Leadership and Self-Deception, The Arbinger Institute

"Self-betrayal"

• An act contrary to what I feel I should do for another is called an act of "self-betrayal".
• When I betray myself, I begin to see the world in a way that justifies my self-betrayal.
• When I see a self-justifying world, my view of reality becomes distorted.
• So -- when I betray myself, I enter the "box". [this "box" is a paradigm of skewed thinking and perception that drives how I act and think]
• Over time, certain boxes become characteristic of me, and I carry them with me.
• By being in the "box", I provoke others to also be in their boxes.
• In the "box", we invite mutual mistreatment and obtain mutual justification [to continue to behave/think selfishly].  We unknowingly collude in giving each other reason to stay in the "box".

For the good of a relationship (be it in social, or in business), we need to get out of the "box".  To get out of the box, we need to see people as people, not objects that need to be cajoled, or manipulated to serve our needs.  We need to see others as important as well.

How is this important in business?  Well, we work together to achieve results.  If we are in the "box", we won't be thinking for the common good, but for our own selves.

Works in relationships as well.  If you ever had mixed feelings about your spouse's attitudes, this book is for you.  Read it.  Will be good for you.  Helped me think though a number of issues with my biz partner.

Inside the House of Money, Steven Drobny

"A fantastic book, in both content and execution." Bloomberg News

"Loved ... [the] book -- its' on my nightstand!" Bill Gross, MD, Pimco

Yup, so I bought it.  Read it.  And then thought, "what a load of crap".  Its a bunch of people who talked about their experiences about how well they did, and some of the lessons they learnt.  Drobny could have just summarised the whole book on one page.  They were just lucky.

But then again, I'm neither Bill Gross nor Bloomberg, so what do I know, eh?

The Warren Buffet Portfolio, Robert G Hagstrom

• Buffet suggests focusing on five to ten stocks.
• Why Munger and Buffet are not in high-tech investments : "...we'd rather deal with what we understand.  Why should we play a competitive game in a field where we have no advantage -- maybe a disadvantage -- instead of playing in a field where we have a clear advantage."
• "Each of you will have to figure out where your talents lie," counsels Munger, "and you will have to use your advantages.  But if you try to succeed in what you're worst at, you're going to have a very lousy career.  I can almost guarantee it."
• "Learning is simply a matter of observing what is going on around you."  Buffet
• The Kelly Optimization Model.
• There is a formula:  2p -1 = x (where p is the probability of winning expressed in fractional percentage, and x = percentage of your bankroll to bet).
• To receive the benefit of the Kelly model, you must first be willing to think about buying stocks in terms of probabilities.
• You must be willing to play the game long enough to achieve its rewards.
• You must avoid using leverage, with its unfortunate consequences.
• You should demand a margin of safety with each bet you make. 
• Benjamin Graham's approach to stock investing:
• Look at stocks as a business.
• Have a margin-of-safety.
• Have a true investor's attitude toward the stock market.
• Do not be stampeded by other people's misjudgment.
• When it comes to money and investing, people frequently make errors in judgment.
• In investing, ... we need to understand basic accounting and finance...statistics and probabilities.  But once of the most important fields to learn from is psychology.
• People put too much emphasis on a few chance events, thinking they they spot a trend.  
• Behaviorists have learnt that people tend to overreact to bad news and react slowly to good news.
• Thaler's notion of investor myopia -- shortsightedness lead to foolish decisions, and is driven by our innate desire to avoid loss.
• Risk-taking propensity is connected to two demographic factors -- age and gender.
• Successful focus investors need a certain kind of temperament.  The road is always bumpy, and knowing which is the right path to take is often counter-intuitive.

Great book.

Meme: Save Yvonne's Sight

I don't normally do this meme thingy. Heavens, I only have a total sum of 4 distinct visitors to this so-called blog. I'm embarrassed to even call this blog a 'blog'. But, there you have it.

But for a good cause, and because I was tagged by one spunky lady, and so, let me introduce you to Yvonne Foong. She's 22 years old, and have her whole life ahead of her. But she will soon lose her eyesight because of neurofibromatosis type II if she doesn't get surgery help. This surgery and hospital stay is expensive, but if everyone pitches in a little, it is doable.

She is trying to raise the needed funds for the surgery through sales of her book I'm Not Sick; I'm Just a Bit Unwell. The book, in English and Chinese versions, is available in Malaysian bookshops and from her web site here. She is also selling T-Shirts and now, mooncakes!

Yvonne Foong is in danger of losing her eyesight thanks to neurofibromatosis (NF). Please find out how you can help her by visiting her blog at http://www.yvonnefoong.com/.

In GOD We Doubt, John Humphrys

1. I have always thought it quite ridiculous to expect someone to believe in God without having had any experience of him. Rather like telling someone to believe in bananas without ever tasting one.
2. What believers and athiests agree on is that our actions are influenced by any number of factors: upbringing; environment; custom and tradition; fear of consequences. Both sides also acknowledge the presence of the still, small voice. But for believers its origin is divine and for athiests it is the voice of reason. As for me, it is difficult to understand the existence of conscience without accepting the existence of something beyond ourselves.

Differentiate or Die, Jack Trout

With enormous competition, markets are driven by choice. The customer has so many good alternatives that you pay dearly for your mistakes. Your competitors get your business and you don't get it back easily. Companies that don't understand this will not survive.

What Is Not A Differentiator?

• Creativity is NOT a differentiator
• Price is RARELY a differentiator
• Breadth of line is a DIFFICULT differentiator

What Is A Differentiator?

• Being FIRST is a differentiator.
• Attribute Ownership is a differentiator.
• Leadership is a differentiator.
• Heritage is a differentiator.
• Market specialty is a differentiator.
• Preference is a differentiator.
• How a product is made is a differentiator.
• Being latest is a differentiator.
• Hotness is a differentiator.

Once you've established what makes you different, your next assignment is to reflect that difference in everything you do. This single-mindedness will influence not only your customers but your own employees as well.

Founders At Work, Jessica Livingston

Interviews Max Levchin, co-founder of Paypal:

Livingston: What advice would you give to a young programmer who's thinking of starting a startup?

Levchin: Try to have a good co-founder...if you have a good team, you're halfway there.

Livingston: You didn't make any mistakes?

Levchin: There are all sorts of tactical decisions that we made here and there that played out to be wrong, but its not like I dould have predicted it. It's not one of these things that I'm now smarter and therefore I could have done it even better. I think, given the information available at that time, I would have likely chosen the same outcome.

Livingston: Was there anything hat was misunderstood about what you were trying to do?

Levchin: ... I don't think there was ever any clarity as to who we were until we knew it was working...

Interviews Steve Wozniak, co-founder of Apple:

Livingston: What is the key to excellence for an engineer?

Woz: You have to be very diligent. You have to check every little detail. You have to be so careful that you haven't left anything out. You have to think harder and deeper than you normally would. It's hard with today's large, huge programs.

Livingston: What advice would you give to hackers who are thinking about starting a company or making something of their own?

Woz: ... Always seek excellence: make your product better than the average person would...it's better to be young because you can spend a lot more nights, very, very late. Because you have to get things done, and there's almost no other way to get around that. When the times come, they are critical.

Interviews Ray Ozzie, founder of Groove Networks (now with Microsoft):

Livingston: What advice would you give to someone who was thinking or joining a startup?

Ozzie: Learn to respect and appreciate other people's skill sets, because you are going to need other people if you do start a company and you are a technologist. Understand that it's a rare, rare case when a tech enterpreneur is the right one to lead a startup for a long period of time...

That's where I think working for another company [first] and building those relationships is extremely valuable. Frequently, people think just running from school out into doing a startup is the best thing to do. But I think that getting some experience within a number of companies is really positive because you meet people and you start to develop patterns in your mind of the types of people that you need, and the types of people that you can trust, and the types of people you never want to work with.

Interviews Tim Brady, First Non-founding employee at Yahoo:

Livingston: Any advice you'd give to someone who was starting a startup?

Brady: ...you always hear "Don't do business with friends, bad idea." So, one of the things that really helped me was that [Jerry] and I had a conversation before I joined, "OK, here are the ground rules." ..."OK, if this happens, I walk away." We had the conversation in order to preserve our friendship, having no idea what was going to happen, but that conversation got me thinking abou it and why I was involved.

Interviews Charles Geschke, cofounder, Adobe:

Livingston: What were some major turning points?

Geschke: ...The other lesson that we had to learn, though, is that you can't be a one-product company. There's a very high risk...that eventually a combination of changes in the techological and competitive landscapes will eventually cause you to begin losing market share.

Livingston: Is there any other advice you would give to someone who was thinking of starting a startup?

Geschke: If you aren't passionate about what you are going to do, don't do it. Work smart, and not long, because you need to preserve all of your life, not just your work life.

Interviews Joel Spolsky, cofounder, Fog Creek Software:

Livingston: What advice would you give to a programmer who's thinking about starting a company?

Spolsky: ...Don't start a company unless you can convince one other person to go along with you.