July 2006


Tingcover_2
Ting – a one word for capturing the intuition moment , is a short business fiction story written by Arupa Tesolin. The main points in the book are as as follows

1. Say Yes to intuition – Implies that there is no such thing as natural gift that only a few people possess. One can develop intuition only when one believes that he can develop intuition skills

2. Do nothing for five minutes – This allows the thoughts to come to us and not the otherway round

3. Listen to your intuition, Practice awareness for 10 minutes. Many times, when we sit still, there are a range of sounds which we become aware of. If we practice this exercise at various locations, one can learnt a lot about the environment which he lives in

4.Watch for intuitive events – Keep track of events that you had thought and have occurred

5. Watch for the "ting" that announces them – Also keep a track the manner in which you are able to feel the things to come

6.Pay attention to Ting

7.Look deeper in to things where you are tinged

8.Look for opportunities when there is a ting

9.Find Linkages

10.Become a Ting advocate

Somehow its difficult to digest such books known as x rulers, which basically suggest that there are x rules to improve your a/b/c/d etc…The book as such boils down to just one thing . At-least once in a day,stay calm, and follow your thoughts that arise out of those calm 5 minutes..Rest of the jazz will follow !

Advertisements

In_praise_of_slowIn the last few days I was reading a book titled – ‘In Praise of Slow’. I picked up this book at the local store mainly because of the title which was rather eye catching. Eye catching because most of blurbs we see in the media, the books we read are about speed, doing things at a faster pace, eating foods hurriedly, juggling with multiple schedules all at once, reading 200 blogs daily, trying to chalk out every slot of the day etc.

The author, Carl Honore. , puts a case for slow moment and also gives several instances of groups who are side stepping from the hurried life to the life of slowness.

It is often true that even though we slice and dice the time intervals in a day , and have a feeling that we are in control of the time, more often than not, we realize the time starts controlling us. The importance that we attach to time is clearly evident in our food habits. Since we want to accomplish the task of eating food in our so called schedule, going for fast food saves time, even though the long term consequences are bad like obesity etc.

If one looks at the evolution of time importance, one can begin from the agrarian times when people used to refer time for sowing, harvesting activities , the tasks which decided their bread and butter in their lives. Thereafter, the industrial revolution escalated the importance of time to greater heights by embedding it in almost every activity of life like, the time one starts to get on the job , the time when the shift ends, the time when one needs to do various activities in a shift were all controlled by time piece. Benjamin Franklin’s statement ‘Time is Money’ was manifested clearly in the work practices, compensation procedures, professional and personal lives for everyone.

Should one necessarily give so much importance to time ? even going to a vacation has become stressful nowadays with people checking in various hotels, trying to maximize the time they have at their disposal, logging on to internet every now and then so as to check their emails that they would have missed, checking their voice mails etc. People nowadays have stopped enjoying their vacation also!! giving rise to the term vacationitis! .  Is time linear ? The concept of linear time has made maximizers in the words of Barry Schwartz" The paradox of choice"  We tend to maximize everything assuming the time is a finite resource. As I type I realize that I should be sending a mail to one of my friends giving instructions for dual boot – windows on MAC. Many of us are a victim of this time maximizing behavior. It is inherently not bad, but because bad when applied universally to all the occasions.

What does being slow help in ? It helps in introspection, helps to charge up our energies and lets us focus on the activity which we have not been doing for some time. In the book, the author takes us through various facets of our life and gives instances world wide over , where movement for slow is beginning to sink in for a lot of people. It also shows how increasingly people are seeking for TEMP GIUSTO, the right speed in their lives by slowing down a few activities.

First aspect, the author touches upon is the FOOD . Carlo Petrini , a man from Italy was fed up of the fast foods that were entering in to the country and felt that he has start something to preserve a wide variety of food making, food eating habits, and so started "Slow Foods" . Founded by Carlo Petrini in Italy in 1986, Slow Food is an international association that promotes food and wine culture, but also defends food and agricultural biodiversity worldwide. (see our History Section). It opposes the standardization of taste, defends the need for consumer information, protects cultural identities tied to food and gastronomic traditions, safeguards foods and cultivation and processing techniques inherited from tradition and defend domestic and wild animal and vegetable species

Second aspect, the author touches upon is Cities. The cities are the modern symbols of pace, hurriedness, indifference, etc. In today’s cities, people are hurrying up their entire lives and thus yearning to bring slowness in to their activities. Alas! not everyone is able to. However, there is a new Citta Slow movement which is taking shape amongst a lot of countries. There are 55 Pledges that any Citta Slow city should take so as to form a part of Citta Slow movement.

Third aspect , the author touches upon is Work. It is so very necessary to keep slowing down to recharge oneself that most of the working professionals forget and get burnt out. However there are a number of countries which have taken up the slow movement. In France , Netherlands there is a culture of 35 hour working weeks where the weekend begin from Thursday itself . In some european countries, email less Fridays are also followed. A very well known origanization SAS works only 35 hours per week and look at what it has achieved over the last 20 years.

The fourth aspect which the author touches upon is Parenting , where in this world , a child is hurried through so many schedules that he just skims the surface of many skills and fails to appreciate the depth of each of the activity . On paper he might be doing so many aspects, but as such his heart might be in none of the activity. All our minds should have a empty space, which will do a similar task like empty box in a 4 by 4 square game , i.e rotate other pieces. Unless we have some empty space , it is difficult to come up with new thoughts. People in some countries are realizing this and taking steps to avoid the hurried learning. Finland for example has a rule that children enter school at 6 and preschool at 7.There is a lot of room for unstructured play and a new jargon is entering the lives of Finnish. ASLAP – As slow as possible.

The author touches on aspects like Sex lives, Medical field, Mind/Body( Slow studio instead of aerobics and gymns) and Entertainment,  where the impact of the slowness has been realized by many people are taking advantages of the same.

After reading various aspects that the author very cogently puts across and makes a case for slowness, the effect on me is immediate. I am typing this post at a lesser speed, I am not trying to think what time it took me to put in this blog entry, nor am I trying to already visualize what I would be doing after writing this post. Yeah! My schedule which I had put in place a few days back is starting at me….but what the heck!! I will instead take a stroll in my neighborhood.

It is one of those books that I should have read much earlier..Anyway past is past…I would atleast try to implement some of the stuff mentioned in the book

Why_things_fail_1
The theme of the book by Paul Ormerod revolves around three aspects, they being, firstly, the pervasive nature of failure, secondly, the patterns between biological extinction of species and firm failures, and thirdly the way one can deal with this failure.

Is the failure pervasive ?
A look at the history of firms shows clear evidence that the life time of a company is not really long. Hannah, a noted researcher analyzed all the firms the top firms between 1912 – 1995 and observed that only 13% of the firms survived. Sometimes technological revolution makes brings this vast extinction, to name a few, printing technology in Venice brought to death 80% of the firms which started operating in the printing space, the early industrial revolution from 1900-1920 saw only 99% of the firms leading to failure.

Can we turn to any economics for answers which claims to a science which explains a  lot about business aspects ?

Risk and uncertainty are inherent in any market transaction , where risk refers to the probability of a event happening for example a coin when tossed would have probability of heads as 0.5 etc,.  Uncertainty essentially translates to the point that one does not even know the probability of happening of the event at all , for example, the event of meteor hitting earth( meteor might never hit earth at all).

The most important consequences of noting uncertainty is that Supply and Demand curves as taught to us in Economics101 courses are no longer simple curves which can be drawn and their intersection is the equilibrium point. In reality one can hardly predict the demand for a price point leave alone for all the price points. The classic formula MC=MP, Marginal cost = Marginal Price can no longer guide us in arriving a decision for pricing a product. There is always the curse of dimensionality that the aggregation of effects of all the factors that change the demand and supply of the product is simply beyond our comprehension. Strong theories, like Philips Curve inverts suddenly between some time periods which makes one doubt the useful ness of economics in practical life.

Can Public Policy help in reducing the death rate of firms or for that any matter any aspect of society which needs improvement ? Here too, there have been umpteen cases where public policy has been of no avail.     Unemployment rates have behaved in a random manner, social mobility has occurred in a random fashion irrespective of the public policy, Inequality with in the countries, measured by Gini’s coefficient has also behaved in a random manner. Segregation of people belonging to various castes/ races among cities is another example which has not changed irrespective of the intent of the government. Robert Schelling was the first one to conduct a thorough analysis on the segregation prevalent in the cities and claimed that it is the weak causes that cause a highly visible segregation and no amount of public policy has been able to reduce the segregation of various races / castes in various states.

The second part of the book talks about the similarity between biological extinction and firm extinction. The biological extinction has followed 2 patterns,one being that the number of firms becoming extinct has not followed any pattern, second being that size is inversely proportional to frequency squared where size is the % of the species becoming extinct per million years. The same kind of similarity is also evident in Hannah data which makes author draw parallel between extinction , evolution of species to that of firms .  The author then goes on to say that a mix of endogenous and exogenous factors are responsible for the extinction and evolution and ends up saying that the book is all about one statement – " Intent does not equate Outcome". In his words,
"Humans, whether acting as individuals or in a collective fashion in a firm or government, face massive inherent uncertainty about the effect of their actions. Whether it is the great characters of tragedy or giant corporations such as Microsoft the future remains covered in a deep veil to all. Species, People, firms, governments are all complex entities that must survive dynamic environments which evolve over time, Their ability to understand such environments is inherently limited. These limits cannot be understood by smarter analysis. Its better to face the reality that there is an inherent uncertainty "

In other words, is there nothing much that can be done to get over this problem? The third part of the book tries to answer this question. The author is of opinion that by adopting a strategy of creative destruction , where constant innovation creates new firm with new business model is the best way to live in this uncertain world.

My Takeaways from the book:
1. Power law evident among firm extinction and biological species
2. Segregation example among various cities
3. Chinks in various economic theories

Ue_lrg

"There is much more to life than what gets measured in accounts" – Tim Harford is one of the most refreshing statements coming from an economist.  A few refreshing comments from an economist in the book make me sit up and read the book cover to cover twice so as to digest the content in the book, which examines some seemingly obvious phenomenon and uncovers the underlying truth behind them.

To begin with, the author says economics is all about "Who get what, when and Why". Pretty much the entire book is structured around analyzing various scenarios, markets etc to show that most of the world life events run based on a few basic economic principles and everyone needs to have these principles in mind so that they can get an additional economic perspective about various things in life.

This book definitely made me think critically on various aspects and has definitely changed the way I would view any market transaction in the future.

Let me try to summarize some of the key aspects that I came across in the book.

Why do markets fail: Markets fail when the bargaining power goes out of whack between the buyers and sellers. This can happen in the instances of monopoly or scarcity power. Secondly, this can also happen in cases where the transaction is not transparent,i.e one side possesses inside information when compared to the other.  Thirdly, externalities sometimes  stifle markets in their nascent stages itself. A detailed understanding of Externalities and Inside Information is provided in the book which is delightful to read, especially because the examples cited are the ones which we come across usually in our daily lives. The book has one full dedicated chapter on the reasons behind China’s success story. The chinese success story based on the economic principles of Scarcity power, Maximize incentives, Correct Externalities, Fight Corruption and Embrace markets serves as a fitting example of the framework suggested in the book.

My biggest take away from the book is about Key hole economics derived from medical field.
Key hole surgeries allow surgeons avoid huge incisions and cause side effects. It is similar to identifying the right problem and working on it. This is so very important way in which economics can be used to solve vexing problems.
Fixing of Singapore insurance is a great example of key hole economics.

This book should be read by anyone who is interested in wearing an economist goggle  while analyzing an issue ,or, working on a problem