Tips to Improve Sparring / Kumite
easyJet – Lois Jones
“Buying Go [Airline] will produce a 100 per cent step-change in growth by bringing expansion more quickly and smoothly,” said Webster (Easy Jet CEO) P81
“This is a cash positive transaction for us”. P104
Icelandair Air purchased 8.4% stake in easyJet. This is an example of how purchasing shares in other peoples companies may provide the best return on investment. P194
Skin In The Game – Nassim Talab
The most intolerant wins. The dominance of the stubborn minority.
The main idea behind complex systems is that the ensemble behaves in ways not predicted by its components. The interactions matter more than the nature of the units. Studying individual ants will almost never give us a clear idea of how the ant colony operates. For that, one needs to understand an ant colony as an ant colony, no less, no more, not a collection of ants. This is called “emergent” property of the whole, by which parts and whole differ because what matters are the interactions between such parts. And interactions can obey very simple rules. P69.
The minority rule explains why a small intransigent minority of people (with a high level of intolerance / skin in the game) will even at a small level of 3 or 4 % of the population dictate the behaviour of the whole population.
For instance nearly all soft drinks that are sold are Kosher in the USA. Very few people actually want Kosher food. But those people who do want it wont eat anything else. The majority don’t really care if the food is Kosher or not as such they simply accept it when it is. It is therefore easier for shops to stock and drinks company to sell drinks that everyone can buy. The preference for Kosher is therefore imposed on the majority even though the majority have no preference for it.
The whole population submits to the dominance of the minority because the majority do not care enough and do not have enough invested to fight the minority on their preference. The minority who feel deeply about the issue are prepared to change their behaviour and create disruption for the majority so causing behaviour change in the majority.
Therefore, influencing a small highly motivated, active group can lead to the whole population to adopt positions they otherwise would never take. (think USA gun control, USA rules on campaigns finance etc) (my summary of ideas P69 -74).
Don’t give crap. Don’t take crap.
Start by being nice to every person you meet. But if someone tries to exercise power over you, exercise power over him. P22
You can criticise either what a person said or what a person meant. The former is more sensational, hence lends itself more readily to dissemination. The mark of the charlatan… is to defend his position or attack a critic by focusing on some of specific statements (“look what he said”) rather than blasting his exact position (“look at what he means” or, more broadly, “look at what he stands or” – for the latter requires an extensive grasp of the proposed idea. P181
It can be useful to consider that many superstitions and beliefs exist and have remained in place because they provide some benefit in their outcome rather than the fact they are logically valid. Thus the value in many beliefs is in their outcomes not their logic. (my summary)
In real life, belief is an instrument to do things, not the end product. This is similar to vision: the purpose of your eyes is to orient you in the best possible way, and get you out of trouble when needed, or help you find prey at a distance. Your eyes are not sensors designed to capture the electromagnetic spectrum. Their job description is not to produce the most scientific representation of reality rather the most useful one for survival. P213
We can not possibly measure and assess everything as if we were a computer; we therefore produce, under evolutionary pressures, some short-cuts and distortions. Our knowledge of the world is fundamentally incomplete, so we need to avoid getting into unanticipated trouble. And even if our knowledge of the world were complete, it would still be computationally near-impossible to produce a precise unbiased understanding of reality. P216
I have shown in Antifragile that making some types of errors is the most rational things to do, when the errors are of little cost, as they lead to discoveries. For instance, most medical “discoveries” are accidental to something else. An error free world would have no penicillin no chemotherapy…. Almost no drugs and most probably no humans. P217
Lets consider a betting at a casino. For the sake of argument lets say that 1% of gambler go bust. If you gamble at the casino over the same time window then you will also have the same chance of going bust at the casino. But if you gambled every day for 100 days. You go bust on day 28 so now there is no longer a day 29. By increasingly the time line of the bets you increase you chances of going bust to almost 100%.
Many recommendations fail to take into account the impact of time on risk. That is to say you get continually exposed to the risk. They also fail to take into account that you will likely to be unable continue after you have become the victim of this risk.
So recommendations based on the long term results of the financial market. You can not expect to match the average of the market because at some point something is likely to happen to get in the way of you doing so and so prevent you continuing. This may for instance be because you need to reduce your exposure due to losses or something in your personal life stops you such as a divorce.
We can not apply cost benefit analysis to situations that have a defined stop in them. (going bankrupt at a casino or getting shot when betting on Russian roulette). The stop point means that you can not calculate an expected return because if you keep playing you hit a stop point (death in Russian roulette) meaning expected returns are not calculable.
People confuse risk of ruin with variations and fluctuations. In other words can you keep playing. If so then risks may actually be beneficial. Even when the risks are in volatile situations. You want to gain the benefits of risk without hitting the down side of an end point. (summary ideas from P.223 -233)
Money Ball – Michael Lewis
The book looks at how clubs value players in sport. The characteristics that are valued by clubs often did not reflect the characteristics that lead to results. Thus characteristics that were valuable (such as on base percentage) were undervalued.
Clubs often overvalued things that actually had impact on performance like whether or not a player appeared confident or had a good looking playing style. The statistical data showed that these measures were flawed. Leading some players undervalued. Such as having emotional problems, being physically small or being overweight. But if the data shows their actual performances these perceived weakness are irrelevant the actual performance is what counts.
Instead the Oakland As looked at statistical data. This eliminated the inaccurate and flawed judgements of individuals. It also eliminated biases such as the Availability Heuristic which lead scouts to make judgements based on recent performances. Or from limited viewing in a small number of games. Where as the long term statistical data is far more revealing of what is actually going on. This also tackled the fact that people tend to over value their own experience as if it is the most valid. Taking emotion and bias out of the equation with statistics eliminates these biases.
This insight lets us understand that perhaps the way we look at people is biased and may not lead us to getting the best options based on our own biases. We might unfairly discriminate against an older worker, someone who is quiet, or someone who seems overweight when in fact this bears no relation to their performance. We may therefore unwittingly miss out on the best options in favour of options that appear good on the surface. We don’t have statistical data like baseball clubs do but we could perhaps place a greater weight on past performance as an indicator of future performance. If we want an innovator for example we should probably look for someone who on close inspection has implemented lots of innovations in their career history. Not someone who talks about innovation at interview and sounds good at interview but can not back it up with a proven history of action. We might also consider that people who are not sociable or do not interview well may in fact be good employees but this fact is disguised by the process we choose to use to select them.
(Summary of the book [above] and my thoughts on it).
It is the process that matters not the outcome. People tend to overvalue outcomes and disregard process. But if a player gets the desired result by doing the wrong thing this is actually something that will hurt you in the long term. (eg running when they shouldn’t but getting way with it) But a player who fails when doing the right thing will befit you in the long term (getting caught out when doing a statistically safe move). The fact that luck and factors out of your control means that something that does not work out should not necessarily lead to a change of course. Instead you need to focus on the correct process and understand that luck means that even the correct process won’t work all the time. But sticking to the correct process will lead to greater success in the long term. P 146. (paraphrase and own notes on idea)
It is very hard to teach certain skills. Even when you try to drill it into people. For instance, it is very hard to make someone disciplined who is not with in a work environment. It may be simply better to hire for these skills if they are important to you. Acknowledging that other skills may be more easily taught such as product knowledge so someone who lacks them than basic personal skills. P148 (idea developed by me)
Bill Beane did not watch the games of the Oakland As : “All they provide me with is subjective emotion and that can be counterproductive” (P245 – quote) Instead he focused on non-subjective data (statistics).
Adapt – Why Success Always Starts With Failure – Tim Hartford
because errors are common and big projects leave little room to adapt. P29
To produce new ideas we must overcome our tendency to fall in step with those around us, and overcome those with a vested interest in the status quo. Making failure survivable sometimes means making small steps, but not always: many innovations emerge from highly speculative leaps, and surviving such leaps is not easy… And distinguishing success from failure, oddly can be the hardest task of all. P36.
Any large organisation faces a basic dilemma between centralisation and decentralisation. Hayek, back in 1945, argued that the dilemma should be resolved by thinking about information. Decisions taken at the centre can be more coordinated, limit wasteful duplication, and may be able to lower average costs because they can spread the fixed resources (anything from a marketing department to an aircraft carrier) across a bigger base. But decisions taken at the fringes of an organisation are quick and the local information will probably be much better even if the big picture is not clear. Hayek believed that most people overestimated the value of centralised knowledge, and tended to overlook ‘knowledge of the particular circumstances of time and place’. P75
The traditional purpose of centralisation is to make sure every business unit is coordinated and nobody is duplicating anyone else’s effort. That might work in a business like Tesco or Wal-Mart, businesses with such control over their supply chain and shop floors that experiments with new products or marketing ideas can be delegated to a computer. But a centralised organisation doesn’t work well when confronted with a diverse, fast-moving range of markets. The advantage of decentralisation, rapid adaption to local circumstances has grown. P76
Sometimes, far more experimentation and far more variation are required – more than any one organisation, no matter how flexible, can provide. In such cases a far more radical approach to promoting new ideas is called for. It is to this problem of creating wild variation that we now turn. P79.
Once a new idea has appeared, it needs the breathing space to mature and develop so that it is not absorbed and crushed by the conventional wisdom.
The idea of allowing several ideas to develop in parallel runs counter to our instincts: we naturally tend to ask, ‘Wat is the best option?’ and concentrate on that. But given that life is so unpredictable. What seems initially like an inferior option may turn out to be exactly what we need. It’s sensible in man y areas of life to leave room for exploring parallel possibilities – if you want to make friends join several clubs, not just the one that appears the most promising – but it is particularly true in the area of innovation, where a single good idea or new technology can be so valuable. In an uncertain world, we need more than just Plan A; and that means finding safe heavens for Plans B, C, D and beyond. P87
“The barrier to change is not too much little caring; it is too much complexity” – Bill Gates P115.
At its most basic, adapting requires variation and selection. P117
We should not try to design a better world. We should make better feedback loops. P140.
Adapting requires selection, the winnowing out of bad approaches from good ones. P140.
And the fundamental point of all these massively parallel experiments I the same: when a problem reaches a certain level of complexity, formal theory won’t get you nearly as far as an incredibility rapid, systematic process of trail and error. P236
A single experiment that succeeds can transform our lives for the better in a way that a failed experiment will not transform them for the worse – as long as we don’t engage in denial or chase our losses. P262
In experiments breading guppies the guppies developed a colour and patterning matching their environment after a few generations. The guppies that did not match the look of the environment were eaten by predators those that did survived and bread more similar looking, well adapted guppies. Individuals unlike, populations can succeed with out adapting. The population adapted through trail and error. But not individual guppy adapted they were either born with good camouflage or not. So with business get in the right market at the right time and you can see your business grow and thrive. If you are Amazon and get in at the start of the growth of the online sales boom your don’t really need to adapt. We therefore need to be careful about adopting business strategies from companies that may have in part succeeded through circumstance. If our businesses do not match the environmental conditions then it is important that we adapt and try something else. We may need to adapt where someone else did not. This is also why good businesses ideas work straight away. They are a good fit to the environment. And improving failing business ideas can be a torturous process – the don’t fit the environment and so struggle. This is why it is important to realise when we are succeeding and when we are failing so we can adapt or change business quickly when we need to do so. P223 (paraphrased content and then wrote own ideas)
First, try new things, expecting that some will fail. Second, make failure survivable: create spaces for failure or move forward in small steps… the trick here is to find the right scale in which to experiment: significant enough to make a difference, but not such a gamble that you are ruined if it fails. And third, make sure that you know when you have failed, or you will never learn. P222
One Trick To Increase Punching Power
Swimming Against The Stream – Tim Watersone
Access to transnational or international funding is no available to everyone who is of a mind and self confidence to reach it. P93 f
Think Twice
Peter Drucker suggested the question “ If we did not do this already, would we, knowing what we know now, go into it?” P69
Do not embrace a strategy with out understanding the conditions in which it succeeds or fails. Certain approaches are not necessarily good or bad but may be situationally dependant. (P91 Idea Re-Written)
Social influence has a significant impact on buying patterns. Therefore small differences in the initial purchase patterns and therefore visible “status” to customers makes a massive difference to overall lifetime sales. P 113 (Idea Re-Written) fffffffff
The White Ladder Diaries
Consider using free-lance reps, wholesalers and distributors to sell products for you. Go direct to local shops.
Produce cash flow forecasts.
The smaller you are the more important it is to look professional.
Discounts. Sliding scales are a bad idea as distributors sit on the sales until they hit the next level of discount. Look at a flat discount.
Response rate changes with approach. Just mail may get 2%, Phone only 2-10%, Mail then phone 2 – 15%, Phone then mail 5-15%, Phone then mail then phone 10 -20%. (according to Calcom Group) P108.
Combining different advertising methods towards the same customer increases response.
Fulfilment centres can be paid to distribute flyers with products they send out.