Photo Credit: RainerSchuetz
Photo Credit: RainerSchuetz

The 4 Millionaires

Four millionaires are sitting on a park bench.  Its a sunny Thursday morning.  While many others are working the 9 to 5 routine, George, David, Jonathan and Paul are relaxing in the park.

As you look at George, David, Jonathan and Paul nothing much stands out.  4 standard guys in a park.  They don’t flaunt their money.

However, they took four very different routes to get the money.

Paul bought a lottery ticket on a whim about 7 months ago.  The ticket won.  He became an instant millionaire.

Jonathan had a distant relationship with his parents as a child.  He spent his adolescence in boarding schools.  His family would gather on Christmas, but the relationships were not deep.  5 months ago his parents passed away.  When the will was read, Jonathan discovered that he received a million.  Another instant millionaire.

David set up a company 7 years ago.  He has worked hard.  Over the years the company grew in employees, grew in clients and grew in value.  2 years ago a US company contacted David about working more closely together.  This year that US company made an offer to buy-out David’s company.  Another millionaire.

George joined a bank after graduation.  He suffered through the painful early years giving 120 hour weeks, but he learnt how to work the system.  He has moved steadily up through the ranks and this year finally made it into the upper echelons.  His bonus this year: about a million.

Who Deserves?

What do you think about Paul, Jonathan, David and George?  How do you judge their path to wealth?  Is lottery worse than inheritance?  Is banker worse than entrepreneur?

Who, in your opinion, has the most “Right” to their money?

Time after time I see promising young athletes reach the professional teams, and they don’t make it.  Time and time again I see someone do well in the good times, but then allow one small setback to avalanche into a total personal, business and financial collapse.

Other times someone struggles through the youth ranks, shows no extreme talent, but when they reach the professional team they excel.  Or, a friend uses a small personal crisis to multiply their productivity across all aspects of their life.

What differentiates those that cope with those that do not?

Resilience: Mental Toughness

How do you cope with setbacks?  How do you deal with the blows that life deals you?

Photo Credit: ecstaticist
Photo Credit: ecstaticist

The 5 levels of Resilience

The five levels of individual Resiliency are:

  1. Able to maintain emotional stability
  2. Able to focus outward: Good problem solving skills
  3. Able to focus inward: Strong inner “selfs”, self-belief
  4. Deliberately practiced procedural habits
  5. Be Water my Friend

Resilience Means Adapting to Adversity

Resilience is the ability to roll with the punches. When stress, adversity or trauma strikes, you still experience anger, grief and pain, but you’re able to keep functioning — both physically and mentally. Resilience isn’t about ignoring it, stoic acceptance or lonely heroics. In fact, being able to reach out to others for support is a key component of being resilient.

Resilience and Mental Health

Resilience offers protection from many mental health conditions, such as depression and anxiety. Resilience can also help offset factors that increase the risk of mental health conditions, such as lack of social support, being bullied or previous trauma.

9 Tips to improve your Resilience

If you’d like to become more resilient, consider these tips:

  • Make every day Meaningful – Do something that gives you a sense of accomplishment and purpose every day. Set goals to help you look toward the future with meaning.
  • Get Connected – Building strong, positive relationships with loved ones and friends can provide you with needed support and acceptance in both good times and bad.
  • Write it Down – Think back on how you’ve coped with hardships in the past. You might write about past experiences in a journal to help you identify behavior patterns.
  • Maintain Hope – You can’t change what’s happened in the past, but you can always look toward the future. Accepting and even anticipating change makes it easier to adapt and view new challenges with less anxiety.
  • Take care of your Health – Include physical activity in your day. Find a night time pattern that allows for good sleep. Eat consciously.
  • Be Proactive. Eat the frog first.
  • Playfulness and Pause. Rest your mind and let it wander through imagined worlds. Mindful imagination can reduce stress (and it improves your immune system).  Play games and act like a kid.  YouTube videos about Goats Shouting Like Humans are stupid, but they do make me laugh insanely.
  • Embrace Creativity Regularly. Participation in music and dance, can have a significant effect in building resilience.
  • Use Procedural Skills –  take advantage of the “procedural learning” part of your brain. Keep practicing the skills you’ve mastered by repetition – like playing piano, ping-pong or drawing pictures. Rote-learned information is what school focussed on – but today it’s all Google-able.  Forget it.  Focus on your procedural skills. These should be exercised and enhanced every day.

Resources:

Here are a few of the excuses I tell myself in order to procrastinate:

  1. They won’t let me
  2. I am too young
  3. I am too old
  4. I am only one person
  5. I don’t know enough
  6. I am not a guru
  7. This could be embarrassing
  8. This will be embarrassing
  9. This is too touchy-feely
  10. I won’t get paid for this
  11. This isn’t business stuff
  12. I have to finish the things I have already started
  13. Seth Godin has already said it better than I can
  14. I’ll do it tomorrow/later/after this coffee
  15. Who am I to think I know something special about this?
  16. I’ve got plenty of time next week
  17. I’ve got plenty of time this year
  18. I’ll do it this summer
  19. I’ll do it after the summer
  20. I need to do a little bit more research
  21. Who’s going to read this anyway?
  22. [¡¡¡ insert your own excuse here 😉 !!!!]
Richard Hamming

That’s just 21…  I have many, many more.

What are your top excuses?  What do you do when you find yourself procrastinating?

Richard Hamming tells of how he would lose lunch companions because he would continually ask

  • “What are the important problems of your field?”
  • “What important problems are you working on?”
  • “If what you are doing is not important, and if you don’t think it is going to lead to something important, why are you working on it?”

His speech You and Your Research is posted in full at Paul Graham’s blog.

Sorry, gave wrong url in the email… here is the correct link for the 9 Steps to Becoming a Public Speaking Expert 

Are you being lied to?

Are you being lied to?  Yes. Often.

We Enjoy Lies. When we believe a lie, it is because we want to believe the lie.

“Everyone is hungry for something and they will give anything to get it” Pamela Meyer, Liespotting

I met Pamela Meyer at the Entrepreneurs’ Organisation University in Istanbul, Turkey about a month ago.  She spoke about Lie Spotting.  She has spent years working with the FBI to train agents in spotting deception.

She spoke about several clues that FBI agents learn to watch for when they conduct interviews.  You can read more about those clues in her book.  However there was a deeper idea that she left with me.

We Enjoy Lies

Bernie Madoff, $18 Billon fraudster

When we believe a lie, it is because we want to believe the lie.

Lying is a cooperative act. When somebody lies to us and we choose to believe it, we are cooperating with the liar. A great liar is excellent at quickly identifying what it is that you want more than anything. The liar’s lies will help you see yourself closer to the person you wish you were, but that inside you don’t feel that you are.

“Lying is the bridge between reality and our fantasies, between who we are and who we want to be. And it’s a cooperative act. You can only be lied to if you agree to it.” Pamela Meyer

If you are taken in by a financial scheme, it is because the liar has seen that you want to see yourself as a smart, financially savvy person; and you don’t feel that you are. Or it may be that your brother is richer than you and it bothers you, the con-man sees that your need is to feel that you are as good as your brother.

I sat there in the audience in Istanbul and I reflected on the types of fantasies that I have.  What type of person I would like to appear to be?  Where does my fantasy me most differ from my real me?  If a liar tells me that I show excellent discipline and consistency: I want to believe. If a liar tells me that I still look young, strong and healthy; I am prone to believing.  If Bernie Madoff told me that he only allows the elite few to invest, and that he has heard that I am a special person; I am prone to deciding to invest.

Caveat Emptor

It is where our fantasy most diverges from our reality that we will be most open to accepting deception.  What are your fantasies that a liar might use?  What do you want to believe that you are, but inside still have doubts?  Who do you want to love you, but inside wonder whether they do?  What groups do you want to belong to, and inside hope to one day be able to join?  In these situations, you will believe a liar’s deception.

Michael asks “What should you do when you don’t know what to do?”  In the times when he felt lost, out of his depth, uncertain, unsure whether he was the right person in the role…  All the great moments of self-doubt that I know I share…

His mentor’s answer?

“Do the next right thing.”

The full post at Michael Hyatt’s Intentional Leadership blog: “What to do when you don’t know what to do“.  I think it goes further than that.  This is not a recipe for rare moments of doubt.  This is a powerful framing of leadership.

There is a time for Managers, and a time for Leaders

When a team is winning, the captain needs to be a manager.  When the team is losing 3-1 at half time, the captain needs to be a leader.  Doing the same but better is going to lead to a 6-2 final score.  The team has to do something different.  This is when the captain must lead.

However, when leadership is made into something too big, action paralysis sets in.  Self-doubt assails the leader and leads to delay.  Leadership needs focus.

Leadership is “Do the Next Right Thing”

Do.  Action.  Leadership is about action.  Nothing changes without taking action.  Knowing what to do but not doing anything is the same as not knowing what to do.

The Next.  The professional knows where he is going, but never allows his mind to go beyond the next step.  He knows that this will lead to a feeling of overwhelm and the little voice inside his mind will tell him to stop.  It is only by keeping extreme focus on the Next that action is possible and sustainable.  The amateur takes on too big a goal.  He lives in a cycle of building frustration leading to a moment where he decides he will act.  He now sets a massive goal for himself and for a day or two manages to exert maximum effort towards this overly ambitious goal.  Three days later he realises how much work is still left and drops back into a depressed state and stops the action towards the goal.

Right.  What is necessary.  What is correct.  What fits with your values and effectively moves you in the direction of your overall goals. Not what others think you should do.  Not what you think others would expect of you.  Not what you parents want.  Not what your friends want.  It is what you feel is right.

Thing.  Specific.

Do. The Next.  Right.  Thing.

“I will act now.”

The great failures do not come from a lack of strategy, or a lack of knowledge about where you would like to get to.  Few people wake up in the morning with a goal of being unhappy and frustrated.
True failure is lack of disciplined action.  This is not the failure of not achieving a goal, not winning a game…  but the hideous failure of having left a life unlived.

“You only need 20 seconds of courage in a life”.  Where are my 20 seconds?  How many do I have left?

Carlo Cipolla

These laws were identified and developed by Carlo M. Cipolla who was Professor of Economics at UC Berkeley up his death in the year 2000.  The full description and implication of these 5 basic laws can be read in his article

The 5 Basic Laws of Human Stupidity

The Basic Laws of Human Stupidity.

  • Law 1: Underestimation Always and inevitably everyone underestimates the number of stupid individuals in circulation.
  • Law 2: Independence The probability that a certain person be stupid is independent of any other characteristic of that person.
  • Law 3: Loss A stupid person is a person who causes losses to another person or to a group of persons while himself deriving no gain and even possibly incurring losses.
  • Law 4: Cost Non-stupid people always underestimate the damaging power of stupid individuals. In particular non-stupid people constantly forget that at all times and places and under any circumstances to deal and/or associate with stupid people always turns out to be a costly mistake.
  • Law 5: Danger A stupid person is the most dangerous type of person.
From law 3 we have four basic categories of human action: helpless, intelligent, bandit and stupid.

The 4 Basic Categories of Human Action

If Dan does something that causes him loss, but gain to Sarah this is helpless.  If Dan does something that causes gain to him and gain to Sarah, this is intelligent.  If Dan does something that causes gain to him and loss to Sarah, this is bandit.  Now…  If Dan does something that causes loss to himself, and loss to Sarah…  this is true stupidity.

In many economic theories a human is assumed to act rationally.  In such theories, Dan would never knowingly cause loss to himself.

In real life we all regularly come into contact with Stupid Dan.

How can economists build models that take into account Stupid Dan?  How can we predict if the person in front of us, our colleague, our boss is about to choose Stupid rather than Helpless, Bandit or Intelligent action?


How can we reduce the possibility of Stupid Action?

This week we decided where my daughter will go to school – potentially for the next 15 years. I have spent a lot of time thinking about what criteria are important in selecting a school and this blog is a summary of 3-4 months of that reflection.

To Prepare One for Living

How do you best waste a life?  Quite possibly the worst thing in the world is “what could have been” – the waste of human talent.  How do parents or schools contribute to allowing a child to waste their potential, to live a stressed life, to be unable to connect to others, to constantly feel that there is “something missing” in their life?

I believe that we are the first generation that really doesn’t face any risks to our survival (other than the “run over by bus” end).  We have endless choice and the perception of a classless, meritocratic society.  There is a widespread assumption that financial, relationship, social success is because of the innate goodness of one or the innate poorness of another.

In a world where survival is pretty much guaranteed, what is required in order to thrive as a human being?  In this blog post I want to think through the aspects that are most difficult to change later in life that are key to a fulfilling life – and argue that the role of parents and schools is to develop these habits during the 18+ years of early development and school.

What is the purpose of school?  I will use some thoughtful answers from teachers at The Fischbowl “The purpose of education is to appropriately prepare our children for their future.” or “The purpose of education is to make the world a better place” and A teacher writes “to prepare one for a living”. One of my favourite bloggers, Seth Godin has a list of 27 objectives for school.  My father says “its from the Latin, educare: to lead out”

I feel that these definitions leave out some important aspects – a better place for whom? For each child?  For parents?  For the wealthy patrons of government, banks and corporate?  We can categorize thinking 5 levels to which schools could purport to be making the world a better place:

5 Levels of Purpose for School

  1. To keep children off the street (conversely, to provide employment to teachers; or to give a few hours of peace to parents)
  2. To prepare children to enter the workforce (to provide fodder for the robber barons, to create a legion of obedient wage earners)
  3. To prepare children to be good citizens (to understand and follow the norms of civilized society, to not rob, cheat or otherwise make the world worse for others)
  4. To assist human unfolding emotionally, socially, intellectually and physically
  5. To develop the unique strengths of each individual and prepare them to thrive and have a fulfilling life

I think there are clearly examples of all five levels in place at all levels of formal education.  We have university professors that see their role as a teacher taking them away from more valuable research time;  Secondary school teachers who spend more time thinking about strikes and the unfairness of the unequal rises in private sector pay over the last quarter century.  Exam systems that serve to divide children into passes (successes) and fails (destined to McDonalds) without looking to help each child get an ‘A’ in their own personal exam. Schools which develop students that are fantastic at following the 23 steps to get an ‘A’, but completely collapse when they come out into the real world where there is no clear set of steps to develop a career, life, relationship or social life.

I have seen some interesting stuff on how parents and schools can weaken their children’s ability to thrive by inappropriate praise over at NY Magazine, “How not to talk to your kids” (definitely worth a read for parents).  Praise and coaching should be directed at aspects that a child has control over (hard work, solving problems, patience, working in a team, overcoming frustration) and not at things outside the child’s control (their looks “you are beautiful”, their intelligence “you are the smartest”).

The Habits of a Good Life

I think there are habits for a fulfilling life and personal competencies that are very difficult to change, and some that are much easier to change.

Easy to Change Harder to Change Hardest to change
  • Education
  • Communications
  • First impression
  • Goal setting
  • Self Discipline (hard work, completing projects)
  • Judgement (decisiveness, understanding consequences)
  • Excellence standards
  • Resourcefulness
  • Likability
  • Persuasiveness
  • Stress management
  • Integrity
  • Energy
  • Passion
  • Ambition
  • Tenacity
  • Intelligence
  • Physical aspects (height, build, looks)

My answer is that school should serve to develop the human competencies that will be hard to change later on in life – and parents and teachers need to praise, coach and help children develop these disciplines.  I will outline three that I now believe are key to the purpose of school:

Develop the discipline of hard work.

“The real happiness comes from the work you’ve put into winning. If it’s too easy, it means nothing to you.” Rafa Nadal

Nothing feels worthwhile without real hard work. Not what looks like hard work to others, but what you personally know is long-term, disciplined, difficult, challenging hard work.

Finish what you start (completer/finisher).  Only start what you mean to finish (judgement).

Nothing is worse than a life lived with 100 half-finished projects. The hardest part of a project is the last bit – finishing it. Saying “this is it”, “this is me” is tough – but if I don’t get my projects finished I will continually be the guy who could have been.

Passion and Tenacity.

Jim Rohn has a speech called “The Ant philosophy” – ants will never quit – you put an obstacle in their way and they will search for another route… for as long as it takes.  This is a great philosophy not just for ants, but for people as well.

We need it from our parents and our early school. It is incredibly difficult to change integrity, passion, energy, ambition and tenacity if we don’t have it nurtured during our early years (Aristotle viewed age 12 as the limit for really incorporating ethics and values).

We decided upon Betania Patmos for my daughter’s (potentially) next 15 years of schooling.  I think I have said “you are beautiful”, “my princess”, and “you are so smart” at least 1000 times to my daughter in 2 and a half years…  I hope my newfound wisdom and the support of the teachers at Betania Patmos can help my daughter overcome the challenge of having me as a father! (but she is beautiful, smart and my favourite princess!)