Playing for money

From Dr. David Newbourgh:

An older guy was disturbed by playing kids in the yards every day who were playing football for fun. He went out and said: "I give you 5 cents each day if you come - but you must play." The kids came and played. After some time the kids came and said, they will only come if they get 10 cents a day. The guy gave them the money and after some time the kids came back and asked for 25 cents to play each day. The old guy gave the kids the money. After a while the kids came again and said they they can only come every day if they got 1 USD. The guy stopped giving them the money and the kids never came back to play again.

Lesson learned: at the beginning the kids played just for fun and for no money. They got used to the money and changed playing for different reasons. That went on until they only played for the money. At the end they stopped playing altogether. Apply to work situations.

Mozart on writing symphonies

“Well, I always could, and I suspect I wasn’t the only one. It’s not something that can be passed on from one person to another. I remember, late in my short life, an even younger person came to me and said, ‘Maestro, I want to write symphonies. Can you give me some advice?’ ‘Well,’ I said, ‘my first piece of advice to you is that you wait until you are a bit older. You are too young yet to write symphonies.’ ‘But Maestro, you were writing symphonies when you were nine years old!’ ‘Yes, and I was not asking advice, either.’”

My dog

Quote from a recent book: "I always wanted to be the person my dog thought I am."

Chinese proverbes

"People's tendency towards good is as water's tendency is to flow downhill." (Mencius, Chinese philosopher, c.300BC)

"Eat less, taste more." (traditional Chinese proverb)

"Failure lies not in falling down. Failure lies in not getting up." (traditional Chinese proverb)

"The higher my rank, the more humbly I behave. The greater my power, the less I exercise it. The richer my wealth, the more I give away. Thus I avoid, respectively, envy and spite and misery." (Sun Shu Ao, Chinese minister from the Chu Kingdom, Zhou Dynasty, c.600BC)

"Success under a good leader is the people's success." (attributed to Lao Tsu, aka Lao Zi, legendary Chinese Taoist philosopher, supposed to have lived between 600-400BC)

"Do not worry if others do not understand you. Instead worry if you do not understand others." (Confucius, Chinese philosopher, 551-479 BC)

"Softness overcomes hardness." (Zuo Qiuming, court writer of the State of Lu, and contemporary of Confucius, c.500BC)

"The greatest capability of superior people is that of helping other people to be virtuous." (Mencius, Chinese philosopher, c.300BC)

"A great man is hard on himself; a small man is hard on others." (Confucius, Chinese philosopher, 551-479 BC)

"Failure is the mother of success." (traditional Chinese proverb)

"It is not wise for a blind man, riding a blind horse, to approach the edge of a deep pond." (traditional Chinese proverb)

"I hear and I forget. I see and I remember. I do and I understand." (Confucius, Chinese philosopher, 551-479 BC)

"He who asks is a fool for five minutes, but he who does not ask is a fool for ever." (traditional Chinese proverb)

"With a strong heart and a ready mind what have I to fear?" (Chu Yuan, aka Qu Yuan, Chinese politician-turned-poet, c.300BC - China's first great poet and considered the father of Chinese poetry, his death by drowning in 278BC is celebrated every year on the Day of Dragon Boat Festival)

"Half and orange tastes as sweet as a whole one." (traditional Chinese proverb)

Pareto Principle

• 80 percent of results come from 20 percent of efforts
• 80 percent of activity will require 20 percent of resources
• 80 percent of usage is by 20 percent of users
• 80 percent of the difficulty in achieving something lies in 20 percent of the challenge
• 80 percent of revenue comes from 20 percent of customers
• 80 percent of problems come from 20 percent of causes
• 80 percent of profit comes from 20 percent of the product range
• 80 percent of complaints come from 20 percent of customers
• 80 percent of sales will come from 20 percent of sales people
• 80 percent of corporate pollution comes from 20 percent of corporations
• 80 percent of work absence is due to 20 percent of staff
• 80 percent of road traffic accidents are cause by 20 percent of drivers
• 80 percent of a restaurant's turnover comes from 20 percent of its menu
• 80 percent of your time spent on this website will be spent on 20 percent of this website

Quotes

The early bird may get the worm, but the second mouse gets the cheese.

"Computers in the future will weigh no more than 1.5 tons." (Popular Mechanics, forecasting advance of science, 1949.)

"I think there's a world market for maybe five computers." (Thomas Watson, chairman of IBM, 1943.)

"I have travelled the length and breadth of this country and talked with the best people, and I can assure you that data processing is a fad that won't last out the year." (Editor in charge of business books for Prentice Hall, 1957.)

"But what is it good for?" (Engineer at the Advanced Computing Systems Division of IBM, commenting on the micro chip, 1968)

"There is no reason why anyone would want to have a computer in their home." (Ken Olson, president, chairman and founder of Digital Equipment Corp, 1977.)

"This 'telephone' has too many shortcomings to be seriously considered as a means of communication. The device is inherently of no value to us." (Western Union memo, 1876.)

"The wireless music box has no imaginable commercial value. Who would pay for a message sent to nobody in particular?" (David Sarnoff's associates in response to his urgings for investment in the radio in the 1920's.)

"Who the hell wants to hear actors talk?" (HM Warner, Warner Bros, 1927.)

"A cookie store is a bad idea. Besides, the market research reports say that America likes crispy cookies, not soft and chewy cookies like you make." (Response to Debbi Fields' idea of starting the Mrs Fields Cookies business.)

"We don't like their sound, and guitar music is on the way out." (Decca Recording Company rejecting the Beatles, 1962.)

"Heavier than air flying machines are impossible." (Lord Kelvin, president, Royal Society, 1895.)

"If I had thought about it, I wouldn't have done the experiment. The literature was full of examples that said you can't do this." (Spencer Silver on the work that led to the unique adhesives for 3M PostIt Notepads.)

"So we went to Atari and said, 'We've got this amazing thing, even built with some of your parts and what do you think about funding us? Or we'll give it to you. We just want to do it. Pay our salary, we'll come work for you.' They said 'No'. Then we went to Hewlett-Packard; they said, 'We don't need you. You haven't got through college yet'." (Apple Computer founder Steve Jobs on attempts to get Atari and HP interested in his and Steve Wozniak's personal computer.)

"Drill for oil? You mean drill into the ground to try and find oil? You're crazy." (Drillers whom Edwin L Drake tried to enlist to his project to drill for oil, 1859.)

"Stocks have reached what looks like a permanently high plateau." (Irving Fisher, Economics professor, Yale University, 1929.)

"Airplanes are interesting toys but of no military value". (Marechal Ferdinand Foch, Professor of Strategy, Ecole Superieure de Guerre.)

"Everything that can be invented has been invented." (Charles H Duell, Commissioner, US Office of Patents, 1899.)

"Louis Pasteur's theory of germs is ridiculous fiction." (Pierre Pachet, Professor of Physiology at Toulouse, 1872.)

"The abdomen, the chest, and the brain will forever be shut from the intrusion of the wise and humane surgeon." (Sir John Eric Ericksen, British surgeon, appointed Surgeon Extraordinary to Queen Victoria, 1873.)

"640K ought to be enough for anybody." (Bill Gates of Microsoft, 1981.)

Riding the dead horse

Tribal wisdom of the Dakota Indians (so legend has it), passed on from generation to generation, says that, "When you discover that you are riding a dead horse, the best strategy is to dismount."

However, in government, education and the corporate world, more advanced strategies are often employed, such as:

1. Buying a stronger whip.
2. Changing riders.
3. Giving horse and rider a good bollocking.
4. Re-structuring the dead horse's reward scale to contain a performance-related element.
5. Suspending the horse's access to the executive grassy meadow until performance targets are met.
6. Making the horse work late shifts and weekends.
7. Scrutising and clawing back a percentage of the horse's past 12 months expenses payments.
8. Appointing a committee to study the horse.
9. Arranging to visit other countries to see how other cultures ride horses.
10. Convening a dead horse productivity improvement workshop.
11. Lowering the standards so that dead horses can be included.
12. Reclassifying the dead horse as living-impaired.
13. Hiring outside contractors to ride the dead horse.
14. Outsourcing the management of the dead horse.
15. Harnessing several dead horses together to increase speed.
16. Providing additional funding and/or training to increase dead horse's performance.
17. Doing a productivity study to see if lighter riders would improve the dead horse's performance.
18. Declaring that as the dead horse does not have to be fed, it is less costly, carries lower overhead and therefore contributes substantially more to the bottom line of the economy than do some other horses.
19. Rewriting the expected performance requirements for all horses. And the highly effective...
20. Promoting the dead horse to a supervisory position.

OODA

Some call the late John Boyd the most original militarystrategist in 1,000 years. True or not, his influence has been profound. His ideas about “maneuverability” as the sine qua non of military effectiveness, long on the back burner (during the Cold War standoff between
sluggish behemoths), have marched front and center in the new age of instability, ambiguity, and terrorism. At the heart of Boyd’s thinking is an idea labeled “OODA Loops.”OODA stands for the Observe-Orient-Decide-Act cycle. In short, the player with the quickest OODA Loops disorients the enemy to an extreme degree. In the world of aerial combat, for example, the confused adversary subjected to an opponent with short OODA cycles often flies into the ground rather than becoming the victim of machine gun fire or a missile. Boyd is careful to distinguish between raw speed and maneuverability. In aerial dogfighting in Korea (Boyd’s incubator), Soviet MiGs flown by Chinese pilots were faster and could climb higher, but our F-86 had “faster transients”—it could change direction more quickly; hence our technically inferior craft (by conventional design standards) achieved a 10:1 kill ratio.

(Read more in Robert Coram’s Boyd: The Fighter Pilot Who Changed the Art of War.)

Where's the bottleneck?

“The bottleneck is at the top of the bottle,” strategy
guru Gary Hamel reminds us.“Where,”he asks
rhetorically,“are you likely to find people with the least
diversity of experience, the largest investment in the
past,and the greatest reverence for industrial
dogma?” His answer, obvious to anyone except the
incumbents:“At the Top.”

How to sell to women

1. Show her “real”women and reliable scenarios.
2. Focus on connection and teamwork.
3.Capture her imagination by using stories.
4.Make it multisensory.
5.Add the little extras.
6.Tap the emotional power of music.
7. Create customer evangelists.
8. Form brand alliances.

Source: Lisa Johnson & Andrea Learned, Don’t Think
Pink:What Really Makes Women Buy and How to
Increase Your Share of This Crucial Market

Women = Opportunity No. 1

Start with women. They buy everything. (Not much of
an exaggeration.) Consider these stats from the U.S.,
UK, Canada,Australia, and New Zealand.Women’s
share of purchases:

Home Furnishings ...94%
Vacations ... 92%
Houses ... 91%
D.I.Y. (major “home projects”) ...80%
Consumer Electronics ...51% (66% home computers)
Cars ... 68%
All consumer purchases ...83%
Bank Account ... 89%
Household investment decisions ...67%
Small business loans/biz starts ... 70%
Health Care ...80%

Richard Branson on Strategy

Follow your passions.
Keep it simple.
Get the best people to help you.
Re-create yourself.
Play.

Have you invested as much this year in your career as in your car?

“Do one thing every day that scares you.”—Eleanor Roosevelt
“Life is either a daring adventure, or nothing.”—Helen Keller
“Tell me, what is it you plan to do with your one wild and precious life?”—Mary Oliver
“Dream as if you’ll live forever. Live as if you’ll die today.”—James Dean
“The two most powerful things in existence: a kind word and a thoughtful
gesture.”—Ken Langone, founder, Home Depot
“The deepest human need is the need to be appreciated.”—William James
“If you don’t listen, you don’t sell anything.”—Carolyn Marland/MD/Guardian Group
“If you can’t state your position in eight words or less, you don’t have a
position.”—Seth Godin
“Never doubt that a small group of committed people can change the
world. Indeed it is the only thing that ever has.”—Margaret Mead
“To live is the rarest thing in the world. Most people exist, that is all.”—Oscar Wilde
“Have you invested as much this year in your career as in your car?”—Molly Sargent,
OD consultant and trainer
“The most successful people are those who are good at plan B.”—James Yorke,
mathematician, on chaos theory in The New Scientist
“It is not the strongest of the species that survives, nor the most intelligent, but the one
most responsive to change.”—Charles Darwin
“We eat change for breakfast!”—Harry Quadracci, founder, QuadGraphics
“If things seem under control, you’re just not going fast enough.”—Mario Andretti
“We have a ‘strategic’ plan. It’s called doing things.”—Herb Kelleher, founder,
Southwest Airlines
“You are the storyteller of your own life, and you can create your own legend
or not.”—Isabel Allende
“Nobody can prevent you from choosing to be exceptional.”
—Mark Sanborn, The Fred Factor
“A leader is a dealer in hope.”—Napoleon
“Nothing is so contagious as enthusiasm.”—Samuel Taylor Coleridge
“A man without a smiling face must not open a shop.”—Chinese
proverb

People in China and India are starving for your job

“When I was growing up, my parents used to say to me: ʻFinish your dinner—people in China are starving.ʼ I, by contrast, find myself wanting to say to my daughters: ʻFinish your homework—people in China and India are starving for your job.ʼ”

One Sad Dog can Infect a group of 100

Hire/Promote those with ... Sunny Dispositions.
Fire those with perpetually ... Gloomy Dispositions.

(Hint: The farther Up the Organization you go, the more important this gets.)
(Rule: Leaders are not permitted to have “bad days” ... especially on Bad Days!)
(Rule: One Sad Dog can Infect a group of 100.)

Source: Tom Peters

Build on them

“Some people look for things that went wrong and try to fix them. I
look for things that went right and try to build on them.”

—Bob Stone, Mr. ReGo

Chicken story

“In Denmark, eggs from free-range hens have conquered over 50 percent of the market. Consumers do not want hens to live their lives in small, confining cages. ... [They] are happy to pay an additional 15 to 20 percent ... for the story ... about animal ethics. This is what we call classic Dream Society logic. Both kinds of eggs are similar in quality, but consumers prefer eggs with the better story. ... After we debated the issue and stockpiled 50 other examples, the conclusion became evident: Stories and tales speak directly to the heart rather than the brain. In
a century where society is marked by science and rationalism ... the stories and values ... return to the scene.”

—Rolf Jensen/The Dream Society: How the Coming Shift from Information
to Imagination Will Transform Your Business

25.000 USD Consulting fee

A consultant promised a solution to the CEO of a Japanese company on how to improve the decision making process and execution. The CEO agreed and the consultant wrote down to lines:

1) Write down the tasks every morning
2) Do it during the day.

The CEO paid the fee.

Tattoo Brands

Tattoo Brands = % of user that would tattoo the brand on their body. Top 10 Tattoo Brands are:

Harley .… 18.9%
Disney .... 14.8
Coke …. 7.7
Google .... 6.6
Pepsi .... 6.1
Rolex …. 5.6
Nike …. 4.6
Adidas …. 3.1
Absolut …. 2.6
Nintendo …. 1.5

Negotiating

Taken from a negotiating book, Getting to YES!:

• Negotiating requires a lot of skill and practice. It's not enough to read everything about playing golf - at one time you have to practice it. Same holds true for negotiating. Practice, practice, practice.
• "Who is winning in your marriage?" - As strange as this sounds, there will often not be a winner / looser in a negotiation. So try to work out a solution for both.

Business Plan = Portfolio of experiments

Rather than try to predict the future, Gates created a population of competing Business Plans within Microsoft that mirrored the evolutionary competition going on outside in the marketplace. Microsoft thus was able to evolve its way into the future. Eventually, each of the other initiatives was killed off or scaled down, and Windows was amplified to become the focus of the company's operating-system efforts. At the time, Gates was heavily criticized for this portfolio approach. Journalists cried that Microsoft had no strategy and was confused and adrift; they wondered when Gates was going to make up his mind. Likewise, it was difficult for those working inside the company to find themselves competing directly with their colleagues down the hall. There is no evidence that Bill Gates looked to evolutionary theory or was thinking about fitness landscapes when designing this strategy. Yet, regardless of how the approach was specifically developed, the effect was to create an adaptive strategy that was robust against the twists and turns of potential history. Microsoft has continued this approach and today has a portfolio of competing experiments in areas ranging from the Web to corporate computing, home entertainment, and mobile devices.

There are some general lessons that can be learned from a portfolio-of-experiments approach to strategy. First, management needs to create a context for strategy. Constructing a portfolio of experiments requires a collective understanding of the current situation and shared aspirations among the management team. Second, management needs a process for differentiating Business Plans that results in a portfolio of diverse Plans. Third, the organization needs to create a selection environment that mirrors the environment in the market. Fourth and finally, processes need to be established that enable the amplification of successful Business Plans and the elimination of unsuccessful Plans. We will discuss each of these key points in turn.

Source: Eric D. Beinhocker, McKinsey, Book: Creating Wealth, 2006.

Chess player

The play of a great chess player is qualitatively different from the play of a merely accomplished one. The great player sees the board differently, he processes information differently, and he recognizes meaningful patterns almost instantly. If you show a chess expert and an amateur a board with a chess game in progress on it, the expert will be able to re-create from memory the layout of the entire game. The amateur won't. Yet, if you show that same expert a board with chess pieces irregularly and haphazardly placed on it, he will not be able to re-create the layout. This demonstrates how thoroughly chess is imprinted on the minds of succesful players. But it also shows , how limited the scope of their expertise is.

Source: Wisdom of crowds, page 32.

Nonmarket paradox

The fundamental paradox of any corporation is that even though it competes in the marketplace, it uses nonmarket instruments - plans, commands, controls - to accomplish its goals.

Example: When Zara (Spanish fashion retailer and label) wants to design a new dress, for instance, it doesn't put the project up for a bid to different outside treams to find out which one will give it the best price. Instead, one of its managers tells it design teams to design a new dress. The company trusts its designers to do a good job for their employer, and the designers trust the company not to make them bargain for a job every time a need arises.

Diclaimer

"CEs should come with the same disclosure as mutual funds: Past success is no guarantee of future success."

Source: Wisdom of crowds