By Guy Raz (2020) The Unexpected Paths to Success from the World’s Most inspiring entrepreneurs
I am quite impressed by this book. It seems that every chapter gives a very clear idea or thing you can pick it up. The author Guy Raz must have spent lots of effort on this book.
Chapter 1 ” The Call” The way to get startup ideas is not to try to think of startup ideas. It is to look for problems, preferably problems you have yourself. You should only work on problems that exist.
Chapter 2 “Is it Dangerous or Just Scary?”
Even starting from chapter 2 “Is it Dangerous or Just Scary?” makes me sit up and think. He uses the analog of bathtubs vs sharks. Bathtubs should be 365 times as frightening as sharks, but its the reverse. In reality, bathtubs claim one American life every day and sharks claim only one per year on average. So why are we thinking it this way?
The reason for this is fairly simple : We are more relaxed around things we are more acquainted with. This makes me think about my current job. It is actually more dangerous to continue to stay on, but its not that scary now. Rather than waiting for technology to disrupt me, I should go around explore more other options.
Anyone who found their success after leaving the relative security of higher education or their previous profession would be utterly unsurprised by the choices that Jim Koch (Boston Beer Company) and Michael Dell (Dell computer) made in 1984. They all talk about the initial uncertainty and the scariness of the unknown. But then those concerns melt away as they reflect on the even greater dangers of regret and squandered opportunity, and as Jim puts it, waking up at 65 years old only to realize that they have wasted their lives.
Chapter 3 “Leave your safety zone. .. but do it safely”
That is the buoying effect of not quitting your job right away and have a fallback plan for when you do. Some of the entrepreneurs continue their job while they startup their company. For example one of the entrepreneurs Daymond eased himself into the entrepreneurial life. It was 40 hours at Red Lobster (being a waiter) and 6 hours at his startup. Then it was 30 hours at Red Lobster and 20 hours at his startup.
Chapter 4 “Do your research”
There is a famous line from Steve Jobs. He said .. People don’t know what they want until you show it to them” What a lot of people don’t know is that there is an important insight at the end of that quote, that inexplicably always cut off, and that statement from Jobs is particularly relevant here : That’s why I never rely on market research.”
All the market research you personally do wasn’t done so that you can collate and regurgitate it back out into the marketplace to give people what they said they wanted. Rather, it was to build a foundation of knowledge on which they could leverage their creative instincts and their professional judgement in order to truly innovate and deliver what dissatisfied customers really needed. You rely on research to teach how to build a plane – which gave them the confidence to lean on their instincts and trust their creative visions when it came time to decide exactly what kind of plane they wanted to build and fly. This has been a winning combination countless times in the history of new ideas.
The fall of big data and the rise of the blockchain economy By George Gilder (2018)
The title of this book alone already appeals to the reader. The founders of Google giving away free things to be used on the internet stem from their religion of Burning Man. It is like a common cult : a communitarian religious movement that celebrates giving – free offerings with no expectation of return – as the moral center of an ideal economy of missionaries rather than mercenaries. It conveys the superiority of “don’t be evil” Google. So if you understand their 10 Principles of Burning Man, you will have a deeper understanding of Google.
Radical Inclusion : no prerequisites for participation
Gifting : Offerings with no expectation of return
Decommodification : exchange unmediated by commercial sponsorship or advertising, “exploitation”
Radical self-reliance : depend on inner resources
Radical self-expression : art offered as a gift
Communal Effort : Striving to produce, promote and protect social networks, public spaces, work of art and methods of communication that support human community.
Civic responsibility : value civil society and obey laws
Leaving no trace : the ecological virtue that contrasts with industrial pollution and human taint.
Participation : Radically participatory ethic; transformative change, in the individual and society, can occur only through personal participation that opens the heart.
Immediacy : no idea can substitute for immediate experience. Participation in society, and contact with a natural world exceeds human powers.
Echoing the 10 Principles of Burning Man is Google’s corporate page presenting “Our Philosophy” a guide to the system of the world in the form of 10 things we know to be true.
Focus on the user and all else will follow. ( Google’s “gifts” to the user bring freely granted personal information, mounting to the revelatory scale of Big Data )
It is best to do one thing really, really well. (To dominate the information market you must be a world champion in “search and sort” fuel by artificial intelligence, you must be, for the purpose of your domain, almost omniscient)
Fast is better than slow (Fast is better than careful and bug free)
Democracy on the web works (But Google itself is a rigorous meritocracy, imposing a draconian rule of IQ and credentialism)
You don’t need to be at your desk to need an answer. (We better buy AdMob for mobile ads)
You can make money without doing evil. (Academic preening that implies that “most great wealth is based on a great crime.” If fast and free covers a multitude of sins, Google is proud to compensate by running its datacenters with net-zero carbon footprint through solar and windmill effects)
There is always more information out there. (Big Data faces no diminishing returns to scale)
The need for information crosses all borders.
You can be serious without a suit.
Great just isn’t good enough. (We are casually great)
However, as the author point out, nowhere in their philosophy mention about the need for security. When security is done right, it is done as a community. Security is at the heart of the problems of the Net. and in this case, Google is a source of problems rather than answers.
“Free” is a lie, a price of zero signifies a return to the barter system. You pay not with money but with your attention. Hence, you pay in time. If it is free, you are part of the product.
By Ajay Agrawal, Joshua Gans and Avi Goldfarb (2018)
After reading such a book for a novice like me, I certainly gain a new perspective for the future. AI (Artificial Intelligence) is a prediction technology. Predictions are inputs to decision making. Economics provides a perfect framework for understanding the tradeoffs underlying any decisions.
When prediction is cheap, there will be more prediction and more complements to prediction. At low levels, a prediction machine can relieve humans of predictive tasks and so save costs. But at some point, a prediction machine may become so accurate and reliable that it changes how an organization does things.
Part 1 : Prediction
The impact of small improvements in prediction accuracy can be deceptive. For example, an improvement from 85% to 90% accuracy may seems more than twice as large as from 98% to 99.9%. However, the former improvement means that mistakes fall by one-third, whereas the latter means mistakes fall by a factor of 20. In some settings, mistakes falling by a factor of 20 is transformational.
Machine learning science had different goals from statistics. Statistics emphasized being correct on average, machine learning did not require that. Instead the goal was operational effectiveness. Predictions could have biases so long as they were better. This gave scientists a freedom to experiment and drove rapid improvements.
Recent advances in machine learning are often referred to as advances in artificial intelligence because : 1) Systems predicated on this technique learn and improve over time. 2) These systems produce significantly more accurate predictions than other approaches under certain conditions. 3) The enhanced prediction accuracy of these systems enable them to perform tasks such as translation and navigation, that were previously considered the exclusive domain of human intelligence.
Prediction machines utilize 3 types of data : 1) Training data for training the AI 2) Input data for predicting 3) Feedback data for improving the prediction accuracy.
Data collection is costly. It is an investment.
Statistical and economic reasons shape whether having more data generates more value. From a statistical perspective, data has diminishing returns. In terms of economics, the relationship is ambiguous. Adding more data to a large existing stock of data may be greater than adding it to a small stock- if that additional data allows the performance of the prediction machine to cross a threshold from unusable to usable. Organizations need to understand the relationship between adding data, enhancing prediction accuracy, and increasing value creation.
Prediction machines are better than humans at factoring in complex interactions among different indicators, especially in settings with rich data. Humans are often better than machines when understanding the data generation process confers a prediction advantage, especially in settings with thin data.
Part 2 : Decision Making
Human prediction will decline. However human skills associated with data collection, judgement and actions will become more valuable. A decade ago, London cab drivers’ knowledge was their competitive advantage. No one could provide the same degree of service. However, 5 years later, a simple mobile GPS or satellite navigation system gave drivers access to data and predictions that had once been the cabbies’ superpower.
Machines may learn to predict human judgement. But there are limits to the ability of machines to predict human judgement. The limits relate to lack of data. Machines are bad at prediction for rare events.
Airlines invented the airport lounge to provide passengers (or at least wealthy or frequent flying ones) a convenient and quiet space to wait for their flights. The lounge exists because you are likely to arrive early for your flights. Apps such as waze provide very accurate travel times from your current location to the airport. Such apps monitor both real time and historic traffic patterns to both forecast and update the quickest route. Better prediction, eliminates your need to have a place to wait at the airport. Airport lounges are an imperfect solutions to uncertainty and they both will be undermined by better prediction.
The introduction of AI to a task does not necessarily imply full automation of that task. Prediction is only one component. In many cases, humans are still required to apply judgement and take action.
Part 3 : Tools
Businesses need to study their work flow and identify tasks required to achieve their objective and only then consider whether computers had a role in those tasks. The actual implementation of AI is through the development of tools. The unit of AI tool design is the task. Tasks are collection of decisions and analyzed.
The AI canvas is an aid to help with the decomposition process. Tasks need to be decomposed in order to see where prediction machines can be inserted. Fill out the AI canvas for every decision or tool. This introduces discipline and structure into the process. It forces you to be clear about all 3 data types required : training, input and feedback. It also forces you to articulate precisely what you need to predict, the judgement required to assess the relative value of different actions and outcomes, the action possibilities and outcome possibilities.
Part 4 : Strategy
C-suite leadership must not fully delegate AI strategy to their IT department because powerful AI tools may go beyond enhancing the productivity of tasks performed in the service of executing against the organization’s strategy. Instead, it may lead to change the strategy itself.
AI will increase incentives to own data. Still, contracting out for data may be necessary when the predictions that the data provides are not strategically essential to your organization. In such cases, it may be best to purchase predictions directly rather than purchase data and then generate your own predictions.
AI can lead to disruption because incumbent firms often have weaker economic incentives than startups to adopt the technology. AI-enabled products are often inferior at first because it takes time to train a prediction machine to perform as well as a hard-coded device that follows human instructions rather than learning on its own.
Part 5 : Society
The rise of AI presents society with many choices. Each represents a tradeoff.
The first trade-off is productivity vs distribution. AI will unambiguously enhance productivity. The problem isn’t wealth creation; it’s wealth distribution. AI might exacerbate the income inequality problem. First, by taking over certain tasks, AIs might increase competition among humans for the remaining tasks, lowering wages and income. Second, AI tools may disproportionately enhance the productivity of highly skilled workers.
The second trade-off is innovation vs competition. AI has scale economics. Businesses has greater incentives to build prediction machines if they have more control, but along with scale economies, this may lead to monopolization. Faster innovation may benefit society from a short-term perspective but may not be optimal from a social or longer-term perspective.
The third trade-off is performance vs privacy. AI perform better with more data. In particular, they are better able to personalize their predictions if they access to more personal data. The provision of personal data will often come at the expense of reduced privacy.
A Guide to Strategic Cost Cutting, Restructuring and Renewal (2017) by Vinay Coute, John Plansky and Deniz Caglar
Successful organizations strive to stay fit at all times, not just in a crisis. In a fit organization, the business strategy act as a “lighthouse” – a defined bacon that guides everyone in the company and those outside of it. The CEO is crucial to a Fit for Growth initiative and must take the lead.
Fit for Growth isn’t just about cutting costs; investing for growth also matters. Outsourcing a function doesn’t mean walking away from it, you still have to manage it. Focus your process improvement initiative on rooting out inefficiencies.
In this book, two big-box retailers offer divergent examples of how to prepare (or fail to prepare) for growth. The what-not-to-do case study comes from Circuit City , which failed to adapt to changing competition and disappeared. After a long decline, the owner had to liquidate the chain. In contrast, Ikea has stayed relentlessly focused and is thriving.
Improving all your processes a little bit will yield less value than improving your most important processes a lot.
After 2000, Circuit City responded to competition from Best Buy with ill-considered moves. In 2001, Circuit City stopped selling appliances so abruptly that it failed to tell its suppliers. And in 2003, it laid off its well-paid, experienced salespeople and replaced them with rookie, hourly employees. These missteps set up the company for a fall. Then the Great Recession struck, Circuit City had to close for good.
Ikea, on the other hand, weathered the Great Recession and thrived. They remain focused on its goals of selling attractive furnishings at rock-bottom prices. Ikea’s customers are loyal, and its workers devote themselves to the mission of slashing costs. Ikea’s unique culture sees wasteful spending as a “mortal sin.” Since shipping packages with empty space is wasteful, Ikea has pursued innovation in packaging to avoid “transporting air”. Its focus on efficiency even in good times underscores a stark contrast with Circuit City.
The failed retailer saw improvement as a panic move it pursued only in response to added competition. At Ikea, improvement is a continual process of meeting internal goals, not of responding to outside pressures.
What is clear and what ultimately motivates leaders to take the first steps on a Fit for Growth journey is the discomfort of staying where they are. To guide your mission, follow 10 principles :
The CEO must make a direct pitch.
Get top managers on board.
Grant amnesty for the past
Look for easy victories (especially at the start) to create confidence and momentum
The Business of News and The Fight For Facts (2019) By Jill Abramson
This is not my usual kind of book that I will read. Surprisingly, it does offer a different perspective of how I see newspaper today.
In the 21st century, newspaper found that their environment had changed and the traits that had allowed them to thrive were now their liabilities. The internet, social media and smartphone changed how people consume news.
The new metric of journalistic quality was popularity. Publishers such as BuzzFeed and Vice profited by ignoring distinctions between news-gathering and the business-side of publishing, and by blurring distinctions between advertising and editorial content. Algorithm-based platforms such as Facebook and Google News eliminated the role of the editor as the arbiter of what constituted news. The new publishing platforms were vulnerable to those seeking to “game” the algorithms and spread fake news or propaganda.
Saving newspaper was useless. Saving journalism was vital. In order to be successful, [online] content had to resonate with readers enough that they felt compelled to share the item with their friends. News had become ubiquitous in the digital age, but it was harder than ever to find trustworthy information or a financial model that would support it.
Newspapers adopted certain new media tactics and style, and revived investigative journalism.
Think you’re aware of the forces that might disrupt your company? Your lens may be far too narrow. By Amy Webb – article from MIT Sloan Management Review (2020)
When companies assess only familiar threats, they miss unfamiliar but crucial sources of disruption. Weak signals in the environment can alert decision-makers to impending change. To perceive crucial trends, leaders need to monitor for disruption in 11 potential sources.
Future forces theory identifies 11 sources that account for all macro change. Disruptions within one or more of these areas can culminate in disruption for your organization. These 11 sources represent uncertainties outside the control of business leaders. : 1. Wealth distribution
2. Education
3. Infrastructure
4. Government
5. Geopolitics
6 Economy
7 Public Health
8 Demographics
9. Environment
10. Media and Telecommunications
11. Technology
Technology doesn’t give rise to change independently, but rather represents a linkage among other sources. Leadership teams should monitor each area, particularly for convergences, contradictions and inflections. They should then trace disruption forward to their organization in order to act preemptively.
Seek out weak signals by intentionally looking through the lenses of macro change is the best possible way to make sure your organization stays ahead of next wave of disruption.
In 2004, weak signals in the way people were interacting with digital content indicated that dramatic change was imminent for personal communications. 2007, Apple introduced the first iPhone, while Research in Motion (RIM) for the popular Blackberry phone persisted in offering only sustaining innovations – incremental improvements that appealed to current customers – and soon become irrelevant.
Building an Enduring Business by Managing the Risks of Growth (2010) By Edward D.Hess
The “Growth Mental Model” drives the mind-set that makes companies to “grow or die”. As a result, some corporations work to exhibit predictable, continuing growth at all costs.
Smart Growth believes that improvement is more important than growth. Although theory suggest that stable growth should be possible, reality says that it is not.
Companies that oppose the grow-at-all-costs trend to generate authentic earnings have plenty in common : They follow “disciplined, focused strategies.” Usually they exercise the nine step “Growth Progression”.
They start by growing their operations geographically.
They expand their product range to their current clients.
They extend their sales into new markets.
They add value to their current product offerings.
They “focus on cost efficiencies”
They drive “technological productivity” with their suppliers and manufacturers.
They strategically make “small scale” product or client acquisitions.
They evolve from selling discrete products to “selling solutions”
They return to step 1, all while enhancing their procedures.
This step-by-step, often experimental, approach – and the results that spring from it – rarely unfolds in a “smooth and continuous” manner.
People, Probabilities and Big Moves to Beat the Odds (2018) By Chris Bradley, Martin Hirt and Sven Smit
Getting to the upper quartile in economic profits requires bold action, not just optimistic forecasts. Hockey-stick-like growth happens in firms that correctly identify the key components of the enterprise and invest in those business lines or divisions that lift the entire ship.
Increase your odds of making the right decisions by thinking in terms of probabilities.
Think through probabilities that you base on your firm’s attributes. Track and analyze 10 variables to assess your odds of success. These variables fall into 3 categories : A) Endowment 1) Get big – the bigger the better. Aim for revenues in excess of $7.5 billion if you expect an advantage from your size. 2) Eliminate debt. 3) Increase R&D spending.
B) Trends 4) When your industry moves up the Power Curve, your company benefits. 5) Choose your market. Operate in fast-growth countries, regions and cities.
C) Moves 6) Make small but steady acquisitions 7) Put resources into business lines strategically, not evenly. 8) Spend almost twice as much as your industry medium. 9) Maintain productivity 10) Maintain gross margins in the top third of your industry.
Knowing where you stand helps you leverage your strengths and determine where to improve.
More and more security holes are appearing in cryptocurrency and smart contract platforms, and some are fundamental to the way they were built. By Mike Orcutt (article from MIT Technology Review, 2019)
Recent blockchain attacks reveal vulnerabilities in cryptocurrency exchanges. Blockchains offer exceptional security features to financial institutions, but hackers find way to break through.
Smart contracts are computer programs that run on blockchain networks. They automate cryptocurrency movements and facilitate legal contracts. They also permit venture capital investors to vote on fund allocations. In 2016, a smart-contract bug allowed hackers to receive money from venture capital fund Decentralized Autonomous Organization without registering the withdrawals, resulting in a $60 million loss.
In public blockchains, where source code is often visible, hackers eventually find and exploit smart-contract bug. AnChain. ai uses AI to scan smart-contracts for flaws. Others attempts to eliminate bugs by using a “formal verification” process to audit contract code. Users can report the flaws in exchange for rewards.
But at the end of the day, money exchange systems based upon blockchains are still dependent upon the behavior of people and human nature tend towards gaming the system.
Please Stop Feeding Into Mob Mentality (Article, The Curious Zhou Zorro, 2020)
The chaos which results from fear of a pandemic like the coronavirus is often more dangerous than the outbreak itself. Don’t be quick to join in the mob’s chorus… you might think you’re just humming along, but you’ve actually become an accomplice.
Reason and common sense take a back seat when mob mentality is in control. Once part of a group, people feel empowered to pass judgement and act without thinking fully about the consequences. When a rumor that cats and dogs could carry the coronavirus went viral online, for example a waive of pet abandonment and killings followed.
In areas where the outbreak has been especially severe, local governments extended the holiday to Feb 8. Those demanding a further extension fail to take into account the severe, negative effects of keeping China’s economy at a standstill. Many small and medium-sized companies are already going out of business. If no one works, how will grocery shelves get stocked? Food shortages would quickly become a reality.
During this challenging time, it’s important for each individual to stay clear-minded. Take measures to protect yourself, but do not become a part of the mob.
"Daily Tools" Black Book 