Category Archives: Key Ideas

Why your biggest political blindspot is not understanding how Government economics differs from yours.

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You don't need to understand an internal combustion engine to drive a car, and you don't need to understand a monetary system to participate in an economy.... BUT TO FIX AN ENGINE OR ECONOMY YOU DO.

I cringe when I see the majority of people believing what I did for most of my life, that our government borrowed to get money to spend (like we do).  THEY DON'T. I've written a little bit about this in How to Think About Economics.

Rebooting the U.S. Economy in a Thought Experiment

Pretend there is no money and we have to reboot the economy,  lets think  through this...

  1. The US gov't has a monopoly on creating money (a "fiat" monetary system)
  2. They "spend" the money into circulation (buy stuff from us) or "give" the money to us (social benefits)
  3. If they tax the same amount back (balance their budget)  WE HAVE NONE LEFT
  4. Therefore: The U.S. government Deficit MUST EQUAL our savings to the penny!

 

State and Local government economics are the same as you and I, they must "earn" (tax) their money since they cannot create it like the feds.

So applying the same economic rules and thinking for your household, business or state government DOESN'T APPLY TO THE FEDERAL GOVERNMENT when you understand the mechanics of "Money Issuers" vs. "Money Users".

Warren Mosler is a guru of "Modern Monetary Theory", and wrote a short book called  "The Seven Deadly Innocent Frauds of Economic Policy"

This book, shows why, in the fiat U.S. monetary system, the following  are FALSE understandings:

  1. The government must raise funds through taxation or
    borrowing in order to spend. In other words, government
    spending is limited by its ability to tax or borrow.
  2.  With government deficits, we are leaving our debt burden
    to our children.
  3. Government budget deficits take away savings.
  4. Social Security is broken.
  5. The trade deficit is an unsustainable imbalance that takes
    away jobs and output.
  6. We need savings to provide the funds for investment.
  7. It’s a bad thing that higher deficits today mean higher
    taxes tomorrow.

WOW... are you saying the federal deficit is a measure of how much money WE (the non-federal government entities--including their employees) have?     YES THAT IS WHAT I'M SAYING.   This is true for all fiat monetary systems which the U.S. has had since ~1933.  Remember the trillion dollar coin?  YES they can mint a $T coin but....this is all about DISCIPLINING government spending, there are no operational reasons.

In How to Think About Economics one of my takeaways is:

Ben Bernanke (Chairman of the Federal Reserve) said during a Congressional Testimony "... with all due respect Senator, the US will always pay it's bills unless you direct the Fed to not make the computer entry"

Why did we do it this way and what the hell is money anyway?

Reading about the history of money is 1/2 human psychology and 1/2 the rise and fall of governments and the interaction of politics, money and banking. I've read many books but recommend "Money,  the unauthorized biography" by Felix Martin.  From the Silicon Valley's of the ancient world, to Russia's attempt to abolish money and banking, to today's Vampire Squid (Goldman Sachs) and cryptocurrencies, Felix tries to convince you how inherently political money is. (This is a blind spot of bitcoin geeks who miss the transitive property:  money=power and  politics=power therefore money=politics).

Island of Yap highly developed Stone Money System

 

"There was in the village near by a family whose wealth was unquestioned---acknowledged by everyone--- and yet no one not even the family itself had ever laid eye or hand on this wealth...known only by tradition...the past two or three generations...lying at the bottom of the sea"

--- From "Money" by Felix Martin

 

Over the last few hundred years economists have generally agreed that money has 3 functions:

  1. A unit of account   (measure things in the unit of "dollars, yen or euros")
  2. A medium of exchange (equate  to  "dollars" and use them instead of barter)
  3. A store of value (store up my labor etc. in dollars or shekels  to spend later)

This is a useful framework because it gives you 3 axis to think about how politics and money interact. Examples include:

Example 1:  Monkey with the unit of account

The Consumer Price Index is used to index wages and Social Security benefits, hence by growing it slowly, the government "saves" money, this is why the measurement keeps changing.  shadowstats.com computes the CPI using the same algorithm as 1990 to show how it's been lowered.  A POLITICAL MOTIVE?

 

Example 2: Monkey with the medium of exchange

The cashless society is being pushed as a solution to big crime (money laundering). But physical money has a property no other representation has, ANONYMITY FOR ALL CITIZENS. All electronic transactions enable, the federal government(s) to  track global transactions and enforce new international tax regimes such as described here and here. A POLITICAL MOTIVE?

Example 3: Monkey with the Store of Value

The government gets to spend money first,  they usually issue debt to economically "sterilize" their expenditure. If the central bank purchases the debt by printing money, it's  "monetized" (didn't pull the same amount of money out of circulation).  If a "primary dealer" bank buys the debt the bank gets the first spend of all interest payments.  If the supply of money and credit grows faster then productivity and population (inflation targets), then the value of the currency declines and the first to spend it receives a purchasing power advantage. Rome did this by shaving the amount of gold or silver from the coins. Avoiding deflation or A POLITICAL MOTIVE?

TAKEAWAYS

Modern Monetary Theory Teaches us:

  • Federal Spending is limited by inflation. Government debt serves as:  a) a check and balance on spending, and b) a risk free asset in the private economy, it is not operationally necessary.

SPENDING MORE (Democrats) or TAXING LESS (Republicans) is the SAME ECONOMICALLY

  • Federal governments issue money, everyone else (including state and local government) use it. Hence state and local deficits are a debt burden on our children, federal is not.

BE MORE OF A TIGHTWAD on STATE AND LOCAL SPENDING

  • Deflationary forces (aging demographics + globalized labor + technology+high debt), moves money from spending to savings.

SHRINKING DEFICITS CAUSE RECESSIONS WITHOUT CREDIT OR VELOCITY GROWTH

  • When the deficit is growing (and money velocity is not slowing down), then money should increase GDP as it enters the economy.

DEFICITS CAUSE THE STOCK MARKET TO RISE (MONEY STORED IN THE PRIVATE SECTOR)

Money Velocity (GDP/Money Supply) Measures how many times a dollar gets spent in a year. Note the drop in velocity during recessions, especially 2008-Now.

  • Money is Politics

BUDGET CEILINGS, CASHLESS SOCIETIES USUALLY HAVE ULTERIOR POLITICAL MOTIVES

If you haven't watched this....  watch it...  How the Economic Machine Works.

-jeff

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Tech CEO's...don't be a pansy if you're forced to layoff

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layoffnothinkingI've been involved in 6 layoffs, 3 on the delivery, 2 as a surviving employee and 1 on the receiving side. These included wildly successful companies before and after layoffs.  There are common elements in big and small companies but small companies suffer more organizational trauma (those affected suffer the same trauma). This post is directed at small competitive company CEO's (<100 people).

First and foremost as the CEO you need to lead, be in the middle, present and available for all meetings with the affected, feel the pain, remorse and self-examine what you could have done better. This event will shape the company culture and it's capacity and capabilities going forward. Laying the bulk of the problem off on your leadership team is pansy, this is your station as the CEO.

Follow advice from people experienced in human resources e.g. safety during the event (police present), documentation, exit interviews, outplacement etc. but this isn't HR's job,  as CEO you need to get the details right while keeping the big picture view to re-energize the company.

Here are my core principles:

Company

1) Future

The business outcome after the layoff is profoundly impacted by how well you managed these 2 issues:

1- Who's in the boat going forward?     -Everyone is fair game in a small competitive company cut, seniority and past contributions are tie breakers, not policy. Friends and founders are the hardest to let go.lifeboat

2- How deep did you cut?         -Size for the worst realistic scenario by cutting deeper than you think. You get one shot for people to bounce back from the adversity, make it over... take the big hit now! Rolling layoffs = dead company.

2) Speed

- One bad day. Execute swiftly in a single day, plan every 15 minutes, communicate clearly to everyone involved... all eyes are on you.

3) Relief

- After the affected have left, communicate clearly that it is over. It's OK to be sad and grieve along with the company.

4) Repurpose

- You're smaller... take work off the table and refocus on core initiatives going forward.

People Affected

layoff

1) Them

- Tell them you're sad, it was absolutely necessary, it's not about them you'll miss them, but the decisions are final.

2) Compassion

- Be compassionate to everyone, this will ripple through their self-esteem, lives and family. Expect crying, anger and shock, possibly even violence and vengeance,  treat with utmost respect.

3) Forward

- Describe how important it is for them to look forward to new beginnings but be the backbone that moves everyone along, thank them for their service and contributions.

4) Help

- Provide as much help, references, out-placement, severance etc. as you can. Employees will be watching, this is where the rubber meets the road for trust,  what-you-say vs. what-you-do is in high definition regarding company values around people.

Employee's Remaining

1) Imperfect

- Make it clear you did your best, probably made mistakes, but after discussing with managers, you made the final decision for the people that were forced to leave. Take the responsibility hit from your managers because some employees might think the company picked wrong people, you're batman... you can handle it.

2) Over

- Time for an all hands meeting message:   "... it's over, we planned for a worst case, you're secure ... questions?"

3) Sad

- Be sad the world's this way along with everyone else.

4) Focuslongdistancerun

-Communicate clearly that this is not for nothing, you need their help. Re-energize by removing some work and focus the whole company on the critical challenges, be it sales, new products, customer retention etc. Ask for inputs on improvements, remind everyone that business is a marathon, not a sprint.

My worst experience was as a CEO during the 2000 tech bubble burst when I had to layoff over 1/3 of thepansyceo company including founders and friends. Our VC' s had portfolio teams that curled up and sucked their thumb during those times, don't be one of those, they were pansy's and were canned.

Layoffs change all companies, from temporarily reducing morale to rewriting the "employee contract". Small companies don't have the "cultural momentum" large ones have, so they are always profoundly changed.

The best way to avoid layoffs is by making tough love business and people decisions everyday... especially when times are good.

I hope this helps.

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The latest research on bullshit

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Bohr not thinking

“It is impossible for someone to lie unless he thinks he knows the truth. Producing bullshit requires no such conviction.”

                                                               – Harry Frankfurt

I ran across this and thought some of my readers might enjoy it   On the reception and detection of pseudo-profound bullshit .  It attempts to quantify people's "bullshit receptivity" to their perception of how "profound" something sounds.  They speculate that there are word patterns that make things  "pseudo-profound" that trip people up.

Good stuff. Rupert Sheldrake should use this approach to show all the pseudo-BS the sciences have delivered to us before changing their mind over the years. Rupert is on a quest to free science from the "material world view" ( Setting Science Free from Materialism ) which he believes is starting to stagnate our progress.

For example, the "Big Bang Theory" of the universe was Introduced in 1949 and accepted by most cosmologists in the 70's  (about when I graduated from high school), but some are questioning it again.

My takeaway is simple, don't fall for bullshit just because it's wrapped in "Science"  or "Scientists Agree". Not all scientists are motivated by seeking truth (I've had PhD employee's tell me they kept going to school because they couldn't get a job!).   The vices of people are embedded in the people, hence they show up in all institutions.  I'm leary of any "Truth" that achieves its status by a vote.

Kurt Godel

Kurt Godel showed us that with our most rigorous thinking (mathematics) we can  "prove" things that aren't true and cannot prove everything that is!

-jeff

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Don't let nosebleed levels of abstraction kill your ability to make leadership decisions!

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Politicians spend their lives mastering it. Good BS'ers have practiced it for years. It's a great way to make people think you have "senior management potential".

budgetjoke

Abstraction  

  1.  the act of obtaining or removing something from a source : the act of abstracting something
  2. a general idea or quality rather than an actual person, object, or event : an abstract idea or quality
  3. the state of someone who is not paying attention to what is happening or being said : an abstracted state                                                                                   - from Mirriam-Webster

Back in the day I worked for a brilliant manager who had his team meet with 2 PhD psychologists regularly  to practice the latest and greatest theories on effective behaviors and team building skills. During one session we read and worked over "Language in Thought and Action" by S.I. Hayakawa (a U.S. Senator). First published in 1949, it is  considered a classic work on semantics.

My first takeaway was  to recognize conversations moving  from lower-to-higher or higher-to-lower levels of abstraction.  This is critical when making decisions since it is usually easier to move up rather than down yet YOU CANNOT RESOLVE ANYTHING MOVING UP!

Consider making a decision about Betsy, the cow....  cow1

cattle...we can talk about her contributions to our herd of cattle....

....or what a valuable piece of livestock she is but...
livestock

...unless we go the other way, perhaps applying our policies on Livestock to Cattle and Cattle to  Betsy,  we can expect a courteous and politically correct conversation  but CANNOT ADD DECISION VALUE on what to do about Betsy.

Unfortunately my experience is that  1) resolving problems  2) recognizing opportunities and 3) defining strategies happen at lower levels of abstraction (often the lowest).

"We're customer oriented"  detail-devil1

"Innovation is the lifeblood of our Company"

 "Lets make America Great Again!"

"It's time that we move from good words to good works, from sound bites to sound solutions"

"It's irresponsible to question the science of climate change"

Software indirection

Abstraction layering (implemented as indirection) has driven Software development productivity to grow exponentially by allowing us to label and manipulate "cumulatively all that went before". But even in this virtual world, constructs of the mind have limitations.


Good stuff, BUT going lower often makes conversations more confrontational, especially when stakes are high.  My second takeaway is that it is ALWAYS helpful to rebuild trust by moving up the abstraction ladder. Stating COMMON GOALS AND DESIRES rebuilds confidence that we're still on the same team. This leadership trait is demonstrated spectacularly in Apollo 13 by Jim Lovell when the crew is getting frayed from rapid-fire life and death decisions...

Jim Lovell (Tom Hanks): Gentlemen, what are your intentions?

[Jack Swigert and Fred Haise turn around and stare at Lovell]

Jim Lovell: I'd like to go home.

They did too.

 

" You've got to be careful when you're talking about reality"    -- my friend Ed Hudson

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5 Questions to Attack your Competitor's Strengths and Win

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"We are not in the watchmaking business, we are in the true luxury business."

- Yves Piaget

 

When I ask many young CEO's and marketing people "Who's your competition and why are you better?" they answer with a list of both strengths and the competitors' longer list of weaknesses.  In addition, they rarely include the big competitor which is the customer's status quo.

Here's how to think strategically about competition.

HIGHLIGHTING A COMPETITOR'S WEAKNESSES RARELY WORKSlion-and-mouse

  1. Today's customer's are more informed of competitor's strengths and weaknesses (especially if they are already using the products)
  2. Customers buy because the perceived strengths outweigh the weaknesses (which they're told are temporary)
  3. Often the competitors' strength is much broader than just the product (e.g. financial strength, longevity, service etc.)

DE-POSITIONING A COMPETITOR'S STRENGTHS CAN TIP THE BALANCE

Here are 5 questions to get you started  de-positioning a competitor...

1)  If me and my competitor both had the same product who would win and why? 

Neutralize those... through partnering, guarantee's, customer insurance etc.

2)  If we swap products with our competitor who would win and why?

Extends the issues from above, neutralize these also

3)  Who is  my "Perfect" customer that would buy from me instead of my competitor?

 Qualify leads to this description and keep closing gaps

4) What is my  competitors "Perfect" customer that will buy from them no matter what ?

FIlter leads and don't  spend energy here, learn what they value in the competitor's strengths

5) Can the opposite of my competitor's strength also  be a strength?

  If so... consider positioning there and migrate customers to the other side

nobody-gets-fired-for-buying-ibm

apple_think_different2

The opposite of a fact is falsehood, but the opposite of one profound truth may very well be another profound truth"    

- Niels Bohr

You must fulfill a minimum requirement on every axis of competition... but you only need to differentiate on one (see my 60 Minute Marketing MBA Presentation). Here are some examples I've experienced:

THEY HAVE...    Great technology              BUT...     not based on open technology price curves

THEY HAVE...    Large existing network    BUT....    compete with customer's  cycles of learning

THEY HAVE...    Financial strength              BUT...      not as strong as our combined partner's

THEY HAVE...   Been around                        BUT...      don't offer disaster insurance

THEY HAVE...   Big user base                        BUT...     you're not that important to them

You get the picture... a little progress here can pay off in higher sales!

Miles-Davis-Cool

"Half of being cool is doing what nobody else is doing."

-My friend Tommy Nelson

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5 Reasons You've Gotta Love to Fish to Execute Strategy

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strategy intersection

I just finished a great article in Harvard Business Review called "What is Strategy, Again?" by Andria Ovans (an HBR editor). Andria outlines  seminal articles and books on strategy.

Now I view strategy as fishing the intersection of Technology, Market and  Business (TMB) for a "Theory of the Company".  Many of the books Andria references are in my 60 Minute Marketing MBA Presentation .

The article  groups 40 years of strategy books, journal articles  and consultants.  They fall under these three headlines...

1) Do Something Different

2) Build upon what you already do

3) React opportunistically to emerging possibilities

MPython_different

bldfoundation

 

 

 

ducati_turnHer article lead me to another HBR article "Why Strategy Execution Unravels - and What to do About It" by McGrath & McMillan .   Their research from 8,000 managers in 250 companies found five myths people had about execution.  The research is continuing along with experiments at 40 companies where they make changes and  measure the impact on strategy execution. Here are the five common myths they've found:

1) Execution equals Alignment

- rowing in the same direction, "smart" goals, KPI's/MBO's,  adequate funding ...ISN'T IT

2) Execution Means Sticking to the Plan

- grit and gutting it out...ISN'T IT

3) Communication equals Understanding

- regular communication to reinforce goals...ISN'T IT

 4) A Performance Culture Drives Execution

- Israeli commando, seal team 6, never miss a beat...ISN'T IT

 5) Execution Should be Driven from the TopExecution_Bossidy

- Larry Bossidy, TJ Rogers, Henry Nicholas kick butt "I'll show you                                discipline"...ISN'T IT

So what is it?


I've noticed execution problems at even well run companies when trying to execute a strategy, which led me to some observations.

1) Since strategy is fishing a set of Technology, Market and Business (model) choices to  filter opportunities, focus resources and build ecosystems, then having STUDIED ALL POSSIBLE TECHNOLOGY, MARKET and BUSINESS OPTIONS, WHAT HAS AND HASN'T WORKED IS NECESSARY TO DEVELOP TRUE EXPERTISE ( the space is not that big and can be pared down heuristically pretty readily).

"True expertise requires making all possible mistakes"  -Neils Bohr

2) I've observed that a clear strategy in the hands of the senior people when the company gets big doesn't usually work.  McGrath &McMillan identify "Distributed Leaders" that get things done inside and outside the company as the key players, not just senior management.  The org chart is not a map of power and influence in a company. In fast changing environments those closest to decisions need a strategic compass.

The Distributed Leaders  need to learn and love to fish for the possible TMB combinations that fit their company. They need to love learning and talking about TMB strategies so they can synthesize ON-THE-FLY the agile decisions today's organizations need to make.  New management paradigms like Holacracy  as practiced by Tony Hsieh @ Zappos go much farther than I'm describing, but has ways to structure some of the same ground.

Bottom line is that the Distributed Leaders must love the strategy fish and learn the essence of what has worked, what hasn't and why.

girl-with-fish

Distributed Leadership needs a lesson in Love

 

 

 

 

 

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How to Think about Economics

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economics-480x280

When talking to executives, technologists and marketing people I'm surprised when they over-simplify  how the global economy functions, and is changing. Here are some key understandings and implications I use when analyzing events.

My framework for recognizing the forces impacting businesses is to isolate three economies and define them as below.

1) Global Economy - how countries settle trade balances (international clearing)

2) Financial Economy - disk drives and filing cabinets with  "claims" on the real economy

3) Real Economy - making, buying and selling stuff

Taking them one-at-a-time with  key takeaways...

GLOBAL ECONOMY - 4 important things to know about the Global Economy...

global economy

1) Prior to 1971 there was an agreed-upon system (1944 Bretton Woods fixed-exchange rates) but in 1971 things went rogue (US dropped peg to Gold and currencies "float") and many policies have STILL not adapted to the new structure.

     Takeaway: I thought Foreign cars held their value better than US cars but it was the US dollar, not the cars, that was changing. Even Congressmen don't get how rapidly rates change (up to 20%/year, and 100% over 5 years for the Yen) and how Global Capital Flows affect everything.

2) Floating exchange rates were intended to be market set, but countries game the system by manipulating (pegging), here's 34 doing it http://goo.gl/43B9ic

      Takeaway:  Countries create mercantile policies that "advantage" them in global markets for DECADES. But markets will EVENTUALLY clear. (China and Germany)

3) The US is the "reserve currency" so transactions occur (not just price) in dollars. Therefore the US must create enough "working capital" dollars for both the US and the rest of the world's International Trade (~50% of US Dollars are in the USA and ~50% overseas with the US share of global GDP at ~20% now, ~31% in 1971 and ~40% in 1941)

     Takeaway: Policymakers make mistakes since changes in foreign demand for US$ can be as  large as monetary policy impacts on the supply. QE and other policies can cause foreign bubbles but subdued US impact with all the moving parts.

4) In 1969 a new global "unit of account" called "Special Drawing Rights" http://goo.gl/5kQGnp. SDR's were set up to be a "worldwide reserve currency" . In fact, the US Post Office accepts SDR's as payment! http://goo.gl/C0jlrG

     Takeaway:  The global monetary system is being restructured. Expect unintended consequences and economic hiccups.

FINANCIAL ECONOMY - 3 important things to know about the Financial Economy...

financial economy

1) 10x bigger than the Real Economy (Bain & Co. estimates globally ~$600T financial assets supported by ~$63T GDP http://goo.gl/NQWYFX )

      Takeaway:  The Financial Economy can jerk the real economy around with bubbles and busts even when the real economy looks good. E.g. 2000 tech, 2008 mortgage, 2015 shale oil etc.

2) Since the early 1900's manipulating the financial economy (e.g. capital gains vs. income tax rates, IRA's, Mortgage Interest deduction etc.) has become the PRIMARY tool of Politics.

      Takeaway:  Policy changes provide huge business shifts. E.g. Tax credits built Hollywood, Obamacare and the Insurance Companies, tax credits and Solar etc.

3) Since 1971, the Federal Government (NOT State or Local) can Print as much money as they want (they don't need to borrow). Ben Bernanke (Chairman of the Federal Reserve) said during a Congressional Testimony "... with all do respect Senator, the US will always pay it's bills unless you direct the Fed to not make the computer entry" http://goo.gl/r32iEl. They are limited by inflation which is a function of (global) demand for US$.

"Private sector SAVINGS is equal to the Federal DEFICIT to the penny!" -Warren Mosler

The cash (ASSET) in your pocket shows up as a LIABILITY on the Federal Reserve's Balance Sheet!  Money is scorekeeping, home economics doesn't apply to the Federal Government they  MIRROR the private economy.

      Takeaway:  We've had ~12 balanced budgets since 1940, there is no intention of ever repaying the federal debt (nor is it necessary) http://goo.gl/ExHANm. Federal interest expands the money supply, but allows financial intermediaries to allocate the expansion,  growing the Financial Sector. Shrinking deficits slows GDP if money velocity remains constant.

REAL ECONOMY - 3  important things to know about the Real Economy...Vespa

1) It is jerked around by the Financial Economy expanding and shrinking credit

      Takeaway:  See Financial Economy 1-4

2) It is jerked around by the Global Economy moving money into and out of the US. (Globalized Finance)

      Takeaway:  See Global Economy 1-4

3) Export / Import financial data collection was built during fixed exchange rates, based on currency not units. Accuracy is a function of exchange rate volatility in any given period.

      Takeaway:  Export/Import to a country expressed in currencies (vs. Units) cannot be compared over time.  Unit trade numbers can be off by 20% with the same $ trade number in a single year!

FINALLY
Ray Dalio of Bridgewater Investments created a wonderful video called "How the Economic Machine Works" https://www.youtube.com/watch?v=PHe0bXAIuk0 Ray clarifies how buying things with money vs. buying things with credit and productivity in the real economy interact.  It's 30 minutes, watch it.

Here's a paper on the same http://goo.gl/s2Nanq

I hope this helps...

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How do customers recognize the truth?

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Image result for truth

Marketing (marcom in particular) is communicating  about your product and company things that customers  believe are true n'est pas? Therefore, understanding how customers recognize truth is a pre-cursor to believable communications.

I've found three groups of people who've worked "truth" really hard. Religious, philosophers and mathematicians. Apparently there are ..... 9, NINE,  IX, 8+1 ..... different theories your customer (assuming they're people) might use to decide whether your statements are true!  Here they are:

1) Coherence                    - fits within a whole

2) CORRESPONDENCE    - proved by evidence or individual opinion in a similar context

3) Constructivist               - constructed from social processes, culturally specific

4) Consensus                    - whatever is agreed upon by a specified group

5) Pragmatic                     - verified by results of putting one's concepts into practice

6) Pluralist                         - "property" of a statement which makes a proposition true

7) DEFLATIONARY           - assertions of truth don't mean anything,  they're a tool of discourse                                                     to emphasize claims or form generalizations (also called Minimalist)

8) Redundancy                - asserting something is true is the same as asserting the real thing

9) EPISTEMIC                    - notion of truth is epistemic (all of the above)

Whew...there you go.  Now we know what to do.

If it helps, mathematicians thought they were on the most solid ground before Godel's incompleteness theorems http://goo.gl/Z50liu now they'd rather not talk about it.

Wait there's more ... "according to a survey of professional philosophers in November 2009 (taken by 3226 respondents, including 1803 philosophy faculty members and 829 philosophy graduate students) 44.9% of respondents accept or lean towards CORRESPONDENCE theories, 20.7% accept or lean towards DEFLATIONARY theories and 13.8% EPISTEMIC theories." (I'm not sure what happened to the other 20.6% maybe they told them to buzz off).

Here's your takeaway....

1)  ~45% of your audience will find 3 or 4 independent testimonial sources that corroborate your pitch (customers, thought leaders, editors, bankers, car salesmen etc) credible

2) ~20% will think you're just BS'ing to make a point

3) ~15% will think that it's all so complicated whatever anyone believes is cool

4) ~20% won't show up (read or listen)Image result for truth

http://psychology.wikia.com/wiki/Truth

"The opposite of a correct statement is a false statement. But the opposite of profound truth may be another profound truth"          -Niels Bohr

"A lie makes a problem part of the future, the truth makes a problem part of the past."                                                                         - Quote from YMCA Camp Marston

 

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Hardly anything hard to say about "The Hard Thing About Hard Things"

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HardThingI recently read Ben Horowitz's book "The Hard Thing About Hard Things: Building a Business When There Are No Easy Answers",  it was great!  I've read alot of management, marketing and strategy books but  I can honestly say it is the only book I've read that captured any of my experience as a CEO or being in the inner circle with a CEO in a startup. 

Einstein once said of his friend Kurt Godel http://en.wikipedia.org/wiki/Kurt_G%C3%B6del that his mere existence brought him happiness. I can say that about this book.

Ben captures five things that are integral to the role yet is never portrayed in the happy crap "small big company with freedom and payouts"  media and journalism stuff...

1) Impossible odds and running out of money (again)

2) Peacetime vs Wartime CEO

3) Firing / laying off friends

4) Lonely decisions (esp:  People Choices)

5) Overwhelming Guilt

Start ups are hard... it helps to be naive... why do people do it....  not all do...

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Asymptotic Thinking

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asymptote

What if... a single machine could provide all of the goods and services that a country's economy currently produces?   Would human productivity (GDP per labor hour) be infinity ? Who should own the machine? Google? The government? Goldman Sachs? Would the end state look the same if we built such a machine over 100, 50, 10 or 2 years?

This is not rambling, this is "asymptotic thinking" and I believe it is a pre-requisite to good strategic thinking. In calculus it is  

lim_{ p \to \infty} GDP(p)

   where p=human productivity and GDP=Gross Domestic Product.

This thinking is important because we approach limits incrementally from a DIRECTION and in strategy, as well as calculus, the direction matters.  More specifically there can be discontinuities along the path, much like crossing a chasm in product marketing.

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