Monday, October 29, 2007

The Wisdom of Crowds by James Surowiecki

An interesting read with tenuous small business applications. It makes the case effectively that crowds can be “wise,” that a diverse group of independent individuals can arrive at collective decisions that are better than any of its individual members and which, reliably, can be used to predict the future. Look at the stock market, for example, or the point spreads on Sunday football games. When they’re working correctly, they predict the future value of a company, or the margin of victory. And they only get out of whack when the crowd that’s driving them stops being diverse and/or starts talking to one another. The business application is for companies to set up internal “decision markets,” in which a diverse group of employees “buy” stock in certain projects as a way of indicating which they think will be successful. The collective wisdom of the group will be reliably right. The methodology is currently being used by some of the largest companies to decide which new products to develop and by a new wave of polling firms to help predict the outcomes of political elections.

I enjoyed the book, but more for its interesting facts and ideas than for it applicability to my business environment. For example, there’s a short section on the history of the United States’ intelligence gathering agencies. Those that existed prior to World War II were part of the different branches of the military, and they were completely surprised by the attack on Pearl Harbor, even though it was later revealed that they had information in their possession at the time that, if it had been shared and analyzed effectively, would have clearly revealed what the Japanese were planning. In the wake of this embarrassment, the CIA was created, with the express purpose of serving as the “centralized” agency, responsible for coordinating the activities of the other intelligence services and overseeing the collective gathering and analyzing of information. In this mission the CIA utterly failed, spawning instead a myriad of new intelligence agencies, each being run as its own little fiefdom and doing everything but sharing information with its neighbors. The result, sixty-some years later, was the surprise that happened on September 11, 2001. In more ways than I originally thought, Pearl Harbor all over again.

Another interesting tidbit is something called the “ultimatum game,” which is perhaps the most-well-known experiment in behavioral economics. To quote Surowiecki:

The rules of the game are simple. The experimenter pairs two people. (They can communicate with each other, but otherwise they’re anonymous to each other.) They’re given $10 to divide between them, according to this rule: One person (the proposer) decides, on his own, what the split should be (fifty-fifty, seventy-thirty, or whatever). He then makes a take-it-or-leave-it offer to the other person (the responder). The responder can either accept the offer, in which case both players pocket their respective shares of the cash, or reject it, in which case both players walk away empty-handed.

If both players are rational, the proposer will keep $9 for himself and offer the responder $1, and the responder will take it. After all, whatever the offer, the responder should accept it, since if he accepts he gets some money and if he rejects, he gets none. A rational proposer will realize this and therefore make a lowball offer.

In practice, though, this rarely happens. Instead, lowball offers—anything below $2—are routinely rejected. Think for a moment about what this means. People would rather have nothing than let their “partners” walk away with too much of the loot. They will give up free money to punish what they perceive as greedy or selfish behavior. And the interesting thing is that the proposers anticipate this—presumably because they know they would act the same way if they were in the responder’s shoes. As a result, the proposers don’t make low offers in the first place. The most common offer in the ultimatum game, in fact, is $5.

Seems like we’re wired to be both greedy and to punish greediness in others. And here’s the final tidbit, this one with a real business application.

Decentralized markets work exceptionally well because the people and companies in those markets are getting constant feedback from customers. Companies that aren’t doing a good job or that are spending too much learn to adjust or else they go out of business. In a corporation, however, the feedback from the market is indirect. Different divisions can see how they’re doing, but individual workers are not directly rewarded (or punished) for their performance. And although corporate budgets should theoretically echo the market’s verdict on corporate divisions, in practice the process is often politicized. Given that, divisions have an incentive to look for more resources from the corporation than they deserve, even if the company as a whole is hurt. The classic example of this was Enron, in which each division was run as a separate island, and each had its own separate cadre of top executives. Even more strangely, each division was allowed to build or buy its own information-technology system, which meant that many of the divisions could not communicate with each other, and that even when they could, Enron was stuck paying millions of dollars for redundant technology.

The important thing for employees to keep in mind, then, is that they are working for the company, not for their division. Again, Enron took exactly the opposite tack, emphasizing competition between divisions and encouraging people to steal talent, resources, and even equipment from their supposed corporate comrades. This was reminiscent of the bad old days at companies like GM, where the rivalries between different departments were often stronger than those between the companies and their outside competitors. The chairman of GM once described the way his company designed and built new cars this way: “Guys in [design] would draw up a body and send the blueprint over and tell the guy, ‘Okay, you build it if you can, you SOB.’ And the guy at [assembly] would say, ‘Well, Jesus, there’s no damn way you can stamp metal like that and there’s no way we can weld this stuff together.’”

The beneficial effects of competition are undeniable, but serious internal rivalries defeat the purpose of having a company with a formal organization in the first place, by diminishing economies of scale and actually increasing the costs of monitoring people’s behavior. You should be able to trust your fellow workers more than you trust workers at other firms. But at a company like Enron, you couldn’t. And because the competition is, in any case, artificial—since people are competing for internal resources, not in a real market—the supposed gains in efficiency are usually an illusion. As is the case with today’s American intelligence community, decentralization only works if everyone is playing on the same team.

This sounds a lot like a place I used to work. The lesson: give people the tools of make their own decisions, but only if everyone is clear about who your competitors are.

Saturday, October 27, 2007

March by Geraldine Brooks

Having never read Little Women by Louisa May Alcott, I can’t tell how much more this novel would’ve revealed to me if I had, but I certainly enjoyed it nonetheless.

This is the story of the Little Women’s father, who evidently spent much of that novel away from them, and the things he experienced as a chaplain in the Civil War. It is extremely well researched and authentically written. Told in the first person, the voice is undeniably one of a 19th century abolitionist, and it is rich in the details associated with everyday life in that era. On top of that, it is an engaging and thoughtful narrative, with a main character whom I truly came to care about and think of as a real person.

March struggles through much of the novel, struggles with the slaveholding society he finds himself amidst and struggles with his own feelings of inadequacy and undeserved blessing. Again, I don’t know what kind of novel Little Women is, but I know it is often recommended for young girls, so I speculate that March finds himself dealing with issues that are totally out of the ken of his family back into Concord, New Hampshire. In fact, we see this disconnect very clearly late in the novel when the point of view switches without warning to March’s wife, who comes down to visit her husband in a Washington hospital after he is shot and takes grievously ill. With her husband unconscious, she has to piece together what happened to him and what he has been doing from the few mementos that are still in his possession and from the reluctant lips of a nurse and former slave who knew him from the time before he was married. She jumps to a series of mistaken conclusions, only a few of which are unjustified, but perfectly sensible from the perspective of the world she lives in. The life of an abolitionist in the North is, forgive the pun, much more black and white than the swirling gray mess that war and slavery can cause. March has acted in the best interests of those around him throughout his experience in the war, and has formed loving bonds with several, living and dead, because of the trials they had suffered together. He blames himself for their deaths, and wants to return to the fight in order to have a chance to redeem himself from those miserable failures. His wife understands none of this, and berates him almost savagely, not just for the bonds he had formed while away from her, but even more so for his desire to rekindle them rather than return with her to their family.

In many ways, the scene reminds me of the one in Huckleberry Finn, when Tom Sawyer appears at the end of the novel, playing his usual games and tricks, and Huck is no longer capable of seeing the fun and frivolity in what appears to him to be matters of gravity and importance. In his time away from Tom, Huck has grown out of that childish phase, and in March’s time away from his family, he has grown, too, grown in ways his wife cannot possibly understand.

This book won the Pulitzer Prize for Fiction in 2006, and I choose it for that reason. After listening to The Road by Cormac McCarthy (this one was an audiobook, too) I’ve decided to read or listen to all the Pulitzer Prize winning novels. Something tells me I’m going to enjoy them all.

Wednesday, October 17, 2007

The Acts of King Arthur and His Noble Knights by John Steinbeck

I picked this one up a while ago simply because it had Steinbeck’s name on the cover. Turns out he was a devotee of the Arthurian legends and worked diligently for the last several years of his life to “translate” Malory’s fifteenth century telling into modern language with modern themes.

Funny thing happened while I was reading it. Steinbeck says in the introduction that he has for a long time wanted to bring to present day usage the stories of King Arthur and the Knights of the Round Table…leaving out nothing and adding nothing.” But as I got deeper into it I became convinced that Steinbeck was playing a trick on everyone. He had started by simply translating the stories from Old English to Modern English, but midway into the book he had begun to insert his own stories, writing them with the same characters and themes as Malory, but creating new plots and new scenarios for them to engage in. Telling his own truths, as it were, with the props of another author. For example:

“Maybe it’s too simple, madame. But you know how children, when they are forbidden something they want, sometimes scream and storm and sometimes even hurt themselves in rage. Then they grow quiet and vengeful. But they are not strong enough to revenge themselves on the one they consider their oppressor. Such a one sometimes stamps on an ant, saying, ‘That’s for you, Nursie,’ or kicks a dog and calls him brother, or pulls the wings from a fly and destroys his father. And then, because his world has disappointed him, he builds his own world where he is king, where he rules not only men and women and animals but clouds and stars and sky. He is invisible, he flies. No authority can keep him in or out. In his dream he builds not only a world but remakes himself as he would wish to be. I guess that’s all. Usually he makes peace with the world and works out compromises so that the two will not hurt each other badly. There it is, you see.”

Now, that’s Lancelot talking to Morgan le Fay and some other witches about why some people decide to pursue the necromanic arts, but at the same time, that is pure Steinbeck. I found it hard to believe that these ideas came originally from the pen of Malory.

“Granite so hard that it will smash a hammer can be worn away by little grains of moving sand. And a heart that will not break under the great blows of fate can be eroded by the nibbling of numbers, the creeping of days, the numbing treachery of littleness, of important littleness. I could fight men but I was defeated by marching numbers on a page. Think of fourteen xiii’s—a little dragon with a stinging tail—or one hundred and eight cviii’s—a tiny battering ram. If only I had never been seneschal! To you a feast is festive—to me it is a book of biting ants. So many sheep, so much bread, so many skins of wine, and has the salt been forgotten? Where is the unicorn’s horn to test the king’s wine? Two swans are missing. Who stole them? To you war is fighting. To me it is so many ashen poles for spears, so many strips of steel—counting of tents, of knives, or leather straps—counting—counting of pieces of bread. They say the pagan has invented a number which is nothing—nought—written like an O, a hole, an oblivion. I could clutch that nothing to my breast. Look sir, did you ever know a man of numbers who did not become small and mean and frightened—all greatness eaten away by little numbers as marching ants nibble a dragon and leave picked bones? Men can be great and fallible—but numbers never fail. I suppose it is their terribly puny rightness, their infallible smug, nasty rightness that destroys—mocking, nibbling, gnawing with tiny teeth until there’s no man left in a man but only a pie of minced terrors, chopped very fine and spiced with nausea. The mortal wound of a numbers man is a bellyache without honor.”

And that’s Sir Kay complaining to Lancelot about the hassles of being seneschal, but I was sure it was really Steinbeck, not Malory, who not only put the words into Sir Kay’s mouth, but engineered the situation in which he had cause to utter them. But then I read in the book’s appendix—an amazing record of correspondence Steinbeck kept with his editor and publisher throughout his preparatory research and writing of the manuscript—that these are in fact stories from Malory. Steinbeck struggled hard to make them interesting and enjoyable for the modern reader, but at their core they are Malory’s stories. I think it is a testament to the work and skill Steinbeck poured into this work that he had me convinced that the stories were his, that they were dealing with themes and issues Steinbeck must have been concerned with in the 1950s, and couldn’t possibly have been related to any issue someone else thought relevant to the 1500s.

And the letters themselves—they are wonderful, giving us a glimpse as they do into the writer’s mind, a glimpse traditionally hidden behind the fiction, but here laid bare for all the world to see. One particularly is worth quoting in full.

I have been thinking about E.O. You know in the many years of our association there has been hardly a moment without a personal crisis. There must be many times when she wishes to God we all were in hell with our backs broke. If we would just write our little pieces and send them in and take our money or our rejections as the case might be and keep our personal lives out of it. She must get very tired of us. And also this must be a weary pattern. We pile our woes on her and they must always be the same woes. If she should suddenly revolt, I wouldn’t be a bit surprised. Instead of gloriously clean copy she gets excuses, and mimes and distress and former and future and bills. Writers are a sorry lot. The best you can say of them is that they are better than actors and that’s not much. I wonder how long it is since one of her clients asked her how she felt—if ever. It’s a thankless business. How sharper than a serpent’s tooth to have a writer. The smallest activity of a writer it seems is writing. If his agonies, his concupiscence, his errors in judgment were publishable the world would be navel deep in books. One of the happier aspects of television is that is draws off some of these activities. Patience on a manuscript.

Now back to Malory or rather my interpretation of his interpretation to be followed, I hope, by my interpretation of my interpretation. As I go along, I am constantly jiggled by the arrant nonsense of a great deal of the material. A great deal of it makes no sense at all. Two thirds of it is the vain dreaming of children talking in the dark. And then when you are about to throw it out in disgust, you remember the Congressional Record or the Sacco and Vanzetti case or “preventive war” or our national political platforms, or racial problems that can’t be settled reasonably or domestic relations, or beatniks, and it is borne in on you that the world operates on nonsense—that it is a large part of the pattern and that knight errantry is no more crazy than our present-day group thinking, and activity. This is the way humans are. If you inspected them and their activities in the glass of reason, you would drown the whole lot. Then when I am properly satiric about the matter I think of my own life and how I have handled it and it isn’t any different. I’m caught with the silly breed. I am brother to the nonsense and there’s no escaping it. But even the nonsense is like the gas and drug revelations of the Pythoness at Delphi which only make sense after the fact.

I am working now on Gawain, Ewain, and Marhalt, having lost a little time over the issues of the boys. It’s so full of loose ends, of details without purpose, of promised unkept. The white shield for instance—it is never mentioned again. I think I am breathing some life into it but maybe not enough. As I go along I do grow less afraid of it. But there must be some reverence for the material because if you reject these stories you reject humans.

There are two kinds of humans on the creative level. The great mass of the more creative do not think. They are deeply convinced that the good world is past. Status quo people, feeling they cannot go back to the perfect time, at least fight not to go too far from it. And then there is creative man who believes in perfectibility, in progression—he is rare, he is not very effective but he surely is different from the others. Laughter and tears—both muscular convulsions not unlike each other, both make the eyes water and the nose run and both afford relief after they are over. Marijuana stimulates induced laughter, and the secondary effect of alcohol false tears, and both a hangover. And these two physical expressions are expendable, developable. When a knight is so upset by emotion that he falls to the ground in a swound, I think it is literal truth. He did, it was expected, accepted. And he did it. So many things I do and feel are reflections of what is expected and accepted. I wonder how much of it is anything else.

Isn’t it strange how parallels occur. About a month ago, while doodling in preparation for work, I wrote a short little piece and put it in my file where it still remains. I quote from it.

“When I read of an expanding universe, of novas and red dwarfs, of violent activities, explosions, disappearances of suns and the birth of others, and then realize that the news of these events, carried by light waves, are records of things that happened millions of years ago, I am inclined to wonder what is happening there now. How can we know that a process and an arrangement so long past has not changed radically or revised itself? It is conceivable that what the great telescopes record presently does not exist at all, that those monstrous issues or the stars may have ceased to be before our world was formed, that our Milky Way is a memory carried in the arms of light.”

Where do you begin commenting on that? Isn’t that what all writers wrestle with? The nonsense from which the fiction is constructed, and the sense only coming—if at all—after it has all been written. Two other items worth quoting:

Arthur is not a character. You are right. And here it might be well to consider that Jesus isn’t either, nor is Buddha. Perhaps the large symbol figures can’t be characters, for if they were, we wouldn’t identify with them by substituting our own. Such a thing is worth thinking about surely.

- - - - - - - - - -

Alas! I can only agree with you—Arthur is a dope. It gets so that you want to yell—Not that again! Look out—he’s got a gun! the way we used to in the old movies when our beloved hero was blundering stupidly into the villain’s lair. Just the same as Arthur. But it goes further and even gets into the smart ones. Consider Morgan—without checking whether her plan to murder Arthur had succeeded, she goes blithely ahead as though it had. But this is literature. Think if you will of Jehovah in the Old Testament. There’s a God who couldn’t get a job as apprentice in General Motors. He makes a mistake and then gets mad and breaks his toys. Think of Job. It almost seems that dopiness is required in literature. Only the bad guys can be smart. Could it be that there is a built-in hatred and fear of intelligence in the species so that the heroes must be stupid? Cleverness equates with evil almost invariably. Is a puzzlement, but there it is.

Monday, October 15, 2007

The Road by Cormac McCarthy

I know why McCarthy won the Pulitzer Prize for this. It is an extremely powerful novel that operates effectively on two interconnected levels.

First, it’s a gripping story. A man and his son, trying to survive in a post-apocalyptic America. You feel for them. You want them to survive in this world gone mad. You want them to get away and be safe. The horror is real when they find the locked basement full of people who are being kept by cannibals for the stringy meat on their bones, one of them laying on a mattress on the floor with both his legs amputated and his stumps burned black to stop him from bleeding to death. Their flight from there, their concealment in the woods under a pile of leaves, their dark and dangerous trek—your heart is in your throat the whole time. And when they get away, and they find the bomb shelter full of canned goods, and plates, and silverware, and new clothes, and soap. The relief and joy in the father’s voice is palpable and strong and true.

I listened to this one as an audio book, and some random reviewer on the site I purchased it from cautioned against that, cautioned that you have to read and linger over McCarthy’s prose to really appreciate it. Having listened to it, I can see that reviewer’s point, and fully intend to get the hard copy and add it to the pile of books to read. But hearing the voices speak to you, especially in a scene like the bomb shelter, is an experience I will not soon forget.

But that’s only one level of the book. The other level is deeper and more primal, and is just as powerful on its level as the suspense story is on its. This is a book about every man and his son, the characters deliberately not given names to accentuate the archetypal role they are playing. And as this man struggles to protect his son from the horrors of their world, we see every man struggling the same way to protect his son from the horrors of his world. There are times when the man gets angry at the son, and he is immediately sorry for being so, and gives his son every indulgence they can afford, from the syrup in the can of cling peaches they find to the grape Kool-aid he finds and keeps until he gathers enough rain water to mix with it. He tells the boy things about their situation in ways they boy would understand, that there are good guys and bad guys in the world, and that they are part of the good guys and that they must “carry the fire” of the old world until they join up with other good guys so that the fire can be strengthened. He risks his own life to keep his son alive, to keep his son from harm, and does things the boy is frightened by or does not want him to do, because he knows that the act is in the child’s best interest. And at the end of the novel, when the man lays dying, he remains strong for his boy and tries to help him understand both what is happening and what he must do after the man has died.

“You need to go on. I can’t go with you. You need to keep going. You don’t know what might be down the road. We were always lucky. You’ll be lucky again. You’ll see. Just go. It’s all right.”

“I can’t.”

“It’s all right. This has been a long time coming. Now, it’s here. Keep going south. Do everything the way we did.”

“You’re going to be okay, Papa. You have to.”

“No. I’m not. Keep the gun with you at all times. You need to find the good guys but you can’t take any chances. No chances. Do you hear?”

“I want to be with you.”

“You can’t.”

“Please—”

“You can’t. You have to carry the fire.”

“I don’t know how to.”

“Yes, you do.”

“Is it real? The fire?”

“Yes, it is.”

“Where is it? I don’t know where it is.”

“Yes, you do. It’s inside you. It was always there. I can see it.”

“Just take me with you. Please!”

“I can’t.”

“Please, Papa.”

“I can’t. I can’t hold my son dead in my arms. I thought I could, but I can’t.”

“You said you wouldn’t ever leave me.”

“I know. I’m sorry. You have my whole heart. You always did. You’re the best guy. You always were. If I’m not here you can still talk to me. You can talk to me and I’ll talk to you. You’ll see.”

“Will I hear you?”

“Yes, you will. You have to make it like talk that you imagine. And you’ll hear me. You have to practice. Just don’t give up. Okay?”

“Okay.”

“Okay.”

“I’m really scared, Papa.”

“I know. But you’ll be okay. You’re going to be lucky. I know you are. I’ve got to stop talking. I’m going to start coughing again.”

“It’s okay, Papa. You don’t have to talk. It’s okay.”

In all of these actions we see not only the truth of what we would all do for our sons if we were in the same awful circumstances, but also the truth of what we do for our sons every day in our lives here and now. That is ultimately what makes the novel so powerful.

Wednesday, October 10, 2007

Crucial Confrontations by Kerry Patterson, Joseph Grenny, Ron McMillan and Al Switzler

This one was recommended by my professional development consultant to help me deal with a situation at work. Here’s the entire method in 314 words or less:

THE BIG IDEA FROM EACH STEP

Choose What and If
1. What: Ask yourself what you really want. You can talk about the content, the pattern, or the relationship. To stay focused, ask what you really want.
2. If: Are you talking yourself out of a crucial confrontation? Don’t let fear substitute for reason. Think carefully not just about the risks of having the confrontation but also about the risks of not having it.

Master My Stories
Instead of assuming the worst and then acting in ways that confirm your story, stop and tell the rest of the story. Ask: Why would a reasonable person not do what he or she promised? What role might I have played? When you see the other person as a human being rather than a villain, you’re ready to begin.

Describe the Gap
Make it safe by starting with the facts and describing the gap between what was expected and what was observed. Tentatively share your story only after you’ve shared your facts. End with a question to help diagnose.

Make It Motivating and Easy
After you’ve paused to diagnose, listen for motivation and ability. Remember you don’t need power. In fact, power puts you at risk. Instead, make it motivating and make it easy. To do that, explore the six sources of influence. Remember to consider others and things as possible influences.

Agree on a Plan and Follow Up
Remember who does what by when and then follow up. This idea is simple and serves as its own reminder. Then ask to make sure you’re not leaving out any details or missing any possible barriers.

Stay Focused and Flexible
As other issues come up, don’t meander; consciously choose whether to change the discussion to the new issue. Weigh the new problem. If it’s more serious or time-sensitive, deal with it. If it is not, don’t get sidetracked.


According to the self assessment at the back of the book, my weak areas are “Choose What and If” and “Stay Focused and Flexible.” I should:

1. Not put off certain discussions longer than I should.
2. Make sure I talk about the root problem when people disappoint me.
3. Stop talking myself out of holding certain discussions by telling myself that it will be better to cope with the behavior than to risk an ugly confrontation.
4. Not get sidetracked when talking to others about problems.
5. Know what to do with new issues that get brought up during a crucial confrontation.
6. Know how to respond when people get angry in the middle of a crucial confrontation.
7. Stop letting people off the hook when they disappoint me.