Inflows and Outflows

Finance, both in business and our personal lives, can both be complex. Debt, equity, valuations, EBITDA, are just a small sample of the kinds of terms involved. However, things become much simpler when we think of finance in inflows and outflows.

In personal finance, if our earning (inflows) is greater than our spending (outflows), all is well. The bigger the difference between inflows and outflows, the better things are. The same applies with revenues and costs in business.

This extends to other contexts as well. For example, businesses succeed when customers acquisition is greater than customer churn. And, sports like soccer have goals scored (inflows) and goals conceded (outflows). However, soccer coaches can spend all their time optimizing for average distance run and average number of passes. Managing by complexity and proxy metrics is an easy trap to fall into.

So, every once a while, it is worth taking a few minutes to look at the big picture. For our finances, it could just be a few minutes every week to understand how we’re spending relative to how much we earn. As long as that difference is positive, things are good. Of course, we should then ask ourselves about how we can save and invest more.

But, the main thing in business and life is to keep focus on inflows and outflows. And, our job is to keep the main thing the main thing.

Hiring for intercept versus hiring for slope

When we’re hiring for a role, we could choose to hire for slope or intercept.

Hiring for slope means foregoing a bit of goodness in the short term for someone who you believe will learn quickly and deliver good long term results. Intercept, on the other hand, is looking for someone to solve the current problem well.

Most organizations experience this conflict when hiring for new roles. Often, they ignore internal transfers because they believe the candidate with the perfect experience is out there somewhere. However, in the long run, a high potential internal candidate may be a much better choice as they’ll ramp up quickly while also deliver great performance within the context of the organization’s culture.

There isn’t a right answer here. I think the right mix is likely going to be somewhere in the middle. However, many organizations like to believe that they’re always on the look out for potential. But, more often than not, hiring managers are encouraged to look for intercept over slope.

A question for every hiring manager and organization then – how often do you hire for slope versus intercept? And, is it the mix you desire?

Fearless leader, Courageous leader

We often use the term “fearless” leader to describe folks we’re leading us. I wonder if we can replace the “fearless leader” idea with “courageous leader.”

Fearless points to the absence of fear. But, fear is useful in parts as it helps alert us to risk. And, being oblivious of risks is a recipe for bad decision making.

Courage, on the other hand, is about realizing that there are things more important than fear. To be courageous, we must first acknowledge our risks and fears – and then choose to push forward because we care.

We don’t need more fearlessness. Courage, on the other hand, is always in short supply.

Hans Rosling

I still remember the first Hans Rosling TED talk I watched – “The best stats you’ve ever seen.” It was mindblowing.

Hans Rosling passed away last week. Luckily for us, he’ll still live with us through his talks and incredible work at Gapminder. I haven’t watched nearly as much of his work as I’d like to. While I’m sure I’ll do so in time, I did ask myself – why did his passing away strike such a chord?

I think it is because he is an amazing example of someone who elevated something commonplace, boring even, with intensity and passion. Hans was a statistician who drew insights from data. But, he did so like an artist.

Martin Luther King Jr  once said – “If a man is called to be a street sweeper, he should sweep streets even as a Michaelangelo painted, or Beethoven composed music or Shakespeare wrote poetry. He should sweep streets so well that all the hosts of heaven and earth will pause to say, ‘Here lived a great street sweeper who did his job well.”

Hans took this idea to a whole new level. It is amazing how good our presentations can be if we put the same amount of thought to them as Hans did. And, his work will be a reminder that we will live in perennial ignorance if we’re not making the effort to understand the data in front of us. It is the data that enables us to see what is possible and be, in his words, “possibilists.”

It is a reminder we need now more than ever.

Respect.

Builder Feedback and Armchair Critic Feedback

I’ve been both an armchair critic and builder over the years. I started out squarely as the former. However, I’ve come to appreciate how hard it is to actually build and ship something that adds value. So, I’ve attempted, over time, to be as constructive as possible in sharing my feedback on something someone else has built. And, a principle I’ve attempted to live by has been to only be very tough on something if I intend to spend my time and energy to help fix it.

The benefit of having been on all four sides of the table (both as a giver and receiver of both styles of criticism) is that I recognize the difference between builder feedback and armchair critic feedback. And, the one crucial difference is tone.

The armchair critic feedback takes refuge in sarcasm and typically adds some version of personal attack. So, if I had to take a swipe at myself this morning as an armchair critic, I’d say – “Seriously? Is this piece of drivel the best you can do as an employee of ____/graduate of ___?” It is hardly every constructive. And, even if you take the time to respond constructively, it is never going to be good enough.

Today’s post isn’t about how to deal with this type of feedback as that depends on the context.

But, it took me a long while to recognize this difference. And, recognizing it has been helpful in tailoring my response to it.

A step closer

Today is an opportunity to move a step closer to our aspirational self.

Somewhere, deep within, we probably have an ideal self we all aspire to be like. This ideal self is either wiser, more engaged, healthier, more focused or whatever we imagine it to be.

Today, we reset our scoreboard, ignore our past and start anew.

So, let’s pick one thing, just one thing, and live today as our ideal self would. It could be exercising like our ideal self would. Or, maybe we’d just engage with people with a patience we don’t usually exhibit.

If it goes well, we’ll be one step closer and will try to keep the streak until it becomes part of who we are now.

And, if we slip, let’s try again tomorrow anyway. After all, there is no failure in this endeavor. Only learning.

PS: It helps if one of our aspirational self’s attributes is continuous learning. No matter what happens in our endeavors today, learning is guaranteed.

Dr Gorrie and Flash Freezing

Dr John Gorrie in Florida began using ice in his hospital to treat his fever patients. But, when a shipment of ice from New England was delayed due to hurricanes, he was forced to figure out ways to create artificial ice.

Around this time, breakthroughs in thermodynamics meant that scientists and experimenters had discovered that a vacuum had a lower temperature. And, changes in air pressure could result in cooling. Thus, Dr Gorrie created his cooling machine. However, he died penniless because the Tudor Company (the incumbent) attacked him with a smear campaign that implicated that the new refrigeration method resulted in bacteria.

Despite this setback, the time was ripe for innovation and innovators around the world began creating refrigeration systems. A French innovator, Ferdinand Carre, then created a boxed refrigerator which was used extensively in the southern US states. Soon, innovators kept improving these refrigerators till they became commonplace.

A big breakthrough followed – experimentalist Clarence Birdseye learnt an ice fishing technique from an Inuit in Canada and noticed that fish that froze really quick retained their flavor. This “flash freezing” technique became the basis of his innovations at the New York fisheries and created today’s frozen foods industry.

 

Inventions and scientific discoveries tend to come in clusters, where a handful of geographically dispersed investigators stumble independently onto the very same discovery. The isolated genius coming up with an idea that no one else could even dream of is actually the exception, not the rule. Most discoveries become imaginable at a very specific moment in history, after which point multiple people start to imagine them.  – Steven Johnson, on refrigeration


Source and thanks to: How we got to now by Steven Johnson

(This story and quote is part of “The 200 words project.” I aim to synthesize a story from a book (and, occasionally a blog or article) I’ve read within 200 words consecutive Sundays for around 45 weeks of the year.)

The global caste system

India has had the caste system woven into the social fabric for more than a thousand years now. I grew up exposed to it and I sometimes wondered what the world might look like without it. Maybe other nations had the answer?

I’ve been fortunate to have opportunities to live in multiple places since I left home for university ten odd years ago. And, guess what – every place has a caste system of its own. Sure, they don’t call it the caste system. But, the caste system is not about castes. It is a vehicle for discrimination. As I’ve been reading in Yuval Harari’s incredible book – Sapiens, discrimination is a necessary part of social order. Human beings have used concepts like pollution and purity for thousands of years to preserve this order. Some people just receive much better treatment at any given time than most of the rest.

We don’t think much of this. If you have a passport from a developed nation, you are treated wonderfully well at any airport around the world. However, everyone else isn’t really all that welcome. Add a non-white skin color and you have a recipe for shitty treatment everywhere you go. Global travel, thus, is a classic example of a global caste system. And, folks from developing countries are the untouchables.

We grow up with these social structures and they’re woven into the fabric of our daily lives. So, it is easy as hell not to question it since it seems like the natural order. Ask some men why there are fewer women in executive positions and you might find them give you pseudo scientific answers about why it is natural, pre-ordained even. Substitute men with other “higher castes” in various contexts. And, the results are similar. Every white supremacist will tell you there’s something impure about the darker person’s gene that doesn’t make them worthy of leadership.

I’d like to believe that these things will get solved over time. We’ve certainly made a ton of progress on various issues over the decades. But, in the current climate, it certainly does seem like things are getting worse.

Then again, maybe it gets worse before it gets better?

TV2 in Denmark has a lovely 3 minute video speaking to just this. It is easy to put people in boxes. We all do, all the time. It is part of being human. But, every once a while, it is perhaps skipping what divides us and looking instead at what we all share.

[embedyt] http://www.youtube.com/watch?v=jD8tjhVO1Tc%5B/embedyt%5D

Consciousness and mistakes

I made a couple of small, avoidable mistakes recently. As with such errors in judgment, I felt my ears burn a bit as I felt the minor embarrassment that accompanies them. I try to avoid wasting time beating myself up. So, I didn’t.

But, I asked myself (both times) – was I disengaged / unconscious at that moment?

It wasn’t. I made these errors of judgment despite the engagement.

It occurred to me that I was missing the point of consciousness. The point of consciousness isn’t to avoid mistakes – it isn’t possible to avoid them as long as you’re attempting to do things. If anything, you become more conscious of them – even the small ones that you might have ignored previously.

Instead, consciousness provides us an opportunity to work on a creative, constructive and corrective response. And, what a wonderful opportunity that is.

So, a note to self – the mistakes and bad judgment aren’t going away. It is up to me to learn, make different mistakes tomorrow and develop better judgment.

Good judgment comes from experience. And, experience comes from bad judgment.

5 Resume Principles

The CV or resume has been pronounced dead many times over. Yet, they’re still around and are what many recruiters and hiring managers ask for. So, if you’re working on your resume, here’s what I’ve learnt about the 5 principles that great resumes follow.


1. No typos and obvious grammatical errors. People spend 30 seconds on your resume, 60 seconds if you are lucky. They expect you have spent significant time on your resume as it is a one page representation of you as a professional. Typos really muck with your chances – especially in a day and age when Word will do it automatically for you.

2. Consistency. Everything on the resume needs to be consistent with what came before. Formatting is the obvious candidate here. Fonts and font sizes need to be the same. If titles or locations are italicized or laid out in a certain format (e.g. State, Country), all titles and locations need to follow suit.

Also, I recommend minimizing format experiments – I am biased toward letting the content stand out.

3. Space use and section split. This advice is focused on the 1 page resume. There are a few things to keep in mind with regards to space –

  • First, the resume shouldn’t look empty. Lots of white spaces or really large font gives the impression that you haven’t done much. The best way to write a resume is to put relevant achievements to fill 1.5 pages and then remove the less important ones. A font like Arial or Calibri with a font size of 10 is ideal if you have 3-4 years of work experience. Use margins between moderate and narrow.
  • Next, the typical sections are some form of Work Experience, Education and Additional Info. Very roughly, the split of these sections (and what is in them) should be representative of the time you spend on them. So, if you have done your Masters somewhere and worked for 8 years, you’d imagine that work would be 50% of the resume, education around 20% and additional info around 20% with 10% of white space on the top and bottom. It is odd if you are more additional info over work experience, for example.
  • This applies even within work experience. It is very odd if a job where you spent 1 year has 6 bullets when you’ve only written one for a place where you spent 3 years of your life (I’ve seen many such examples). It is okay to add an extra bullet or two for the most relevant experiences. But, don’t overdo it.
  • Finally, it is okay to have extra-curricular activities listed under work but I wouldn’t go beyond a bullet. Use the space to describe your skills.

4. Skills relevant for the job. There are folks who advise people to create different resumes for different companies. I don’t really like doing that. But, if it works for you, go for it. The implicit principle they point to is to tailor your skills to the job at hand. And, that’s important. There are two steps here.

First, every line should start with an action verb – ends with “ed.” There are many great resources out on the internet that’ll help you pick the right action verb. Second, the action verbs should ideally correlate with the role you are applying for. For example, if you are applying for a role that is heavy on data, I would imagine to see variants of “Analyzed,” “Evaluated,” and “Modeled” in your resume. As a general rule, you should be able to boil most roles and job descriptions for the 3-4 skills you really need. And, you should hopefully be able to highlight your relevant transferable skills.

5. Achievements, not actions. The resume isn’t about what you did, it is about what you achieved. So, every bullet in your resume (ideally) should be achievement focused. And, the best way to do that is to have lots of numbers – numbers stand out. This is the part I struggled with the most and this is the part every person I’ve helped struggled with the most. So, let’s break this down further –

Education achievements Common practice is to state a list of education related achievement – “X scholarship” or “Y club President.” The example achievement lines would be –
– Selected among top x% of students for X scholarship
– Elected President of Y club and led club to record year of fundraising ($20,000)

Work achievements – There are 2 ways to show achievement at work –
$ saved/earned or % improved. The best bullets will end with the direct impact of your work. If you have just a few of these, make sure they’re always on top.
Examples:
Led cross functional team to solve call center NPS and instituted training program that led to better customer retention, resulting in $3M savings in 2015.
Analyzed a 500,000 customer data-set and identified opportunities to reduce churn by increasing customer touchpoints, resulting in 3% churn improvement.

Value bullet with a number. The next alternative is to at least put some numbers to show the size of the problem. E.g. worked on a project for a client worth $5M dollars or Coordinated with 14 functions and 58 people to solve a hairy problem.

Additional info achievements – Achievement focused bullets apply here too. For example, the last line is typically a line on interests. This line is wasted if you just put in – “Movies, shopping, walking, reading” or some variant of that. Pick one and tell us something cool. An example – “Running enthusiast and recently ran the X marathon.” That serves as a conversation great starter.


A great resume typically goes through 10-15 versions before it is perfected. Of course, it is ideal you don’t drop your resume and hope for a recruiter to read it. The best way in is through referrals (More in the 3 phases of the job search process). But, when it is eventually read, the role of the resume is to make the person reading want to talk to you to learn more.

Getting to that takes work. But, when the work is done, it shows.