Book Title: Start with WHY – How Great Leaders Inspire Everyone to Take Action
Author: Simon Sinek
Year written/published: 2009
Book Source: Amazon
Some extracts:

When the world is flat…

So for the most part they stayed put. It wasn’t until that minor details was revealed – the world is round – that behaviors changed on a massive scale. Upon this discovery, societies began to traverse the planet. Trade routes were established; spices were traded. new ideas, like mathematics, were shared between societies which unleashed all kinds of innovations and advancements. The correction of a simple false assumption moved the human race forward.

Types of Manipulations:

1. Price
2. Promotions
3. Fear
4. Aspirations
5. Peer Pressure
6. Novelty (aka Innovation)

Novelty…

Colgate’s sales started to slip. So the company introduced a new product that included a new feature, the addition of fluoride, perhaps. Then another. Then another…. Each innovation certainly helped boost sales, for a while at least. And so the cycle continued. Guess how many different types of toothpaste Colgate has for you to choose from today? 32… And given how each company responds to the “innovation” of the other, that means Colgate’s competitors also sell a similar number of variants that offer about the same quality… Once again this is an example of the newest set of shiny objects designed to encourage a trial or a purcahse. What companies cleverly disguised as “innovation” is in fact a novelty.

it’s worth repeating…

People don’t buy WHAT you do, they buy WHY you do it

Apple and Creative

Apple did not invest the mp3, nor sis they invest the technology that became the iPod, yet they are credited with transforming the music industry. The multigigabyte portable hard drive music player was actually invested by Creative Technologies, a Singapore based technology company that rose to prominence by making the sound blaster audio technology that enables home PCs to have sound. … In fact, Apple didn’t introduce the iPod until 22 months after Creative’s entry into the market. This detail alone calls into question the assumption of a first mover’s advantage. The problem was they advertised their product as Apple’s “1000 songs in your pocket”. The difference is creative told us WHAT their product was and Apple told us WHY we needed it.

Rational vs Limbic brain…

When you force people to make decisions with only the rational part of their brain, they almost invariably end up “over-thinking”. These rational decisions tend to take longer to make, says Restak, and can often be of lower quality. In contrast, decisions made with the limbic brain, gut decisions, tend to be faster, higher quality decisions… The more time spent thinking about the answer, the bigger the risk that it may be the wrong one. Our limbic brain are smart and often know the right thing to do.

Too much info…

Rarely do we sift through all the available information to ensure we know every fact. And we don’t need to. It is all about degrees of certainty. “I can make a decision with 30% of the information,” said former secretary of state COlin Powell. “Anything more than 80% is too much.”

Clarity of WHY:

Ot all starts with clarity. You have to know WHY you do WHAT you do. If people don’t buy WHAT you do, they buy WHY you do it, so it follows that if you don’t know WHY you do WHAT you do, how will anyone else?

Doing Business…

The goal of business should not be to do business with anyone who simply wants what you have. If should be to focus on the people who believe what you believe. When we are selective about doing business only with those who believe in our WHY, trust emerges.

Employees first…

… a heretic for positing the notion that it is a company’s responsibility to look after the employees first. Happy employees ensure happy customers, he said. And happy customers ensure happy shareholders – in that order.

Human Matrix…

No one likes to loose, and most healthy people love their life to win. The only variation is the score we use. For some it’s money, for others its fame or awards. For some it’s power, love, a family or spiritual fulfillment…. The drive to win is not, per se, a bad thing. Problems arise, however, when the metric becomes the only measure of success, when what you achieve is no longer tied to WHY you set out to achieve it in the first place.

Competition…

Companies with a clear sense of WHY tend to ignore their competition, whereas those with a fuzzy sense of WHY are obsessed with what others are doing.

Tipping point…

The farther right you go on the curve, the more you will encounter the clients and customers who may need what you have, but don’t necessarily believe what you believe. As clients, they are the ones for whom, no matter how hard you work, it’s never enough. Everything usually boils down to price with them. They are rarely loyal. They rarely give referrals and sometimes you may even wonder out loud why you still do business with them… The goal of business them should not be to simply sell to anyone who wants what you have – the majority – but rather to find people who believe what you believe… Get enough of the people on the left side of the crve on your side and they encourage the rest to follow.

Image Credit

Energy versus Charisma…

Energy motivates but charisma inspired. Energy is easy to see, easy to measure and easy to copy. Charisma is hard to define, near impossible to measure and too elusive to copy… Charisma has nothing to do with energy; it comes form a clarity of WHY. it comes form absolute conviction in an ideal bigger than oneself. Energy, in contrast, comes from a good night’s sleep or lots of caffeine. Energy can excite. But only charisma can inspire.

Most people in the world are the HOW-types..

Most people are quite functional in the real world and can do their jobs and do very well. Some may be very successful and even make millions of dollars, but they will never build billion-dollar businesses or change the world.

Small vs Big companies…

When a company is small, this is not an issue because the founder has plenty of direct contact with the outside world. Trusted HOW-Types maybe in short supply and the founder opts to make a majority of the big decisions. The founder or leader actually goes our and talks to customers, sells the product and hires most if not all the employees. As the company grows, however, systems and processes are added and other people will join… When a company is small, it revolves around the personality of the founder. There is not debate that the founder’s personality is the personality of the company… As a company grows, the CEO’s job is to personify the WHY. To ooze of it. To talk about it. To preach it.

personal success…

… some people, while in pursuit of success, simply mistake WHAT they achieve as the final destination. This is the reason they never feel satisfied no matter how big their yacht is, no matter how much they achieve. The false assumption we often make is that if we simply achieve more, the feeling of success will follow. But it rarely does.

Book Title: It’s not how good you are, it’s how good you want to be
Author: Paul Arden
Year written/published: 2003
Book Source: Amazon
Some extracts:

Your vision of where or who you want to be is the greatest asset you have. Without having a goal it’s difficult to score.

That’s the nature of the creative person. All creative people need something to rebel against, it’s what gives their lives excitement, and it’s creative people who make the client’s lives exciting.

Firstly you need to aim beyond what you are capable of. You must develop a complete disregard of where you abilities end. Try to do the things that you’re incapable of. … Make your vision of where you want to be a reality. Nothing is impossible.

Do not covet your ideas…

GIve away everything you know and more will come back to you. You will remember from school other students presenting you from seeing their answers by placing their arms around their exercise book or exam paper. It is the same at work, people are secretive with ideas. “Don’t tell them that, they will take the credit for it.” … The problem with hoarding is you end up living off your reserves. Eventually you will become stale. If you give away everything you have, you are left with nothing. This forces you to look, to be aware, to replenish. .. Ideas are open knowledge. Don’t claim ownership.

High creativity…

The comedian John Cleese puts it rather more eloquently, “High creativity is responding to situations without critical thought” (playfulness) If you are in deadlock here are a couple of tricks you might try:

1. Do the opposite of what the solution requires
2. Look out of the window and whatever catches your eye, a bird, a television aerial, an old man on crutches or whatever, make that the solution to your problem.

Rough layouts sell the idea better than polished ones…

Because you haven’t shown the exact way it’s going to be, there scope to interpret it and develop and change it as you progress… With with him (Client) rather than confronting him with your idea.

Get out of advertising…

You will see the same books in every agency. Certainly, a knowledge of the techniques of and the tricks of advertising can be very useful, possibly essential. True, people do look for some-thing new, but sometimes it’s something new to copy. TO be original, seek your inspiration from unexpected sources.

Present creative work first…

Try opening with the creative work. If he likes it he’ll listen with interest to whatever else is said. If he doesn’t, you’re dead anyway, and it will shorten the meeting.

Book Title: Open Innovation – Researching a New Paradigm
Author: Editted by Chesbrough, Wim Vanhaverbeke, Joel West
Year written/published: 2006
Book Source: Amazon
Some extracts:

Definition

Open Innovation is the use of purposive inflows and outflows of knowledge to accelerate internal innovation and expand the markets for external use of innovation, respectively…. Open innovation paradigm treats R&D as an open system. Open Innovation suggests that valuable ideas can come from inside or outside the company and can go to market from inside or outside the company as well. This approach places external ideas and external paths on the same level of importance as that reserved for internal ideas and paths to market in the earlier era.

R&D spending in small firms increases…

Business and technology…

There is no inherent value in a technology per se. The value is determined instead by the business model used to bring it to market. The same technology taken to market through 2 different business models will yield different amounts of value. As inferior technology with a better business model will often trump a better technology commercialized through an inferior business model.

Start-up…

Start-ups play an important role, well beyond that of their share of revenues on employment within the economy. They are the carriers of new technologies, and sometimes explorers of new markets. They also often represent experiments with new and different business models…. startups provide an initial impetus for radical innovations, and sometimes becomes important partners in the creations and delivery of those radical innovations… represent an important source of novel technologies into an industry, even though startups do not appear to command much market share in consumer electronics….

3 steps of Radical Innovation:

1. Discovery
2. Incubation
3. Acceleration

Our 3 challenges led to 3 related research questions:

1. What circumstances motivate firms to embrace Open Innovation approaches as part of their R&D efforts?
2. Why would non-profit firms commit their IPs as well as ongoing human resources to an effort that they know will benefit others, including competitors?
3. Why do individuals contribute their IP to a project that benefits firms without receiving financial remuneration?

Open Source….

Open source as an Open Innovation strategy has 2 key elements: shared rights to use the technology, and collaborative development of that technology. Unlike many individual participants, firms must also consider a third issue : capturing an economic return to justify their investment.

Importance of Appropriability

Nearly 2 decades ago, David Teece (1986:285) wrote:
It is quite common for innovators – those firms which are first to commercialize a new product or process in the market – to lament the fact that competition/imitation have profited more than the firm first to commercialize it!…. Teece’s observation anticipated a subsequent burst of research that showed that technological pioneers have as many advantages as disadvantages.

Role of IP

Voiding this problem of underinvestment in innovation is exactly the point of granting temporary monopolies through intellectual property rights. …. “The objective of intellectual property protection is to create incentives that maximize the difference between the values of the intellectual property that is created and used and the social cost of its creation….

early and present technological innovations…

… recounts how the key technologies of the early and mid-20th century was developed by industrial research departments within the large diversified enterprises of US and Europe. Such diversification, along with vertical integration from research and development (R&D) through distribution, provided these firms with competitive advantage over smaller and newer rivals through economies of scale and scope…. “It is a view that says successful innovation requires control… This paradigm counsels firms to be strongly self-reliant, because one cannot be sure of the quality, availability and capability of other’s ideas..”… However, from his study of US industry practice at the end of the 20th century,,, this model was reaching its limits. Along other factors he identified the increased mobility of knowledge and availability of venture capital to create new firms to capitalize on such knowledge.

Book Title: Delivering – A Path To Profits, Passion, and Purpose
Author: Tony Hsieh
Year written/published: 2010
Book Source: Amazon
Some extracts:

on asian culture…

The accomplishments of the children were the trophies that many parents defined their own success and status by. We were the ultimate scorecard. There were 3 categories of accomplishments that mattered to the Asian parents. Category 1 was the academic accomplishments… Category 2 was career accomplishment: Becoming a medical doctor or getting a PhD was seen as the ultimate accomplishment… Category 3 was musical instrument mastery.

The focus after graduation…

As the end of my senior year in college approached, Sanjay introduce me to this thing called the World Wide Web. I thought t was a pretty interesting and fun thing to explore at the time, but i didn’t pay too much attention to it. The focus for most seniors, including myself, was trying to get a job lined up before graduation… Many of our roommates applied for banking or management consulting jobs, both of which were considered the “hot” jobs to get. TO me, both seems incredibly boring and I also heard that the workdays were 16 hours long…. I wanted a job that paid well and didn’t seem like too much work.

ready for an adventure…

But we wanted to run our business and be in control of our own destiny, This wasn’t about the money, it was about not being bored. Both Sanjay and I had now officially resigned, and we were ready to begin the next chapter of our lives. We had no idea where it would lead us, but wherever it was, we knew it had to be better than feeling bored and unfulfilled. We were ready for an adventure.

hiring at LinkExchange…

The good news was that the people we hired were smart and motivated. The bad news was that many of them were motivated by the prospect of either making a lot of money or building their careers and resumes. They wanted to put a few years of hard work into LinkExchange and then move on to their next resume building job at another company.

money and people…

Large amount of money have a strange way of getting people’s true colours to come out. I observed the greed of certain people who had joined the company right before the acquisition trying to negotiate side contracts for themselves at the risk and expense of everyone else in the company….

Making a list of happiest periods…

I made a list of the happiest periods in my life and I realised that one of them involved money. I realized that building stuff and being creative and inventive made me happy. Connecting with a friend and talking through the entire night until the sun rose made me happy. Trick-or treating in middle school with a group of my closest friends made me happy. … I thought about how easily we are all brainwashed by our society and culture to stop thinking and just assume by default that more money equals more success and happiness, when ultimately happiness is really just about enjoying life….. I didn’t realise it at the time, but it was a turning point for me in my life. I had decided to stop chasing the money and start chasing the passion.

Excerpt from Ivanka Trump’s book:

So my advice is to stop trying to “network” in the traditional business sense, and instead just try to build up the number and depth of your friendship, where the friendship itself is its own reward. The more diverse your set of friendships are, the more likely you will derive both personal and business benefits form our friendships later down the road.

Outsourcing and business…

We told the people at eLogistics that we had opened up on our own warehouse because we weren’t happy with the service levels we were getting from them. …. Every week, if WHISKY outperformed eLogistics, then we would take 10000 pairs of shows out of eLogistics and move them over to the WHISKY warehouse. The people at eLogistics weren’t very happy about our plan, but it was hard for them to argue against the logic of it. … it was a valuable lesson. We learned that we should never outsource our core competency.

great companies…

Good to Great by Kim Collins… He talks about what separates the great companies form just good ones over the long term. One of the things that he found form his research was that great companies have a greater purpose and bigger vision beyond just making money or being number one in a market. A lot of companies fall into the trap of just focusing on making money, and then they never become a great company.

inside out…

Now that we were in Vegas with nobody else to learn on except each other, culture became our number one priority, even more important than customer service. We thought that if we got the culture right, the building our brand to be about the very best customer service would happen naturally on its own.

Zappos culture book…

The original idea was simple. We would ask employees to write, in a few paragraphs, the answer to the question: What does Zappos culture mean to you? Except for correcting typos, we would leave it unedited and publish everything in a book. Completely uneditted? THat’s crazy!… For Zappos, it was a risk worth taking… In an age of transparency when twitter can contribute to a company’s success or its downfall, is there anything more compelling than exposing your company’s DNA to the world?

MCQ for logins…

In most companies, logging in to the computer systems requires a login and password. At Zappos, an additional step is required: a photo of a randomly selected employee is displayed and the user is given a multiple-choice test to name that employee.

visiting Zappos…

One of the great advantages of focusing on culture is when repoertes come and visit our offices. Unlike most companies, we don’t give reporters a smal list of people they’re allowed to talk to. Instead we encorage them to wander around and talk to whoever they want.

3 basic rules for public:

1. Be passionate
2. Tell personal stories
3. Be real

10 questions to ask when looking for investors and board members:

1. Do you really need investors? Can you avoid funding by growing more slowly?
2. How actively involved will your investors be How actively involved do you want your investors to be?
3. What value beyond money can your investors add (connections, advice, experience)?
4. What is the time horizon for a financial exit that your investors are expecting?
5. What if anything, are your investors hoping to get out of their involvement beyond just financial return? How would they prioritize those things?
6. Do your investors and board directors buy into the vision and mission of the company?
7. Would they accept less profits if it meant that the vision could be fulfilled faster?
8. How flexible are your investors and board members in their thinking?
9. Who controls the investor? Who controls the board?
10. Do the core values of your investors and board members match the core values of your company?

Happiness Framework 3:

1. Please
2. Passion
3. Purpose

What I find interesting is that many people go through life chasing after the pleasure type of happiness, thinking that once they are able to sustain that, then they will worry about the passion and, if they get around to it, look for their higher purpose.

Book Title: When Genius Failed – The Rise and Fall of Long-Term Capital Management
Author: Roger Lowenstein
Year written/published: 2000
Book Source: Google Books, Amazon
Summary: LTCM, a hedge fund was started in 1994 with Wall Street veterans and 2 Nobel Laureates only to loose more than $4billion and it was finally bailed out at major banks in 1998.
My Comments: Read it to know a true story of greed, human behavior, secrecy, blind-trust in academic & financial models and most of all the lesson of humility.
Some extracts:

LTCM panic…

Panics are as old as markets, but derivatives were relatively new. Regulators had worried about the potential risks of these investive new securities, which linked the country’s financial institutions ina complex chain of reciprocal oligations. Officials had wondered what would hapen if one big link in the chain should fail.

Ambitious target…

J. M.’s design was staggeringly ambitious. He wanted nothing less than to replicate the Arbitrage Group, with its Global reach and ability to take huge positions, but without the backing of Salomon’s billions in capital, credit lines, information networks, and 7000 emplyees. Having done so much for Salomon, he was bitter about having been forced into exile under a cloud and eager to be vindicated, perhaps by creating something better.

Start-up…

LTCM opened for business at the end of February 1994. Merilwether, Rosenfield, Hawkins and Leahy celebrated by purchasing a shipment of fine burgundies ample enough to last for years. In addition to its 11 partners, the fund had about 30 traders and clerks and $10 million with of SPARC workstations, the powerful Sun Microsystems machines favored by traders and engineers. Long Term’s fund raising blistz had netted !1.25 billion – well short of J. M’s goal but still the largest start-up ever.

odds of a Black monday…

The most obvious example was Black Monday, when, on no apparent news, the market plunged 23%. Economists later figures that on the basis of the market’s historic volatility, had the market been open every day since the creation of the Universe, the odds wold still have been against its failing that much on any single day. In fact, had the life of the universe been repeated 1 billion times, such a crash would still have been theoretically “unlikely”.

Philosophy…

A central tenet of the partner’s philosophy was that markets were steadily getting more efficient, more liquid, more “continuous” – more as Meton had envisioned them. With more investors hunting for mispriced securities and with market news traveling faster, it seemed logical that investors, would take less time to correct mistaken prices. And on most days, they probably did. An efficient market is a less volatile one (it has no Black Mondays) and from day to day, a less risky one.

Secrecy and leverage…

After the event, it was widely reported that Wall Street had somehow been ignorant of Long Term’s swollen total and leverage ratio. Merill Lynch would go so far as to state in a press release, “… this was the first time that we learned the overall size and scale of the positions and extent of leverage…”

bulging problem…

One could only say that it appeared to be growing very quickly – as were exposures up and down Wall Street. Almost imperceptibly, the Street had bought into a massive faith game, in which each bank had become knitted to its neighbor through a web of contractual obligations requiring little or no down payment.

Trust in modern finance and brains…

The supreme irony is that the professors were trying to deconstruct and ultimately to minimise risk, not – they believed – to speculate on overcoming it. In this, the fund was not unique. Long-Term was in fact the quintessential fund of the late 20th century - an experiment in harnessing the markets to the twin new disciplines of financial economics and computer programming. The belief that tomorrow’s risks can be inferred from yesterday’s prices and volatilities prevails at virtually every investment bank and trading desks. This was Long Term’s basic mistake, and its stunning losses betrayed the flaw at the very heart – the veyr brain – of moden finance.

Book Title: Open Business Models – How to thrive in the New Innovation Landscape
Author: Henry Chesbrough
Year written/published: 2006
Book Source: Amazon
Some extracts:

If, however, the investor never practices the technology he or she patended, or never licences others to practice the technology then the product covered by the temporary monopoly is never taken to market. Not only does the society lose the use of the new investion; the society has empowered the investor to prevent anyone else from using it until the patent expires.

Firms developing new technologies and new products pursue IP protection primarily for defensive reasons, to ensure their ability to practise their technology in their business without the fear of interruption. The resence of patent becomes an insurance policy against unwelcome litigation and acts as a powerful barganing chip in situations where litigation arises.

Open innovation provides a clear rationale for participating in intermediate markets. In a world of widely distributed useful knowledhe, one can only sustaininnovation by acitvely licensing external ideas and technologies alongside develiping and deplyoying one’s own ideas… A new kind of open business model and an open appraoch to managing I{ are required to sustain and advance the company’s business in a wolrd of abundant knowledge

There are a number of reasons. First, unused ideas are a waste of corporae resources. Second, unused ideas are demoralising for the staff that created them. Third, unused ideas clutter and congest your innovation syste,, slowing it down. Fourth, releasing unused ideas outside will generate new knowledge about market or technical opportunities – which would never emerge if these ideas were kept bottled up inside the firm. And last, if ideas get bottled up too long, they may find another, unplanned exit of their own. They might leak out to another firm, or an integral group of people might choose to take them out of their own.

1. selling, installation, service, support with the software

2. versioning the software, with the free version as an entry-level offering and other more advanced verisons as value-added offerings

3. integrating the software with other parts of the customer’s IT infrastructure

4. providing propriety complements to open source software

5. e.g. Red Hat company

This raises an old, but very important, problem first noted by economist Ken Arroe, which is known as the Arrow Information paradox: “I an a customer need to know what your technology can do before I am willing to buy it. But once you as a seller have told me what the technology is, and what it can do, you have effectively transferred the technology to me without any compensation!”

Book Title: Strategy: A View From The Top (An Executive Perspective)
Author: John A. Pearce, Cornelis A. De Kluyver
Year written/published: 2006
Book Source: Amazon
My Comments: I would recommend anybody who wants an introduction to strategy to read this book. I especially loved the thorough explanation of different frameworks of strategy.
Some extracts:

Kocourek, Burger, Birchard propose 12 questions boards should ask in the course of discharging their oversigh responsibilities:

1. Does the management have a comprehensive strategy and operating plan for the company to realize its performance potential? (Strategic direction)
2. Are the necessary human, financial, physical and other supporting resources provided and properly allocated to achieve success? (Resource allocation)
3. Does the CEO provide the leadership required by the company and does the organisation have a succession plan for this position? (Management)
4. Does the management use an effective system of key performance indicators to monitor and control operation performance? (Operating Controls)
5. … …

Methods to speed up ( as a competitive advantage)

1. Streamlining operation
2. upgrading technology
3. forming partnerships

Fundamentally, 6 mandates drive innovation at 3M:

1. Support innovation from R&D to customer sales and support
2. Understand the future by trying to anticipate and analyse future trends
3. Establish stretch goals
4. Empower employees to meet goals
5. Support broad networking across the company
6. recognize and reward innovative people

Book Title: Brida
Author: Paulo Coelho
Year written/published: 2008
Book Source: Google Books, Library
Some extracts:

Some quotations:

When we least expect it, life sets us a challenge to test our courage and willingness to change.

Only one thing makes our dream impossible: the fear of failure

To love is to commune with another person and to discover in him or her a divine spark.

Book Title: Never Eat Alone – And other secrets to success one relationship at a time

on getting far:

To achieve your goals in life, I realized, it matters less how smart you are, how much innate talent you’re born with, or even, most eyeopening to me, where you came from and how much you started out with. Sure all these are important, but they mean little if you don’t understand one thing: You can’t get there alone. In fact, you can’t get very far at all.

getting info:

There are two aspects to getting good information. One part comes from within you; the other part comes from those around you.

on people:

Our strength comes from what we do and know cumulatively. The fact is, no one gets ahead in this world without a lot of help. Eliminating things like intimidation and manipulation, there is only one way to get anybody to do anything. Do you know what it is?
This is far from a trivial question. Business is, after all, the ability to motivate a group of individuals to move an idea from concept to reality; to take a theory and make it a practice; to gain the buy-in of your employees and colleagues; to encourage others to execute your plans.

Book Title: Tribes
Author: Seth Godin
Year written/published: 2008
Summary: How to lead and create a movement
Book Source: Google Books,
Some extracts:

Inciting a movement:

…. There’s a difference between telling people what to do and inciting a movement. The movement happens when people talk to one another, when ideas spread within the community, and most of all, when peers support leads people to do what they always knew was the right thing.

improving a tribe:

2 things to turn a group of people into a tribe:

1. a shared interest
2. a way to communicate

a leader can help increase the effectiveness of the tribe and its member by:

1. transforming the shared interest into a passionate goal and desire for change
2. providing tools to allow members to tighten their communications
3. leveraging the tribe to allow it to grow and gain new members

the factory model…

the second reason we have factories has nothing to do with efficiency and a lot to do with human resource. Part of us wants stability. We want the absence of responsibility that a factory job can give us. The idea of “I’m doing what you told me to” is very compelling, especially if the alternatives is foraging for food or begging on the streets.

The easiest thing..

The easiest thing is to react

The second easiest thing is to respond.

The hardest thing is to initiate.