Tag: Business

Loonshots – Safi Bahcall

Loonshots: How to Nurture the Crazy Ideas That Win Wars, Cure Diseases, and Transform Industries: Amazon.co.uk: Safi Bahcall: 9781250225610: Books

Title: Loonshots: How to Nurture the Crazy Ideas That Win Wars, Cure Diseases, and Transform Industries
Author: Safi Bahcall
Publication Date: 2019
Recommendation Score: 4.5/5

Safi Bahcall is an entrepreneur with a Ph.D. in physics. In his book “Loonshots” he tries to apply the principle of physics to innovation in business ventures. The book is inspired by two success stories in recent American history 1) the turnaround of the Bell Telephone Company, led by Theodore Vail, during the first decade of the 20th century which resulted in creating the Bell Labs, 2) and by the efforts of Vannevar Bush to improve the technology of the US army during the second world war.

The author states that for an organization to nurture innovation, the following conditions should be met:

Phase Separation and Dynamic Equilibrium

Create phase separation and dynamic equilibrium: to separate the artists, who want to create crazy technology, from soldiers whose discipline ensures that the technology is being implemented efficiently (quality, cost, time). And create a continuous exchange of ideas, information, and people between the two groups (dynamic equilibrium) to allow the transfer of technology from the innovation phase to the implementation phase, and to allow the transfer of field experience to innovators.

The Leader as a Gardener

Innovation leaders should be like gardeners: their role is to balance between the two groups and to manage the transfer between them. Not to intervene as soldiers, nor to contribute as artists. And leaders should love their artists and soldiers equally.

Skin in the Game – Nassim Taleb

Couverture de Skin in the Game

  • Title: Skin in the Game – Hidden Asymmetries in Daily Life
  • Author: Nassim N. Taleb
  • Publication Date: 2018
  • Recommendation Score: 5 / 5

Nassim Taleb is a non-conventional thinker. He is a mathematician and cares a lot about rigor and logic. He is a philosopher and cares about the consequences of theory on people’s life. This is reflected in his writings when theory (science) and practice (real life) are intertwined.

“Skin in the Game” is the 5th book in Nassim Taleb’s Incerto series. It deals with asymmetries in daily life (decision-making, risk management, politics, religion, etc.). This post summarizes some of the ideas of the book.

Ethics and Competence

In the introduction, the author focuses on the idea that one cannot disentangle ethics and competence when dealing with human beings. What does it mean that you trust a professional? Do you trust their knowledge and skills? Or their ethics and moral values? Or both?

Some people have skin in the game, such as citizens, merchants, businessmen, entrepreneurs, artisans, etc. Others have no skin in the game such as bureaucrats, administrators, policy wonks, consultants, etc.

No-skin-in-the-game people keep the upside and transfer the downside to others. Skin-in-the-game people, on the other hand, take their own risk and keep their own downside.

Avoid taking advice from someone who gives advice for a living, unless there is a penalty for their advice.

The golden rule vs the silver rule

The golden rule is: Treat others the way you would like them to treat you. The author argues that the following silver rule is more robust: Do not treat others the way you would not like them to treat you.

The Hammurabi code of laws and “skin in the game”

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If Serving is below you, then Leadership is beyond you.

Checklists: where the Disciplined Outperforms the Genius.

Checklists are a simple, powerful, yet often ignored, business tool. They provide a reliable and quick shortcut that improves our performance in the task at hand with less mental effort. Whether flying a plane, operating a surgery, troubleshooting a system, or making big decisions, checklists are always useful.

This post gives the reasons why checklists are paramount in some situations and emphasizes their importance in the process of decision-making.

What is a Checklist?

A checklist is a pre-defined standard operating procedure to follow when performing a specific task. It is a proven business tool that improves performance and minimizes human errors and mental effort.

How to build Checklists?

Both knowledge and experience contribute to checklist definition, in a closed feedback-loop fashion, where the checklist definition contributes to the knowledge and experience too.

Build_Checklist

Checklists are useful for frequent routines, which reduces the cognitive effort needed to perform them. Nevertheless, we can use them in any other task, profession or industry.

Why do we need Checklists?

Image result for checklist manifestoSimply put, we need to use checklists to perform some tasks because we cannot be sure we have considered all the details of the task at hand. Our brains have blind spots. Sometimes, we overlook even the most basic fact of the problem, which may lead in some circumstances to catastrophic results. In a hospital, for example, a nurse may treat the wrong patient if the name is not verified. Worse, a surgeon may operate the wrong patient! Yes, it happened and may happen again even for the highest skilled nurse and surgeon.

Here are some reasons why we are often unable to consider all the facets of the problem at hand:

  • We simply forget: as human beings, we are prone to forgetting. This is why we often write things down in the form of to-do lists and checklists.
  • Complexity: as human knowledge and technology grow in complexity, so does our professional tasks (finance, software design, hardware design, etc.). The memory alone does not help.
  • Limited attention: pay attention to something, and you’re almost sure you are missing something else. It is a scientific fact that our conscious mind can handle only one object at a time, and leaves rest for the unconscious autopilot. That is why we may forget the pizza in the oven if we engage in an interesting discussion. This is also the principal cause of car accidents, medical errors, etc.
  • Expertise: an increasing number of professions require super-specialized experts. A domain expert is prone to both complexity and overconfidence and may overlook basic facts.
  • Cognitive biases: our cognitive biases, such as the confirmation bias, the planning fallacy, the availability heuristic, etc. are the major cause of errors.

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Outsmart The Planning Fallacy

Projects go over-budget and over-schedule; small ones, like renovating your kitchen, and huge ones, like constructing the Sydney Opera House. One main reason is our overconfident optimistic approach to planning. Behavioral psychologists call this the “Planning Fallacy“.

This post defines the concept of planning fallacy, gives examples of its consequences on some global projects, and provides some tips to mitigate it.

The Planning Fallacy

The planning fallacy is when we underestimate the time and resources needed to complete a project. We are often optimistic about our performance and the outcome of the project, so we take our desires for real plans.

The planning fallacy is a cognitive bias that fools our decision-making ability into considering the best-case scenario. It has a somewhat positive side, which is risk-taking. This cognitive bias allows us to take both small risks, such as opening a small business, and huge risks such as starting a war.

Catastrophic Project Plans

The following chart presents some major projects around the globe that went catastrophically over-budget. Notice the trend; the bigger the project, the higher the overbudget.

Sans titre

Mitigate the Planning Fallacy

Among the methods to mitigate the planning fallacy, we present the major three: Continue reading “Outsmart The Planning Fallacy” →

Plans are worthless, but Planning is everything.

Dwight D. Eisenhower

How to Learn New Skills Quickly

Image result for The First 20 Hours: How to Learn Anything ... Fast

Learning new skills is paramount in today’s world. Whether you are searching for a first job, seeking a promotion in your current job or planning to make a career pivot, your ability to learn new skills (fast) will be your best friend. 

In his book “The First 20 Hours: How to Learn Anything. Fast!”, Josh Kaufman suggests the following 10 steps to gain a new skill quickly:

  • Choose a project you love, a project you are very curious about.
  • Focus your energy on one skill at a time, don’t try to learn everything at once.
  • Define your target performance level, when you become “good enough” on the skill. This will define how long and how much energy you will put in this project.
  • Deconstruct the skill into sub-skills. Divide and conquer.
  • Obtain critical tools, the tools you need for practice and performance.
  • Eliminate barriers to practice, including emotional barriers. Set your environment in a way to reduce the effort required to practice. Remove distractions, put your mobile phone away, etc.
  • Make dedicated time for practice, MAKE it.
  • Create fast feedback loops. Feedback is to get accurate information about how well you are performing. Using this information to improve the performance creates a feedback loop. The faster the loop, the faster the learning.
  • Practice by the clock in short bursts. You may try the Pomodoro technique.
  • Emphasize quantity and speed. Don’t seek perfection. Quantity is better than quality for learning a new skill.

To be at your best performance, and accelerate your learning curve, make sure you are in the zone, or in a flow state. More on that in future posts.

Failing to plan is planning to fail.

Alan Lakein

The Personal MBA – Josh Kaufman

The Personal MBA: Master the Art of Business audiobook cover art
Audible Audio-book

  • Title: The Personal MBA: Master the Art of Business
  • Author: Josh Kaufman
  • Publication Date: 2010
  • Recommendation Score: 5 / 5

Book Review

The author, Josh Kaufman, argues that MBA programs are too expensive, with a low return on investment. Especially that the best MBA programs are highly selective, they will pick the candidates who have promising profiles, and who would climb the ladder with or without an MBA. He suggests that business school is unnecessary, and that reading books and gaining real-life experience is a better option.

“The Personal MBA” book as a distilled summary of a huge number of business and personal development books. It gives a boost of knowledge about business, but you need to complete it with further readings and practical experience. As the author puts it: The Personal MBA is a “Do-It-Yourself” approach to business education, but “Do-It-Yourself” does not mean “Do-It-By-Yourself”.

The book comprises both the technical and emotional skills needed for a successful career. The chapters pursue the following outline:

  • Value Creation
  • Marketing
  • Sales
  • Value Delivery
  • Finance
  • The Human Mind
  • Working With Yourself
  • Working With Others
  • Understanding Systems
  • Analyzing Systems
  • Improving Systems

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