" Lucky" Imran vs " Noetic" Dan

Hello people,

Over the past few days I have had the chance of doing most things I love to do - including watching movies and reading novels. So, these two pursuits allowed me to watch the latest Imran Khan starrer "Luck" and finish the Dan Brown thriller " The Lost Symbol" in 1.5 days flat.

But, the thing is when run-of-the-mill Bollywood meets adult fiction best sellers, crazy ideas are born ( at least in my brain they are :-) )

So let me propose a thought ( with all the flourish of a marriage toast ) -

" Investment in human luck can be a very profitable business if the subjects can properly focus their thoughts-in short, God can be made to play loaded dice"

"Luck" despite having a very average script, accompanied by the usual Bollywood hype-hoopla and impossible sequences, is built around a very interesting concept- Investment in Human luck as the substitute/ future for the stock market, shares, gold and commodities. Some would say that the stock market is centered around luck , but if u have sat through any IIM portfolio management/ securities analysis classes....believe me...ur thoughts will change radically.

Dan Brown has written of Noetic sciences.....an esoteric branch of science that even has an institute (IONS) in California. For the uninitiated ( or those who are not DB fans)...this deals with human mental capacities and has come up with several startling discoveries including the fact that thought has physical mass and if properly focussed can affect and change other physical mass. The good news for non believers of esoteric terminology/sciences (NBET/S :-) ) is that the institute is categorized as a questionable institute for practicing health related sciences.

But suppose for a moment..that their discoveries are true ( or actually are...to be politically correct) ...then this in combination with Luck's concept gives rise to a very interesting idea.....if u could change luck by concentrating ur thoughts then u can become rich by overcoming the laws of probability and investing in ur own/ someone else's luck. This is how the idea can play out....

U have a game of dice where the stakes are high and as u push the stakes up...ur thoughts get concentrated. Being a true practitioner of the noetic sciences, u will ur thoughts to focus on the dice on the table. But u cannot control the way in which these " heavy ideas" :-) interact with the outside world. So, this is a two edged sword....as the stakes go higher...ur thoughts become concentrated...fueled by ur desire to win....and heavier thoughts upon interaction can potentially tip the dice either way. Hence u can create loaded dice of ur own ( or if the noeticists are to be believed, u always do), thereby negating the laws of probability and potentially creating a matrix where this law does not hold and u win everything.....but being unable to control the way these powerful thoughts/ emotions interact with the dice...the probability returns though in a different form.

So people, one can invest in people's luck...as luck can change if u are a noeticist...and it can change at ur will...but which way your luck will change you do not know.....so this leads us to the age old adage- " The only thing certain about luck is that it will change" ....so long Dr. Einstein

The Propeller Theory

We have all talked about core competency and non core competencies but how does a company decides what is its core competency. In the initial stages of a product design or service design or delivery, the management doesnt even know about their existence the next year. So how can a company decide on the concept of core competency.

Secondly is there a shift in the core competency over time?
According to some research it has been observed that core competencies of a company do shift. Sometimes so much that we realize it only when the shift is visibly drastic. But all this while the shift is always there, though the internal system is able to see the change, it is also able to adapt to it, so in relative terms there is no change. But when the internal system is unable to adapt, it admits that has been a shift in the above mentioned core competency.

Lets take an example, a company X has the core competency of producing a good Y better than anybody else using a set of unique operations management technique in a country Z. Initially there were trading restrictions with the outside world so company X always had a near monopoly situation. Imports trickled in but the company X was able to adapt to the situation by changing prices and aggressive marketing campaign. Suddenly WTO came in and the barriers were removed, now another set of N companies who imitated (over a prolonged period of time & improvised) some of the same operations management techniques from X during the initial years and implemented them into their own systems now come in with their products in direct competition to product Y. Adding to that they have also exploited some third country for cheap labor and raw material.

So now the company X suddenly realizes that they have lost their core competency ( extreme case) or the core competency has become a mere competency. It is now that they will try to find out if they can realize a new core competency which can provide them with a sustainable competitive advantage. In other cases it may happen that the other companies though cannot copy the core competency of X, they may develop their own ways and means to bypass the advantage it provides.

So they may utilize their other assets to reap in the benefits which company X is getting by its core competency.

Assumption: I believe that core competencies scale high on terms on rarity and non imitability. But over a period of time they can be imitated and improvised. Also a set of competencies of another competitor and a set of non crucial assets can also be utilized to gain the value a company may achieve by a core competency that company X has in its system.
I would like to keep in the discussion open here with a few questions
1. Like the doppler shift, is there a relative shift in the nature and effectiveness of a core competency?
2. How soon a firm can realize its own core competency?
3. Though with lesser efficiency, if a firm can imitate the benefits of a rival's core competency with set of regular mortal competencies and asset class. Do we actually need a core competency?
4. Finally is utilizing such assets and competencies in an effective manner is also a pseudo core competency?

Of Population dynamics, economics and epidemic marketing

They have discovered that electricity and magnetism is related, they say that humans evolved from apes though they have never found what they proudly call "the missing link" and they are nowhere near the GUT - the general unification theory , the holy grail of science.

So here in my own small way I propose an idea that might help "their" cause a bit.

The business world borrows most of its ideas from the natural world and animal populations and business strategies evolve in the same manner

Now what does Darwin have to do with Welch ? A lot actually....

If u follow economic theory then you would have come across the Cournot's duopoly model. This is a very famous model that defines how a firm should act when faced by a competitor in a closed environment provided they both dont know how the other is going to react. Then if you take the trouble of graphing out the profits that each firm gets...you are left with a quadratic equation that produces an concave graph...one that has a maxima.

Now comes the interesting part.....

If you graph out the population levels that exist for any kind of animal population in a closed environment....like a school of tuna fish with limited feeding resources.....then over a period of time it would follow the exact same shape......there would be generation, increase of population, decrease to a sustainable level and finally extinction.

Compare that to a typical product lifecycle that most marketing gurus in the world swear by ( ok not swear by but teach ).....its the same shape.The fabled cycle of introduction (birth), growth, maturity, decline and extinction.

So we have 3 different phenomenon- strategy, population and marketing following the same basic lifecycle. So, this prompts the thought that the business world borrows heavily from the Darwinian theory of evolution....

The behavior of an organization (both the firms and the animal population being organizations with defined hierarchies) would remain essentially the same whatever be its surrounding in the sense that the Darwinian laws of competition and the survival of the fittest apply. Now the question is can this hypothesis be extended to the social setting where a human population also has the same hierarchical structure albeit not as explicitly stated or properly defined as that of a school of fish or a colony of ants. This is where I believe that population dynamics will meet swarm theory.

I believe that the overall size of the population in a closed ecosystem (population dynamics) will be affected by Darwin’s laws but how the existing population behaves at a particular moment can be mapped by swarm theory. The center of the population and its outline will define the entire population and this can be utilized by today’s modern marketers for their benefit.

So the conclusion is that if u are an animal ( at heart or otherwise) ...you should know business...they are related

The pulsation of reality

Does history have a shape ? Will evolution stop one day ? Can physics be linked to political science?

I believe that the answer is same for all these questions -the pulsating wave

Although in the static 2 dimensional form this is nothing but a superimposition ( interference) of the sine and cosine functions of a particular variable .But move it to the 3dimensional this is the

shape of our universe,in the virtual - the shape of history,biology and politics.

The universe is pear shaped according to Mr. Stephen Hawking....and that lays the ground for extension of the universe into further pulsations unknown to man today.

The human population is becoming more intelligent as the generations evolve , that is an accepted fact. But every thinker and philosophical source from the New testament to H.G. Wells in his book "The time machine" talk about the world coming to an end or the restarting of evolution from scratch. The "morlocks" thousands of years from today, could not, according to wells match the intelligence of their ancestors of a thousand years before. Similarly, if Hindu mythology is to be believed then the weapons used by Lord Rama or anyone of the innumerable warriors of the Mahabharat are a distant dream for the best engineers of the modern era.

Look at the Renaissance that followed the dark ages in Italy,Portugal and Germany. But the period following the renaissance was the industrial revolutio that changed the paradigm of thought and again converted Europe into a mass of dirty cities, smoke billowing factories and harried laborers. So economics and social status of the people followed the pulsating wave.

The colonialisation era seems to be a tale of the unsatisfied hunger of the developed nations for newer lands and better resources.But look closer and you see a pattern emerging - The countries that colonized first waned in power and were replaced by new ones....so the total extent of colonialization activity followed a pulsating wave - India was free when the US was a colony and the Chinese occupation occured as the same was waning in India.

So....in short...everything from the sound nodes to the political strategies of England to the imagination of Mr. Wells regarding the intelligence of mankind and finally the universe follows the pulsating wave. Another feather in the cap of the "Golden Ratio" theorists.....

The matrixial transformation

A game is something that is meant to be enjoyed. However if mathematicians have their way, as they have been having for the past several decades- they attach the word " theory " to this expressein of joy and convert it into something wholly more frightening in most cases - a myriad world of probabilities,rules, action sets and equilibriums.

Of all these complex ( and in my case often unfathomable) concepts , there is one that makes a little more sense to normal mango people ( aam aadmi ) - RULES. We have heard the word from lowly class monitors to the dean of the institute - but always in the same context - "follow the rules or else....."

So let me try to build the idea of a matrix- an enclosed physical/ virtual space that has only one rule - " Bend the rules as they fit you " . This was how Neo survived the agents in the movie...and this is how business meets game theory in a resounding clash of possibilities.

The presence of players in the matrix ( it may be anything- from a cricket field to a forest)- characterises the kind of happenings in that matrix. Each player is free to choose the kind of outcomes that they want to a particular sequence of events - in the sense that everyone will want the best things to happen to them ( thats a no-brainer).

But the beauty of the matrix is that the ultimate rule that governs a particular aspect of the game is determined by the interaction among all these individual choices, according to the proportion of agreement- so no one is really sure of what is going to happen until the set of actions and their sequences unfold. So the rules of the game have changed from being static to being dynamic- and that too determined discretely for each set of players.

Then ,the process of evolution starts- the player who learns and adapts at the fastest rate to this dynamic rule game will be able to control the matrix at the point where his/ her expectation of the outcome of his actions achieves a certain level of certainity. Other players will not be able to follow because they do not have the same understanding level to affect the matrix in a similar, significant way. Once the lead player bends the rules then again the interaction effect comes into play- so the evolution is different and another player might emerge victorious. So a la the movie- it is possible to make bullets take a curvilinear path or humans fly across buildings if only you know which laws to bend keeping in mind the objective of this transformation.

This is what might happen in the business world also - respond to your competitors in the way that they least or dont expect - thus you can negate first movers' advantage , core competency and resource command and what not . As they said in the innovative way to catch a lion -

" How to catch a lion ? Let the lion catch you. Newton's 3rd law- every action has equal and opposite reaction - implies you caught the lion "

----- Something that you dont expect--- change is the name of the game

Strategic importance of Jammu and Kashmir among the regional powers of Asia

Strategic Views on the State of Jammu & Kashmir

PAKISTAN

The summers in Pakistan leads to acute water shortage; hence J& K is important for Pakistan’s survival and sustainable industrial and agricultural growth as losing J& K may end their sovereign control over the lifeline of Pakistan, the mighty Indus as well as several of its northern tributaries. Pakistan's per capita water availability has plummeted from 5,600m3 (1947) to 1,200m3 (2005) due to its burgeoning population and Indus has become indispensible for Pakistan’s survival. (Waslekar et al- International Centre for Peace Initiatives) Pakistan also has an eye on the mineral wealth of J & K which has considerable reserves of bauxite (8.6 million tonnes) (State geological survey), high quality limestone, gypsum deposits (100 million tonnes) and high quality sapphires. J & K is a source of high quality timber and saffron which fetch the best prices in the world. All these economic factors make Pakistan’s interests in J & K much more than a religious war.

INDIA

Beyond the concept of unity in diversity and the tag of a “secular state”, J & K has other strategic factors which make it indispensible for India. In its entirety, J & K provides India with a foot into the door to central Asia, a resource too important for the country’s growing oil and natural gas requirements; at the status quo position today it allows India to maintain a special status in the affairs of the central Asian region. Further, tourism revenues and horticultural revenues also form a large part of the interests. Despite its current status, a future look into the mineral wealth of J & K is also on the table for the government. If we wonder to see why the rise of militancy took place in J&K beyond the obvious sentimental motive fired up by Pakistan, it was the lack of infrastructural development in J&K in comparison to other hilly regions like Himachal Pradesh and Kumaon & Garwhal division of UP (now Uttarakhand). Further any major development that did take place in the state was confined mainly to Jammu region and the city of Srinagar which fueled discontent among the rural population.

CHINA

Spill over effect of Kashmir dispute into its Xing Jiang province which has a substantial Muslim population. Further China in the long run sees an arc of hostility as the only visible counter to the rising Indian republic which may form a strategic alliance with western powers in the coming years. With Kashmir either as a buffer state or within the control of Pakistan, China can extend its sphere of influence. The Karakoram highway between Pakistan and China running through J & K is symbolic of this fact. Pakistan in turn gets Chinese weapons for its army and provides Chinese an easy access to the Gulf which can be a potential gold mine for Chinese products and for oil imports from the gulf using the Gwadar port it is developing on Makran coast.

All in all Jammu & Kashmir is one strategically important pie which none of the regional powers would share with others for reasons beyond religion, ethnicity and historical borders.

Originally Written for IIMConnect by Abhishek Bakshi as columnist for Strategy Vertical

Memetics- The cerebral virus

The evolution of ideas is a fascinating concept. Just as the biological entities evolve by a controlled change or replication of genes, similarly the mental evolution could be thought to be driven by an entity that can be segregated and held responsible for the way the mind thinks , responds or processes information. Richard Dawkins in his 1976 book”The Selfish Gene” first proposed the concept of a unit of cultural idea that he named the “meme” .

A meme consists of any idea or behavior that can pass from one person to another by learning or imitation. The mind is exposed to an environment that the rest of the biological being is not, an environment called “culture”. So, in terms of culture, the mind has to evolve in a manner different from the rest of the body. It is this threshold where biology is no longer dominant and material matter is substituted by abstract matter that competes to form the present state or level of consciousness. So, while the human body should evolve as a result of evolution of the genes as well as adaption to surroundings, the mind must evolve genetically and/or memetically in the presence of memes.

I propose, with my limited understanding that the cultural sociosphere (the realm of human culture) is nothing but a pool of ideas (memes) to which all human minds are connected by means of direct experience or imaginative power. The better educated and perceptive the human host is, the better is its connection to this huge bank of ideas, cultures, theories, gestures, practices, fashions, habits, songs, dances etc. that we name the Meme Pool . The human mind can be considered to be a meme machine or a vessel with both input and output points, similar to individual nodes in a computer network, that will react to an individual situations using the memes it has already integrated into its “hardware” as a result of frequent use or exposure. If the situation is something not faced by the host before, the mind will then connect to the meme pool, in order to extract the ideas that will let it face the situation in the most effective manner. Memes can thus be regarded as the software modules that can be ingrained on the cerebral hardware and used in applications. Only that software we use most frequently is made a copy of in our mental makeup and that is what we call the “self”.

The dual stage core competency theory

Core competence is a word that every management grad encounters. But a more fiddlable and ever changing concept u wont find. Prahlad and Hammel had something else in their mind when they gave the concept in 1990 and today interpretations are mostly the original concept plus the prof or the student's whims and in extreme cases fantasies. Since this is a democratic country , so i feel that not putting my interprtation forward will be a waste of my hard earned " Right to freedom of expression". So here is what I feel about this much maligned/ glorified concept:-

No organization can perform 2 separate processes with the same degree of proficiency. Even though an organization could perform better in many areas than its immediate competition, yet all these areas are either not its core competence or are sourced from the single process that is actually the firm’s core competence.

I believe that the competitiveness (potential or actual) of the company is defined solely by the ability of its human resources as they then take the decisions and perform the tasks that define products, pricing and performance of the organization.

Thus shifting core competence should be the way to go. I feel that if an organization has to outperform competitors then uptil a certain point the core competence can be processes, technology, project management etc- whatever everybody else who is doing well follows. But beyond that threshold, once they are in uncharted territory, they have to shift to people management and development as their core competency. And this gives rise to the Human Capital (HC) centric organization. This is an organization where people are the central hub from which everything else will be derived be it structure, reward , strategy and finally success of the organization.