[Thoughts] Beliefs and Behaviour

We often act in a certain way because that is what we assume others think or behave.

There are times when we do not seem to understand why others act in a certain way. But taking a moment for reflection, we might realise same is true on the reverse.

For instance, there is always a friend around you who would instantly reply to any message you send them, simply because he or she assumes everyone else has the same habit of checking their phones as soon as it buzzes. Simple things might not cause much conflict in reality, whereas a more fundamental misalignment of assumptions and behaviours might.

To give another example, one might assume everyone else on Earth would be selfish and not be considerate of others. That will reinforce selfish act and could be a reason that explains such behaviour.

You might have also come across someone who would doubt others as liars are liars themselves.

To decipher the underlying reason as to why this assumption has emerged, we would have to look further back. We make assumptions everyday before mentally engaging with others, be it with colleagues or with friends. An number savvy person might find himself or herself assuming others would have an analytical mindset and be able to  interpret numbers and graphs in the same way he or she would. This 'belief' could be formed with a numerous of reasons.

Mainly, the beliefs and assumptions that are triggered from an 'auto-pilot' brain. What appears might be blatantly simple and obvious. However, it takes a lot for us to understand why others might hold such beliefs and assumptions, before we can fully appreciate there are extremely intricate networks of thing - namely a collection of experiences - that are at work behind formulating these beliefs and assumptions.

We often hear people saying, 'I really do not understand such tragedy has happened and why the attacker or victim acts in a certain way or behave in a certain manner'. Yet there are times when we are so certain that we empathise with others by declaring, 'I totally understand how you feel.'

Or do we really?

[Quote] 10 principles in business

1. Focusing on making a partnership work is more profitable than focusing on making money.
2. Love your employees more than you love your clients. 
3. The best new business is your current business.
4. Price projects by asking yourself what the client's lawyer would charge.
5. It's better to be hired for your work than for your price. 
6. When it comes to getting paid, the first of the month is better than the thirtieth. 
7. Making money off mechanicals, printing and computers turns your business into a commodity. 
8. The books in your library are more important than the numbers on your balance sheet. 
9. In order to love your work, take vacations.
10. Power, in business, comes from sharing money and valuing love. 
    

[Definition] Business

Successful business (1) creates or provides something of value that (2) other people want or need (3) at a price they're willing to pay, in a way that (4) satisfies the purchaser's needs and expectations and (5) provides the business sufficient revenue to make it worthwhile for the owners to continue operation.

(1) Value creation - requires market research - understand people's need (2)
(3) Attracting customers - requires marketing - make people interested
(4) Fulfill customer's need - requires value delivery and operations - deliver on promise to customers
(4) Satisfy customer - requires customer service - exceed customer's expectations
(5) Bring in money - requires finance - profit sufficiency

It's all about the PEOPLE and SYSTEMS.
Understand how human thinks and behaves. Systematic processes that can be repeated to produce desireable result.

[Insight] Planning vs Deep-diving

Do we generate insight by planning ahead rather than getting your hands dirty by jumping straight into data?

It all depends. On a very generalised view, it is best to dedicate the 'right' amount of time in each stage during an analysis. There isn't any right nor wrong, but there is only insane extremes. 

I would argue that planning ahead is a waste of time if there is not even basic insight into the data. For instance, spending 1 day on planning an analysis (be careful that we are talking about a piece analysis, not the entire project) where where one does not even know what sort of type, quality and amount of data we are dealing with would just be a complete waste of time. 

At another extreme, diving straight into raw data without purpose seems reckless. Yet we can often generate insights as we explore into data and hypothesis is usually drawn that way.

Hence, it does not harm to spend time 'faffing' with data in order to get familiarity with the data and to understand what we are dealing with. However, we have to know when to stop and pull back before browsing aimlessly and getting lost in the data exploration stage. The next wise step is to draw up a detailed plan for a thorough analysis. 

To conclude, jumping straight in would not harm, but you have to realise at which point does it become marginally unproductive. 

[Post] Discount

年近歲晚, 又是一個消費旺季, 各式各樣的商店都打出折扣的旗號, 以吸引顧客消費. 有的折扣是明顯的, 例如8折, 有的折扣卻是不甚明顯的.

首先說明顯的那種, 8折即是把原價乘80%, 少付了原價的20%, 這是小學的計算, 現實上這種計算是有的, 但更常見的是商家把原價提高後, 再計算折扣, 很有機會比起原價更高, 或只是比起原來的減了少許. 另一種情況是有加一服務費, 原本的消費是$1,000, 有9折及加一. 最後的金額是$1,000 X (1+10%) X 90% = $990, 真正的折扣只是99折, 而不是9折. 另一種計算方法是$1,000 X 10% = $100折扣, 即是$900, 再加上加一$1,000 X 10% = $100, 總額是$1,000, 即是沒有折扣. 兩種方法我也遇過, 下一趟大家可以向商戶拿取收據作研究.

另一種折扣是複雜的那種, 最近有一間連鎖百貨公司開新的分店, 那分店提供折扣, 條件是顧客要買$500以上的貨品, 才可以有$100現金劵, 但這現金劵不可以當現金用, 而是在下一次光顧$500以上時, 才可以當$100使用, 而且只有少於一個月的使用期. 如果顧客兩次都光顧$500, 折扣只是$100, 即是9折, 但條件多多. 當光顧的總金額大於$1,000時, 折扣更少.

這種折扣較為複雜, 要光顧兩次, 而且有金額的限制, 令商家可以有較高的營業額, 這較簡單的折扣更有效. 顧客當然喜歡簡單的那種, 但商家更喜歡能同時提高營業額的方法.

另一種是買3送1, 原來每件要$100, 買4件要$400, 送1件時只付$300, 即是便宜了$100, 是75折. 表面上折扣率不錯, 但也是要多買一點東西, 顧客是否有需要, 因人而異, 但肯定會幫助商家減少積壓了很久的存貨.

在現代社會, 經濟掛帥, 不少公司長年累月都掛著折扣的牌, 是否有折扣要靠大家的智慧. 同樣, 香港多處也有特賣場, 是否特賣, 也要多作比較. 從商家角度看, 特賣場是散貨場, 商家希望早些拿回現金. 去過那些特賣場的人也可能會感到價格並不完全便宜, 有些東西在美國本土商店的價格原來更低. 現時特賣場內充滿內地的遊客, 其實價格已提升了不少. 要找真正的折扣, 是一場商家與顧客的角力, 要看你有多少時候去尋找.

[Quote] The Trump Card

所謂«絕招»就是把一個簡單的事情做到極致

[Learn] Merchandising

What is online merchandising and why does it matter?

Merchandising, traditionally speaking, is largely about the product on the shelf; what's offered in the store. But, there's more to it. Take a look at this definition of merchandising:

"…merchandising refers to the variety of products available for sale and the display of those products in such a way that it stimulates interest and entices customers to make a purchase…" It's the second part of that definition: "display of products in such a way that stimulates interest and entices customers to make a purchase" that is at the heart of online merchandising. Online merchants typically don't select or manage the inventory, but they optimize the performance of the inventory in the online store environment based on customer behavior.

Today, the online merchandiser's tool set is rich and robust: sophisticated on site search tools, product recommendation software, product videos, side by side product comparisons, enhanced visualization tools, reviews and ratings, the list goes on. Site analytics help merchants identify how placement and presentation decisions are impacting conversion, basket size and sales. Site administration tools have advanced to help "non-technical' online merchants make presentation changes easily. A/B testing tools allow for ongoing testing, learning and optimizing based on what works. More than ever, online merchants are focused on site productivity; getting maximum product engagement, conversion and sales per order.

[Learn] Boundaries

Sometimes, boundaries help you make tough decisions.
If you build your company with the policy that you'll never run an ad, it makes it even more important that you build a remarkable product--you'll never be tempted to compromise and try to make it up with hype.
Same thing goes for organizations that refuse to pay bribes. By eliminating situational decisions and grey areas, it changes strategies from the top down.
Or perhaps you're not willing to pay overtime, regardless of the emergency, regardless of how late the project is... it makes it far more likely projects won't be late, because they're designed to ship without emergency...
Rigidity is rarely your friend, but well understood boundaries make decision making a lot easier.

[Post] Losing the Future

The biggest problem facing the global economy is not climate change, trade imbalances, financial regulation, or the eurozone. It is short-term thinking. An epidemic of myopia has swept over the world in the past few decades, and it threatens our living standards like nothing else.

It's an epidemic with more than one cause, and not all of them are obviously sinister. Part of the problem is the growing complexity of the global economy. Life is simply getting harder to handle with the brainpower at our disposal.

To understand why, imagine a chess master. She might be able to think her way through the game about eight moves in advance. Now add more squares to the board, and perhaps a few new pieces. How many moves in advance can she think? Not eight -- maybe not even five. Because of the growing interconnectedness of the global economy, our lives are becoming more complex in much the same way, with many more moving parts; we can no longer worry just about those closest to us. As a result, we can't plan for the long term as easily as we used to. Every corner of the global economy is like a chessboard with an infinite number of squares; there's simply too much uncertainty.

Structural aspects of the global economy are magnifying the problem. For instance, the quarterly-earnings culture of financial markets -- the obsession with meeting analysts' expectations for corporate profits every three months, no matter what financial acrobatics that may imply -- owes its existence in part to arbitrary choices about how often companies have to report their results. Similarly, the money pumped into political campaigns has allowed them to lengthen considerably -- up to 22 months in the case of the 2008 U.S. election -- but legislative cycles have stayed much the same. With only two years between Congresses in the United States, for example, there's hardly time to focus on anything except reelection.

Together with these challenges, there is one truly odious cause of short-term thinking: narcissism. This personality trait has been changing in a measurable way. In surveys taken by psychologists, the level of narcissism -- often defined as a lack of empathy -- among successive cohorts of college students has been rising steadily since the late 1970s. Evidently, the "human potential" movement of the 1960s became transformed into the self-realization movement of the 1970s, the selfishness of the 1980s, the self-affirmation of the 1990s, and finally the self-absorption of the Internet age. Narcissistic people don't only empathize less with others today; they also empathize less with others in the future, including their future selves.

The effects of these changes are manifest in every part of the global economy. Individuals fail to plan adequately for their retirement; they simply don't care about their future selves as much as they ought to. They're also happy to push their debts into the future, in forms ranging from credit cards to government bonds. Essentially, they are stealing from future generations to fund their lifestyles today. In the long term, however, their actions could be disastrous: a rash of debt crises, perhaps, or tax rates high enough to stifle even the fastest-growing economies.

The corporate sector is suffering too. Managers focused on hitting their quarterly targets may ignore profitable long-term investments if the upfront cost is too great. This may be especially true for so-called social investments, whose benefits may not occur until several years have passed. For instance, what executive would spend extra money to help the quality of education in his company's community if the benefits in terms of higher-skilled workers and wealthier consumers might not appear until after he retired?

Governments are also passing up valuable opportunities to help their economies grow. Infrastructure, scientific research, and education cost a lot in the short term, and their benefits can take years or even a generation to accrue. Yet these benefits, in terms of higher wages, enhanced competitiveness, and economic growth, are enormous. The question is: How can you get a politician to focus on these investments, when she may be long gone from office by the time they pay off? For that matter, how could you get her to spend money today to fend off global warming or some other apparently far-off calamity?

The answer in both cases, of course, is for voters -- and shareholders, in the private sector -- to send a strong message that will punish short-term thinking. For this to happen, we need to change our preferences. We have to take responsibility for our own excesses. We have to teach our children to delay their gratification, to work hard even when the results might not come right away, and to use all the tools at their disposal to understand all the complications of an uncertain world.

If we do not, we risk an enormous disappointment of expectations that will be catastrophic in both economic and psychic terms. Already, living standards for the younger generation in wealthy economies are starting to fall short of those their parents enjoyed. The response among the young has been to borrow more, earlier, and the oceans of cheap money supplied by the world's central banks have only served to enable them.

They are just accelerating the catastrophe. The time to stretch out our time horizons at home, in business, and in government is right now, before our future disappears altogether.

[Quote] With an open heart and an open mind

It might not be warranted, but you won't get far without it. Don't bother going to that meeting or reading that book unless you can momentarily assume the message comes from a place of goodwill and generosity.

Skepticism doesn't help you hear.

[Football] ManCity Alternative Line-up

[Reading] The Sage

“Life has a gap in it, it just does.” 

For one thing, as all the great wisdom traditions have taught, learning to be satisfied with little makes us calmer, less anxious and more able to deal with the imperfections of life. Wanting the maximum, in contrast, makes us grasping, constantly aware of what we do not have.

Too much also tends to spoil what you already have, whereas too little at least preserves it. Overeat and the dinner is spoiled by nausea and indigestion. Leave the restaurant a little hungry and at least you haven’t ruined your enjoyment of what you have had.

That does not mean we should be happy for our life gardens to contain large, uncultivated areas, of course, or that we should not put in something extra that will flourish if we see the opportunity. Making the most of your limited life need not mean hankering after a different or bigger one. But it does suggest that if you spy a gap, as Margot’s friend says: “Don’t go crazy trying to fill it.”

The Shrink

An entertaining and potentially revelatory self-development exercise is to imagine alternative lives. The idea is that this may lead you to neglected aspects of yourself that could do with some attention. What do you fancy being? An opera singer? A monk? A foreign correspondent?

It can be tantalising, a bit like walking up a lovely mountain path and noticing trails going off in all sorts of intriguing directions. With the best stamina in the world you can’t explore all of them, but you can’t help wondering what breathtaking panoramas you might be missing. Similarly, even if you are happy with your life, there will always be alternative paths – desires, potentials and capacities that you could develop – but you can’t know where they might lead.

Sometimes responding to the lure of such dormant potentials is easy: we can just choose to cultivate a certain quality a bit more. You may not be able to go for a complete life change, but perhaps you could still join a choir, make room for contemplation, do some travelling – or even read more travel books.

At other times it’s trickier: you’ve become aware of nurturing an inner sculptor, say, but sculpture doesn’t quite fit into your already overcommitted life. It’s even harder when it comes to relationships, since rarely do we get everything we need from one person, and it could be unwise to keep chasing perfection when good enough is ... well, good enough.

There are times when accommodating an undeveloped potential requires radical life shifts, but how do we know when such a big adjustment is in order? Of course there are no off-the-shelf answers, but you could ask yourself a few questions. One is how urgent the need to change direction is, how important it is to have this missing ingredient in your life. Another is to what extent you are genuinely dissatisfied with your life rather than just responding to a fleeting curiosity or passing cloud of boredom.

Gaps are part of the human condition, so we can never fill them all. The point is deciding which ones we can live with.

[Newspaper 20120704] Eurozone ESM

Eurozone's rescue funds to recapitalise undercapitalised banks directly, rather than provide money via vulnerable governments (of particular benefit to Spain and potentially enormous benefit to Ireland) and to buy sovereign bonds in the market (of apparent benefit to Italy and Spain).

It was also agreed that loans from rescue funds would not be senior to existing loans, which should reduce the risk of panics by lenders. Leaders also agreed a €120bn ($151bn) package of measures to promote growth. On the principle that support should coincide with control, the European Central Bank is to be given responsibility for a new system of European banking supervision, as a step towards what protagonists hope will be a true banking union.

Yet what was not agreed is even more important. The list includes any increase in the funds available for the European Stability Mechanism (capped at €500bn); eurozone bonds, in any form; and a eurozone-wide deposit guarantee or bank resolution regime. 

Meanwhile, it needs to be stressed, the ECB has no intention of being buyer of last resort of sovereign bonds.

Thus the most important positive element is the movement towards breaking the mutually destructive links between banks and sovereigns. This is a step towards the eurozone equivalent of the US troubled asset relief programme, or Tarp. A consequence must be to take the responsibility for supervision out of the hands of national governments. The result is also going to be a huge further increase in the powers of the ECB. At the same time, this is only a small step towards a full banking union, which would require a bigger fiscal back-up than anything now available. 

The decision to let the rescue funds buy government debt in the market is even less meaningful and could prove destructive, as the Belgian economist, Paul de Grauwe, now at the London School of Economics, argues in a recent article.* The outstanding debt of Italy and Spain is close to €2.8tn, or a little less than six times the size of the ESM. It is well known from the work on currency crises of Paul Krugman, the Nobel laureate, that speculators can bet safely against a fund known to be too small to stabilise a market. The only credible stabiliser is an entity with infinite firepower. In the case of sovereign finance inside the eurozone, the only entity able to protect a country against selffulfilling runs on its sovereign debt is the ECB. Since the ECB is unwilling to act in this role and leaders are unwilling to give the ESM the powers to force it to do so, these proposals amount to spitting in the financial winds. Markets may have worked this out: while bond spreads have fallen, they remain dangerously elevated (see chart).

In substance, then, these are small steps, incapable of achieving the three necessary conditions for an end to the crisis: a definitive separation of banks from sovereigns; financing of weak sovereigns on manageable terms during the lengthy period of economic adjustment and retrenchment; and, above all, a return to healthy economic growth.

Let us not be too grudging: the decision to allow the ESM to recapitalise banks directly is possibly very important, both in itself and for what it portends. It might transform Ireland's position. Nevertheless, the biggest danger is that the economics of the eurozone are deteriorating fast. Joblessness reached 11.1 per cent in May, the highest on record for the zone. Worse, apart from its refusal to intervene in sovereign debt markets on the needed scale, the ECB is hopelessly late in taking necessary monetary action. With austerity biting in vulnerable countries, everybody is feeling the pinch: even Germany is not immune to downturns in big trading partners. It is conceivable that the eurozone will struggle through this economic trench warfare over the next several years. However, the costs - not just economic but also political - are likely to be enormous.

Yes, the eurozone does need a new constitution. But the priority is to get economies moving. Until then, the risks of further crises remain.

[Video] Trial, Error and the God Complex

[Quote]Fallacies

A few tricks that might be handy to keep up your sleeves.
- Accidents:
Suppose a freak incident to reject a general rule, the freak feature helps overturn general rule. Vice veresa, when it is claimed that you are breaking the rules, dig up the freakiest case: if the rule doesn't apply in this case, why should it to yours?

- Affirming the consequent:
Mix up the antecedents and consequents. In an 'if... then...' construction, it is not correct to affirm the consequent in order to prove the antecedent! This is extremely useful when you wish to impute base motives to someone. E.g. If I drop an egg, it breaks. This egg is broken, so I must have dropped it.

- Antiquitam, argumentum ad:
This supposes that something is good or right simply because it is old. (But after all, human progress is made by replacing the old with new) A belief or action being old does not make it right, any more than it makes it wrong. E.g. You are not having a car, I never had a car, my father never had one; nor did his father before him.

- Apriorism:
Usually, observation of facts test our principles. To start out with principle and use them to accept/reject facts is the wrong way round. Relationship between principle and fact is complicated: we need some kind of principle, otherwise nothing presents itself as fact in the first place. E.g. In patent medicine, principle governs the interpretation of facts, such that recovery approves the medicine; while lack of recovery was proof that more is needed.

- Bifurcation:
The presentation of only 2 alternatives where others exist. E.g. If you are not with us, you are against us.

- Blinding with science:
Use of technical jargon to deceive audience, blinding them to the true merits of what is being said.

- Bogus dilemma:
Presenting false consequences or false choices. E.g. If you become a politician, you tell the truth, men will hate you; you tell lies, god will hate you. Since you must tell either truth or lies, you will be hated.

- Circus in probando:
Using as evidence a fact, which is authenticated by the very conclusion it supports. E.g.'I have the diamond, so I shall be the leader.' 'Why should you get to keep the diamond?' 'Because I'm the leader, stupid!'

- Complex question:
A question that conceals an assumption. The answer is basically assumed before it is given. E.g. Did the pollution you caused increase or decrease your profits? E.g. Would you prefer to go to bed now, or after you've finished your cocoa?

[Travel] Madrid - Apr 2012

Plaza Santa Ana

Puerta del Sol

Plaza Mayor

Palacio Real de Madrid

Parque del Retiro

Museo del Prado

Gran Via

[Thoughts] Making Impression

People acting differently than what they normally would act.
We speak not of what we think, but for the response that we expect.
We tell outrageous stories to others.
We make sure our opinions are heard.
We argue.
We lie.

And all we have in common to a certain degree, in the world of free information, is our strive to be recognised, by everybody and especially the ones who we want to impress.

A Brief Look-back at Year End

A kid looks at the toy in another kid's hand, thinking, 'He has something that I don't have.'
One interpretation of the story is that the kid lives in a deprived family. He has to work hard to fight against natural selection, a much greater effort to be put in in order to survive. Also his personality as a whole is shaped by constant pressure coming from all directions.
This person is everybody, we are all deprived in some ways, and we are shaped and nurtured over time by something we cannot possibly have the control over.

Another interpretation of the story is that the kid is properly equipped with quite a few toys already. He is genuinely happy with what he has. Until he sees this toy in the other kid's hand which is so much better than what he has ever seen before. No, he is not greedy, but he wants to have something better due to his 'ambition'. This encounter of the new toy has truly broadened his horizon, and this realisation challenges himself to get out of his comfort zone, to put extra effort into getting that 'better' toy.
The toy, for me, is the (sometimes unfathomable) knowledge and talent.

The final interpretation shows an opportunity missed, not due to any resource constraint. The boy could be holding the exact toy that the other boy is holding. It's not because there isn't enough money or anything, he made the best decision at the time he got the toy. Although he really could have been holding this other toy that he prefers, for one reason or another, he is holding this inferior option. But hey, he tried his best at the time, he might as well put up with what he has. Reality is such that he cannot always get what he think or expect he would get.
This feeling, within me, was felt when I saw intimate couples together as the first sparks from the firework glittered in 2012.

What's ahead, as always, is full of uncertainty. Holding high hopes; always look on the bright side of life, and always look on the right side of life!

[Learn] Q&A

When you see kids go on a field trip, the questions pour out of them. Never ending, interesting, deep... even risky.

And then the resistance kicks in and we apparently lose the ability.

Is the weather the only thing you can think to ask about? A great question is one you can ask yourself, one that disturbs your status quo and scares you a little bit.

The A part is easy. We're good at answers. Q, not so much.

[Ponder] One to One

Things come and go.To be physically presence, to be exchanging conversations with the person you value are the building blocks of a successful and fulfilling relationship experience. What ultimately drives this genuine understanding of one another, without a slight bit of contemptuous thought, is too intricate to be put in sentences. And it is rare. Voicing out views would appear to be frank, otherwise it could just be something called patience working its magic, masquerading an underlying robust feeling. A proactive exchange in comment delivered in a good manner can mostly avoid discontentedness, but often it is met with either denial or misinterpretation. Once a constructive initiative puts the other into a zone of resistance, it would trigger the siren sound. Further push or shove can almost guarantee the beginning of a sequence of self-defence and excessive justifications, and we can almost be sure that stubbornness will be found at this stage at both ends. An important thing in this circumstance is not to let emotion override one's rational mind. This is the key for the path towards resolution to be found. 

On the other hand, meeting this (one) important person does not necessarily mean you would be spending a significant amount of time together, and it all hinge upon gut feelings. This often signifies that further withheld or drawn-back approaches are required. But the further a string is been pulled back, the greater the risk is for a damaging trigger to be set off in the future. Therefore, it would require an even more sophisticated, mentally calm and steady person to avoid this final bitterness to be felt. 

Some vital words to bear in mind: Do not be afraid to take on challenges. Keep faith and chin up to the contest. Ultimately, one shall never be afraid to fail.