Thought Process

Charlie Munger’s Iron Prescription

May 22, 2019 by Nagesh Belludi Leave a Comment

Intellectual inquiry is effortful, and you need a durable internal push to engage in it.

An inflexible approach impedes critical-thinking. I’ve discussed previously (here, here, here, and here) that a sophisticated critical-thinker considers alternative world-views that may cause him/her to philosophize differently.

For example, if you cling rigidly to a “raise taxes on the wealthiest people” position, you are possibly unwilling to contemplate that, among other problems, higher taxes disincentivize productivity, promote economic behaviors to dodge taxes, and contribute to class warfare. Examining all sensible inferences and considering a variety of possible viewpoints or perspectives may help you to arrive at more moderate, practical positions that are conceivably within acceptable limits.

Charlie Munger’s Iron Prescription: Avoid Intense Ideology

One of the central wisdoms of Charlie Munger, Berkshire Hathaway’s Vice-Chairman and the distinguished beacon of multi-disciplinary thinking, is to keep an eye open for dangers that accompany in submitting to a particular ideology.

At his celebrated commencement address to the graduates of the University of Southern California Law School on May 13, 2007, Munger affirmed,

In my mind, I got a little example I use whenever I think about ideology and it’s these Scandinavian canoeists who succeeded in taming all the rapids of Scandinavia and they thought they would tackle the whirlpools in the Aaron Rapids here in the United States. The death rate was 100 percent. A big whirlpool is not something you want to go into and I think the same is true about a really deep ideology.

I have what I call an “iron prescription” that helps me keep sane when I naturally drift toward preferring one ideology over another. And that is I say, “I’m not entitled to have an opinion on this subject unless I can state the arguments against my position better than the people do who are supporting it.” I think only when I reach that stage am I qualified to speak.

…

This business of not drifting into extreme ideology is a very very important thing in life if you want to have more correct knowledge and be wiser than other people. A heavy ideology is very likely to do you in.

In the era of social media and group polarization, it’s easy to slip into confirmation bias by committing yourself to a self-imposed ideology.

As I’ve mentioned previously, studies have shown that associating with likeminded folks can make you even more disdainful of contradictory viewpoints. Nothing will ruin you faster than an ideology burrowing deeper in a closed mind.

Idea for Impact: Nothing deceives you as much as extreme passion

Stay away from intense ideologies until you’ve examined the opposing viewpoint. Don’t ignore the counterevidence. Consider the other side of any thought as carefully as your own.

Postscript: Munger’s other iron prescription concerns avoiding the victim mentality: “Whenever you think that some situation or some person is ruining your life, it is actually you who are ruining your life… Feeling like a victim is perfectly disastrous way to go through life. If you just take the attitude that however bad it is in any way, it’s always your fault and you just fix it as best you can—the so called iron prescription—I think that really works.” See my previous article on Charlie Munger and lessons on adversity.

Four Ideas for Business Improvement Ideas

November 1, 2018 by Nagesh Belludi Leave a Comment

Seek fresh eyes. Ask new employees and interns to make a note of every question they have about how things get done in your organization. If anything—reports, approvals, meetings, reviews—doesn’t seem sensible, let them record those inefficiencies. After a few weeks, when they’ve become familiar with the organization and its workflow, have them reassess and report their observations. The best improvement ideas come from people who aren’t stuck in the established ways.
Notice something? Fix it quickly or delegate. Never walk absentmindedly by something that could be improved. A cluttered instruments cabinet in a warehouse? A loose tile in a walkway? A broken link on your customer service website? Don’t take inconveniences and unpleasant situations for granted.
Explore the outsider’s perspective. Notice how trivial stuff can really frustrate you when you’re standing in line at the Bureau of Motor Vehicles or dealing with a slow bureaucracy? While running errands, do others’ rules, regulations, and procedures annoy you? Bump into something that doesn’t have to be laborious, arduous, expensive, or annoying, but is? Examine if your business imposes any of those inconveniences on your customers.
Make it easy for customers to complain. Seek customer feedback in such a way that it encourages people to share their negative experiences. As I’ve illuminated before, many innovative ideas have their roots in prudent attention to and empathy with customers’ experiences.

Idea for Impact: Problem-finding is one of the most significant—and overlooked—parts of innovation. Learn to pay attention to the subtle clues to opportunities all around.

Creativity by Imitation: How to Steal Others’ Ideas and Innovate

October 22, 2018 by Nagesh Belludi Leave a Comment

Innovation by Imitation: Many Innovations Come from the Outside---How Henry Ford Developed the Moving Assembly Line for the Model T

Emulating others’ ideas is an underappreciated learning tool. Many creative innovators set forth as remarkably astute mimics of others. “Good artists copy, great artists steal,” prods a creator’s maxim often misattributed to Picasso.

Imitation is a leading pathway to business innovation, even if being an imitator is anchored by a sense of derision. Ever more businesses are nicking great ideas wherever they can obtain them—in their own industries or beyond. Hospitals have adapted safety and efficiency procedures from the military and the airline industry. Aircraft manufacturers have adopted the car industry’s lean supply chain management concepts. Ritz-Carlton, the luxury chain of hotels and resorts, runs the Ritz-Carlton Leadership Center that has helped trained its legendary cult of customer service and employee empowerment best practices to managers from companies across industries.

Creativity by Taking Existing Ideas: Applying Them in a New Context

The most prominent example of innovating by imitation is Ford’s development of the automobile assembly line—a system Henry Ford copied (and improved) from the Chicago meat processing business.

Innovation by Imitation: Genesis of the Moving Assembly Line Henry Ford’s relentless ambition to build his Model T a high-volume-low-cost automobile, together with his engineering knowledge and manufacturing experience provided the leadership and creative environment that nurtured the development of the moving mechanical assembly line. Today, the moving assembly line is the epitome of manufacturing. Almost everything that is now industrially manufactured—automobiles, aircrafts, toys, furniture, food—passes down assembly lines before landing in our homes and offices.

The genesis of the moving assembly line is in the American agricultural products industry. During the late 18th century, the movement of grains changed from hand labor to belts and later moving hoppers.

Innovation by Imitation: Many Innovations Come from the Outside

Innovation by Imitation: Chicago Slaughter Houses Pioneered the Moving Disassembly Line Before Henry Ford Started His Assembly Line By 1873, Chicago’s meat-processing industry adapted belts and hoppers to transform beef and pork production into a standardized, mechanized, and centralized business. After cows and pigs travelled to their fate in train cars from farms throughout the Midwest, they were dropped into hoppers and killed. Conveyor belts then moved carcasses past meat cutters, who progressively removed various sections of the animal, cut them into appropriate sizes, and repackaged and dispatched processed meat across the United States.

The meat processors’ task was disassembly (as opposed to putting together automobile parts in Ford’s plants.) Each worker had a specific, specialized job. Production moved swiftly. The American writer Upton Sinclair famously described this industry’s ghastly working conditions in his acclaimed novel The Jungle and said, “They use everything about the hog except the squeal.”

Chicago Slaughter Houses Were the Pioneers of the Moving Disassembly Line Before Henry Ford Started His Assembly Line

In the early 1900s, when Henry Ford wanted to keep Model T production up with demand and lower the price, Ford’s team explored other industries and found four ideas that could advance their goal: interchangeable parts, continuous flow, division of labor, and cutting wasted effort. Ford’s engineers visited Swift & Company’s Slaughterhouse in Chicago and decided to adopt the “disassembly line” method to build automobiles.

The introduction of the moving assembly line process in 1913 enabled increased production up to 1,000 Model Ts a day and decreased assembly time from 13 hours to 93 minutes. Additional refinement of the process, thanks to reliable precision equipment and standardized shop practices, shortened production time radically: within a few years, a new Model T rolled off the assembly line every 24 seconds. First produced in 1908, the Model T kept the same design until the final one—serial number 15,000,000 rolled off the line in 1927.

Auschwitz-Birkenau and Victims of the Holocaust

Sadly, just as Henry Ford copied the Chicago meat processing and perfected the moving assembly line, the Nazi apparatus copied Ford’s methods of mass production to massacre six million people. While Midwestern butchers processed the livestock carcasses, the Nazis systematically handled corpses of the victims of the Holocaust. Nazi operatives removed victims’ hair, clothing, shoes, gold teeth, hairbrushes, glasses, suitcases, and anything of value to be repurposed for the Reich. The atrocities of this inexpressibly shocking disaster are on display at the train tracks and the museums of Auschwitz-Birkenau, Poland.

Formal Strategic-Benchmarking Programs

Smart businesses have formal strategic-benchmarking programs to achieve significant efficiency improvements: they pinpoint the strategic capabilities that matter most to their businesses, seek out companies or businesses that currently manage those capabilities best, and try to copy and deploy those capabilities as rapidly as possible. But time is of the essence for the success of these undertakings, as the management guru Tom Peters warns,

I hate Benchmarking! Benchmarking is stupid! Why is it stupid? Because we pick the current industry leader and then we launch a five-year program, the goal of which is to be as good as whoever was best five years ago, five years from now. Which to me is not an Olympian aspiration.

Imitation is a Key Characteristic of Highly Creative People: The Case of Steve Jobs Copying from Xerox

One of the key characteristics of highly creative people is their exposure to and experience with working in several related domains. They are very good at crossing domain boundaries, relating their creativeness in new and perhaps unexpected ways, and adapting knowledge into new domains. The following case of one of history’s most famous innovators illustrates this distinguishing characteristic.

Steve Jobs of Apple introduced the revolutionary Lisa computer in 1983. It featured such innovations as the graphical user interface, a mouse, and document-centric computing. Jobs had taken—and refined—all these inventions from Xerox’s PARC research labs and introduced by Xerox on its commercially-unsuccessful Alto and Star computers in 1981. The biographer Walter Isaacson writes in his best-selling Steve Jobs: “The Apple raid on Xerox PARC is sometimes described as one of the biggest heists in the chronicles of industry.” Isaacson cites Jobs: “Picasso had a saying—‘good artists copy, great artists steal’—and we have always been shameless about stealing great ideas… They [Xerox management] were copier-heads who had no clue about what a computer could do… Xerox could have owned the entire computer industry.”

Innovation by Imitation: Steve Jobs of Apple copied Xerox's PARC innovations in graphical user interface, a mouse, and document-centric computing

Idea for Impact: Borrow Ideas from Others and Combine Them with Your Own Creativity

Interestingly, many “benchmarking” exercises in the world of business—even academia—do not come “top-down” out of strategy. In other words, innovations by imitation are typically not driven from the top down. Instead, they materialize from everyday operational challenges—those painful experiences that send managers scuttling for solutions in a hurry.

Look outside your industry. To improve your creativity, try spending time researching other smart companies—even those outside of your industry. Learning directly from other companies is a useful, underutilized form of research for finding ways to improve performance.

Attend to developments at your competitors and in other industries. Look for potential opportunities that have been discovered elsewhere. Avoid the “not invented here” syndrome—don’t reject other’s great ideas. Keep an open mind.

Investing is Saying “No” 99% of the Time

September 22, 2018 by Nagesh Belludi Leave a Comment

As an investor in high-quality public companies and startup ventures, I spend very little time each on a lot of investment opportunities and a lot of time each on a very few opportunities. Over seven-tenths of the returns I’ve ever produced have been with just four companies.

I try to learn of as many ideas and opportunities as possible, especially in companies led by first-class entrepreneurs and businesspeople. From time to time, I spend hours at the community library flicking through one-page summaries in the Value Line Investment Survey, arguably the best investment product available on the market.

Exposing myself to many opportunities makes me a better investor. Even if my stock-filtering method quickly guides me to say “no” commonly, my goal is to find a kernel of usable information to add to my “mental attic.” I can’t predict when something might come in handy to help make sound investment choices in the future. As the great investor Charlie Munger said at the 1996 Wesco Financial annual meeting,

Our experience tends to confirm a long-held notion that being prepared, on a few occasions in a lifetime, to act promptly at scale, in doing some simple and logical thing, will often dramatically improve the financial results of that lifetime.

A few major opportunities, clearly recognizable as such, will usually come to one who continuously searches and waits, with a curious mind that loves diagnosis involving multiple variables. And then, all that is required is a willingness to bet heavily when the odds are extremely favorable, using resources available as a result of prudence and patience in the past.

Don’t Ignore the Counterevidence

September 14, 2018 by Nagesh Belludi Leave a Comment

Don't Ignore the Counterevidence---Consider objections to your viewpoints Left to themselves, much of our opinions and judgments are subjective, imprecise, incomplete, narrow-minded, or utterly unapprised.

A good critical-thinker deliberates objectively about alternative world-views that may cause him/her to philosophize differently. The English philosopher and economist John Stuart Mill made an unparalleled case for this intellectual obligation in his treatise On Liberty (1859):

If the cultivation of the understanding consists in one thing more than in another, it is surely in learning the grounds of one’s own opinions. Whatever people believe, on subjects on which it is of the first importance to believe rightly, they ought to be able to defend against at least the common objections. … on every subject on which difference of opinion is possible, the truth depends on a balance to be struck between two sets of conflicting reasons. Even in natural philosophy, there is always some other explanation possible of the same facts; some geocentric theory instead of heliocentric, some phlogiston instead of oxygen; and it has to be shown why that other theory cannot be the true one: and until this is shown, and until we know how it is shown, we do not understand the grounds of our opinion. But when we turn to subjects infinitely more complicated, to morals, religion, politics, social relations, and the business of life, three-fourths of the arguments for every disputed opinion consist in dispelling the appearances which favour some opinion different from it. The greatest orator, save one, of antiquity, has left it on record that he always studied his adversary’s case with as great, if not with still greater, intensity than even his own. What Cicero practised as the means of forensic success, requires to be imitated by all who study any subject in order to arrive at the truth. He who knows only his own side of the case, knows little of that. His reasons may be good, and no one may have been able to refute them. But if he is equally unable to refute the reasons on the opposite side; if he does not so much as know what they are, he has no ground for preferring either opinion. The rational position for him would be suspension of judgment, and unless he contents himself with that, he is either led by authority, or adopts, like the generality of the world, the side to which he feels most inclination.

Mill recommends anticipating the potential objections to one’s argument, coming to terms with the merits of opposing points of view, and establishing why the balance of reasons still supports one’s viewpoints:

Ninety-nine in a hundred of what are called educated men are in this condition; even of those who can argue fluently for their opinions. Their conclusion may be true, but it might be false for anything they know: they have never thrown themselves into the mental position of those who think differently from them, and considered what such persons may have to say; and consequently they do not, in any proper sense of the word, know the doctrine which they themselves profess. … So essential is this discipline to a real understanding of moral and human subjects, that if opponents of all important truths do not exist, it is indispensable to imagine them, and supply them with the strongest arguments which the most skilful devil’s advocate can conjure up.

Idea for Impact: Consider objections to your viewpoints; Remain open to alternative interpretations.

Suspend your inclinations and commitments and ask whether any of the objections have some force against your argument.

Don’t argue merely from those premises that appear compelling to you; address the premises that appear compelling to your opponent.

As Aristotle counseled, “The fool tells me his reasons; the wise man persuades me with my own.”

Summary of Richard Carlson’s “Don’t Sweat The Small Stuff”

September 4, 2018 by Nagesh Belludi Leave a Comment

Stress follows a peculiar principle: when life hits us with big crises—the death of a loved one or a job loss—we somehow find the inner strength to endure these upheavals in due course. It’s the little things that drive us insane day after day—traffic congestion, awful service at a restaurant, an overbearing coworker taking credit for your work, meddling in-laws, for example.

It’s all too easy to get caught up in the many irritations of life. We overdramatize and overreact to life’s myriad tribulations. Under the direct influence of anguish, our minds are bewildered and we feel disoriented. This creates stress, which makes the problems more difficult to deal with.

The central thesis of psychotherapist Richard Carlson’s bestselling Don’t Sweat The Small Stuff… And It’s All Small Stuff (1997) is this: to deal with angst or anger, what we need is not some upbeat self-help prescriptions for changing ourselves, but simply a measure of perspective.

Perspective helps us understand that there’s an art to understand what we should let go and what we should concern ourselves with. As I mentioned in my article on the concept of opportunity cost, it is important to focus our efforts on the important stuff, and not waste time on the insignificant and incidental things.

I’ve previously written about my favorite 5-5-5 technique for gaining perspective and guarding myself against anger erupting: I remove myself from the offending environment and contemplate if whatever I’m getting worked up over is of importance. I ask myself, “Will this matter in 5 days? Will this matter in 5 months? Will this matter in 5 years?”

Carlson stresses that there’s always a vantage point from which even the biggest stressor can be effectively dealt with. The challenge is to keep making that shift in perspective. When we achieve that “wise-person-in-me” perspective, our problems seem more controllable and our lives more peaceful.

Carlson’s prescriptions aren’t uncommon—we can learn to be more patient, compassionate, generous, grateful, and kind, all of which will improve the way we feel about ourselves and the way that other people feel when they are around us.

Some of Carlson’s 100 recommendations are trite and banal—for example, “make peace with imperfection,” “think of your problems as potential teachers,” “remember that when you die, your ‘in-basket’ won’t be empty,” and “do one thing at a time.” Others are more edifying:

Let others have the glory
Let others be “right” most of the time
Become aware of your moods and don’t allow yourself to be fooled by the low ones
Look beyond behavior
Every day, tell at least one person something you like, admire, or appreciate about them
Argue for your limitations, and they’re yours
Resist the urge to criticize
Read articles and books with entirely different points of view from your own and try to learn something

Carlson’s succinct insights have hit home with legions of the hurried and the harried. He became a bestselling author and a sought-after motivational speaker. Before his tragic death in 2006 at age 45, Carson followed up “Don’t Sweat The Small Stuff…” with some 20 tacky spinoffs intended particularly for spouses, parents, teenagers, new-weds, employees, and lovers.

That Burning “What If” Question

August 8, 2018 by Nagesh Belludi Leave a Comment

The Rightness of Past Choices Become Obvious in the Clarity of Future Hindsight

In the Czech novelist Milan Kundera’s philosophical novel, The Unbearable Lightness of Being (1984; film adaptation, 1988) the womanizing protagonist Tomáš deliberates if he wants to be single or with his eventual wife Tereza:

We can never know what to want, because, living only one life, we can neither compare it with our previous lives nor perfect it in our lives to come.

…

There is no means of testing which decision is better, because there is no basis for comparison. We live everything as it comes, without warning, like an actor going on cold. And what can life be worth if the first rehearsal for life is life itself? That is why life is always like a sketch. No, “sketch” is not quite the word, because a sketch is an outline of something, the groundwork for a picture, whereas the sketch that is our life is a sketch for nothing, an outline with no picture.

The Mournful “What If” is a Powerful and Emotional Inquiry about Alternative Lives You Could Have Lived

Oftentimes, when dealt with adverse circumstances, life’s self-criticism apparatus kicks in. Plagued with self-doubt, life asks the questions “Why did things turn out this way?” and “Why wasn’t this experience what I expected it to be?” Regrets gnaw in the back of the mind, “How would my life be different?” and “I never shouldn’t have done this.”

And when you cognize life in hindsight, your lived life doesn’t usually compare favorably with your imagined, could-have-been life.

And that’s why you should refrain from ruminating about those non-lived lives—such projections of your mind only instigate sorrow.

Idea for Impact: Sketch the Picture of Our Own Choosing

That Burning 'What If' Question One of the most effective ways of eliminating regrets is to eliminate the underlying ignorance that is the cause. The wise fancy what the past was once and appreciate how it is molded them. But they no longer desire to live there or evoke the choices of the life that could have been.

As the great Stoics taught, you must reject regret, appreciate that you are now the distillation of all your past choices and experiences, and take the next positive little step. Reflecting on “What do I want to make of all of this?” and “What am I looking forward to?” can clarify your potential.

As Viktor Frankl emphasized in his 1946 masterwork on positive approach to psychological treatment, “Live as if you were living already for the second time, and as if you had acted the first time as wrongly as you are about to act now!”

Who wants to lament the life not lived when you can do dive into the life you’re actually in and do so much good now?

Live this choice. Sketch the picture of our own choosing.

Disproven Hypotheses Are Useful Too

June 21, 2018 by Nagesh Belludi Leave a Comment

Hypotheses are conjectures—often merely proposals or intuitions—about what may constitute facts.

A specific hypothesis can be tested for its adequacy and proved correct or incorrect using the scientific method. Sometimes, a hypothesis is accepted for the time being, until further evidence suggests an amendment.

It does not matter if a certain hypothesis is proven incorrect because, in itself, the falsification of a hypothesis can offer precious insight about the “what is not” to enhance the “what is.”

Hypotheses are the bedrock of scholarship. Scientific understanding accrues when many interrelated and tested hypotheses are used to develop theories, and rethink and restructure our knowledge.

The Historian’s Fallacy: People of the Past Had No Knowledge of the Future [Mental Models]

June 7, 2018 by Nagesh Belludi Leave a Comment

The practice of picking a thesis and then setting out to establish it is a widespread intellectual pursuit. But biographers and historians sometimes portray their subjects as if the historical participants could recognize what lay ahead of them.

The Historian's Fallacy: People of the Past Had No Knowledge of the Future Assuming that people of the past pondered over the events of their day from the same perspective as we do in the present is committing The Historian’s Fallacy.

The notion of the historian’s fallacy was first presented by the British literary critic Matthew Arnold (1822–88) in The Study of Poetry (1880.) In questioning how historical backgrounds were portrayed in the development of literary styles, Arnold called attention to the frequent logical error of using hindsight to assign a sense of causality and foresight of significant historical events to the people who lived through them. In reality, those historical participants may not have had wide-ranging perspective that we assume in interpreting the context, conventions and limitations of their time. Arnold wrote,

The course of development of a nation’s language, thought, and poetry, is profoundly interesting; and by regarding a poet’s work as a stage in this course of development we may easily bring ourselves to make it of more importance as poetry than in itself it really is, we may come to use a language of quite exaggerated praise in criticising it; in short, to overrate it. So arises in our poetic judgments the fallacy caused by the estimate which we may call historic. … Our personal affinities, likings and circumstances, have great power to sway our estimate of this or that poet’s work, and to make us attach more importance to it as poetry than in itself it really possesses, because to us it is, or has been, of high importance.

The American historian David Hackett Fischer, who coined the phrase “historian’s fallacy,” cited the claim that the United States should have anticipated Japan’s surprise attack on Pearl Harbor because of the many warning signs that an attack was in the cards. Fischer argues those signs seem obvious only in hindsight—to the World War II military leaders, many of those signs suggested possible attacks on many positions other than Pearl Harbor.

A good historian strives for objectivity by ignoring his own knowledge of consequent events and employing only what the historic individuals would have known in the context of their own time.

A related fallacy is Presentism—a manner of historical analysis wherein the past is interpreted by means of present-day attitudes. Presentism often fosters moral self-righteousness. Employing present-day moral standards to reflect on the Founding Fathers’ ownership of slaves, David Hume’s racism, or Gandhi’s opposition to modernity and technology should not be tainted by our stance of temporal condescension.

Why Risk Mitigation and Safety Measures Become Ineffective: Risk Homeostasis and Peltzman Effect [Mental Models]

May 17, 2018 by Nagesh Belludi Leave a Comment

Risk Homeostasis and Peltzman Effect are two concepts relating to how humans react to risks.

Risk Homeostasis is the notion that our personal psychological frameworks comprise a target level of risk towards which we direct our efforts.

We measure risk on our own “risk thermostat.” Because the risk in our environment changes continuously, we are incessantly forced away from our target risk level, but revert toward it by counteracting those external influences.

If the perceived risk of a situation exceeds our target level, we undertake defensive actions to reduce the risk. And if the perceived risk is lower than our target level, we attempt to increase our risk back to our target level by exposing ourselves to dangerous actions.

Why Risk Mitigation and Safety Measures Become Ineffective Consequently, people take more risks when they’re forced to act more carefully. For instance, requiring motorcycle bikers to wear helmets may make them take more risks—to maintain their level of thrill, not to get into accidents.

Peltzman Effect is the notion that people respond to increased safety by adding new risks. The namesake, economist Sam Peltzman, argued in 1975 that when automobile safety rules were introduced, at least some of the benefits of the new safety rules were counterbalanced by changes in the behavior of drivers. Peltzman posited that making seatbelts mandatory for cars resulted in reducing the number of occupant fatalities, but increased pedestrian casualties and collision-related property damages.

Peltzman made a case that even though seatbelts reduced the risk of being severely injured in an accident, drivers compensated by driving aggressively and carelessly—driving closer to the car ahead of them, for instance—so as to save time or maintain their level of thrill, even at the risk of causing damage beyond themselves and their cars.

Risk Homeostasis and Peltzman Effect remain controversial theories. Despite their apparent relevance, the prevailing evidence remains inadequate and inconclusive about how people behave less cautiously when they feel more protected and vice versa.

Further, Risk Homeostasis and Peltzman Effect challenge the foundations of safety and injury-prevention policies. They assert that the only effective safety measures are those that alter individuals’ desired risk level. Anything that barely modifies the environment or regulates individuals’ behavior without affecting their target risk levels is useless.

Thought Process

Intellectual inquiry is effortful, and you need a durable internal push to engage in it.

Charlie Munger’s Iron Prescription: Avoid Intense Ideology

Idea for Impact: Nothing deceives you as much as extreme passion

Wondering what to read next?

Wondering what to read next?

Creativity by Taking Existing Ideas: Applying Them in a New Context

Innovation by Imitation: Many Innovations Come from the Outside

Chicago Slaughter Houses Were the Pioneers of the Moving Disassembly Line Before Henry Ford Started His Assembly Line

Formal Strategic-Benchmarking Programs

Imitation is a Key Characteristic of Highly Creative People: The Case of Steve Jobs Copying from Xerox

Idea for Impact: Borrow Ideas from Others and Combine Them with Your Own Creativity

Wondering what to read next?

Wondering what to read next?

Idea for Impact: Consider objections to your viewpoints; Remain open to alternative interpretations.

Wondering what to read next?

Wondering what to read next?

The Rightness of Past Choices Become Obvious in the Clarity of Future Hindsight

The Mournful “What If” is a Powerful and Emotional Inquiry about Alternative Lives You Could Have Lived

Idea for Impact: Sketch the Picture of Our Own Choosing

Wondering what to read next?

Wondering what to read next?

Wondering what to read next?

Wondering what to read next?