RK's Musings

Blah Blah Blah: What to do when words don’t work - Summary

Dan Roam, the author of popular books “The Back of the Napkin” and “Unfolding the Napkin”, has written a new book with a message that one must fuse our linear wordy based thought process with pictures/images/visuals to comprehend things in a better way. Well, this message is not something new. Presentations with visuals catch our attention rather than the boring bullet point slides. To some extent my book summaries might also be boring as they are merely words, although I try to put in some visuals to make it interesting.

This book has three parts. The first part talks about the fact that we are drowning in blah-blah-blahs and in the process losing our clarity of thought. The second part of the book talks about vivid thinking, a jazzy word for using visual and verbal thought process to get to the message/ideas that we ought to understand and the stuff we ought to filter out as noise.

The author uses an analogy of Fox and Hummingbird to distinguish between visual and verbal skills necessary to think. Fox is linear, analytic, patient, clever and smug( representing our verbal mind). Hummingbird is spatial, spontaneous, synthesizer and easily gets distracted (representing our visual mind). This book argues for a balance between Fox and Hummingbird traits.

Why should we care about developing these skills? Well, there is a lot of blah-blah that we get to hear in our lives, be it in corporate presentations, conference calls, customer meetings etc. and most of the times the idea is either complicated, missing or outright misleading. The intent of blah-blah-blah could also be obfuscate or deviate from the original intent. Hence it is imperative to understand the right message from all the blah-blah-blah, and that is where these Fox and Hummingbird skills are useful.

We have all been drilled with Fox Skills/ Verbal skills right from our childhood. However Hummingbird skills have not been taught consciously to most of us and hence we develop a phobia to use visual skills/ images/drawings to understand things. It is merely a phobia, says the author, and tries to offer a framework, i.e visual grammar,to get going on developing these skills. The framework has 6 elemental pictures

• Portraits are visual representation of nouns and pronouns ( WHO and WHAT )
• Charts are visual representation of quantity ( HOW MANY)
• Maps are visual representation of preposition and conjunctions ( WHERE )
• Timelines are visual representation of tense ( WHEN )
• Flowcharts are visual representation of complex verbs( HOW )
• Multivariable plots are visual representation of complex objects – Synthesis of all the above elements answering WHY

The last part of the book shows the reader a way to see the forest from the trees by distilling 7 attributes of a vivid idea. It uses an acronym FOREST to show the essential attributes of an idea. F == form, O == Only the Essentials, R == Recognizable, E == Evolving, S == Span Differences, T == Targeted.

Whether you believe in this structured framework or not, this book will make you realize that visual imagery is imperative for better understanding of the ideas you get to read/write/talk in the verbal/wordy world.

UNTITLED : Summary

This book is a poor imitation of Steven Pressfield’s book , “Do the work”.The author is a professional actor who seemed to have settled in to some creative director gig at a Church. The book is called “Untitled” and metaphorically refers to the blank page that faces any person at the beginning of a project, be it writing an article/book/painting/creating a biz etc. Everyone has to start with a blank page. In an writer’s life though, every novel and every little story of the novel begins with a blank page and he/she must fill in characters , narrative as he goes along. In that sense, “blank page“ is a demon that a writer needs to fight every day. 

This book is collection of cliché’s , quotes picked up from various philosophers/authors/books etc.  Except using iTunes library as a Launchpad for creative writing that the author mentions, the book has nothing really original. Through out the book, the author harps on one point that ideation , execution , is plain old hard work and there is no magic bullet.  The author being a creative director and an actor himself, should have at least been a bit creative in writing some original content than merely quoting other people.

Pomodoro Technique Illustrated : Summary

This is a book on the lines of GTD( Getting Things Done). I tried GTD a looooong time ago and I gave up almost immediately. It surprises me though, that there is actually an outlook plugin for GTD system and a ton of softwares based on GTD. That means there is some section of people who are finding it useful .

Anyways this book is markedly different in its premise. It is based on chunking principle. If you want to do anything , focus on it for a specific period of time, take a break and repeat it !!. 

“Pomodoro”, is an Italian word for Tomato, and the originator of this technique (Francesco Cirillo) found a productivity hack using a kitchen timer that was in the shape of a tomato. Hence the name Pomodoro Technique. Basically the principle goes something like this:

• Set a timer for 25 min on a task and work on it with absolutely no distractions. Each 25 min chunk is called a Pomodoro.
• Take a forced break for 5 min where one is not supposed to think of previous Pomodoro activity or future Pomodoro activity
• Repeat the above steps 3 times after which you can a 15 min break.

Is it really a productive hack ? God Knows!..I read this book (in 2 Pomodoros ) out of sheer curiosity  as this has generated quite some buzz. I guess this technique might be useful for multitaskers who have too many things on their to-do list and want some structure to their juggling act.

29 Ways to Stay Creative

Via Siddharth:

Do the Work – Summary

This is a free Kindle book that I stumbled upon. This book is basically designed to coach you through a piece of work be it writing a book / developing a software / creating a model / new venture / new product/ new service etc. This book is not so much about “what you should do”, but more about “how you should you do it”. In any creative endeavor, most of us would agree that the biggest obstacle is “internal”. You can name the internal struggle in umpteen ways, here the author chooses to call it “Resistance”. He starts off saying that three big forces against us doing creative work are Resistance (i.e., fear, self-doubt, procrastination, addiction, distraction, timidity, ego and narcissism, self-loathing, perfectionism, etc.), Rational thought , Friends and family. Out of the above three mentioned forces, the author dwells upon the beast (Resistance) in us which we do not recognize sometimes. The beast has the following characteristics :

Resistance Is Invisible , Insidious , Impersonal , Infallible , Universal Never Sleeps , Plays for Keeps

Our Allies in our creative efforts are Stupidity, Stubbornness, Blind faith, Passion, Assistance (the opposite of Resistance) Friends and family. One must invoke these allies from time to time so that one can fight against this dragon called resistance.

I guess everyone can relate to this book based on the nature of work they are up to. In my case where my work is to build math/stat models, there are some nice takeaways from this book that one can relate to any model building exercise

Start before you are ready : If you are building let’s say a volatility based model, don’t over prepare. Look at the data, do some diagnostics, fit a basic model and back test it. Once you know it really sucks you can improvise.

A Research Diet : You cannot read LOT of books and assume that at the end of it, the model will magically become crystal clear. You need to cut down the literature to a few important books and then start building a prototype of the model. However the books you shortlist should be read cover to cover. You got to forget everything else and go over the books so that you don’t miss any vital point from those shortlisted set of books. So, in one sense, what you include in your research diet becomes crucial. Again this is a process. First time you have no clue what to read. Second time, you become a little better in choosing the relevant to stuff to read, third time you get a decent idea and so on and so forth. Utopian state according to me would be,“You see a problem ---- You immediately know the kind of model that would work for that specific problem ---- If you have the skill sets well and good ---- else you kind of know precisely the books, the academic papers, the software, the people whom you must connect so that you can build a useful model”. Any modeler should strive towards this utopian world.

Stay Primitive : All you need is pen & paper, a programming language and a database to do your research work. Nothing fancy is needed. The advantage of using open source is that you can customize to your requirements, meaning you can decide what is needed and what is not. Most often than not, it is the pruning that is critical. Like a garden that becomes beautiful after pruning, most open source software from my experience work like a charm, once you know what to prune and how to prune.

Swing for the seats : Don’t be taken aback by the complexity of the model if you know that it has a potential to work. After all, most often than not, you might end up using only a SINGLE component of the model but that which works perfectly for the situation.

Three Act Structure : Like the artists, painters, movie makers, create a three act structure for your model. What are the three major components that your model has/model will accomplish by the time you ship it. These three acts should be the basis of everything that you do.

Fill in the gaps : Once you have the three act structure ready, work furiously to fill in the gaps. Do research. You must remember that ideas don’t come linearly. Some tangential direction from some footnote in some random paper could be just the thing that you want to implement.

The Process : Build a prototype / Back test / Do research / Build a prototype / Back test / Do research – Basically it boils down to ACT-REFLECT loop a zillion times till you are ready with the model

Obviously any process will hit roadblocks and this is where the book explains two tests where you will win over resistance based on your attitude.

Test Number One : How badly do you want it?

The scale below will help you answer. Mark the selection that corresponds to how you feel about your book/movie/ballet/new business/whatever.

Dabbling • Interested • Intrigued but Uncertain • Passionate • Totally Committed

If your answer is not the last one in the options list, then Resistance will eventually triumph.

Test Number Two : “Why do you want it?”

1. For the babes (or the dudes)
2. The money
3. For fame
4. Because I deserve it
5. For power
6. To prove my old man (or ex-spouse, mother, teacher, coach) wrong
7. To serve my vision of how life/mankind ought to be
8. For fun or beauty
9. Because I have no choice

If you checked 8 or 9, you will beat the beast/Resistance. If you have checked any one of from 1 to 7 Resistance will win the war, even though you might win a few battles here and there.The book ends with saying that, @ the end, you have to ship it. You do the research/ math/back test and you don’t ship it, you have failed.

This book made me curious to read the expanded version of the same content “The War of Art”, a nifty play of words from the title of a famous book “The Art of War”.

This book explains the same points with many more examples and anecdotes. If you feel resistance in doing your work at any point in time, be it at the beginning/ middle/ towards the end of your project, these two books will jolt you out of your sloth.

Takeaway :

The book makes one realize the beast in all of us, “Resistance”. By exposing its various manifestations, its allies, its weapons, one can be prepared to overcome it in our daily lives. We cannot remove it completely .We need to fight with it every day. However we can get better at it, day after day, if we are committed.

Poke the Box : Summary

It has been a really long time since I have read any of the Seth Godin books , so picked up his latest book – “Poke the Box”. Books from Seth are usually filled with nuggets of wisdom culled out from marketers / entrepreneurs/purple cows that he comes across. To me, I love the way he writes; Straight to the point, no bullshitting, no nonsense and blends his message with anecdotes and interesting insights.

Firstly something about the man on the cover; Seth says

“The man in a hurry is an archetype, first discovered in the hieroglyphs of ancient Egypt. He’s you, the excited, optimistic experimenter who understands that risk is misunderstood and that forward motion is the key to success. “

The phrase “Poke the box”, represents hacking or action. In author’s words,

“How do computer programmers learn their art? Is there a step-by-step process that guarantees you’ll get good? All great programmers learn the same way. They poke the box. They code something and see what the computer does. They change it and see what the computer does. They repeat the process again and again until they figure out how the box works. The box might be a computer or it might be a market or it might be a customer or it might be your boss. It’s a puzzle, one that can be solved in only one way—by poking.”

The book’s central message is “Start Often and Ship Often”. This applies to ideas/books/ventures/products and it means that creativity has to crisscross with the marketplace often. There is no use writing a novel and perfecting it endlessly instead of shipping the rough draft. There is no use in building the perfect product instead of shipping the product in versions and making it better as time goes. This does not mean that you ship something half-baked. It only means that you have to ship often , to fail often , and to finally succeed. Shipping entails the risk of failure and unless a company/an individual/team is not prepared to fail, it will be in an endless loop of perfecting the product and living in an utopian world, thus missing the critical component required for any success- “Failing too often”.

To be an initiator/shipper you don’t need to have some grandiose context. Seth puts in beautifully

Outsized entrepreneurs are lionized daily. We’ve heard their names again and again—people (too often men) who started a business, started an organization, started a revolution. Good for them. But you don’t have to be Howard Schultz to be an initiator. People have come to the erroneous conclusion that if they’re not willing to start something separate, world-changing, and risky, they have no business starting anything. Somehow, we’ve fooled ourselves into believing that the project has to have a name, a building, and a stock ticker symbol to matter. In fact, people within organizations are perfectly situated to start something. The third person in the four-person inbound customer service team can do it. The receptionist can do it. The assistant foreman can do it. The spark I’m talking about is simple to describe, but easy to avoid.

There is another aspect to starting/poking the box, which is “finishing”. If you don’t ship the idea/product/art/whatever that you are doing to find the reaction from the market place, then you have failed.

Takeaway:

“Starting as a way of life” is probably the only way to ensure that you fail often, you ship often , and in the process succeed.

Rework

 

I am a great fan of 37 signals. I have been using backpackit service for the last 5 years and have always loved the web app for its simplicity and UI design. The fact that Ruby on Rails got a major push because of the founders , is one of the best things to happen for people who believe in rapid prototyping,  as they  could  use Ruby on Rails to quickly test the traction for their web app ideas.  

This book is from the founders which summarizes their learning's from running 37 Signals gig. 

One specific thing which  I found particularly nice which echoes with what I believe, as far as statistical tools are concerned. One can have the biggest and the mightiest of servers, the most expensive statistical software with 24*7 support and still churn out  plebeian data analysis. One the other hand a nimble guy with basic open source components which might cost nothing , and who PUTS in hours working on stuff , can actually churn out kick ass stuff. The authors in the book name one of their essays as, “TONE IS IN YOUR FINGERS”, which is my favourite from the collection of thoughts in this book. It goes something like this:

Guitar Gurus say,”Tone is in your fingers”.You can buy the same guitar, effects pedals, and amplifier that Eddie Van Halen uses. But when you play that rig, its still going to sound like you. Likewise, Eddie could plug in to a crappy Strat / Pignose set up at a pawn shop, and you ‘ll still be able to recognize that its Eddie Van Halen playing. Fancy gear can help, but the truth is your tone comes from you.

Many amateur golfers think they need expensive clubs. But it’s the swing that matters, not the club.

Give Tiger Woods a set of  cheap clubs and he‘ll still destroy you.

- Jason Fried & Co

 

The Checklist Manifesto : Summary

The title of the book makes it obvious for anyone what’s in store for them in the book. At some point of time or the other, we all would have made a list of something in our lives… Grocery list, Books to read list, Things to do list, Steps in an algo while coding, List of aspects to be checked in unit testing/system testing, List of steps in a process (that is outsourced to a call center where standardization is the key) , List of items to be back packed, etc.

Personally I like making a checklist even if the list is not more than 4 items long. The very fact that you tick off the item after you complete a task gives me some kind of feel good effect that you have accomplished whatever you had intended to. In one way it also quantifies things that you have in your mind. those 6 books that you wanted to read, those 5 things you need to have while taking a customer call ,  those 9 items you should buy at a grocery store etc .. In that sense a checklist is a nice and simple quantification mechanism, a recall mechanism for our attention strapped life.

Ok, now is there a book worth of stuff relating to checklists ? If the book was written by a management consultant, or a self help guru, I wouldn’t have bothered to even cast a glance at it . But the fact that it is written by a doctor who talks about the usage in the medical field is something that caught my attention. Medical field  at the outset seems like a field where there is no scope for standardization as every patient needs to be treated differently. However the author says checklist can get things right in medical field!

The book starts off with a few examples of doctors who have gained enormous experience in surgery, became highly skilled over their careers , but still fail to do things in an organized way while performing surgeries.  So, what’s missing ?

The author brings out a fundamental puzzle in modern medical world. Because of sophisticated treatment procedures, a doctor needs to keep track of innumerable tasks and more often than not , he/she adopts specialization to super specialization path. This solution has not been quite effective as there are about 150,000 deaths following surgery in US every year, more than 3 times the road casualties.

The book  takes a tour of various domains where checklists have been used , sometimes by accident, sometimes by necessity . Though, the form , format and content of checklists have evolved in these domains, the tool has made a lasting impact. Basically if you look at all the places where checklists are used, they started as a means to overcome fallibility of human memory and attention , when it comes to mundane and routine matters. Slowly the checklists were adapted to the situation and communication mechanism was put in place to make it work. In essence, any system driven problem solving might need a checklist in its tool kit.

In the construction industry where the very activity of project involves a multitude of tasks at varying complexity levels, there is a heavy use of checklists in various forms, routine task list, exception list, etc. An industry which was characterized by compartmentalized work culture of design-implementation has been replaced by more wisdom of crowds thinking .A single overarching design is not meeting the trying demands of a multi-storied structure. Construction industry has thus seen an end to the master builder culture and has taken a systems approach to design + implementation.

In the airlines industry, checklists are heavily used to handle various situations and remove mental hijack when there is a panic. By laying down the procedures for emergencies, the airlines makes sure that crew does not forget to do some of the basic steps of an emergency. Did you know that the pilot for the airbus that averted the accident, which was called miracle on Hudson and was covered in the media for days and weeks , had used checklists and his crew were well trained to handle such situations. Even though the media portrayed it as an incident where a single pilot had a great role to play, a little investigation by the author revealed a different story, LUCK + Preparedness(checklists) was behind the Miracle on Hudson.

In the field of hotel management, one of the finest kitchens in the world use and communicate using checklists. Sometimes the staff go to an extent of keeping a checklist for each of its valuable customer to give the same consistent experience time and again.

There are a some examples of investors , venture capitalists , mentioned in the book, who use checklists in their work to finalize a deal. There is a mention of Pabrai Investment Funds California, Acquamarine capital management in Zurich who diligently use checklists. Now one can dismiss them as freak examples.

So, if there are so many areas where checklists are used, why hasn’t been an adoption amongst various fields/people ? In the words of the author,

“We don’t like checklists. They can be painstaking. They are not much fun. But I don’t think the issue here is mere laziness. There’s something deeper, more visceral going on when people walk away from not only saving lives but from making money. It somehow feels beneath us to use a checklist, an embarrassment. It runs counter to deeply help beliefs about how the truly great amongst us – those we aspire to be – handle situations of high stakes and complexity. The truly great are daring. They improvise. They do not have protocols and checklists. May be our ideas of heroism needs updating

The fear people have about the idea of adherence to protocol is rigidity. They imagine mindless automatons, heads down in a checklist, incapable of looking out of their windshield and coping with the real world in front of them. But what you find when a checklist is well made, is exactly the opposite. The checklist gets the dumb stuff out of the way , the routines your brain shouldn’t have to occupy itself with.”

 

Takeaway :

Making a checklist and adhering to it enforces discipline, and reduced human fallibility. I think it is a good quantification mechanism where you can see what’s done, what needs to be done and where you stand.

Plight of the Fortune Tellers : Summary

There are a couple of books which I think , every risk manager should read. After reading them I hypothesize that there will be 4 outcomes

• Risk manager ignores the view as just another view and moves along ( and moves the firm too , in a downward direction)
• Risk manager starts introspecting his/her methods and starts becoming skeptical about them and will probably do something about it
• Risk manager starts introspecting his/her methods and becomes extremely skeptical about them and will do something about it, hopefully
• Risk manager quits his job and does something else, far removed from the field of risk management. Who knows, he might just embrace risk with out giving any consideration to the frame of thinking at his/her previous job

"Plight of the Fortune Tellers" is one such book which should be on the must-read list for any risk management professional. It is a book which was written years ago , before this subprime mess hit the economy. Its insightful view of the risk management world from the world of frequentist and bayesian worlds is bound to shatter a lot of myths for an open-minded reader. I always intuitively knew that bayesian is the way to go. But this book reinforced my thoughts as the author brings a lot of facets and goes very deep in to the subject to show that Risk management's current practices are completely flawed. BTW, there is not a single equation in the book . It is a remarkable achievement for any author on risk management to avoid equations and explain his ideas in simple english!!. This book rocks!

"The Cardsharps", by Caravaggio ,

shows a handsome and probably very naive young man who is engaging in a financially rather risky activity:gambling. We become aware of how risky this game of cards really is when we note that a man is looking over the shoulders of the young player and communicating to his fellow cardsharp the cards in the young man’s hands: unfortunately, a lowly “three.”And, when our attention is drawn by the action of the playing cardsharp to the dagger concealed in the waist band, we begin to fear that what the young man is risking may be more than a few ducats.
The dire consequences in miscalculating the odds of a risky activity, is what the painting talks about!

Here are the main ideas from the book:

Author pitching to the reader to spend time and effort on the book

• Leibniz usage of statistics to forward the cause of Prince Fredrick of Prussia. Statistics is used to take decisions and not mere hypothesis about stuff and write papers about it
• Fundamental need to rethink about the role of probability, role of rare events, time homogeneity and forecast period!

Thinking about Risk

• There are 2 types of probabilistic assessment. System I and System II
• System II is analytical, tools, math based
• System I is heuristics based, where we overestimate odds of one group and underestimate odds of another group
• Risk management in the current environment is heavily skewed towards System II thinking
• What is needed is a good blend of System I and System II thinking

Thinking about Probabilities

• Frequentist Probabilities and Subjective Probabilities
• Subjective does not mean "anything goes". You should be able to bet with those odds
• Why cant we say that coin is 40% fair. Why should we always live in the world of accept/reject world ? Either coin is fair or biased ?
• Point estimate + confidence intervals == frequentist world...
• Risk management needs Bayesian Probability where there is a constant interaction of prior assumption and data
• With limited amount of data, in the frequentist world, there is always an external model which one uses!

Making Choices

• Prospect theory and Utility theory - What have they got to say on choices ?
• Problems associated with each of the above theories

What is Risk Management for ?

• In a bank or a firm, whats the purpose of the risk management division. Shouldn't investors themselves indulge in diversification and any form of risk management done by the firm will not suit all the investors ?
• The truth of the matter is that investors almost always do not have the complete information about what is happening in the firm
• All the investors see is stock price and earnings , their volatility. High earnings volatility is a signal to the investors that the firm might not do well
• The sole purpose of risk management is to create stable earnings estimate. - This is what the author thinks. If you ask Taleb, he would probably say, firm should get rid of risk management division completely :)

Var&Co - How it all started ?

• 3-6-3 World of a banker
• Firms started to undercut the bank by directly issuing bonds
• Banks started banking! on trading revenues
• Complex instruments --> More desks --> More variables
• VaR , a convenient metric but which is actually VariableAndwRong

Looking beneath the surface?

• There are approaches to Var , namely Historical simulation, Empirical fitting, Fundamental Fitting
• Historical simulation is dumb but least controversial as it involves no parametric calibration
• Empirical fitting is intellectual orgasm. Pick one of the distributions in the stats101 book , find the best fit and then you have all the freedom in the world to talk about 99.979999 percentile!!!(arggg). Even if you have data about 1000 days, you can still predict a 10000 day event. Does it scare you?
• Fundamental fitting - This is what happens when physicists try see finance as a science. Finance is social science and there are no universal structural equations!! alas!! its not pondered upon a lot
• Monte Carlo - More sin has been committed with Monte Carlo technique than any other, in the statistical world. WHY ? Montecarlo doesnt say a thing about distribution. Given a distribution , it will tell you how to proceed...But ...who gives you that initial distribution
• Central Limit theorem - It doesn't work in tails. It talks only about the initial moments!!! So, rare event is out of question using CLT
• Correlation is a metric for elliptical joint distributions. But why should joint distributions be elliptical for the observed real world variables ?
• If I want to assign meaningful probabilities to very rare events, I cannot escape the link between the frequency of data collection, the relevance of the data, and the rarity of the event in question. And if the event I am interested in depends on the co dependence among very many variables, the complexity of the problem literally explodes

Which probability matters in risk management ?

 

• Probability Square - Four vertices - Frequency of Data Collection + Time homogeneity + Rarity of the event + Forecast Horizon
• Frequentist world : High frequency of data is good as the event is time invariant.
• We need external model /view which says that the data observed in the past is relevant to the forecast horizon. But then how do we validate that external model ?? It is not math / sciences where one can take axioms as god given and move along
• If the phenomenon I want to investigate is very time homogeneous, if I can collect data very frequently, if what I am interested in happens not too rarely, and if the horizon of my statistical prediction is short, I am clearly in Frequentist Land
• Prediction of Short term horizons - Market Risk - Large data sets available ; Is it relevant data ? For valuing CDS how far backward is relevant data ?
• Prediction of Long term horizons - Does market to market make sense ? Important to model trend , but it is inherently more variable than estimating volatility. Long term nature of the issue at hand cuts down the data points, cuts down the confidence.
• Statistics 101 - Point estimate + confidence intervals is crap in the risk management world
• In Markowitz’s Portfolio Selection bible, for instance, the possibility that all the probabilities attaching to the different outcomes may not be perfectly known only makes its appearance on p. 257 of a 303-page book—by which time the assumption that the objective probabilities are perfectly known has become solidly embedded in the psyche of the reader
• The frequency with which we can update the value of a long-term portfolio (if we do not mark it to market), the length of the projection horizon of interest for these portfolios, the difficulty in estimating the trend and its high dependence on our models and prior beliefs, the importance of the trend itself in determining the overall portfolio performance—all these factors strongly suggest that a subjective-probability approach is the appropriate one.

The promise of economic capital ?

• Need for the regulatory capital should be linked in a beneficial manner to the risk management of the firm. A bank should not end up gaming the regulatory capital requirements

What can we do instead ?

• Subjective probability is the relevant type of probability for assessing returns, and judiciously employed frequentist analysis is useful to assess risk, it then follows that we cannot use the same statistical tools to evaluate the risk and expected reward from a project.
• Treat Risk and Return separately and use different tools for each of them
• For risk, look at the asymmetry of the distribution, dispersion and kurtosis
• Three decisional crutches - Best Possible Scenario Worst possible scenario , Break even analysis
• A call to arms for related disciplines such as bayesian analysis, decision theory and experimental psychology

This book cannot be speed read at all. It needs to be read slowly, allow the points to sink in and ultimately help you understand the nature of risks in a better way. Personally, after reading this book, I think there is tons of innovations that need to come in to Risk management field. WHY ? The current mess is a clear indication that things are not right and risk management as a discipline should strive harder than ever before to prove its worth.

Retaining Millenials

I stumbled on to this article tracing the meaning of the term " Millenial" ( referring to folks born after 1980). The gyan on retention is well worth a read

Link : Retaining Younger Workers in the Workplace - Gen X - Millenial - Baby Boomer

Good Analogy

Here's a nice analogy that I came across between Gardening and Managing :

Any good gardener knows that the secret of good gardening, the inescapable foundation for excellent results, lies in soil preparation--unglamorous as that may be. No matter how good the plants are, no matter how much you water or fertilize later on-- unless you start by creating a rich, open environment for your plants to grow in, you are likely doomed to failure. Therefore, the wise gardener, before ever making that first, exciting trip to the garden center to pick the plants of his or her dreams, spends time creating great soil. You do this by digging it up to loosen it and to see what it's like, and then digging things into it. Great soil is loose and open, so the plants can burrow their roots into it easily, and it has natural nutrients incorporated into it as needed--compost, rich topsoil, etc.--so that the plants get the nourishment they need. For a manager, "listening" is preparing the soil. It's your key to creating a working environment that supports optimal growth. Listening to your employees first allows you to "dig it up and see what's there." That is, it gives you a chance to find out what people actually know and don't know, what has and hasn't been done, where the concerns and misunderstandings are--as well as the enthusiasm and clarity.

Little things

Little things make a lot of impact in a company. There is a a simple practice of having free bagels with cheese on every Friday morning in a company and I had a chance to overhear quite a few conversations of the employees. This was placed in such a way that employees from various functions could come and talk over while they were having bagel in the morning. It could be their weekend plans, their department stories, etc..People infact looked forward for Friday bagels..From a company's standpoint, they hardly cost anything..But from an employee's feel good standpoint, it is great investment.

i guess these little things are what matter and these are no taught as a part of Human resource management courses in B schools...These have to be learnt on-job i guess.