Author Archives: Kevin L

Competitive dynamics

Through my career in teaching, government and consulting, I’ve advised people on strategy and competition. One of my key takeaway from life experience and observing the dynamics in the market is that competitiveness is not actually the best way to compete. Most of the best achievers I see out there takes on market leadership moves – typically activities that create rather than divert business.

For example, in school, I shared my notes with classmates, coached them, gave them my responses to assignments. Friends of mine through school have benefited from my guidance and help. In exchange, I did better than I could have done because I’ve sought to teach others what I learnt, which reinforced my learning better than any other approaches. Whether I could do better than others, was irrelevant in the tactics I’ve adopted because I never wanted to bother about ‘competition’.

Subsequently at work, I noticed there were people who were competitive at work, keeping knowledge to themselves and working quietly to outshine others, or networking with bosses. And there were those who mentored and coached younger colleagues, choosing to spend more time helping others get better at work and sharing the mission of the work.

There will always be people who are competitive, who is out there to climb ladders that are built for them. There will scale heights, but only limited by what the system and the existing infrastructure can afford them. True breakthroughs are going to come from those who did not set out to go high or far by the well-recognized parameters.

Good things don’t last forever

In economics speak, the law of diminishing marginal returns sets in at some point. We don’t know what point it sets in but most of economic analysis seem to look at situations where the law of diminishing marginal return has already set in. That is really the only way we can ensure that the system has some sort of equilibrium. And within a limited timeframe of analysis, that is probably true – there is always some kind of limit that is causing the cost curve to be upward sloping.

So Moore’s law is a little bit of a challenge to that notion; but in reality, it does not contradict typical economic analysis because economist is always taking a snapshot in time. And when it doesn’t work, we take the ‘long run’ which is meant to say ‘eternity’ basically. This time horizon between the short run and the long run, which is when just about everything happens, is where we don’t have the clear view.

And because we don’t have a clear view, there are possibilities, lots of them. Moore’s law has been around for 60 years and been predicted to end for a long time now. The reason we think it is going to end is the idea that the diminishing returns will set in somehow. I think there’s no doubt it’ll end at some point. Preparing for that possibility is important; but maybe not as important as the opportunity that present itself from the time it is true.

Symmetries in relationship

“The safest way to try to get what you want is to try to deserve what you want. It’s such a simple idea. It’s the golden rule. You want to deliver to the world what you would buy if you were on the other end.”

Charlie Munger

In Barry Nalebuff’s Split the Pie, he emphasized the concept of symmetry in negotiation, highlighting that in any two-party negotiation, the contribution of both are actually equal. Because the benefits are off the table when any one of the parties walk away. And therefore once the pie is identified, it should be split down the middle.

As seen in the quote above, the thinking about symmetry is the same when we consider how we ought to treat others, how we put things out into the world, and make decisions. There is always a thought experiment that allows you to be on the symmetrical opposite end of the deal – and you’ve to consider if you’d accept what you’re getting.

What this mean is you can introduce this thought experiment to someone who puts up a ridiculous deal and flip the tables on him/her. When the person highlights the asymmetry of the parties, you can mention that it is irrelevant to what you’re trying to create here. The question is whether the person is actually committed to securing this gain? If the person has a better deal elsewhere, put it on the table so it shrinks the pie and the split can be reallocated.

You don’t stand a chance

When you participate in a lottery, you stand a chance to win. If you don’t buy the ticket – well then you don’t. I don’t believe in buying the ticket however, because I don’t want to play in that game of chance. The odds are stacked against me – and I’d think to myself ‘you don’t stand a chance’. Because buying the lottery ticket serves me no other purpose other than the chance.

Most other things in life are not like that. We participate in tenders knowing we won’t win. We come up against strong sports teams knowing we will lose. We go for auditions knowing our performance probably won’t make the cut. Why do we do all that? Not because of a blind hope but because we achieve more than just getting the chance when we take part in those. We leverage that opportunity to showcase ourselves, to show up, to prove to ourselves a part of our identity – as a musician, a dancer, as a professional who can do the work. We also use the chance to connect with audience, or prospective audience. Maybe it’s just one person, the judge, but it’s still an audience whom you did not previously have.

And that’s why we have to care enough to take action about sustainability, to change the way we consume, to speak up against actions that sets us on a course of no return, and ask for leadership that can lead us into a future we actually want to be in. Because it is saying something about ourselves, it is connecting with our future, and those same people who are going to live in it.

What about the baseload?

I get asked this question a lot; by the people operating power systems, by the Oil & Gas industry, and the traditional old school bankers. They also ask about price of intermittent renewable energy plus energy storage; and when that will reach grid parity. Essentially, they are saying that the new innovations cannot replace the current technologies because the cost don’t stack.

I’m not sure those are the right conversations to have or the right questions to ask. Economics do drive a lot of systems and considerations but they probably should not be hijacking our priorities and our realities. Climate change is real; and if we are to put our best foot forward to make the difference, we are not going to make it. Putting our best foot forward is about using our minds, engaging our hands and changing our lives.

Yes, baseload power will be changed, energy prices will increase, perhaps our spaces, our wealth will have to be sacrificed. But our earth can remain a sanctuary for life, and our world can remain intact; if only we are putting our best foot forward. Not dragging our feet, not trying to maintain status quo. Not trying to exercise malicious obedience.

Economics of whatever

In my line of work as a strategy consultant, I sometimes work on techno-economic studies. Using a combination of statistical analysis, forecasting techniques and calculations, we estimate various different cost trajectories, and examine the economics of something. It could be a project, a technology, or a decision that a company is trying to undertake which has some cost impact and some benefits somewhere else.

In economics, we can only perform estimates when we assume all else equal. That’s the only way to perform proper sensitivity analysis. When you change more than one parameter, then you’d call it a scenario analysis. There are infinite possible scenarios when there is infinite parameters to shift or parameters with continuous range of possibilities. So when we model the economics of something, we’d always be varying something that we think we have control over, or that we expect will be changing in the near term, and see the effects on the economics.

Yet we often think that the economics of a technology or something will remain the same unless something drastic happens. More often than not, economics of technologies shift when various players in the market make different investments, either in the underlying technologies, manufacturing capacity for the gears and components, or simply into research and development. The actions of many different parties can have a collective impact of making the economics work when at first it doesn’t seem to work.

When we critique the economics of a new innovation or project, we often forget we are comparing them against the status quo where many are already very well-invested into. The years, decades and even centuries of using a technology, manufacturing it, creating complex supply chain and auxiliaries around the status quo. It is naturally hard to beat. But what is critical about a new technology is that the incremental investments can make a large impact, small changes to scale can also make a difference. Coordination and changing expectations play a big role.

Will the economics of new innovations change overnight? Unlikely, but they typically change faster than you and I can work out the math for the economics of it.

Malicious obedience

I have been going through Bob McGannon’s Linkedin course on ‘Leading with Intelligent Disobedience‘, he brings up the concept of ‘malicious obedience’. It is the behaviour that follows from ‘well, if that’s what you want’. And it is probably what we engage in more often than we are proud of.

I think by juxtaposing intelligent disobedience with malicious obedience, one suddenly recognise rules for the place they should be. Yet more often than not, we follow rules somewhat blindly, out of laziness, fear or lethargy, when there might be more wisdom and intelligence in breaking them. Of course, here, we recognise another dimension for following the rules – it is to do so with malicious intent.

Of course, the malicious intent might not spring up overnight. It could be employees who knew something was wrong and sounded the alarms but the management refused to heed. It could be a child protesting the stupidity of a rule at home and not having received the appropriate explanation for why the rule was in place. So the risk of not empowering others with the ability to disobey intelligently is that we send the wrong message about what obedience is about.

Talking to bosses

In my career-coaching, I often encounter cases of communication challenges from employees or staff especially in conveying messages or ideas to the bosses. Part of the problem is probably culture and the strange imbalance of power with bosses, particularly in larger organisations. There is a lot more filtering of information with complex intentions:

  • Staff might be trying to simplify things for bosses in order to get information across fast but end up obscuring some information
  • Staff may also be trying to manage their bosses’ perception of them and hence try to be focused on delivering more good news than bad
  • Information might be mixed with remarks incorporated for bootlicking purposes

All of these we learnt through a combination of poor workplace culture, bad upbringing with parents hiding lots of different things here and there. There are much better ways to be able to bring truth to the table without having to flinch at the expected responses.

  1. Highlight the context and the objectives of the company or project, and gain affirmation first
  2. Bring up how the objectives are not being met
  3. Define the problem clearly and how it connects to the objectives not being met
  4. Provide some options; each of which justified either by expert or external opinions, past experience from the team and other parties
  5. Request for a decision to be made

If the boss sits on the decision and don’t make it; you may need to be more persistent in highlighting the issue. Then you can start bringing the consequences and laying alongside the costs of the options so that doing nothing would clearly be more costly.

This approach is also useful for sales but perhaps that’s for another day.

Rules for intelligent disobedience

Bob McGannon introduces some rules for breaking the rules when talking about intelligent disobedience which I found to be useful in general even without considering the notion of intelligent disobedience. He suggested some really quick considerations:

  1. Do it as an exception: only when the standard rules don’t work.
  2. Don’t do it in stealth: Convey your intention and explain the reasons you’re breaking the rules.
  3. Not to be passive aggressive: you don’t play nice and say you’re going to follow the rules and then leave your boss’ room and then break them.
  4. Don’t break the law: if a rule is based on a law, you need to make sure that you’re not acting in a manner that breaks the law.

Why putting these ideas upfront is important for management and also within the context of any organisation is that you want people to be acting intelligently and have a clear robust process for exceptions. It doesn’t mean you create extra bureaucracy; if anything, it is to allow people to act wisely and be allowed to face the music later if they agreed it is a mistake.

Within an organisation, by introducing these ideas, you empower employees and treat them maturely as individuals rather than a cog in the system. In practically all areas of life, when we need people to be more autonomous, we naturally will end up hiring the best people.

Intelligent disobedience

Through the Linkedin learning course by Bob McGannon, I became acquainted with the idea of intelligent disobedience. I think the premise that he lays out is pretty interesting. That the human world is made of many rules and usually, 95% of the time, these rules work but then there is always 5% of the time when it doesn’t. This is when circumstances are extraordinary, when the situation is not as expected by the rule-makers and so on.

The exceptions are what calls for intelligent disobedience. After all, the reason that a person should be put in a job is not because he knows all the rules on the job. He needs needs to be able to follow, but more importantly, he needs to know when to break them. If rule-following is all it takes, then the cockpit of most commercial aircraft technically don’t require pilots. It is the need to take exceptional actions that we need professionals to take certain roles.

Talents are basically known to be the ones who break rules. They don’t get punished for them; in fact more often than not, they are celebrated. Philip Yeo is a good example of that in Singapore. In fact, he probably exhibited most traits of intelligent disobedience in most of his stories of defiance that he recorded in his book, “Neither civil nor servant”. To a large extent, risk-taking involves a lot more nuanced thinking than the manner our Singaporean culture allows for.