Perfectly designed

Interesting thought:

"Each company is perfectly designed to fulfill the task that it is currently producing." Or in other words: your company is (only) as good as it is currently operating. Don't assume your company is actually doing better than it is.

Lemon (juice)

Some quotes I overheard:

• Try to turn 'lemons' into lemonjuice. (~ a la from good to great)
  
• "Don't wrestle with pigs. You'll get all dirty and the pigs will love it."
• "The claim to faim."
  

Real Estate Strategy

From a friend of mine:

• Use 50% equity to keep interest payments low
• Use rental income to cover mortgage payments and provide sufficient buffer
• USD 250.000 can be used for singles tax-free of the gain if one lived in the building for at least two years
  
• USD 500.000 if married
• Make use of re-investment: this will defer the real-estate gain to later period
• Bid 20% below asking price but don't scare seller off
• Houses will usually sell for 5% below asking price
• Do your research with comps!
  

Drilling for oil

“This is so simple it sounds stupid, but it is amazing how few oil people really understand that you only find oil if you drill wells. You may think you’re finding it when you’re drawing maps and

studying logs, but you have to drill.”
Source: Tom Peters blog, June 2006.

“The most successful people are those who
are good at plan B.”

James Yorke, mathematician, on chaos theory
in The New Scientist

Speed bump

Dae-in Cha, class of 2006 wrote: "No is a point of view and not a closed door." No is a valuable feedback. It implies that something is missing from what you are offering. If you can get people to tell you the reason for their no, even better. Those reasons help you refine your thoughts , redesign your plan, and perhaps save some meony you would have invested in an imperfect concept. So for me, I've learned [at Darden] to consciously interpret "no" as a speed-bump, and not as a closed door.

Large trees

Being No 1 in a specific market space doesn't create value by itself. One might as well consider not being No 2 as one avoids hefty competition. In fact, in China there's a company who's goal it is to be No 11. A Chinese proverb covers this idea well: "A large tree collects the most wind".

Licence payments

There are various forms of licence payments that are often applied in combination:

• Initial payment
• Minimum (royalty) payment, e.g. USD 25.000 p.a.
• Regulary annual royalty payment (e.g. 5% of net sales)
• Milestone payments (e.g. for first sale of product)

Since the licnsor has in interest that the licensee truly enteres business and generates revenues, both parties oftentimes negotiate "diligence milestones", e.g. operational targets that the licenssee should strive to achieve.

In case of sublicence agreements it is often customary to

• Share sublicence fees with the original licensor (e.g. 40% of sublicence fees go to licensor)
  

Tank mine strategy

This strategy is used in a military context to "take-out" tanks on a battlefield:

• Slow down a tank with a tank mine (small device doesn't destroy tank in total)
  
• Slow tank is easier target and can be taken out with a bazooka.

In other words: some times it can be useful to use a catalyst or an intermediate step to reach your goal. One tool might not be useful in a givin situation but maybe one can change the setting and then apply adequate tools.

Black swan problem

You may have heard of the black swan problem. It relates to the theory of induction put forth by Sir Karl Popper and later by David Hume.

It was, however, John Stuart Mill, an economist and philosopher, who put it in perspective: "No amount of observations of white swans can allow the inference that all swans are white, but the observation of a single black swan is sufficient to refute that conclusion."

How does this link to the above issue on stocks? That stocks have outperformed all investments in the long run (and therefore less risky) does not necessarily mean that it will continue to do so in the future. In other words, your decision should not be based just on history.

Live lessons

From my dean Robert F. Bruner

Your success going forward will rely on your attention to these attributes?

• Total integrity: Business people are severely tested in their capacity for truth-telling, trust-building and social awareness. You are your own brand. What brand reputation do you want?
• Work ethic. Hard workers are the first hired and the last fired. Thomas Jefferson said, "I believe in luch, and I find that the harder I work, the more of it I have."
• Sensible risk taking: Take risk, but be sensible. Go where the competition is not: you won't create a lot of wealth in highly competitive markets. Borrow sparingly; but what you need (not what you want); save.
• Learning. Continue to invest in your intellectual capital. Job security is associated with keeping your human capital near the forefront of your chosen field.
• Joy. All weather people bring to their work a spark and energy that carries them through good times and bad.

(List is not comprehensive)

In a Balloon

A man in a hot air balloon is lost. He sees a man on the ground and reduces height to speak to him.
"Excuse me, can you tell me where I am?"
"You're in a hot air balloon hovering thirty feet above this field," comes the reply.
"You must work in Information Technology," says the balloonist.
"I do," says the man, "How did you know?"
"Well," says the balloonist, "Everything you told me is technically correct, but it's no use to anyone."
"You must be in business," says the man.
"I am," says the balloonist, "How did you know?"
"Well," says the man, "You don't know where you are, you don't know where you're going, but you expect me to be able to help. You're in the same position you were before we met, but now it's my fault."

What is an elephant?

Six blind men were discussing exactly what they believed an elephant to be, since each had heard how strange the creature was, yet none had ever seen one before. So the blind men agreed to find an elephant and discover what the animal was really like.
It didn't take the blind men long to find an elephant at a nearby market. The first blind man approached the beast and felt the animal's firm flat side. "It seems to me that the elephant is just like a wall," he said to his friends.
The second blind man reached out and touched one of the elephant's tusks. "No, this is round and smooth and sharp - the elephant is like a spear."
Intrigued, the third blind man stepped up to the elephant and touched its trunk. "Well, I can't agree with either of you; I feel a squirming writhing thing - surely the elephant is just like a snake."
The fourth blind man was of course by now quite puzzled. So he reached out, and felt the elephant's leg. "You are all talking complete nonsense," he said, "because clearly the elephant is just like a tree."
Utterly confused, the fifth blind man stepped forward and grabbed one of the elephant's ears. "You must all be mad - an elephant is exactly like a fan."
Duly, the sixth man approached, and, holding the beast's tail, disagreed again. "It's nothing like any of your descriptions - the elephant is just like a rope."
And all six blind men continued to argue, based on their own particular experiences, as to what they thought an elephant was like. It was an argument that they were never able to resolve. Each of them was concerned only with their own idea. None of them had the full picture, and none could see any of the other's point of view. Each man saw the elephant as something quite different, and while in part each blind man was right, none was wholly correct.
There is never just one way to look at something - there are always different perspectives, meanings, and perceptions, depending on who is looking

Who packed your parachute?

Charles Plumb was a navy jet pilot. On his seventy-sixth combat mission, he was shot down and parachuted into enemy territory. He was captured and spent six years in prison. He survived and now lectures on the lessons he learned from his experiences.
One day, a man in approached Plumb and his wife in a restaurant, and said, "Are you Plumb the navy pilot?"
"Yes, how did you know?" asked Plumb.
"I packed your parachute," the man replied.
Plumb was amazed - and grateful: "If the chute you packed hadn't worked I wouldn't be here today..."
Plumb refers to this in his lectures: his realisation that the anonymous sailors who packed the parachutes held the pilots' lives in their hands, and yet the pilots never gave these sailors a second thought; never even said hello, let alone said thanks.
Now Plumb asks his audiences, "Who packs your parachutes?..... Who helps you through your life?.... Physically, mentally, emotionally, spiritually?....... Think about who helps you; recognise them and say thanks."

Customer service

A bank had introduced a charge to be levied when people paid in money to be credited to an account held by a different bank. The charge was 50p and had been in force for about 6 months or so. A well to do, upper-class lady enters the bank and presents the cashier a cheque (check) which she asks to be paid into an account held by a different bank. The cashier duly tells the lady that there will be a charge of 50p. Indignantly, she tells him, "I wasn't charged the last time."
To which the cashier immediately replies, "Well that will be a pound then..."

Change your perspective (No exit story)

A person checks into a hotel for the first time in his life, and goes up to his room.
Five minutes later he calls the reception desk and says: "You've given me a room with no exit. How do I leave?"
The desk clerk says, "Sir, that's absurd. Have you looked for the door?"
The person says, "Well, there's one door that leads to the bathroom. There's a second door that goes into the closet. And there's a door I haven't tried, but it has a 'do not disturb' sign on it."

Six Sigma DMAICT steps

D - Define opportunity
M - Measure performance
A - Analyse opportunity
I - Improve performance
C - Control performance, and optionally:
T - Transfer best practice

The rocks in bucket time management story

Use this time management story to show how planning is the key to time management.

• Start with a bucket, some big rocks enough to fill it, some small stones, some sand and water.
• Put the big rocks in the bucket - is it full?
• Put the small stones in around the big rocks - is it full?
• Put the sand in and give it a shake - is it full?
• Put the water in. Now it's full.

The point is: unless you put the big rocks in first, you won't get them in at all.
In other words: Plan time-slots for your big issues before anything else, or the inevitable sand and water issues will fill up your days and you won't fit the big issues in (a big issue doesn't necessarily have to be a work task - it could be your child's sports-day, or a holiday).

Conscious / competence learning matrix

The progression is from quadrant 1 through 2 and 3 to 4. It is not possible to jump stages. For some skills, especially advanced ones, people can regress to previous stages, particularly from 4 to 3, or from 3 to 2, if they fail to practise and exercise their new skills. A person regressing from 4, back through 3, to 2, will need to develop again through 3 to achieve stage 4 - unconscious competence again.

1. unconscious incompetence
   the person is not aware of the existence or relevance of the skill area
   the person is not aware that they have a particular deficiency in the area concerned
   the person might deny the relevance or usefulness of the new skill
   the person must become conscious of their incompetence before development of the new skill or learning can begin the aim of the trainee or learner and the trainer or teacher is to move the person into the 'conscious competence' stage, by demonstrating the skill or ability and the benefit that it will bring to the person's effectiveness
2. conscious incompetence
   the person becomes aware of the existence and relevance of the skill
   the person is therefore also aware of their deficiency in this area, ideally by attempting or trying to use the skill
   the person realises that by improving their skill or ability in this area their effectiveness will improve
   ideally the person has a measure of the extent of their deficiency in the relevant skill, and a measure of what level of skill is required for their own competence
   the person ideally makes a commitment to learn and practice the new skill, and to move to the 'conscious competence' stage
3. conscious competence
   the person achieves 'conscious competence' in a skill when they can perform it reliably at will
   the person will need to concentrate and think in order to perform the skill
   the person can perform the skill without assistance
   the person will not reliably perform the skill unless thinking about it - the skill is not yet 'second nature' or 'automatic'
   the person should be able to demonstrate the skill to another, but is unlikely to be able to teach it well to another person
   the person should ideally continue to practise the new skill, and if appropriate commit to becoming 'unconsciously competent' at the new skill
   practise is the singlemost effective way to move from stage 3 to 4
4. unconscious competence
   the skill becomes so practised that it enters the unconscious parts of the brain - it becomes 'second nature'
   common examples are driving, sports activities, typing, manual dexterity tasks, listening and communicating
   it becomes possible for certain skills to be performed while doing something else, for example, knitting while reading a book
   the person might now be able to teach others in the skill concerned, although after some time of being unconsciously competent the person might actually have difficulty in explaining exactly how they do it - the skill has become largely instinctual this arguably gives rise to the need for long-standing unconscious competence to be checked periodically against new standards