A View from The Prairie, 2023

January 2023

Separate or Together?

Many people quit their job and go off on their own only later to get a board of advisors, join networking groups and trade associations. Britain left the European Union but a number of other countries are trying to join. The Texas Republicans voted to leave the US but thousands of others are trying to get in. Methodist churches are leaving the denomination. Separate or together, which is better? That all depends on what you value. "Network Effects" also play a role.

Resilience

After years of drought, California is finally getting some rain. Some might say too much rain. Those who had adapted to the drought conditions watch their preparations float away. There are those who are destroyed by events and those who pivot, dance, and find a way out no matter what happened. Resilience is far more than having good defenses against calamity. Resilience is the ability to find a way forward through any and all circumstances.

Collaborative Management

News channels are full of the "back to the office" push. Yet, in the rush to go back to "the good old ways of business", many managers may do the effort in the wrong way generating more resentment and quitting. The push needs to be clearly needs based and done with the goal of furthering the mission of the business. A new and collaborative method of management may be needed.

Fraud Not Detected

Now that the Federal Reserve is trying to stop the party, a lot of managers will be trying to keep the party going. Many will be tempted to "fudge" things to cover up how bad business really is. Over time, these efforts could lead them into outright fraud. The amount of fraud can be surprising. One estimate is that up to 10 percent of public corporations commit misrepresentations or fraud in any given year and 40% commit some kind of accounting violation.

No Undue Burdens

A passenger caused a ruckus and got banned by the airline. After a diner raised a huge fuss, the manager asks the diner not to come back. Customers can use their judgement when choosing to buy from a business. In a competitive environment, businesses need to be careful about putting an undue burden on their customers. Businesses can ask customers to not come back because of behavior. There are many opportunities out there when we do not place undue burdens on who our customers are or who our employees are.

Sorry Boomers

Our country is at a cultural turning point. The "baby boomer" generation is no longer the largest population group in the country. The "boomers" are dying off and the young people are now larger than the boomers. The millennials are now the largest age group and when combined with Generation Z, they are more than 40% of the population. When the boomers first started to affect culture, our country went through the turmoil of the 60's and 70's. The previous generations were not happy about losing control. Perhaps our current turmoil is partly based on the boomers losing power.

Limits on Individuality

The rugged western rancher ruling over his own land is a deep part of our national mythology. We want to believe that we can be self-sufficient. We want to believe in the myth of "pulling ourselves up by our bootstraps." The reality is that what we do on our own land does affect others. Other people are impacted by what we use, what we produce, and what we discard. Groups need rules and the larger the group, the more rules.

Make Work Adult Again

Perhaps, it is time to change what is work. With AI and the new robots coming, we may need a new paradigm of work. We have "dumbed down" work enough. We no longer need people doing dumb tasks. Perhaps we need to make work "adult" again.

Company Purpose

Recently, a beer company ran an ad that riled part of their market. The person who approved that ad made a fundamental mistake, forgot their primary purpose, and violated the number one rule of advertising; Don't harm your customer. When advertising a broad market product, they should never create controversy. When we don't know the primary purpose of an organization, we can often make subtle or even major mistakes out of ignorance. What is your organization's primary purpose?

Accepting Responsibility

On the eve of the D-Day invasion, General Eisenhower prepared two statements. One was for if the invasion succeeded. The other was accepting full responsibility for a failure. He knew that to succeed as a leader, he needed to accept responsibility for when things go wrong, even when he didn't cause things to go wrong. Leaders know that praise goes down but responsibility comes up.

Distracted from Real Goals

Are you distracted from the real goal? Many get distracted by having their name on the building. At least one business person worked hard to get his name on buildings, casinos, and golf courses. That name on the casinos and buildings has not kept those businesses from going bankrupt over and over again. That name on the buildings is not a brand for quality. Often, when we distracted and start focusing on our own prestige, we lose sight of our customers and what they want. Our goals need to be

Make Office Work Great Again?

Many people are pushing back against the huge number of changes that happened over the last few years. We saw a large number of companies adopt remote working during the pandemic and many are mandating a return to the office. This is not being driven by any hard metrics of worker productivity, but from the needs of managers. Managers do not believe that remote workers are as productive even when the few metrics show that remote work has been as productive or more productive that being in the office. But we need new metrics and new tools for managers as remote work is not going away.

Cascading Failures and Resilience

Someday, stop by a children's playground, pick up a handful of sand, and dribble it out in a pile or watch the sand in an hourglass. The pile will build up and appears to be stable for a while. But then, the top will start sliding and a bunch of sand slides down. This is a cascading failure. One small grain of sand won't stick and as it starts sliding, it triggers others to let go and slide also. The longer the sticking, the larger the failure. The failure stops when many catch the falling grains and hold them fast. The world is a lot like that.

Make a Profit?

So many impressions, so many clicks, thousands of followers, hundreds of connections on LinkedIn, book listed on the New York Times Best Seller List, EBITDA, Rule of 40, etc. When people are asking for money, we can hear so many ways that sound like success. But most of these are not sustainable success. Many a startup company wants to show investors that they are being more successful than they really are. They can make presentations showing all sorts of statistics that imply success. But there is only one measure of success: making money. In order to make money, sales have to bring in more money than it costs to generate those sales.

Authority or learner?

In 1907, George Soper tracked a series of typhoid fever outbreaks to the cook. He was certain that she caused the diseases and approached her in all the confidence of the professional who knows the answer. She reacted strongly to his attitude and it took government action to put Typhoid Mary into quarantine. Being a "professional" is not always the best way to get things done. It can feel good to be "the expert" and have people look up to us. The danger is that we can easily slip into

Financial Bubbles Unpreventable

Every so often, western society has a financial bubble. Ever since the Tulip craze in Holland, people have wondered how to prevent such bubbles. A study by the University of Miami shows that one of the deep causes of a bubble is a lack of knowledge by the buyers. This has profound implications for financial regulators. Bubbles are created by people gambling without knowledge and piling on in the fear of missing out on a "sure bet." Such gamblers do not want to know more. If a bubble could be prevented by more knowledge, then a solution would be

Is The Organization Correct?

Do you ever wonder why this meeting even was called? Is that pad of paper filled with doodles? So many times, a meeting is set up and it continues to meet long after its purpose is over. In the same way, much of corporate organization persists long past it's "due date". Some people even consider the organization more important than the people it is supposed to be serving. It can be time to blow up the organization structure and find new ways of getting things done. Just because an organization has been in existence for years or centuries doesn't mean that it is the correct organization for today nor does it mean that people in the organization are correctly guiding it.

Past results no guarantee of future

During World War II, some Pacific Islanders experienced both Japanese and Allied soldiers using their islands and sharing their material wealth. Once the war was over and the soldiers left, some islanders tried to bring back the wealth by cutting new landing strips in the jungle and imitating people in control towers. It didn't work. What worked in the past often doesn't work again in the future and efforts to make it work can prevent future success. The past can imprison the future.

Taking a Stand on Social Issues

Between wars, social strife, claims of climate change, and even whether to vaccinate, many people want businesses to take a stand on many different issues. We have to be very careful about what issues to take a stand on. Taking a stand on social issues is likely to divide our customers and we need to be careful to take a stand at the right time and for the right reasons. It is vital to identify which issues fit our values and which stands even need to be communicated to the outside world. People who grew up reading that "with great power comes great responsibility" are demanding businesses use their great power for good.

AI Hallucinations

The lawyer, Steven A. Schwartz, used ChatGPT to pull together his filings for a federal court in Manhattan. Unfortunately, the filing contained six cases that did not exist. ChatGPT made them up. Two researchers asked ChatGPT to write a paragraph on osteoporosis and to further explain what it wrote. It provided five references. Yet, none of those papers existed. Artificial Intelligence (AI) "hallucinates." It makes up data. It can be wrong up to 70% of the time.

The Aura of Truth

A businessman signs papers stating that his property is worth far more than it really is. Because he confidently asserts that his ideas of worth are reality some people actually believe him. A TV commentator pushes his own ideas and as long as he acts confident, people take his word. We have a problem with truth. Assertiveness and confidence are no longer enough to be true. For too long, authorities have assumed that their confidence was sufficient to have them be believed. Today, we need more ways to test for truth. Each time that we have a new technology that cuts the cost of publishing, it has required new ways to test for truth. The new AI tools are spitting out tons of falsehoods, but doing it in language that makes it sound as if it were truth.

Do we really want to be seen?

A businessman put his name on his company and on many of the buildings used by that company. Now, the company is at risk and he might lose control of his company and his name. There are risks to putting our names or our faces as the public image of the company. When we want to move on, we might lose control of the use of our name or face.

Computer Systems will Fail

A lot of people are putting their trust in the new AI systems. In reality, all that we can be confident in is that eventually these systems will fail. The failure point is not in the systems themselves, but in the people. Users will always push systems past their safety points. People will always misuse tools. Human beings will make systems fail. No matter how good a computer system is, humans will use that computer system in ways that it was not intended for.

Principles over personalities

A number of organizations operate on personalities. Each organization certainly has a style which some will call a personality. But the issue is when personalities determine direction for an organization instead of asking what is the right thing. Personalities are more likely to cause problems than solve the real issues. Personality driven organizations often get filled with "yes men" who protect that personality from reality. Well run businesses operate on principles.

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