Personal: April 2006 Archives

I just loved this post by Guy Kawasaki, and had to comment on it! I've been an engineer, a programmer, a tester, a marketing guy, and am currently an entrepreneur... Oh the lies I have told and heard ... (hahhahahaha) I'm going to write another post on "What I learned in my 5 years as an engineer" Stay put to see that sometime soon!

I just saw this article on the BBC website: US war costs 'could hit $811bn'. I'm pretty sure that those terrorists and other insurgents aren't using so much money to create panic. Perhaps the "powers that be" in Iraq and Afghanistan should ask the Indian government on how they tackle terrorism. After all there have been insurgents and terrorists in India since independence. There could be learning opportunities here! In one good example, the state of Punjab in India had a major insurgency in the 80s. Terrorism was rampant. Now however, there is no terrorism in Punjab. On the contrary, Punjab as a state today is peaceful and has some of India's biggest export industries, enriching the local populace considerably.

I first came across transaction cost economics (TCE) in my MBA class at RSM. It was intriguing as TCE was used to explain the reason for a firm to exist at all, mergers, contracts, employment and so on. The idea is that every transaction has a cost because of negotiations, paperwork, delays, egos, self interest, etc. The idea of any business "equilibrium" is to reduce this cost. A new equilibrium should be achieved when the benefits of the status quo is possible at lower transaction cost. It got me thinking about human relationships too. Why do people get married or get into long term relationships? The most obvious answer is love and affection. But there are quite a few among us, who have felt love and affection for quite a few other humans, but we don't get into a long term relationship with all of them. My theory is this: Two new factors are also responsible - risk aversion and TCE! Now, every one takes risks. In some areas of life, one takes more risks than others. A lot of us are very happy to take risks in our profession, but we don't quite like risk in our private life. It tends to give us a sense of continuity and perhaps even rest and an outlet for our stress. Most of us also at one point or the other in our lives decide that we 'need' this continuity and low risk in our personal life. As one gains a sense of security, continuity and a low risk feel in his or her personal life, it gets tougher to make a change in that personal life - the "transaction cost" of the change becomes higher. The sooner someone gets risk averse and evaluates the transaction cost, the sooner that person gets into a long term relationship. What does this have to do with BUSINESS.. Deepen and broaden your personal relationship with your customer. That way you increase his or her transaction cost of switching to another supplier. Network with the customer on several areas of his/her life. Take them out to dinner, or go out with them. Get them to like you and trust you. It's good for your personal life and good for business!

To mash up a line from the poem by Robert Frost with an old phrase by Steve Jobs:

Now I have "Miles to go before I sleep" because I need to "make a dent in the Universe"

Seth Godin brings up the eternal question asked by every entrepreneur.. What's next? I'll tell you what's next. Go browse the websites of your customers, and those of their competitors. Figure out what new force will impact their business. Better still, think of a disruptive force that can be used to impact their business positively. You should find these forces in industries that are seen as leading edge. They'll impact your customer's business too. But not just yet. And there lies the opportunity. Now go and help your customer take advantage of these forces. Here are a few to get you started :-)

• Web 2.0
• Razors and Blades - Paid services around products given away for free
• The PSF organisational model - Every staff function becomes a professional services firm that also serves external customers
• Collaboration - across divisions, and functional silos within companies
• Creation networks - Get everyone to innovate on your behalf, including your competitors and customers
• Open source everything - How fast can you spell Linux?
• China and India as the factory and backoffice of the world
• Brazil - which has become energy independent by running all automobiles on ethanol and is committed to using free software for everything in the government. Can you imagine the impact on costs of products produced there in a couple of years time?
• Russia, Thailand, Vietnam and the Philippines will provide the next wave of investment, and outsourcing opportunity

Now go write a proposal or a businessplan this evening. Actually go take a break! You just worked hard all day :-)

A fibonacci poem is a poem where the number of syllables on each line is a fibonacci progression. A fibonacci sequence is such that each number is the sum of the previous 2 numbers. It goes like this: 1, 1, 2, 3, 5, 8, 13, 21, ... The New York Times has a little article on this. Here's my little attempt. I think I've succeeded in illustrating what I do in a Fibonacci poem. So here goes! Why (1 syllable) I (1 syllable) love to (2 syllable) blog about (3 syllables) business issues (5 syllables) Better pricing enriches you (8 syllables) Simple processes cut costs and speed productivity (13 syllables) Venturing builds effective businesses at lower cost, and builds stronger economies (21 syllables) And that's what I do: Pricing, Processes and Venturing

How cool is that? Here's the link http://www.fieggen.com/shoelace/index.htm Definitely not productive, but at 23:11 at night, who cares?