Week Of September 9, 2019

“We all savor victories and suffer defeats.  But neither victories or

defeats should describe us; rather, we are defined by whether we have

the will to get up and claw our way back into the game.  This is the

true challenge, one seemingly without end, for life is our ‘long game.’”

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“Be kind, for everyone you meet is fighting a great battle.

Plato

 

WEEK OF SEPTEMBER 9, 2019

 

“I asked John Wooden one time, ‘How did you change your

culture?’ He made me feel like a little kid. He said, ‘You

don’t change the culture. You change the players.’

This is a gleaming example of what that’s all about.”

Pete Carroll`, Seattle Seahawks Coach

 

“The ‘Big Secret’ in life is that there is no big secret.

Whatever your goals, you can get there if you’re willing to work.”

Oprah Winfrey

 

TODAY’S STUFF

  • Sorry, Size Matters
  • Gladwell’s Back!
  • The Man Who Killed the Hat
  • Days of Disruption (No. 31): Subscribe or Die
  • Artificial You
  • Econ Recon:  The Candle Burns Brightest Before It Goes Out?   A So-Called War

 

SORRY, SIZE MATTERS

The story of small companies coming out of nowhere to dominate their industries, or create new ones, such as Apple, Microsoft or Amazon, are inspiring.  But like most stories, there are elements of truth and myth, most notably that “traditional large companies can’t innovate and that smaller digital companies will render many large ones extinct.”

A short blog posting from HBR summarizes some sobering research on the odds of the small company attaining the size implied by the vision of its founders.  The good news: small can still become big.  The bad news: it’s becoming less likely that a small will do so.

 

GLADWELL’S BACK

Life’s a first impression business.  We size people up when we meet them, and make decisions based on whether we think we can trust them, usually with incomplete information.  Unfortunately, even the smartest of us can be taken in.  Gladwell explains the reasons why so many intelligent folks were taken in by (and lost millions to) Bernie Madoff, and how an experienced statesman like British Prime Minister Neville Chamberlain fell prey to Hitler’s persuasive talents and unwittingly opened the door the Nazi domination of western Europe and ultimately World War II.

In his new book, “Talking to Strangers: What We Should Know About the People We Don’t Know,”  Malcolm Gladwell explores how we can do a better job of figuring out who to trust.  Web MD offers a good executive summary  of the book prior to its upcoming release on September.  Check it out.

 

THE MAN WHO KILLED THE HAT

The principle of Occam’s Razor advises that the simplest explanation is usually the best.  In suggesting this, William of Occam was referring to explaining natural phenomena.  But when it comes to matters of taste, life gets more complex.  To wit: the death of the hat.

Fashion folklore has long maintained that President John F. Kennedy’s hatless inauguration speech sparked a fashion trend that decimated the men’s hat industry in the early 1960’s, and for a generation thereafter.  Formal top hats had been the order of the day for presidential inauguration until Kennedy broke protocol and assumed office bareheaded.  Millions of men stopped wearing hats of any kind after that.

Did Kennedy really kill the hat?  This short offering from Primer explores the question and is a good lesson in the need to consider more than the obvious when explaining why things go wrong, or go well.

 

DAYS OF DISRUPTION (No. 31): SUBSCRIBE OR DIE

Everything Ends.  No strategy is permanent.  No business model is immune to the winds of change.  One of the most disruptive entrants in the history of the entertainment industry is the video gaming business.  For years, the key elements of its business model were the number of consoles and the number of games available.  New games were introduced in much the same way that a new movie was promoted, with extravagant premiers and reliance on opening weekend sales metrics.

All that is changing.  You’ve heard of SaaS (Software as a Service). The gaming industry has moved to GaaS  (Gaming as a Service), relying less on hype and promotion of consoles and games and more on a model designed to create recurring revenue and “lock-in.”   Are there lessons here to rethink your business or some part of it?  Understanding “Why Video Games are shooting down the Hollywood model  may provide some insights.

 

ARTIFICIAL YOU

Many executives are looking forward to the day when Artificial Intelligence (AI) takes the place of some portion of their workforce.  C-Level execs should perhaps be more concerned about being replaced, at least to some degree.  This WSJ article shares the latest trend in cybercrime: using AI to mimic the CEO’s voice, thereby authorizing transfers of cash to hackers. Mimicking the CEO’s video appearance may be next.  Learn how “Fraudsters Used AI to Mimic CEO Voice in Unusual Cybercrime Case.”

 

ECON RECON

The Candle Burns Brightest Before It Goes Out:   This old proverb might describe the current business cycle.  ITR Economics Director Jackie Greene takes a hard look at the strong performance of corporate profits in Q2 and suggests that we don’t get too excited.  She warns that, “Red flags that suggest the corporate profits rising trend is not sustainable are appearing in the leading indicators and in the corporate profits data itself.”  Find out why she says, Corporate Profits are Up, but Will it Last?

A So-Called War:  The trade war between the US and China is constantly in the news and it seems like every tweet can move the Dow by hundreds of points.  Economist Brian Wesbury thinks the media focus on trade wars amplifies the noise at the expense of the facts.  He says, “This isn’t even a trade war. It’s a skirmish with a single county.“  His latest Wesbury 101 video offers a four minute explanation of  “The So Called Trade War.”

 

Have a good week!