Wednesday, December 29, 2010

Companies that can both execute and adapt are very rare indeed

From The Adaptable Corporation by Eric D. Beinhocker.
We thus have, on the one side, high-performing executers that can't sustain their performance and, on the other, long-term adapters that don't perform well. Companies that can both execute and adapt are very rare indeed. Wiggins and Ruefli found that fewer than 0.5 percent of the companies in their sample stayed in the top stratum for more than 20 years. Only three companies - American Home Products, Eli Lilly, and 3M, or 0.04 percent of the whole - made it to the 50-year mark. (This sample didn't include multibusiness companies, such as GE.)

Tuesday, December 28, 2010

The market performs better than companies do

From an interview in McKinsey Quarterly:
Richard Foster: In the book, Sarah Kaplan and I show that over the long term, the market performs better than companies do. There can be periods - 5, 7, 10, even 15 years - when that isn't the case, but corporate performance always reverts to a lower level than the market because the economy is changing at a faster pace and on a larger scale than any individual company so far has been able to do without losing control. That's the challenge: to create, operate, and trade - to divest old businesses and acquire or build new businesses - at the pace and scale of the market without losing control.

Thursday, December 23, 2010

A single mouse

From John M. Barry, The Great Influenza, page 160. In describing some of the testing on mice Barry mentions:
Male mice were and are generally not used in experiments because they sometimes attack each other; the death or injury of a single mouse for any reason can distort experimental results and ruin weeks of work.

Which makes sense. But I am surprised to come across this only now and in this place after so many hundreds if not thousands of science papers I have read over the years. It makes me wonder what, if any, bias or distortion using only female mice might have introduced into over a century of medical research from this pragmatic response to a quotidian issue. Presumably none, but you have to wonder.

He would sally forth to seek them

Thomas H. Huxley in An Essay, Joseph Priestley. Heh.
If the man to perpetuate whose memory we have this day raised a statue had been asked on what part of his busy life's work he set the highest value, he would undoubtedly have pointed to his voluminous contributions to theology. In season and out of season, he was the steadfast champion of that hypothesis respecting the Divine nature which is termed Unitarianism by its friends and Socinianism by its foes. Regardless of odds, he was ready to do battle with all comers in that cause; and if no adversaries entered the lists, he would sally forth to seek them.

Wednesday, December 22, 2010

To live is to think

Cicero, Tusculanes Disputationes -
To live is to think.

To move in harmony

Thomas H. Huxley in A Liberal Education and Where to Find It.
Education is the instruction of the intellect in the laws of Nature, under which name I include not merely things and their forces, but men and their ways; and the fashioning of the affections and of the will into an earnest and loving desire to move in harmony with those laws.

Tuesday, December 21, 2010

He became extraordinarily careful

From John M. Barry, The Great Influenza, page 158. Oswald Avery, early in his research career at the Rockefeller, became excited about the results from a couple of initial experiments and rushed to publish two papers. The ideas he advanced and the tentative evidence he offered both proved to be wrong to his great mortification.
Avery again reached well beyond his experimental evidence for a conclusion.

Both were quickly proved wrong. Humiliated he was determined never to suffer such embarrassment again. He became extraordinarily careful, extraordinarily cautious and conservative, in anything he published or even said outside of his own laboratory. He did not stop speculating - privately - about the boldest and most far-reaching interpretations of an experiment, but from then on he published only the most rigorously tested and conservative conclusions. From then on, Avery would only - in public - inch his way forward. An inch at a time, he would ultimately cover an enormous and startling distance.

Monday, December 20, 2010

Swirling personal experience

From John M. Barry, The Great Influenza, page 158, quoting Albert Einstein.
One of the strongest motives that lead persons to art or science is a flight from the everyday life. . . . With this negative motive goes a positive one. Man seeks to form for himself, in whatever manner is suitable for him, a simplified and lucid image of the world, and so to overcome the world of experience by striving to replace it to some extent by this image. This is what the painter does, and the poet, the speculative philosopher, the natural scientist, each in his own way. Into this image and its formation, he places the center of gravity of his emotional life, in order to attain the peace and serenity that he cannot find within the narrow confines of swirling personal experience.

Sunday, December 19, 2010

All else was extraneous

From John M. Barry, The Great Influenza, page 157. Describing one of the key scientific investigators of influenza, Oswald Avery, who manifests the discipline and focus that is so often associated with great achievements.
Avery had almost no personal life. He fled from one. He almost never entertained and rarely went out to dinner. Although he was close to and felt responsible for his younger brother and an orphaned cousin, his life, his world, was his research. All else was extraneous. Once the editor of a scientific journal asked him to write a memorial piece about Nobel laureate Karl Landsteiner, with whom he had worked closely at Rockefeller. In it Avery said nothing whatsoever about Landsteiner's personal life. The editor asked him to insert some personal details. Avery refused, stating that personal information would help the reader understand nothing that mattered, neither Landsteiner's achievements nor his thought processes.

(Landsteiner likely would have approved Avery's treatment. When he was notified he'd won the Nobel Prize, he continued working in his laboratory all day, got home so late that his wife was asleep, and did not wake her to give her the news.)

Saturday, December 18, 2010

Polonius' advice

From William Shakespeare, Hamlet. I am always scanning material for the embedded adages and proverbs that serve as cultural code for living an effective life. I came across this miscellany from Lord Polonius in Hamlet.
Yet here, Laertes! aboard, aboard, for shame!
The wind sits in the shoulder of your sail,
And you are stay'd for. There; my blessing with thee!
And these few precepts in thy memory
See thou character. Give thy thoughts no tongue,
Nor any unproportioned thought his act.
Be thou familiar, but by no means vulgar.
Those friends thou hast, and their adoption tried,
Grapple them to thy soul with hoops of steel;
But do not dull thy palm with entertainment
Of each new-hatch'd, unfledged comrade. Beware
Of entrance to a quarrel, but being in,
Bear't that the opposed may beware of thee.
Give every man thy ear, but few thy voice;
Take each man's censure, but reserve thy judgment.
Costly thy habit as thy purse can buy,
But not express'd in fancy; rich, not gaudy;
For the apparel oft proclaims the man,
And they in France of the best rank and station
Are of a most select and generous chief in that.
Neither a borrower nor a lender be;
For loan oft loses both itself and friend,
And borrowing dulls the edge of husbandry.
This above all: to thine ownself be true,
And it must follow, as the night the day,
Thou canst not then be false to any man.
Farewell: my blessing season this in thee!

Friday, December 17, 2010

Consider a system that is constantly changing

I have been working lately on materials addressing the puzzle of development - why do some people and some countries seem to do a better job over time of accumulating the wealth that allows them to make the decisions they wish to make? This passage from Melvin Konner in The Tangled Wing: Biological Constraints of the Human Spirit, page 408, addresses some aspects of the complexity. Here he is speaking of the effort to understand and forecast the influences on a person, their personality, and their decision making process but he could as easily be speaking of individuals from a life development or countries from an economic development perspective.
Consider a system that is constantly changing, according to laws both known and unknown, from causes both internal and external, in a manner both cyclical and progressive, by processes both reversible and irreversible. Allow it to pass through an inconceivable number of states, and to come to rest for varying times in any of them. Give it many potential reactions to a given input, including changing, ignoring, and terminating that input. Enable it to reproduce itself through functions that have entered the design exclusively because they serve that purpose, though often indirectly and at the cost of other purposes. Endow it further with a trajectory of fixed maximum length (say, ninety years), which carries the system, predictably, through a series of potential or actual states from nonexistence to final cessation of function, with a possible termination of function at any earlier time. Finally, build in a sensor that can detect where the system is in the trajectory, assess the chance of continued functioning, and react, as far as possible, to change that chance for the better, except - and this is a crucial but - where that conflicts with the goal of reproduction. We now have something approaching, at least in its outlines, the complexity of the human behavorial system. We must add, of course, the potential for malfunction that is common to all systems, whether because of design flaws or unpredicted stresses.

Thursday, December 16, 2010

Define: Sacerdotal

From P.D. James, The Lighthouse, page 329.
He remembered that this routine preparation for a climb had always been done in silence, a formal, purposeful putting on of courage and resolution, almost, he thought, as if his grandfather had been an ordained priest and he the acolyte, both performing some wordless but long familiar sacerdotal rite.

Sacerdotal from Wiktionary:
Adjective

sacerdotal (comparative more sacerdotal, superlative most sacerdotal)

1. Of or relating to priests or a high religious order; priestly.

Wednesday, December 15, 2010

Ostrich egg brunch

From Tom Parker in Rules of Thumb, page 123. While the first book is out of print, he has a current one in the series, Rules of Thumb: A Life Manual that is in print.
Ostrich Eggs. One ostrich egg will serve twenty-four people for brunch.

Tuesday, December 14, 2010

From Charles Panati in Words to Live By, page 180.
Wishing to Be Friends is Quick Work, but Friendship is a Slow-Ripening Fruit

Aristotle (384 -322 B.C.E.), a pupil of Plato, viewed friendship among the highest virtues. It was an essential element in a full, virtuous, and worthwhile life. For Aristotle, there were three kinds of friendship:

1. Friendship of pleasure: two people are wonderfully happy in one another's company.
2. Friendship of utility: two people assist one another in everyday aspects of life.
3. Friendship of virtue: two people mutually admire one another and will be on best behavior in order not to jeopardize their relationship.

In the Nicomachean Ethics the philosopher said: "My best friend is the man who in wishing me well wishes it for my sake."

Monday, December 13, 2010

We ought to be able to show some practical difference

From Selected Writings by William James, page 2.
I tell this trivial anecdote because it is a peculiarly simple example of what I wish now to speak of as THE PRAGMATIC METHOD. The pragmatic method is primarily a method of settling metaphysical disputes that otherwise might be interminable. Is the world one or many?--fated or free?--material or spiritual?--here are notions either of which may or may not hold good of the world; and disputes over such notions are unending. The pragmatic method in such cases is to try to interpret each notion by tracing its respective practical consequences. What difference would it practically make to anyone if this notion rather than that notion were true? If no practical difference whatever can be traced, then the alternatives mean practically the same thing, and all dispute is idle. Whenever a dispute is serious, we ought to be able to show some practical difference that must follow from one side or the other's being right.

Sunday, December 12, 2010

Or courage to forget

From Remember or Forget by Charles Hamilton Aide
I sit beside my lonely fire
And pray for wisdom yet:
For calmness to remember
Or courage to forget.

Thursday, December 9, 2010

The one is man that shall hereafter be

from Queen Mab
by Percy Bysshe Shelley

Man is of soul and body formed for deeds
Of high resolve; on fancy's boldest wing
To soar unwearied, fearlessly to turn
The keenest pangs to peacefulness, and taste
The joys which mingled sense and spirit yield;
Or he is formed for abjectness and woe,
To grovel on the dunghill of his fears,
To shrink at every sound, to quench the flame
Of natural love in sensualism, to know
That hour as blest when on his worthless days
The frozen hand of death shall set its seal,
Yet fear the cure, though hating the disease.
The one is man that shall hereafter be,
The other, man as vice has made him now.

Wednesday, December 8, 2010

Does not know what to do with it.

From Napoleon Hill, The Law of Success
Education-let us not forget this-consists of the power with which to get everything one needs when he needs it, without violating the rights of his fellow men.

[snip]

The man who can intelligently use the knowledge possessed by another is as much or more a
man of education as the person who merely has the knowledge but does not know what to do with it.

Tuesday, December 7, 2010

A date which will live in infamy

What makes a great speech? Hard to tell sometimes. Surely one set of elements must be the accuracy, the foresight and the durability of what is spoken. Here is President Franklin D. Roosevelt's speech to Congress on December 8th, 1941, the day after the attack at Pearl Harbor, asking that Congress declare war on the Japanese Empire. For all that the fog of war must have been thick, particularly in those telecom dark ages, there is virtually nothing inaccurate in the speech despite nearly seventy years of scholarly research and, even with the most dispassionate caste of mind, these words remain solemnly moving all these many years later.

For older middle schoolers and high schoolers, Walter Lord's Day of Infamy remains an excellent narrative story of the attack on Pearl Harbor.
Mr. Vice President, Mr. Speaker, members of the Senate and the House of Representatives:

Yesterday, December 7th, 1941 - a date which will live in infamy - the United States of America was suddenly and deliberately attacked by naval and air forces of the Empire of Japan.

The United States was at peace with that nation, and, at the solicitation of Japan, was still in conversation with its government and its Emperor looking toward the maintenance of peace in the Pacific.

Indeed, one hour after Japanese air squadrons had commenced bombing in the American island of Oahu, the Japanese Ambassador to the United States and his colleague delivered to our Secretary of State a formal reply to a recent American message. And, while this reply stated that it seemed useless to continue the existing diplomatic negotiations, it contained no threat or hint of war or of armed attack.

It will be recorded that the distance of Hawaii from Japan makes it obvious that the attack was deliberately planned many days or even weeks ago. During the intervening time the Japanese Government has deliberately sought to deceive the United States by false statements and expressions of hope for continued peace.

The attack yesterday on the Hawaiian Islands has caused severe damage to American naval and military forces. I regret to tell you that very many American lives have been lost. In addition, American ships have been reported torpedoed on the high seas between San Francisco and Honolulu.

Yesterday the Japanese Government also launched an attack against Malaya.
Last night Japanese forces attacked Hong Kong.
Last night Japanese forces attacked Guam.
Last night Japanese forces attacked the Philippine Islands.
Last night the Japanese attacked Wake Island.
And this morning the Japanese attacked Midway Island.

Japan has therefore undertaken a surprise offensive extending throughout the Pacific area. The facts of yesterday and today speak for themselves. The people of the United States have already formed their opinions and well understand the implications to the very life and safety of our nation.

As Commander-in-Chief of the Army and Navy I have directed that all measures be taken for our defense, that always will our whole nation remember the character of the onslaught against us.

No matter how long it may take us to overcome this premeditated invasion, the American people, in their righteous might, will win through to absolute victory.

I believe that I interpret the will of the Congress and of the people when I assert that we will not only defend ourselves to the uttermost but will make it very certain that this form of treachery shall never again endanger us.

Hostilities exist. There is no blinking at the fact that our people, our territory and our interests are in grave danger.

With confidence in our armed forces, with the unbounding determination of our people, we will gain the inevitable triumph. So help us God.

I ask that the Congress declare that since the unprovoked and dastardly attack by Japan on Sunday, December 7th, 1941, a state of war has existed between the United States and the Japanese Empire.

Franklin D. Roosevelt - December 8, 1941

You will only be deceiving yourself

From Napoleon Hill, The Law of Success
Success in this world is always a matter of individual effort, yet you will only be deceiving yourself if you believe that you can succeed without the co-operation of other people. Success is a matter of individual effort only to the extent that each person must decide, in his or her own mind, what is wanted. This involves the use of "imagination." From this point on, achieving success is a matter of skillfully and tactfully inducing others to cooperate.

Sunday, December 5, 2010

The bad economist confines himself to the visible effect

From Frederic Bastiat in Selected Essay on Political Economy:
There is only one difference between a bad economist and a good one: the bad economist confines himself to the visible effect; the good economist takes into account both the effect that can be seen and those effects that must be foreseen.

Saturday, December 4, 2010

The Broken Window

Essays on Political Economy by Frederic Bastiat. It is amazing how long we can maintain illusions (for example "cash for clunkers") that were long ago explained and dispelled.
I. The Broken Window.

Have you ever witnessed the anger of the good shopkeeper, James B., when his careless son happened to break a pane of glass? If you have been present at such a scene, you will most assuredly bear witness to the fact, that every one of the spectators, were there even thirty of them, by common consent apparently, offered the unfortunate owner this invariable consolation--"It is an ill wind that blows nobody good. Everybody must live, and what would become of the glaziers if panes of glass were never broken?"

Now, this form of condolence contains an entire theory, which it will be well to show up in this simple case, seeing that it is precisely the same as that which, unhappily, regulates the greater part of our economical institutions.

Suppose it cost six francs to repair the damage, and you say that the accident brings six francs to the glazier's trade--that it encourages that trade to the amount of six francs--I grant it; I have not a word to say against it; you reason justly. The glazier comes, performs his task, receives his six francs, rubs his hands, and, in his heart, blesses the careless child. All this is that which is seen.

But if, on the other hand, you come to the conclusion, as is too often the case, that it is a good thing to break windows, that it causes money to circulate, and that the encouragement of industry in general will be the result of it, you will oblige me to call out, "Stop there! your theory is confined to that which is seen; it takes no account of that which is not seen."

It is not seen that as our shopkeeper has spent six francs upon one thing, he cannot spend them upon another. It is not seen that if he had not had a window to replace, he would, perhaps, have replaced his old shoes, or added another book to his library. In short, he would have employed his six francs in some way which this accident has prevented.

Let us take a view of industry in general, as affected by this circumstance. The window being broken, the glazier's trade is encouraged to the amount of six francs: this is that which is seen.

If the window had not been broken, the shoemaker's trade (or some other) would have been encouraged to the amount of six francs: this is that which is not seen.

And if that which is not seen is taken into consideration, because it is a negative fact, as well as that which is seen, because it is a positive fact, it will be understood that neither industry in general, nor the sum total of national labour, is affected, whether windows are broken or not.

Now let us consider James B. himself. In the former supposition, that of the window being broken, he spends six francs, and has neither more nor less than he had before, the enjoyment of a window.

In the second, where we suppose the window not to have been broken, he would have spent six francs in shoes, and would have had at the same time the enjoyment of a pair o shoes and of a window.

Now, as James B. forms a part of society, we must come to the conclusion, that, taking it altogether, and making an estimate of its enjoyments and its labours, it has lost the value of the broken window.

Whence we arrive at this unexpected conclusion: "Society loses the value of things which are uselessly destroyed;" and we must assent to a maxim which will make the hair of protectionists stand on end--To break, to spoil, to waste, is not to encourage national labour; or, more briefly, "destruction is not profit."

What will you say, Moniteur Industriel--what will you say, disciples of good M. F. Chamans, who has calculated with so much precision how much trade would gain by the burning of Paris, from the number of houses it would be necessary to rebuild?

I am sorry to disturb these ingenious calculations, as far as their spirit has been introduced into our legislation; but I beg him to begin them again, by taking into the account that which is not seen, and placing it alongside of that which is seen.

The reader must take care to remember that there are not two persons only, but three concerned in the little scene which I have submitted to his attention. One of them, James B., represents the consumer, reduced, by an act of destruction, to one enjoyment instead of two. Another, under the title of the glazier, shows us the producer, whose trade is encouraged by the accident. The third is the shoemaker (or some other tradesman), whose labour suffers proportionably by the same cause. It is this third person who is always kept in the shade, and who, personating that which is not seen, is a necessary element of the problem. It is he who shows us how absurd it is to think we see a profit in an act of destruction. It is he who will soon teach us that it is not less absurd to see a profit in a restriction, which is, after all, nothing else than a partial destruction. Therefore, if you will only go to the root of all the arguments which are adduced in its favour, all you will find will be the paraphrase of this vulgar saying--What would become of the glaziers, if nobody ever broke windows?

Friday, December 3, 2010

A fantastic house of cards

From Where are the Geniuses of Today? by Alex Petrov:
The ability to reason, to compute, to manipulate the symbols and rules of logic -- this unnatural talent, too, must lie at the very margin, where small differences in raw talent have enormous consequences, where a merely good physicist must stand in awe of Dyson and where Dyson, in turn, stands in awe of Feynman. Merely to divide 158 by 192 presses most human minds to the limit of exertion. To master -- as modern particle physicists must -- the machinery of group theory and current algebra, of perturbative expansions and non-Abelian gauge theories, of spin statistics and Yang-Mills, is to sustain in one's mind a fantastic house of cards, at once steely and delicate. To manipulate that framework, and to innovate within it, requires a mental power that nature did not demand of scientists of past centuries. More physicists than ever rise to meet this cerebral challenge.

Thursday, December 2, 2010

It is notorious that facts are compatible with opposite emotional comments

From William James, The Varieties of Religious Experience.
It is notorious that facts are compatible with opposite emotional comments, since the same fact will inspire entirely different feelings in different persons, and at different times in the same person; and there is no rationally deducible connection between any outer fact and the sentiments it may happen to provoke. These have their source in another sphere of existence altogether, in the animal and spiritual region of the subject's being. Conceive yourself, if possible, suddenly stripped of all the emotion with which your world now inspires you, and try to imagine it as it exists, purely by itself, without your favorable or unfavorable, hopeful or apprehensive comment. It will be almost impossible for you to realize such a condition of negativity and deadness. No one portion of the universe would then have importance beyond another; and the whole collection of its things and series of its events would be without significance, character, expression, or perspective. Whatever of value, interest, or meaning our respective worlds may appear endued with are thus pure gifts of the spectator's mind. The passion of love is the most familiar and extreme example of this fact. If it comes, it comes; if it does not come, no process of reasoning can force it. Yet it transforms the value of the creature loved as utterly as the sunrise transforms Mont Blanc from a corpse-like gray to a rosy enchantment; and it sets the whole world to a new tune for the lover and gives a new issue to his life. So with fear, with indignation, jealousy, ambition, worship. If they are there, life changes. And whether they shall be there or not depends almost always upon non-logical, often on organic conditions. And as the excited interest which these passions put into the world is our gift to the world, just so are the passions themselves gifts,- gifts to us, from sources sometimes low and sometimes high; but almost always non-logical and beyond our control. How can the moribund old man reason back to himself the romance, the mystery, the imminence of great things with which our old earth tingled for him in the days when he was young and well? Gifts, either of the flesh or of the spirit; and the spirit bloweth where it listeth; and the world's materials lend their surface passively to all the gifts alike, as the stage-setting receives indifferently whatever alternating colored lights may be shed upon it from the optical apparatus in the gallery.

Wednesday, December 1, 2010

If God had made man a solitary animal . . .

Frederic Bastiat, via 1994 Annual Report of the Federal Reserve Bank of Dallas.
If God had made man a solitary animal, everyone would labor for himself . . . But, since man is a social creature, services are exchanged for services . . . Do this for me, and I will do that for you.