual of the brain ordinarily used for processing the sensory information of sight, hearing, smell, taste, and touch. Highly creative people appear to be able to form vivid mental images and manipulate those images both to envision creative dilemma and to come up with creative solution to problems.

One way to improve or increase your creative capacity is to improve your ability to mentally image and research indicates that this is definitely possible. We can divide visual imagery into two basic types. The first type is pictorial in which you visualize a replica of an object or scene as it appears in real life of pictorial image. The second type of visual image is 'diagrammatic' in which the image is seen as a symbol or diagram of a real object or scene. This type of imaging involves an extra step of mental processing. In addition to imaging an object, you have to transform that object to a symbolic representation between objects. The other way to practice manipulating images through guided sequential visualization. Hypothetical thinking is the foundation of your imagination. When you do this, you are mentally imaging something that is not manifest in the world of reality.

Thinking Divergently: Accessing the connect Brianset.

Brianstom is a way of divergent thinking. The process should be divergent thinking and gather many solution/idea a- using the contents of memory to generate multiple solutions to a problem in an open-ended manner. Convergent thinking - directing all of one's knowledge toward a problem that has a singular and specific solution.

Synaesthesia is an unusual condition in which different sensory and verbal systems in the brain seem to be cross-wired. They may hear hear colors.

Goals are essential to creative work. Following are some of the things that goal settings can do to help you achieve your creative objectives.

Motivate action

Help you manage time

Increase chances for success

Increase self-confidence

Increase sense of control over your life.

The trick is to have written and specific goals and you achieve this in the reason brainset.

Steps in the problem solving process:

Recognize when you have a problem

Define the problem

Set a goal

Brianstorm possible solutions

Evaluate possible solutions

Choose the best solution based on pros & cons

Make a plan to implement the solution and try it

Assess success

If the first solution did not work, try another.

Some guidelines for evaluating your work

Get some distance

Evaluate your work with respect

Don't decide to throw out a work midway through the project

Look at individual parts of your work

Look at the work from the point of view of the audience

Be flexible

Decide whether to consult others

Be hard on your work.

Rules for handling negative evaluation from others.

Congratulate yourself - you did something new and hence others criticizing

Consider criticism to be valuable feedback

Do not defend yourself if criticized

Rephrase the main points of the criticism

Thanks the person criticizing your work for their feedback

Determine the value of the criticism objectively.

The conditions of state of flow as described by Mihale Csikszentmihalyi in his book - Flow and the Psychology of discovery and invention.

1. There are clear goals

2. There is immediate feedback to your actions

3. The level of challenge matches your skill level.

When these conditions of flow are met, the ensuing mental state includes the following characteristics.

There is a merging of action and awareness

Distractions go unnoticed

There is no worry of failure

Self-consciousness disappears

Time become distorted

The activity becomes an end in itself.

How can you increase your intrinsic motivation in the activities that fill your daily life?

1. Set time limits on the task or establishes deadlines

2. Increase your appreciation for the task

3. Increase your standard for task performance.

If the tasks are too challenging, bring down the challenge so you won't feel anxious or overwhelmed by it.

1. Break the task down into smaller manageable parts

2. Reinforce your skills

Setting the Mood: tips for establishing a creative environment.

1. Increase your exposure to creative work - Go to concerts, museums, opera and lectures

2. Create an environment hat values and expects creative behavior - Insist that everyone in your environment respects and encourages creative behavior even when the results do not pan out.

3. Avoid premature evaluation of ideas

4. Provide time and opportunity for solitude - Creative ideas often occur during moments of solitude and contemplation.

5. Spend time in places of natural beauty - Spend time in mountains, at the seashore, gazing at the stars, walking in the forest r watching colorful sunset.

6. Spend time with other creative individuals

How do you find a creative problem?

1. Keep a list of things that bother you (pet-peeves?)

2. When something goes wrong, brainstorm possible causes

3. Think about what slows you down

4. Pay attention to your negative emotions

5. Scan your env. Regularly for things that could be changed and improved.

Following are the hints on how to enter the absorb brainset and prepare for insight while you are allowing ideas to incubate.

1. Make a creativity playlist of music that inspires you and allows your mind to wander

2. Find a place of natural beauty

3. Take a walk

4. Spend time in natural light

5. Carry a notepad or digital recorder.

Here are the tips on getting your work out

1. Increase your visibility in your community

2. Create talking points

3. Brand yourself (Special logo that's associated with your work)

4. Develop a web presence.

Books recommended:

Flow by Mihaly Csikszentmihalyi

The art of thought by Graham Wallas

November 14, 2010

Design is how it works by Jay Greene

How the smartest companies turn products into icon.

[There has been two types of designs - Industrial design and service design; this book brings up the third dimension - design for passion]

Design companies - few examples:

Bang & Olufsen:
The (O&B) gives the designer complete control in order to keep them entirely removed from corp. politics and bureaucracy. The company goes a step further giving designers complete control even allowing them to kill a product if it does not meet their design objectives. " We don't design for manufacturing, but we manufacture for design".

Design is an argument; you can't prove it. There are no metrics to it" says David Merkoski , executive director at frog design. He continues, " There is not a McKinney-type guy you can bring in". Doing consistently great design requires a commitment to it.

Apple is believe in keeping simple for users.
"iPhone is not just a product, it is a manifestation of a culture", says John Barrat CEO of Teague a design firm.

IDEO uses anthropology sociology and psychology to help all sorts of companies learn how they can make experience better for customers.

It would be wrong to blame a lack of ingenuity on finance-bred executives alone. Designers themselves often speak in a language only they understand, rather than make it easy for uninitiated to learn how to work. They use words like 'empathy, authenticity, ideation, singularity and simplicity' words that outside the design world echo chamber are broad to the point of meaninglessness.

Design is not just alone about style and form; these are important; but design is really about the way products and services come to life.

Porsche: Delighting customer with quality, design and performance:

When Ferry Porsche was asked about the design of the 356, he said, "In the beginning, I looked around but could not find the car I dreamt of, so I decided to build it myself". The son of a car designer - his father Ferdinand created the original Volkswagen Beetle at the request of Adolf Hitler- Porsche infused his company with a passion for creating dream-worthy vehicles that continues to this day.

So what does design authenticity mean? As per the book written by James H. Gilmore & B. Joseph Pine II's 'Authenticity: what consumers really want' says, consumers respond to products and services that are 'real'. Consumers are willing to shell out money for goods that engage them, good to which they have personal connection. That is one of the reason Porsche's have evolved from modes of transportation to mythic symbols. It has used design to create a feel an intangible emotion about its cars that allows it to charge a significant premium.

Porsche starts the design process on new models and refreshes existing ones with a competition. As many as five designers where each with five different ideas for a car, sketched out in detail. The head of the design team guides them, picking the best of the bunch from each designer making sure that each car is different enough from the version he is selected from the other designers to ensure variety. The designers then refine their ideas and build models, roughly three feet long. From there, Porsche's six member executive team pick the two best designs to turn into full-scale models. The rest of the team will work together on the two selected models as no one designer can manage all the details of creating new model. 'When it comes to design, it is not a democratic process. You can't do market research on design' says head of the Porsche's design team.

In its earliest days, Nike did not care that much about fashion, music or food. It got its start in 1964 doing one thing really very well - making the best running shoes available to hard-core runners who could not afford the dominant brand of the day Adidas. the idea came to Knight when he was working toward his MBA at Stanford and his thesis " Can Japanese sports shoes do to German sports shoes what Japanese cameras did to German cameras'. He argues that a low-prices running show from a Japanese company could challenge Adidas's monopoly of the US market. He put his thesis into action and rest is history.

The company needed a name for its shoes and a logo so runners could identify them. Blue Ribbon's first employee a runner Knight met at Stanford named Jeff Johnson came up with the name - Nike after the Greek goddess of victory . And Carolyn Davidson a graphic designer student at Portland State University came up with something of a rounded check-mark for a logo earning $35 dollars for her work. (Company 's name became Nike in 1978 )

Hatfield - VP of creative design at Nike says, "Many of us have had a passion for sports long before we came here". Nike's culture at its best, is the best of sports the best of what makes athletes great. May be the most important quality from a design standpoint is that great athletes aren't averse to risk. "We love taking risks. We don't mind where we pursue something and it does not pan out" says Parker the new CEO. "Be a sponge - curiosity is life and assumption is death".

It would be easy to dismiss this success as great marketing. And there is no question that Nike is among the best at the game. Parker says, "The most powerful marketing tool is the product itself".

Like many great design companies, LEGO was born from a craftsman's hands. In 1932 carpenter Ole Kirk Kristiansen struggled to make ends meet. It was during global depression. To make ends meet, he turned into toys, handcrafted wooden ones, figuring that the one area where families would not cut back so drastically was gifts for their children. he went to village to village selling such playthings as carved ducks with wheels on the bottom and strings attached to the necks that could be dragged across the floor, trucks, airplanes. As it grew, Kristiansen settled with LEGO as name which means 'play well' in Danish and later he learned that in Latin, it means, I assemble'.

After the World War II, that LEGO evolved into a construction toy company. But then high quality wood was increasingly hard to get and hence Kristiansen tried with plastic. The biggest moment came when Kristiansen's son Godfred submitted the application to the Danish Patent and trademark office in Copenhagen to patent the LEGO building brick system.

Company created LEGO innovation model a detailed methodology for product development. The formalized design has four steps. The first phas e- known as P0- is the stage where LEGO designers, marketers finance staff and others look broadly at potential business opportunities, study consumer trends and come up with ideas for their business groups. P1 is the stage that the designers refer to as the ideation phase. It is when the product group start brainstorming concepts that might address the opportunities outlines in the previous phase.

In P2, the best concepts from the previous phase are developed, business cases are prepared and prototypes are created. In the final phase P3, LEGO executives look at account development and manufacturing costs and decide which products to take to market. The company flies in top executives from around the globe to help assess the products prospects in each region and to establish marketing commitments. They'd pick and choose among the models they thought would do best in their region.

"Children are ruthless in that they are very demanding about what they want to buy" says Nipper CEO of LEGO. " If your offer does not stack up, they will go somewhere else. Brand is important but as LEGO learned, design is crucial. If LEGO is the Catholic Church, then design is the Sistine Chapel. It is the holiest of the holy"

At OXO the renowned maker of design-centric kitchenware, the food seems to come nonstop. OXO is full of foodies. And as with other firms OXO began when its founder Sam Farber grew frustrated with existing products and decided to create something better. Back in the late 1980s, Farber was vacationing in the south of France when he noticed his wife Betsey's mild arthritis causing pain while she peeled apples for a tart. The thin metal peeler was hard to hold. The image gnawed at Farber into the night and he called up his buddy at 1:30 am and mentioned his idea of solving his wife's problem. Its the idea of creating products that are easy to use for the wildest possible spectrum of customers - young and old; make and female left and right handed; European, Asian and American; people with physical challenges like arthritis.

Universal design remains at the heart of OXO to this day. While kitchen tools are still company's core offerings, it has applied the ideas of Universal design to gardening tools, cleaning gadgets and office supplies. OXO has learned that outliers - arthritic cooks who have trouble gripping utensils for example - are sensitive enough to spot design flaws that the rest of us unthinkingly accept.

OXO employees who have that the company on average for five years understand that the company's success depends on coming up with novel concepts rather than iterative products. "Our process is finding a pet peeve" Lee - president of OXO- says. "if there is no pet peeve, there is no product. The pet peeve that launched the company was the discomfort of using a standard vegetable peeler. Like that vegetable peeler, many pet peeves are aggravations that consumers put up with without ever really knowing it. Design gurus often refer to these as unspoken needs.

OXO follows a formal design process very similar to LEGO uses. It begins with Phase 0 - it is an exploratory stage in which the company puts together a design brief anywhere from four to fifteen pages, laying out the problem it wants solved, potential product features and target price points. Then it hands the brief over to Smart design , form, or one of seven other design firms with which it works. The phase often concludes with a brainstorming session where OXO and the design firm conjure up product concepts. Phase 1 is the conception stage, in which OXO and its design partner start refining their work. Designers start sketching product ideas. They consider different materials and build basic models. Those basic models help OXO answer the question of whether the product will address the unspoken need.

If it does, the company moves to phase 2 in which it designs and develops the product. When an idea moves to Phase 3, OXO and its designers refine the concept even more, ultimately creating a tooling mold that its manufactures will use to build first samples.

REI may be one of the best companies at turning shopping into an experience and turning customers into devoted patrons. It is a store where consumers can go to learn how to use GPS device on a trial, figure out which local waterways offer the best kayaking for beginners and discover what to pack for a summit attempt on a fourteen thousand-foot peak. It is a place where outdoor enthusiasts go to be inspired.

When it came time for REI to ponder what future stores should look like is, it started with a whiteboard exercises, jotting down words that represent REI's brand. Entertainment was a word that came up but it was dispatched pretty quickly. The words that resonated most ever were community and interaction, words that reflect approach that Lloyd Anderson and Jim Whittaker took with the first customers.

But this cooperative is bigger than the kind you might find at a community organic market. In fact, it is the biggest consumer cooperative in the country with 3.7 million active members, folks who have spent ten dollars or more in the previous year. The dividend induces members to join. But it gives them a piece of the business. REI has done what most retailers can only dream of. "They created a cult" says frog design president Doreen Lorenzo.

The fact that Anderson created a cooperative - one that distributes more than half of the profits generated by member merchandise purchases as dividends more than $750 million over the years - says much about the customer-experience design of REI that lives to this day.

Clif develops products that improve its customers athletic performance - energy bars for athletes to provide instant energy needed for their athletic needs - cycling, running etc. Clif does not merely develop products; it design them and the experience of using them. And it is an example of how the lessons of design can be applied to industries where aesthetics don't matter.

Ace Hotels:
Since 1999 the company Calderwood runs with three friends has opened three of the most talked about new hotels in the travel press. The first was Ace hotel Seattle. The roots of the company stretch back to Seattle in the early 1990 when Calderwood joined his friend Wade Weigel to launch Rudy's Barbershop, a place where tattooed and pierced hair cutters will you a ten-dollar buzz cut.

Rudy's found fans in Seattle's alternative rock music scene in part by selling concert tickets and CDs - Calderwood ran a show promotion company at the time called Tasty Shows. It built following with the city's young art scene by doing things like commissioning a mural by Shepard Fairey who gained his greatest recognition years later for his iconic Barrack Obama 'HOPE' poster during 2008 presidential campaign. The group took out no loans, funding the company from savings and plowing profits into opening new shops in the chain which now has more than a dozen location in Seattle, Portland and Los Angeles. They group realized they'd stumbled upon something of a formula, a way to use design to tap into a young hip demographic that marketers take such pains to reach.

With limited budget, the pair kept costs low by shopping for furniture and fixtures at consignment shops and surplus outlets. Ace hotels rooms evoke the kind of apartment you might have had right after college. Or at least the apartment you wish you had. The Ace is all about functional design.

It is not trying to create a bland experience that is palatable for everyone but loved by no one.
We designed a place where we wanted to stay" Herrick says. Like other founders mentioned in the previous cases, Ace guys created their business for themselves.

Virgin Atlantic:
Virgin Atlantic was born from that sort of frustration. the company's iconic leader, Sir Richard Branson had been running the Virgin record label for several years and traveling the globe in the process. Like just about every frequent flier, he loathed air travel. In the early 1980s American Airlines cancelled his flight from the Virgin Islands o Puerto Rico. Fed up, Branson called a charter company and arranged to get a plane to fly the route for two thousand dollars. Then he divided the cost by number of folks left stranded, jotted the number down on a borrowed blackboard and walked through the terminal selling tickets for thirty nine dollars a pop. He recalls, "Jokingly writing "Virgin Airlines" on the blackboard. Like genesis of so many great business idea, Virgin Atlantic came from a simple revelation.

"We decided to create the kind of airline that myself and my friends would like to fly on" says Branson. There is again, that idea of designing a business to meet the needs of the founder because nothing else like existed.

Even in the early days, Branson focused on designing an experience that kept customers coming back. They came out with first flat-bed design for upper class passengers. They are the first one bringing new experience for air travelers and excel in consistently providing them throughout their fleets.

"The only reason the Virgin brand has survived so long is that people trust that the actual end products that they are getting from Virgin are good ones" says Branson. Virgin Atlantic is outlasting rivals because it is not afraid to take chances in designing a superior customer experience. "if you ignore the accountants and you introduce stand-up bars and talk to other people, if you do things like introduce masseuses onboard, if you do things like introduce seat-back videos on economy class, yes, in the short term, it costs more money. But in the long term, the best always survive" says Branson.

The Intersection of Business and design:
The focus on the intersection of business and design is not just happening at design schools. Bz schools are adapting to train tomorrow's executives to think like designers. That is because the most forward thinking schools saw a change sweeping through the economy in the early days of the millennium when all sorts of jobs shifted to India and Asia facing commoditization on a grand scale. the smartest Bz schools adapted, creating curriculums focused less on number crunching and more on abstract thinking. Instead of nurturing the cold calculations of the left brain, they developed courses to cultivate the creativity of the right brain. Instead of teaching students how to reach to market disruptions, they developed classes in how to create those disruptions.

Roger Martin - dean of Rotman School of Management wrote 'The opposable Mind' in 2007 is one of the most important business books on this subject. he says, "Bz education to a great extents, has been about analyzing existing models. the people who has succeeded so brilliantly don't chose from models. They are creators and builders of new models. Bz schools simply don't teach that".

"One of the great things that Apple has done is getting industrial design out of the way and letting the experience take over" says Tim Brown of IDEO. Experience matter and design can guide companies to create the ones consumers want most.

IDEO, Ziba and a handful of others firms have turned the design world on its head, changing the definition of the word. In their hands, design is much more than just making things aesthetically attractive. The most creative companies develop methods to do consistently innovative work. They apply the lessons of design to all sorts of bz. even ones in industries that don't lend themselves to creating works of beauty.

Use it to find some inspiration. There are lessons to be learned from Nike's appreciation of pop culture, Porsche's workshop of performance, OXO's embrace of Universal Design, and Ace Hotel's ability to create hipness on the cheap.

As Rotman's Roger Martin would say, don't copy some else's model; come up with your own. Think like a designer as you map out company strategy. Many of the companies that are stumbling today are the ones that haven't addresses the challenges of the economy creatively.

Books recommended: The opposable Mind by Roger Martin.

Winning the loser’s game - by Charles D. Ellis

Winning the loser’s game - by Charles D. Ellis

Timeless strategies for successful investing
[few of the recommended books on this topic - individual investing-, this is the best. The author highly recommends index funds and EFT funds are investment choice for individual investors]

The Loser’s game:

Contrary to investment manager’s often-articulated goal of out performing the market averages, the nation’s investment managers are not beating the market; the market is beating them. The basic assumption that most institutional investors can outperform the market is false. They cannot as a group, outperform themselves. In fact, given the cost of active management - fees, commission, market impact of big transactions and so forth, - 85% of investment managers have and will continue over the long term to under-perform the overall market.
That is why a large majority of mutual funds, pension funds and endowments are not successful; professional investing has become a loser’s game.
Individual investors investing on their own do even worse - on average, much worse (day trading is the worst of all; a sucker’s game; don’t do it -ever)
In winner’s game, consider the profound difference between these two kinds of games. In winner’s game is the outcome is decided by correct actions of the winner. In loser’s game, the outcome is determined by mistakes made by the loser. (War is a loser’s game, flying flights is also a loser’s game).
The historical record shows that on a cumulative basis, over three-quarters of professionally managed mutual funds under-perform the S&P 500 stock market index.

Today’s money games include a formidable group of competitors. Several thousand institutional investors - hedge funds, mutual funds, pension funds and others - operate in the market. Even the smallest spends $100 million in typical year buying services from the leading brokers in New York, London, Hong-Kong, & Tokyo. Understandably these formidable competitors always get the ‘first call’ with important new information. This about the half the time that we individual investors buy and about half the time we sell, the ‘other fellow’ is one of those giant professionals with all their experience and all their information and all their analytical resources.

Investment professional usually buy or sell for reasons inside the stock market; however individual investors usually buy for reasons outside the stock market; they buy because they inherit money, get a bonus etc. and in the same way, they sell stocks when they have kids to go to school, or buy a new house etc. This way, they are making huge mistake. Most individual investors are not experts on even a few companies. Many gather information from newspaper, TV, friends, etc. The professional investors use the latest market feed like Reuters, Bloomberg and such sophisticated information services. they meet with corp. management frequently. They have teams of in-house analysts and senior portfolio managers with an average of 20 years of experience.

Beating the market:
The only way active investment managers can beat the market, after adjusting for market risk, is to discover and exploit other investors mistakes. In theory, active investment managers can try to succeed with any or all of four investment approaches.
1. Market timing
2. Selecting specific stocks or groups of stocks
3. Making timely changes in portfolio structure or strategy
4. Developing and implementing a superior, long-term investment concept or philosophy.
Market timing is very critical. In bond portfolio, the market timer hopes to shift into long maturities before falling interest rates drive up long-bond prices and back into short maturities before rising interest rates drive down long-bond prices. In a balanced portfolio, the market timer strives to invest more heavily in stocks when they will produce greater total returns than bonds, then shift into bonds when they will produce greater total returns than stocks, and then into short-term investments when they will produce greater total return than either bonds or stocks. Unfortunately more often any are tried, the ,more certainly they fail to work.
The historical statistics shows what happens to long-term compounded returns when the best days are removed from the record. Taking 10 best days - less than one-quarter of 1 % of long period examined - cuts the average rate of return by 17 %( from 18% to 5%). Taking the next 10 days away cuts returns by another 3 %. Removing a total of 30 days - just half of 1% of the total period - cuts return almost by 40% (from 18% to 11%).

Using S&P 500 average returns, the story is told quickly and clearly; all the total returns on the stocks in the last 75 years were achieved in the best 60 months - less than 7% of the 800 months of those long decades. If you missed those few and fabulous 60 months, you would have missed all the total returns accumulated over three generations. Removing five best days out of 72 years of investing would reduce cumulative compound returns - without dividend investments- by nearly 50%.
The second tactical way to increase returns is through ‘stock selection. Professional investors devote extraordinary skills. time and effort to this work. Stock validation dominates the research efforts of investing institutions and the research services of stockbrokers all over the world.

Strategic decision involves major commitments, which affect the overall structure of the portfolio. They are made to exploit insights into major industry groups, changes in the economy and interest rates or anticipated shifts in the valuation of major stocks.

Even after all these prep. things goes wrong. In a paper titled. ‘Why do investors trade too much’, it says, on average the stocks these investors bought from 1987 through 1993. These stocks were underperformed by 2.7% over the following year. while stocks they sold outperformed by 0.5% over the following year.
Experienced investors all understand four wonderfully powerful truths about investing and wise investors govern their investing by adhering to these four great truths.

1. The dominating reality is that the most important investment decision is your long-term mix of assets; how much in stocks, real estate, bonds or cash

2. That mix should be determined partly by the real purpose - growth, income, safety and so on - and mostly according to when the money will be used.

3. Diversify within each asset class and between asset classes. Bad things do happen - usually as surprises.

4. Be patient and persistent. Good things come in spurts - usually when least expected - and fidgety investors fare badly. ‘Plan your play and play your plan’ say the great coaches. ‘Stay the course’ is usually wise. So is setting the right course - which takes you back to #1.
The hardest work in investing is not intellectual; it is emotional. Being rational in an emotional environment is not easy, particularly with market always trying to trick you into making changes. the hardest work is not figuring out the optimal investment policy, it is sustaining a long term focus - particularly at market highs or market lows - and staying committed to your optimal investment policy.

The next step is to decide whether this loser’s game is ever worth playing. An index fund provides investment managers and their clients with easy alternatives. They do not have to play the more complex games of equity investing unless they want to. The freedom to invest at any time in an index fund is a marvelous freedom of choice because superior knowledge and skill are not consistent attributes of even the best investors. Given the intensity and skill of the competition, superior knowledge is rare.

The option to use an index fund enables any investor to keep pace with the market virtually without effort. Investors would be wise to devote attention to understanding the real advantage offered by the market index fund - the product of all the skill and work being done by every day by the investors dream team.

Here are some of the investor’s risks to avoid:
trying too hard
Not trying hard enough
Being impatient
Making mutual funds investment changes in less than 10 years (if you have mutual fund)
Borrowing too much
Being naively optimistic
Being proud
Being emotional
As the pundits says, ‘success is getting what you want’ and happiness is wanting what you get’ - you can be both successful and happy with your investments by concentrating on the asset mix and by living with and investing by a few simple truths so your investment really will work for and serve you and your purposes.

Here are the ‘unfair’ advantages of index investing in today’s market environment.
1. Higher rates of return because over the very long term 85% of active managers fall short of the market
2. Lower management fees (0.2%)
3. Lower operating expenses
4. Lower brokerage commissions
5. Lower market impact
6. Convenience
7. Lower taxes (fewer profits per year and hence less tax)
8. Freedom from error or blunder and peace of mind
9. Freedom to focus on really important decision like investment objectives and long-term polices & practices
10. Less anxiety or concern because you never have to worry that you might be making mistakes of omissions or commissions that will result in unusual losses or missed opportunities.

One alternative to index funds may be worth considering : ‘exchange traded funds (EFTs). Unlike mutual funds which are sold and redeemed by the fund company, EFT are made up of a bundle of stocks tracking a specific stock index trade on an exchange and can be bought or sold through brokers throughout the trading day.
(Vanguard & Morgan Stanley both offer the classic commodity S&P 500 index funds where vanguard charge 0.18% and Morgan charges 0.70%.)

As important as it is, deciding to index or use ETF is not just a final decision. Two more decision must be made. Which index or market and which particular index or ETF? For example, the S&P 500 had heavy weightings on several very large stocks that were selling at unsustainable high price, but when it got busted, it ended up in disappointing results that accurately matched the S&P 500.

In this situation, investors had three sensible choices.
1. Be patient - this too shall pass’ attitude
2. Invest in broader ‘total market’ index fund or
3. invest in index fund matched to a major area of stock market that was currently not popular such as low p/e ‘value’ stocks.

For most investors, the second option - total market index fund - is often most sensible choice, particularly if you have no reason to be selective in a particular way. If you decide to overweight small-cap stocks or emerging markets or even frontier markets in your portfolio, you can do so with index funds or EFTs or both. But aware: The argument for index funds is strongest when investing in the most efficient markets like those for large-cap stocks in US, UK and Japan. Specialized index funds and specialized ETFs invest in market that are not broad deep and efficiently priced. In smaller market, market replication is more difficult and less accurate.

Most investors are surprised to learn that the best plain vanilla index fund mix is half international. The reason, it is easy to see that investing proportionally in all world’s major stock markets and all the different economics those markets represent increases diversification significantly.

There are four factors that decide how & where to invest
1. Understanding each investor’s real needs
2. Defining realistic investment objectives to meet those realistic needs
3. Establishing the asset mix or portfolio structure best suited to meeting those risk and return objectives
4. Developing well-reasoned investment policies to implement the strategy and achieve the particular investor’s realistic long-term investment objectives.

Time transform investments from least attractive to most attractive and vice verse because while the average expected rate of return is not at all afflicted by time, the range or distribution of actual returns around the expected average is greatly affected.

The single most important dimension of your investment policy is the asset mix, particularly the ratio of fixed-income investment to equity investments. Analyses of asset mix show over and over again that the tradeoff between risk and reward is driven by one key factor: time.

The history of returns on investments as documented in study after study shows three basic characteristics:
1. Common stocks have average returns that are higher than those of bonds. Bonds in turn have higher returns than those of short-term market instruments.

2. The daily, monthly and yearly fluctuations in actual returns on common stocks exceed the fluctuations in returns on bonds which in turn exceed the fluctuations in returns on short-term money market instruments.

3. The magnitude of the period-to-period fluctuations in rate of return increases as the measurement period is shortened and decreases as the measurement period is lengthened. In other word, rate of return appear more normal over longer periods of time.

The winner’s game:
There are simple five levels of decision for each investor to make.
1. Settling on your long-term objectives and asset mix - the optimal proportion of equities, bonds and perhaps other assets to archive those objectives
2. Equity mix, the proportion in various types of stocks - growth versus value, large cap versus small cap, domestic versus international. If you have a large portfolio the same decision can be made on subcategories for each major asset class.
3. Active versus passive. For most investors, passive index funds will be the best long-term choice
4. Specific fund selection - deciding which mutual funds will manage each component of the overall portfolio
5. Active portfolio management - selecting specific securities and executing transactions.
One of the core concepts and basic themes of this book is that funds available for long-term investment will do best for the investor, if they are invested in stocks and kept in stocks for the long term.
The lower the price of shares when you buy, the more shares you will get for every $1000 you invest and the greater the amount of dollars you will receive in future dividends on your investments.

There are 10 commandments for individual investors
1. Save - invest your savings in your future happiness and security and education for your kids
2. Don’t speculate
3. Don’t do anything in investing primarily for tax reasons (tax shelters are poor investments)
4. Don’t think of your home as an investment.
5.Don’t do commodities
6. Don’t get confused about stockbrokers and mutual fund sales people
7. Don’t invest in new or interesting investments
8. Don’t invest in bonds just because you have hear that bonds are Conservative
9. Write out your long term goals and stay with them.
10. Distrust your feelings.

Estate Plan:
Do a proper estate plan for kids to inherit your wealth
1. Everyone who qualifies for an individual retirement account (IRA) should have one and contribute maximum every year, enabling the twin engines of long-term compounding and tax deferral to do their magic ($5000 is the maximum)
2. You can give up to $13,000 without tax to each person you wish every year (married couple can give $26,000)
3. You have a lifetime total limit of $1million on other tax free gifts to individuals
4. IRS allows you to put up $1million into generation-skipping tax-free family fund
5. A qualified personal residence trust enables you to transfer ownership of your house to your children and live in your home rent-free for a period of 15 years.

Estate lawyers will advise on more such topics.
Real Estate:
A remarkable proportion of the wealthiest individuals and families have made their fortune in real estate - Tax advantage are major factor; astute use of leverage and access to credit - lots of it - are important; extraordinary skill at adversarial negotiations is crucial; patience and deceive actions are both essential. In addition, success depends on extraordinarily intricate knowledge of all the relevant details of each local market and within a chosen market of each property, its tenants and their lease agreements, clever insights into ways of specific improvements will significantly enhance future rentals and a special ability to attract desirable tenants. An absolute devotion to the business is mandatory.

Books recommended:

The intelligent investor by Benjamin Graham
The Crowd by Gustave Le Bon
The only investment guide you will ever need by Andrew Tobias

November 2, 2010

Creativity by Mihaly Csikszentmihalyi

Flow and the psychology of discovery and invention.

[IMO, this is a very good book in this topic; the book is based on series of discussion on creativity with many very successful persons who excel in this field - many of them are Nobel winners]

This books is about what makes the life worth living. His best selling book is 'Flow' followed by another book ' The evolving Self'.

Evolution in Biology and in Culture:

Creativity results from the interaction of a system composed of three elements

1. A culture that contains symbolic rules,

2. A person who brings novelty in to the symbolic domain

3. A field of experts who recognize and validate the innovation.

For instance, in Vera Rubin's account of her astronomical discovery, it is impossible to imagine it without access to the large amount of information about celestial motions that has been collecting for centuries., without access to the institutions that control modern telescopes, without the critical skepticism and eventual support of other astronomers.

Instructions for how to use fire, or the wheel, or atomic energy are not built into the nervous system of the children after such discoveries. Each child has to learn them again from the start. The analogy to genes that we must learn if culture are memes or units of information that we must learn if culture is to continue.

To say that the theory of relativity was created by Einstein is like saying that is the spark that is responsible for fire. The spark is necessary, but without air and tinder there would be no fire.

Attention and Creativity:

Creativity as I deal with it in this book, is a process by which a symbolic domain in the culture is changed. Memes needs to be learned before they can be changed. If we want to learn anything, we must pay attention to the information to the learned. And attention is a limited resources. Great deal of our limited supply of attention is committed to the tasks of surviving from one day to the next. Over the entire lifetime, the amount of attention left over for learning a symbolic domain - such as music or physics- is a fraction of this already small amount.

As culture evolve, it becomes increasingly difficult to master more than one domain of knowledge. Whereas in the past, an artist typically painted, sculpted cast gold and designed building (e.g. Leonardo da Vinci), now all of these special skills tend to be acquired by different people.

Another consequence of limited attention is that creative individuals are often considered odd - or even arrogant selfish and ruthless. It is important to keep in mind that these are not traits of creative people, but traits that the rest of us attribute to them on the basis of perception. When we meet a person who focuses all of his attention on physics or music and ignores us and forgets our names.

Each of us born with two contradictory sets of instructions, self conservative tendency, made of instincts for self-preservation and an expanding tendency made up of exploring, for enjoying novelty , risk etc. The first one require little encouragement or support from outside to motivate the behaviour and the second can wilt, if it is not cultivated. If too few opportunities for curiosity are available, if too many obstacles are places in the way of risk and exploration, the motivation to engage in creative behaviour is easily extinguished.

Basic scientific research is minimized in favor of immediate practical applications.Students generally find the basic academic subjects threatening or dull, their chance of using their minds in creative ways comes from working on the student paper, the drama club or the orchestra. So if the next generation is to face the future with zest and self-confidence, we must educate them to be original as well as competent.

the reigning stereotypes of the tortured genius is to a large extent a myth created by Romantic ideology and supported by evidence from isolated and atypical historical periods. Many American poets and playwrights ended up addicted to drugs and alcohol, it was not their creativity that did it but an artistic scene that promised much, gave few rewards and left nine out of ten artists neglected if not ignored.

What is creativity?:

Creativity does not happen inside people's heads, but in the interaction between a person's thoughts and a sociocultural context, It is a systematic rather than an individual phenomenon.

Who is right to declare on creative? the individual who believes in his/her own creative or the social milieu that denies it? if we take the side with the individual, then creativity is very subjective. On the other hand, if we decide that social confirmation is necessary for something to be called creative, the definition mush encompass more than the individual . What counts, then is whether the inner certitude is validated buy the appropriate experts. It is not possible to take a middle ground.

Creativity is used in many places without its due credit. Following are the three such cases where creativity used commonly.

1. Some artists are very good is playing a music. Unless they also contribute something of permanent significance, I refer to people of this sort as brilliant rather than creative.

2. People who experience the world in novel and original ways. but only they knew about it. They should be called personally creative. But given the subjective nature of this form of creativity, it is difficult to deal with it no matter how important it is for those who experience it. These people never leave any accomplishment, any trace of their existence - except in the memories of those who have known them.

3. People who have changed our culture in some important respect. They are creative ones (e.g. Edison, Leonardo di Vinci, Picasso, etc..). Because their achievements are by definition public it is easier to write about them

It is perfectly possible to make a creative contribution without being brilliant or personally creative, just as possible that someone is personally creative will never contribute thing to the culture.

Talent people may not be creative; majority achieved creative results without any exceptional talent being evident. Genius people are both brilliant and creative.

System model:

To have any effect on the creativity, the idea must be couched in terms that are understandable to others, it must pass muster with the experts in the field, and finally it must be included in the cultural domain to which it belongs. It makes sense is that creativity can be observed i=only in the interrelations of a system made up of three main parts.

In this definition, a child cannot be creative as child has be to exposed to a domain before domain can be changed.

Creativity in the Renaissance:

A good example is the sudden spurt in artistic creativity that took place in Florence between 1400 and 1425. These were the golden years of the Renaissance and it is generally agreed that some of the most influential new works of art in Europe were created during that quarter century. - Dome of the cathedral built by Brunelleschi, the gates of paradise crafted for baptistery by Ghilberti (this art changed the Western world's conception of decorative art).

The reason is the following. In Rome and elsewhere, by the end of the thirteen hundreds, eager scholars were excavating classical ruins, copying down and analysing the styles and techniques of the ancients. This slow preparatory work bore fruit at the turn of the 15th century - opening up long-forgotten knowledge to the artisan and craftsman of the time.

The cathedral of Florence - Santa Maria Novella - had been left open to the skies for 80 years because no one could find a way to build a dome over its huge apse. The pantheon had been rebuilt by the emperor Hadrian in the second century. Nothing of that has been built well over 1000 years and the methods that allowed Romans to build such a structure that would stand up had been long forgotten in the dark centuries of barbarian invasion.

The Creative personality:

Without a good dose of curiosity, wonder and interest in what things are like and in how they work, it is difficult to recognize an interesting problem. Openness to experience, a fluid attention that constantly process events in the environment is a great advantage for recognizing potential novelty.

A person also needs access to domains. This depends to a great extend on luck. Being born to affluent family or close to good schools , mentors, and coaches obviously is a great advantage.

Access to the field is also very important. Some people are terribly knowledgeable, but are so unable to communicate with those who matter among their peers that they are ignored or shunned in the formative years of their careers. Access to field is usually severely restricted. There are many gates to pass, and bottlenecks form in front of them.

If I had to express in one word what makes these creative persons personalities different from others, it would be 'complexity'. By this I mean, that they show tendencies of thought and action that in most people are segregated. they contain contradictory extremes - instead of being an 'individual', each of them is a 'multitude'.

The Ten Dimensions of complexity:

1. Creative individuals have a great deal of physical energy, but they are also often quiet and at rest. They work long hours with great concentration while projecting an aura of freshness and enthusiasm. Hans Bethe mentioned, " two things are required for creativity. One is brain and the second is the willingness to spend long time in thinking with a definite possibility that you come out with nothing".

2. Creative individuals tend to be smart, yet also naive at the same time. General intelligence is high among people who make important creative contributions. As Howard Gardner remarked in his study of major creative geniuses, a certain immaturity, both emotional and mental can go hand in hand with deepest insights.

3. A third paradoxical trait refers to the related combination of playfulness and discipline or responsibility and irresponsibility. There is no question that a playful light attitude is typical of creative individuals.

4. Creative individuals alternate between imagination and fantasy at one end and a rooted sense of reality at the other. Both are needed to break away from the present without losing touch with the past.

5. Creative individuals seem to harbor opposite tendencies on the continuum between extroversion and introversion.

6. Creative individuals are also remarkably humble and proud at the same time. There are good reasons why this should be so. In the first place, these individuals are well aware they stand 'on the shoulders of giants'. Second, they also are aware the role of luck in their own achievements.

7. Creative girls are more dominant and tough than other girls and creative boys are more sensitive and less aggressive than their male peers.

8. Creative individuals are both traditional and conservative and at the same time rebellious and iconoclastic.

9. Creative individuals are very passionate about their work, yet they can be extremely objective about it as well. The energy generated by this conflict between attachment and detachment has been mentioned by many as being an important part of their work.

10. The openness and sensitivity of creative people often exposes them to suffering and pain yet also a great deal of enjoyment.

The work of creativity:

Is there a single creative process? Creative individuals usually have their own theories.

Robert Galvin says that creativity consists of anticipation and commitment. Anticipation involves having a vision of something that will become important in the future before anybody else has it; commitment is the belief that keeps one working to realize the vision despite doubt and discouragement.

Peter Drucker on the other hand lists four reasons that account for his accomplishment.

1. I have been able to product because I have always been a loser and have not had to spend time on keeping subordinates, assistants, secretaries and other time wasters.

'Born to see, my task is to watch (Goethe's Faust II)'

2. I never set foot in my university office

3. I have been workaholic since I was 20

4. Because I thrive on stress and begin to pine if there is no deadline.

The creative process has traditionally been described as taking five steps.

1. Period of preparation, becoming immersed, consciously or not, in a set of problematic issues that are interesting and arouse curiosity.

2. Period of incubation; during which ideas churn around below the threshold of consciousness. It is during this time that unusual connections are likely to be made.

3. Insight (sometimes called Aha moment), e.g: Archimedes cried out 'Eureka. This is the creative moment (moment of truth).

4. Evaluation - when the person must decide whether the insight is valuable and worth pursuing.

5. Elaboration. it is probably the one that takes up the most time and involves the hardest work.

The flow of creativity:

When people are asked to choose from a list the best description of how they feel when during whatever they enjoy during most? The answer most frequently chosen is, ' designing or discovering something new'.

What is enjoyment?

Americans and Japanese seem to experience enjoyment in the same way, even though they may be doing very different things to attain it. Nine main elements were mentioned over and over again to describe it feels when an experience is enjoyable.

1. There are clear goals every step of the way. Knowing what you are trying to achieve gives your actions a sense of purpose and meaning.

2. There is immediate feedback to your actions. Not only do you know what you are trying to achieve, you are also clear about how well you are doing it. This makes it easier to adjust for optimum performance. It also means that by definition flow only occurs when you are performing well.

3. There is a balance between challenges and skills. If the challenge is too difficult we get frustrated; if it is too easy, we get bored. Flow occurs when we reach an optimum balance between our abilities and the task in hand, keeping us alert, focused and effective.

4. Action and awareness are merged. We have all had experiences of being in one place physically, but with our minds elsewhere and often out of boredom or frustration. In flow, we are completely focused on what we are doing in the moment.

5. Distractions are excluded from consciousness. When we are not distracted by worries or conflicting priorities, we are free to become fully absorbed in the task.

6. There is no worry of failure. A single-minded focus of attention means that we are not simultaneously judging our performance or worrying about things going wrong.

7. Self-consciousness disappears.In everyday life, we are always monitoring how we appear to to other people. When we are fully absorbed in the activity itself, we are not concerned with our self-image, or how we look to others. While flow lasts, we can even identify with something outside or larger than our sense of self such as the painting or writing we are engaged in, or the team we are playing in.

8. The sense of time becomes distorted. In flow we forget time, and hours may pass by inn what seems like a few minutes or the opposite happens.

9. The activity becomes 'autotelic' – meaning it is an end in itself. Whenever most of the elements of flow are occurring, the activity becomes enjoyable and rewarding for its own sake. This is why so many artists and creators report that their greatest satisfaction comes through their work. As Noel Coward put it, Work is more fun than fun.

If work and family life become autotelic, then there is nothing wasted in life and everything we do is worth doing for its own sake.

What is the relationship between flow and happiness. While we are in the flow, we usually does not feel happy. It is only after we get out of flow, at the end of session or in moments of distraction within it, that we might indulge in feeling happy.

Twenty five centuries ago, Plato wrote that most important for a society was to teach young to find pleasure in the right objects. The problem is that it is easier to find pleasure in things that are easier, in activities like sex and violence that are already programmed in our genes. Children grow up believing that football players and rock singers must be happy and envy the stars of the entrainment world for what they think must be fabulous, fulfilling lives. They don't realize until much later, if at all that they glamour of those lives is vulgar tinsel that to be like them leads anywhere but to happiness. Neither parents nor teachers are very effective at teaching the young to find pleasure in the right things.

Creative Surroundings:

The place where one lives is important for three main reasons.

1. One must be in a position to access the domain in which one plans to work. Information is not evenly distributed but clumped in different geographical nodes.

2. Novel stimulation is not evenly distributed. Certain environment have a greater density of interaction and provide more excitement and a greater effervescence of ideas; therefore they prompt the person who is already inclined to break away from conventions to experiment with novelty more readily than if the person had stayed in a more conservative more repressive setting.

3. Access to the field is not distributed in space. The centers that facilitates the realization of novel ideas are not necessarily the ones where the information is stored or where the stimulation is greatest. Often sudden availability of money at a certain place attracts artists or scientists. Likewise in real-estate, location is important here too. The closer to the major research labs, journals, depts., institutes and conference centers, the easier it is for a new voice to be heard and appreciated.

The belief that physical environments deeply affects our thoughts and feelings is helped in many cultures. The Chinese sages chose to write their poetry on dainty island pavilions; Hindu Brahmans retreated to the forest to discover the reality hidden behind illusory experience. Christian monks were so good at selecting the most beautiful natural sports that in many European countries it is a foregone conclusion that a hill or plain particularly worth seeing must have a convent or monastery built upon it.

Creating creative environment:

The centers of creativity - Athens in its heyday, the Arab cities in the 10th century, Florence in the Renaissance, Venice in the 15th century, Paris, London and Vienna in the 19th Century and New York in the 20th century were affluent and cosmopolitan they tended to be at the crossroads of cultures, where information from different traditions was exchanged and synthesized.

Patterning Activities:

Most creative individuals find out early what their best rhythms are for sleeping, eating and working and abide by them even when it is tempting to do otherwise. It is not only through personalizing the material environment that we are able to enhance creative thought.

The Lives:

Many respondents mentioned how important a parent had been teaching them certain values. Probably the most important of them was honesty. An astonishing number of respondents said, that one of the main reason they had become successful was because they were truthful or honest and these were virtues they had acquired from a mother's or father's example.

Why is honesty considered so important? The physical scientists said that unless they were truthful to their observations of empirical facts, they could not do science, let alone be creative.

The Accessibility of Information:

For many centuries, European science and knowledge in general was recorded in Latin. very few individuals in the intellectual discourses of the times. Moreover, few people had access to books which were handwritten, scarce and expensive. The great explosion of scientific creativity in Europe was certainly helped by the sudden spread of information brought about by Gutenberg's use of movable type in printing and by the legitimation of everyday languages which rapidly replaced Latin as the medium of discourse. In 16th century Europe it become much easier to make a creative contribution not necessarily because information became more widely accessible and easier to add to.

This historical example is just one of many that have influenced the rate of creativity at different times (another example is World War I where people started to look for different view point due to tragedy of the war and hence they accepted or welcomed different opinions or ideas).

Often intellectual or power elites hide their knowledge on purpose, to keep to themselves the advantage that go with the information. To accomplish this they develop arcane languages, mysterious symbols and secret codes that are meaningless to those not initiated into the guild. The priestly castes of Mesopotamia and Egypt, the Chinese bureaucrats, the clerical hierarchies of Europe were not particularly interested in sharing their knowledge with all comers. Thus they were not motivated to make the representation of their knowledge transparent.

It is easier to tell whether a new way of doing things is better than the old in mathematics which is extremely coherent domain; it would be slightly more difficult in Physics, and even more in biology and economics; it would be most difficult in other social science and philosophy which are not as tightly connected by an internal network of laws. When a domain is not strictly integrated by logical rules, it is difficult for the field to judge whether novelty is valuable and whether it should be included in the domain.

Enhancing Personal Creativity:

The acquisition of creative energy: All brains are extremely alike and the limits on how many bits of information we can process at any given time are also similar. In principle, because of the similarity in cerebral hardware, most people could share the same knowledge and perform mental operations at similar levels. yet what enormous difference there are in how people think and what they think about

In terms of using mental energy creatively, perhaps the most fundamental difference between people consists in how much uncommitted attention they have left over to deal with novelty. In too many cases, attention is restricted by external necessity. We cannot expect a person who works for two jobs or a working woman with children to have much mental energy left over to learn a domain.

To free up creative energy we need to let go and divert some attention from the pursuit of the predictable goals that genes and memes have programmed in our minds and use it instead to explore the world around us on its own terms.

So how can interest and curiosity be cultivated, assuming that you feel the desire to do so? Following are some of the specific advice

1. Try to be surprised by something every day: It could be something you see, hear or read about. Stop to look at the unusual car parked at the curb , taste the new item on the cafeteria menu, actually listen to your colleague at the office. How the car is different from other cars? what is its essence? Don't assume that you already know what these things are all about or that even if you knew them, they wouldn't matte any way. Be open to what the world is telling you. Life is nothing more than a stream of experiences - the more widely and deeply you swim in it, the richer you life will be.

2. Try to surprise at least one person every day. Instead of being your predictable self, say something unexpected, express an opinion that you have not dated to reveal, ask a question you wouldn't ordinarily ask. Or break routine of your activities. Invite a person to go with you to a show, a restaurant that you never visited before. Experiment with your new appearance. Comfortable routines are great when they save energy for doing what you really care about; but if you are still searching, they restrict and limit the future.

3. Write down each day what surprised you and how you surprised others: Most creative people keep a diary or notes or lab records to make their experience more concrete and enduring. If you don't do so already, it might help to start with a very specific task; to record each evening the most surprising even that happened that day and your most surprising action. This is simple enough assignment and one you will find is fun to do. After few days, you can reread what you have written and reflect on those past experiences. One of the surest ways to enrich life is to make experiences less fleeing so that the most memorable interesting and important events are not lost forever a few hours after they occurred.

4. When something strikes a spark of interest, follow it. Usually when something captures our attention - an idea, a song, a flower - the impression is brief. We are too busy to explore the idea, song or flower further. Or we feel that it is none of our business. After all, we are not thinkers, singers or botanist, so these things lie outside out grasp. Of course that is nonsense. The world is our business and we can't know which part of it is best suited to our selves to our potentialities unless we make a serious effort to learn about an many aspect of it possible.

Cultivating flow in every day life:

The rebirth of curiosity does not last long, however unless we learn to enjoy being curious. When there is nothing specific to do, our thoughts soon return to the most predictable state which is randomness or confusion. We pay attention and concentrate when we must - when dressing, driving cars, staying awake at work. But when there is no external force demanding that we concentrate, the mind begins to lose focus. It falls to the lowest energetic state, where the least amount of effort is required. When this happens, a sort of mental chaos takes over, unpleasant thoughts flash into awareness, forgotten regret resurface and we become depressed.

On the other hand, when we learn to enjoy using our latent creative energy so that it generates its own internal force to keep concentration focused, we not only avoid depression but also increase the complexity of our capacities4s to relate to the world.

How can we relearn to enjoy curiosity so that the pursuit of new experiences and new knowledge becomes self-sustaining?

1. Wake up in the morning with a specific goal to look forward to. Creative individuals don't have to be dragged out of bed; they are eager to start the day. This is not because they are cheerful, but they believe that there is something meaningful to accomplish each day and they can't wait to get started on it.

2. If you do anything well, it becomes enjoyable. The more activities that we do with excellence and style, the more of life becomes intrinsically rewarding.

3. To keep enjoying something, you need to increase its complexity. Most domains are so complexity that they cannot be exhausted in a lifetime, not even the lifetime of the human race. It is always possible to learn a new song or write one. It is always possible to find a new better way to do anything. that is why creativity - the attempt to expand the boundaries of a domain - makes a life time of enjoyment possible.

Habits of Strength:

After creative energy is awakened, it is necessary to protect it. if we don't, entropy is sure to break down the concentration that the pursuit of an interest require. Then thought return to baseline state - vague, unfocused, constantly distracted condition of the normal mind.

What can you do to build up habits that will make it possible to control attention so that it can be open and receptive or focused and directed, depending on what your overall goal require?

1. Take charge of your schedule. Our circadian rhythms are to a large extent controlled by outside factors: rising sun, the commuter train schedule, a project deadline, lunch time, client's needs. The schedule that you are following is not the best for your purpose. The best time for using your creative energies could be early in the morning or late night. The important thing to remember is that creative energy like any other form of psychic energy, only works over time.

2. Make time for reflection and relaxation. Constant busyness is not good prescription for creativity. It is important to schedule times in the day, the week and the year to take stock of your life and review what you have accomplished and what remains to be done.

3. Shape your pace. It is not what the environment is like that matters but the extent to which you are in harmony with it. The house of Hindu Brahman or a traditional Japanese family is likely to be bare of almost all furniture and decorations. The idea is to provide a neutral environment that does not disturb the flow of consciousness with distraction.

'A place for everything and everything in its place'

4. Find out what you like and what you hate about life. Creative people are in touch with their emotions. They always know the reason for what they are doing and they are very sensitivity to pain, to boredom, to joy to interest and to other emotions. They are very quick to pack up and leave if they are bored and to get involved if they are interested. The basis of ancient Greek philosophy was the injection to know thyself.

Internal Traits:

If we go through life with habits that are very rigid or inappropriate to the kind of job we do, the creative energy gets dammed up or wasted. Thus it helps to consider how to apply what we learned about the personalities of creative individuals to the traits that may be useful in everyday life.

1. Develop what you lack. All of us end up specializing in some traits which usually means that we neglect traits that are complementary to the ones we developed. What should keep you trying is the knowledge that by experiencing the world from a very different perspective, you will enrich your life considerably.

2. Shift often from openness to closure. Perhaps the most important duality that creative persons are able to integrate is being open and receptive on the one hand and focused and hard-driving on the other.

3. Aim for complexity: The ability to move from one trait to its opposite is part of the more general condition of psychic complexity. Complexity is a feature of every system, from the simplest amoeba to the most sophisticated human culture. Creative individuals relatively complex personalities.

The application of creative energy:

If you learn to be creative in everyday life you may not change how future generations will see the world, but you will change the way you experience it. Problem finding is important in the daily domain because it helps us focus on issues that will affect out experiences but otherwise may go unnoticed. To practice this skill you might try the following suggestions.

1. Find a way to express what moves you. Creative problems generally emerge from areas of life that are personally important. There are many problems that we face in our life - money, bad boss, etc - which is likely interfere with the quality of life. But you will not know what ails you unless you can attach a name to it. The first step in solving a problem is to find it, to formulate the vague unease into a concerte problem amenable to solution.

2. Look at problems from as many viewpoints as possible. When you know that you have a problem, consider it from many different perspective. How you define a problem usually carries with it an explanation of what caused it. Creative individuals do not rush to define the nature of problems; they look at the situation from various angles first and leave the formulation undermined for a long time. Instead of quickly identifying that boss does not like me and hence this issue, try to find another few reasons for the same problem by thinking differnelty.

3. Figure out the implications of the problem. Once you have created a formulation, you can begin to entertain possible solutions. Solution might include finding interests outside the job, or learning to understand and to like the boss or catch up on job skills 0 or a little of each.

4. Implement the solution. Solving problems creatively involves continuous experimentation and revision. The longer you can keep options open, the more likely it is that the solution will be original and appropriate.

Divergent thinking:

Produce as many ideas as possible

have as many different ideas as possible

Try to produce unlikely ideas

The competition among new memes is fierce; few survive by being noticed, selected and added to the culture. Luck has a huge hand in deciding whose c is capitalized. But if you don't learn to be creative in your personal life, the chances of contributing to the culture drop even close to zero. And what really matters, in the last account, is not whether your name has been attached to a recognised discovery, but whether you have lived a full and creative life.