Monday, August 27, 2007

Success Secrets: Virtues of Omission

We’ve all heard of “sins of omission”…the “non-actions” that can hurt others by our not doing something. But how about “virtues of omission”. By virtues of omission, I mean those things we avoid, actions we cease to engage in, activities we cut off. These are the kinds of deeds that can make vast improvements in our lives, but are not good “conversation starters”…to say the least. In fact, I don’t think I have ever heard someone say “I switched from Tiffany’s to Costco so I can compound my retirement savings faster”. Or…”Guess what…I decided to skip my vacation to stay home and read”.

Yes, these are the kind of actions that just don’t say “Rich and Famous”, but could make enormous differences in our lives. Consider how our lived would be, on a cumulative basis if some of these “virtues of omission” were practiced:

Avoid alcohol and smoking
Avoid every cup of coffee over $1.00
Avoid staying up past 11pm
Stop drinking soda pop
Stop every expression of anger
Stop watching television
Stop all unnecessary subscriptions (premium cable, magazines you don’t read)
Stop gossiping
Stop criticizing
Stop defensive behaviors
Stop impulse buying
Stop blaming others
Stop self-pity
Turn off the lights when you’re not using them
Pay down your mortgage
Eat less sugar
Eat less white flour
Talk less.
Listen more.
Give less advice.
Eliminate a fallacy from your thinking
Take more advice
Choose a small, un-flashy car
Buy clothes that have no logos on them
Save and invest regularly
Read a book instead of going to a movie
Sit and think quietly for 15 minutes every morning

None of these items creates “visibility:, and none will cause the neighbors to gasp in awe. But think of he changes they could cause as the results accumulate over a lifetime. It takes courage to engage in these “virtues of omission, because the amount of external reinforcement (praise, compliments, etc) is virtually nil. The reinforcement as to come from within, and from self-review of our progress . It’s not impossible. It’s worth doing. But don’t expect any medals.

Saturday, August 25, 2007

Success Secrets: Charlie Munger's Checklists

I have been writing a series of posts about the concepts of bllionaire Charlie Munger, now accessible as a separate category on this blog. Among the concepts Charlie Munger touches upon is the seemingly lowly checklist. Now, why would a billionaire mention checklists as a key component of success? As I continue to think through Munger’s ideas, I get a sense that Munger views human consciousness as many psychologists do: a thin beam of light in a dark room. Our consciousness has a narrow focus, and also can easily be distracted from its ends by such things as urgency, emotion, surprise, envy, etc.

As I learned in my reading of Flawless Execution, fighter pilots use checklists all the time. It keeps them alive. Civilian airliner pilots also use checklists. Tat keeps us alive.

What is a checklist really? It is the focused application of a huge amount of procedural knowledge, “fed” to the conscious mind at the right time, in order to assist a current task, without overwhelming us with a huge volume of knowledge which would distract us from the task.

We literally cannot remember all that is good for us. Checklists allow the structured use of unlimited amounts of knowledge to aid us at the exact points we need them.

Checklists also free out mind to actually do conscious work, without the necessity of using our brain as a collection of “Post-it” notes.

Checklists help us counter emotions that might get in the way of decision-making. An example: If you have a portfolio of different financial assets, it is often a good idea to sell a bit of one asset class when it exceeds a given percentage of your portfolio, and buy some more when that percentage is too low. But try doing that in a raging market, either up or down. It is emotionally painful to think about trimming your stocks when they are hitting new highs, and buying some in the depths of a panic. This is where a checklist can help.

Checklists help us do things we should do even when we don’t want to do them. Humans may get bored, but that does not change the fact that many repetitious acts, habits, etc are very good for us. Checklists can remind us of daily, weekly, monthly commitments that are in our best interest.

The human mind can only remember a few things at a time. But what if the task at hand requires a lot more “things” than you can remember? Who says your memory is the standard for what it takes to get things done? Obviously, the “task” doesn’t “care” whether you’ve remembered everything you need to remember. And that could cause a lot of problems.

Perhaps we need to divorce our consciousness form our ego. Our minds need tools just as our bodies do. We do not hesitate to use tools to attain our ends in the physical world: we have no “ego problem” using hammers, forklifts, dishwashers, automobiles, etc to attain our physical ends. Why do we hesitate to use mental tools? Checklist , and lists in general are one of the most powerful tools imaginable. Do we think we are “too good” to use them? In fact, we could even postulate that, for any list we can hold in our memory, a written list would be a dozen times more effective.

Checklists are particularly useful for things we rarely do, since we don’t hve a “routine” procedure. For instance, if we don’t negotiate frequently, it is helpful to review a checklist of negotiation principles. . The same might be true of such things as international travel, seasonal activities such as home maintenance, the particular specs of a given client, etc.

Checklists get us to our goals more quickly, safely, and consistently than we ever could without them.


New on My Reading List

Success Secrets: Senturia on Decision Trees

In my previous post I mentioned Decision Trees, a powerful business tool that is less known in the area of personal success. By coincidence, this week’s segment of Neil Senturia’s wonderful podcast “I’m There For You Baby” also mentions this unique methodology. I recommend a listen.


Thursday, August 23, 2007

Success Secrets: Charlie Munger and Decision Trees

I have recently been exploring the ideas of Charlie Munger, associate of Warren Buffet, and himself a billionaire. Munger’s work is a good example of why I got interested in creating the Success Books blog. I started this site because of my interest in achievement and self improvement. One of the things I cam constantly discovering is that a lot of the more popular books on achievement, goal-setting, etc, are, in essence, “doorways” from the world of business and scientific thinking, where results are often the key between success and failure, and where results are often measured more carefully than in our personal lives. These techniques for achievement are more available than ever to tose of us who seek them, because the web is bursting with experienced, generous and brilliant individuals who are eager to pass along these techniques to the rest of us.

Decision trees are one such technique.

In many of his lectures, Charlie Munger has mentioned Warren Buffet as “thinkng naturally in terms of decision trees”. Decision trees essentially allow one to compare the potential outcomes of different paths of action.
As I have discovered before, the web is bursting with high-quality sites that include excellent expositions of the Decision Tree method.

One is the Hong Kong University Open Courseware site on Critical Thinking, Logic, and Creaivity. Besides the Decision tree example, The site has courseware on such useful basic thinking skills as

Strategic Reasoning

Creative Thinking

Fallacies and Biases

Basic Logic

… and many more.

This site complements a lot of what Munger has to say about the roots of success (and failure). One of Munger’s core concepts is that that mind can achieve magnificent results if it is magnified through basic logical and thinking tools, and, furthermore, through identifying the weak points that cause our judgments to err, such as biases, fallacies, etc. The Hong Kong site contains tutorials on just these subjects, and many related ones.

Another site which I found through my Decision tree search was the excellent Quality Tools site

The site contains hundreds of pages on dozens of topics that can translate from the world of business to personal success. The site is the work of quality expert David Straker.

Here are a few of the topics he covers:

Activity Network
Affinity Diagram
Bar Chart
Cause-Effect Diagram
Check Sheet
Control Chart
Decision Tree
Design of Experiments
Failure Mode and Effects Analysis (FMEA)
Fault Tree Analysis (FTA)
Flow Process Chart
Force-Field Diagram
Gantt Chart
Line Graph
Matrix Data Analysis Chart (MDAC)
Matrix Diagram
Nominal Group Technique (NGT)
Pareto Chart
Prioritization Matrix
Process Capability
Process Decision Program Chart (PDPC)
Relations Diagram
Scatter Diagram
String Diagram
Tree Diagram
Value Analysis

I look forward to exploring both of these sites in depth over the next few months.