Tuesday, March 26, 2013

Proper Assessment Prevents Poor Planning and Preparation

Failure to plan is to plan for failure. 

To properly compete in a complex setting, the possession of a plan does not always guarantee a win or a strategic advantage.  

Sunzi's Art of War (AoW) essay states that the successful strategist is usually victorious when he/she knows the configuration of their grand settings.  Some of our other non-strategy associates felt that the act of assessing strategically is too much work and is totally overrated. They preferred to participate in the "fun and exciting" activities from the seat of their pants. This perceived gamble reinvigorates the thrill of operating under a risk. 

As long as their own trust fund is never touched, they will pursue it.  =)) 

The first step is knowing the approach for assessing their situation and the approach for building a plan that is based on their assessment. 

Having that key information about one's own grand settings, occasionally enables the successful strategists to pinpoint that rare path of least resistance. Portion of that key information is a cyclical pattern of motives and methods. Understanding these habits and these tendencies is one of the many steps of how they amplify their strategic power (strategic advantage). 

The standard of assessment enhances one's planning and preparation. The quality of assessment usually determines the quality of plan.

In a past post, we have discussed about our process of assessing a situation through the utilization of those strategic and tactical factors. The pseudo AoW experts do not know what are those factors.  They are usually too busy preaching to their followers to focus their time and their effort on getting to their destination without ever understanding the configuration of their terrain. ...  In a highly competitive terrain, what is the probability of these lemmings  surviving?

The Sunzi Perspective
“These are the ways that the successful strategists are victorious. They cannot be spoken or transmitted in advance. ... Before the confrontation, they resolve in their conference room that they will be victorious, have determined that the majority of factors are in their favor. Before the confrontation they resolve in their conference room that they will not be victorious, have determined a few factors are in their favor.

If those who find that the majority of factors favor them, will be victorious while those who have found few factors favor them will be defeated, what about someone who finds no factors in their favor?

When observing from this viewpoint, victory and defeat will be apparent.”

- Art of War 1 (Paraphrased from the Sawyer's translation)

Following is the Sunzi's tactical approach for strategic assessment:
1. Measuring the dimensional factors of their situation; 
2. Estimating the potency of their measures; 
3. Calculating the efficacy in terms of the positives and the negatives; 
4. Balancing the order of the measured factors through the use of the "Victory Temple Protocol"; and
5. Predicting the probability and the possibility of victory.
-  Art of War 4

The Li Quan Perspective
"Those who excel in warfare contend for advantage with others only after determining through temple calculations that they will be successful. Attacking the rebellious and embracing the distant, toppling the lost and solidifying the extant and uniting the weak and attacking the benighted are all manifestations.  The interior and exterior becoming estranged, as in the case of the Shang and Chou armies, is what is referred to as having determined victory through temple calculations before engaging  in combat.  According to T'ai-yi Tun-chia assessment method, anything above sixty a majority, anything below sixty is  a minority.  ... In all these  cases, victory and defeat are easily seen. "
- Li Quan's  T"ai-pai Yin-ching

Based on the "completeness" of one's assessment, the successful strategist determines the strategic efficiency of their situation. it indirectly enables one to understand whether it is possible to prevail over their competitor.

The Reality

One cannot arrive to a viable strategic position in a chaotic setting if their assessment and their scheme are invalid. The result consequence is usually a combination of exceeding the timeline and the operating budget. One should not be surprised if their end result does not meet the expected performance standard.

To prevail in your competitive terrain, our recommendation is that the budding strategist should learn how to assess their situation before choosing a possible high-risk move. 

In a high risk, unpredictable terrain, the risk consequence for not assessing is   grinding and grounding oneself toward a state of zero gain.

The capable and experience strategists who always assessed their grand setting, know how to construct a force multiplier within their terrain.  (Some people referred it as "strategic power" or "strategic advantage.")  ... This  specific process can be defined as a strategic version of bricolage. ... The challenge is always having the courage and the drive to implement it.

The Clue to Constructing a Force Multiplier
When you hear the hoof beats, do not look for the horses. 
Focus on the zebras. 

The quantity of the quality components within one's terrain and the connectivity between them are what determines the possibility of constructing the force multiplier.

While another portion of this base concept can be found in the first set of quotes in chapter five of the Art of War, you can also find the macro clue from reading the Master Ghost Valley (MGV) essay, Jiang Tai Gong Six Secret Teachings and Huang Shek Gong's Three Strategies

A conceptual portion of the MGV book can be found in the Li Quan's translation
We will talk about more about this specific topic in a future post.

Side Note
For what it is worth, the opportunity to build a force multiplier is not guaranteed for each and every time. It is depended on the deep configuration of that opportunity.  One needs to be capable of connecting the dots.  Click here for one good example.

Comments from The Compass Desk

If you are participating in a highly competitive terrain, follow these three simple steps: 

  • Assess the grand setting; 
  • Position oneself by planning and preparation; and 
  • Influence the settings with the implementation of the scheme while being mindfully aware of the target's strategic state.
If the influence loses its potency, restart the Compass Cycle. Repeat your assessment of your grand terrain carefully.  Be aware of the possible deception.

Assess. ... Position.  ... Influence.  ... 

Follow those steps.  ... You will not regret it.  Good luck!

Monday, March 18, 2013

Performing Our Annual Strategy Tradition

Our friends at Cook Ding's Kitchen have asked us whether we have followed through with our annual strategy book reading and reviewing session.   ... We quietly followed it as usual.

The Compass Strategy Tradition
Unlike the emotional-provoked people who liked to read the trendy "idea" books at any time of the day,  the smart strategists preferred to focused their time on honing their craft or expanding their influence.

During the winter season, they would spend a day or one weekend to read the various strategic classics for the purpose of reflecting on what is strategy.  Therefore, he/she will be strategically prepared when the spring season arrives. (This is one of the many psychological preparation tactics of the Wudang martial arts section.)  ... It is recommended that one chooses a cold day that would propel him/her to stay indoors. 

Following is an abridged list of books that some of us have reread:
  • Peter L. Bernstein's  Against the Gods: The Remarkable Story of Risk
  • Boston Consulting Group's Perspective on Strategy
  • Thinking Visually: Business Applications of Fourteen Core Diagrams;
  • Weinberg's books on consulting, system thinking and individual effectiveness
  • The Romance of the Three Kingdoms 
  • Dr. Sawyer's books on ancient Chinese history and translations of strategic classics (especially The Strategies for the Human Realm)
  • Dr. Roger Ames's series on Chinese culture.
  • Scott A. Boorman's The Protracted Game
  • F. Capra's The Tao of Physics
Another good tradition is the Cook Ding's Kitchen's Lenten challenge.

This specific tradition  reminds the reader to be aware of the relevant fundamentals that could guide him or her toward solving a problem.  

Being the readers of the classics, we believed in the philosophical view that there are no real new ideas.  The new ideas of the information economy are just an re-integration of classic ideas, with a new focus and a different message ( In terms of software, it could be a cleaner user interface.).

Regardless of one's profession, it is important to follow the "arcane" traditions that remind the smart strategists to strengthening their strategic foundation while being mindful of their goal.

/// updated on March 21st.

Friday, March 15, 2013

Filtering the Truthfulness From the Deception

The Seven Military Classics of Ancient China (The Art of War and Jiang Tai Gong)  emphasized the importance of detecting deception.

In our 21st century, the masses rarely do so. Since there is no risk consequence, they make immediate judgment call. Performing due diligence sometimes takes some time, some effort and the willingness to analyze.  Most people are not willing to do that.  

Some of them do not even have the drive to stay focused on a topic for five solid minutes.  ... That is so sad.  

The Lie
During a lecture for the London Review of Books, the Booker Prize-winning novelist launched a scathing criticism of Prince William’s wife, branding her a “jointed doll on which certain rags are hung” with “no personality of her own” and insisting she appears to have been “designed by committee and built by craftsmen, with a perfect plastic smile.”
Source: SFGate.com

The Truth 
Source: LrB
"Last summer at the festival in Hay-on-Wye, I was asked to name a famous person and choose a book to give them. I hate the leaden repetitiveness of these little quizzes: who would be the guests at your ideal dinner party, what book has changed your life, which fictional character do you most resemble? I had to come up with an answer, however, so I chose Kate, the Duchess of Cambridge, and I chose to give her a book published in 2006, by the cultural historian Caroline Weber; it’s called Queen of Fashion: What Marie Antoinette Wore to the Revolution. It’s not that I think we’re heading for a revolution. It’s rather that I saw Kate becoming a jointed doll on which certain rags are hung. In those days she was a shop-window mannequin, with no personality of her own, entirely defined by what she wore. These days she is a mother-to-be, and draped in another set of threadbare attributions. Once she gets over being sick, the press will find that she is radiant. They will find that this young woman’s life until now was nothing, her only point and purpose being to give birth.
Marie Antoinette was a woman eaten alive by her frocks. She was transfixed by appearances, stigmatised by her fashion choices. Politics were made personal in her. Her greed for self-gratification, her half-educated dabbling in public affairs, were adduced as a reason the French were bankrupt and miserable. It was ridiculous, of course. She was one individual with limited power and influence, who focused the rays of misogyny. She was a woman who couldn’t win. If she wore fine fabrics she was said to be extravagant. If she wore simple fabrics, she was accused of plotting to ruin the Lyon silk trade. But in truth she was all body and no soul: no soul, no sense, no sensitivity. She was so wedded to her appearance that when the royal family, in disguise, made its desperate escape from Paris, dashing for the border, she not only had several trunk loads of new clothes sent on in advance, but took her hairdresser along on the trip. Despite the weight of her mountainous hairdos, she didn’t feel her head wobbling on her shoulders. When she returned from that trip, to the prison Paris would become for her, it was said that her hair had turned grey overnight.
Antoinette as a royal consort was a gliding, smiling disaster, much like Diana in another time and another country. But Kate Middleton, as she was, appeared to have been designed by a committee and built by craftsmen, with a perfect plastic smile and the spindles of her limbs hand-turned and gloss-varnished. When it was announced that Diana was to join the royal family, the Duke of Edinburgh is said to have given her his approval because she would ‘breed in some height’. Presumably Kate was designed to breed in some manners. She looks like a nicely brought up young lady, with ‘please’ and ‘thank you’ part of her vocabulary. But in her first official portrait by Paul Emsley, unveiled in January, her eyes are dead and she wears the strained smile of a woman who really wants to tell the painter to bugger off. One critic said perceptively that she appeared ‘weary of being looked at’. Another that the portrait might pass muster as the cover of a Catherine Cookson novel: an opinion I find thought-provoking, as Cookson’s simple tales of poor women extricating themselves from adverse circumstances were for twenty years, according to the Public Lending Right statistics, the nation’s favourite reading. Sue Townsend said of Diana that she was ‘a fatal non-reader’. She didn’t know the end of her own story. She enjoyed only the romances of Barbara Cartland. I’m far too snobbish to have read one, but I assume they are stories in which a wedding takes place and they all live happily ever after. Diana didn’t see the possible twists in the narrative. What does Kate read? It’s a question.
Kate seems to have been selected for her role of princess because she was irreproachable: as painfully thin as anyone could wish, without quirks, without oddities, without the risk of the emergence of character. She appears precision-made, machine-made, so different from Diana whose human awkwardness and emotional incontinence showed in her every gesture. Diana was capable of transforming herself from galumphing schoolgirl to ice queen, from wraith to Amazon. Kate seems capable of going from perfect bride to perfect mother, with no messy deviation. When her pregnancy became public she had been visiting her old school, and had picked up a hockey stick and run a few paces for the camera. BBC News devoted a discussion to whether a pregnant woman could safely put on a turn of speed while wearing high heels. It is sad to think that intelligent people could devote themselves to this topic with earnest furrowings of the brow, but that’s what discourse about royals comes to: a compulsion to comment, a discourse empty of content, mouthed rather than spoken. And in the same way one is compelled to look at them: to ask what they are made of, and is their substance the same as ours.
I used to think that the interesting issue was whether we should have a monarchy or not. But now I think that question is rather like, should we have pandas or not? Our current royal family doesn’t have the difficulties in breeding that pandas do, but pandas and royal persons alike are expensive to conserve and ill-adapted to any modern environment. But aren’t they interesting? Aren’t they nice to look at? Some people find them endearing; some pity them for their precarious situation; everybody stares at them, and however airy the enclosure they inhabit, it’s still a cage.
... Is monarchy a suitable institution for a grown-up nation? I don’t know. I have described how my own sympathies were activated and my simple ideas altered. The debate is not high on our agenda. We are happy to allow monarchy to be an entertainment, in the same way that we license strip joints and lap-dancing clubs. Adulation can swing to persecution, within hours, within the same press report: this is what happened to Prince Harry recently. You can understand that anybody treated this way can be destabilised, and that Harry doesn’t know which he is, a person or a prince. Diana was spared, at least, the prospect of growing old under the flashbulbs, a crime for which the media would have made her suffer. It may be that the whole phenomenon of monarchy is irrational, but that doesn’t mean that when we look at it we should behave like spectators at Bedlam. Cheerful curiosity can easily become cruelty. It can easily become fatal. We don’t cut off the heads of royal ladies these days, but we do sacrifice them, and we did memorably drive one to destruction a scant generation ago. History makes fools of us, makes puppets of us, often enough. But it doesn’t have to repeat itself. In the current case, much lies within our control. I’m not asking for censorship. I’m not asking for pious humbug and smarmy reverence. I’m asking us to back off and not be brutes. Get your pink frilly frocks out, zhuzh up your platinum locks. We are all Barbara Cartland now. The pen is in our hands. A happy ending is ours to write.

Click here for the entire essay. 

Comments From The Compass Desk
After collecting intelligence, successful strategists assessed their situation.  They measured the validity of their sources before re-assessing the situation. Finding the path of minimum resistance requires them to identify deception.  It is the Dao of the successful strategist.

Tuesday, March 12, 2013

Our Book Review on The Physics of Wall Street

While estimation is the black art that many strategists believed that they have mastered, predicting the unpredictable is the "real" holy grail of the strategy game.  

Regardless of what the pseudo experts say,  a few strategic traders have succeed at the Wall Street terrain for a minimum timeline.  Duplicating a similar success with the same approach is quite difficult due to the extreme degree of competitive darwinism that are quietly deployed in the back room of their competitors.   (Hint: Read the side note.)

James Owen Weatherall latest book- The Physics of Wall Street  was referred to us as a supplementary view to our strategic perspective  ... We found It to be quite interesting in terms of the different approaches that were used.   .  Most of the reviews on Amazon and Good Reads were quite favorable  . .  

The readers will learn the general objective and the broad approach of each trader's strategic process.  But they will not learn the specifics that are behind their methodology. 

The Kelly Criterion
Edward O. Thorpe's approach of using Kelly Criterion in the table game of 21 Blackjack was quite ingenious. We presumed that he has also successfully used it in his assortment of trading ventures. 

Our research tells us that many people have also used this process model for stock trading and Forex trading.  It has been said that Bill Gates and Warren Buffet are fans of this approach.

Side note: Sun Bin's , the great  grandson  of Sunzi, assisted Tian ji (a field general of the Qi state during the Chinese warring states era) in a "wagering horse race" situation with the Emperor of the Qi state through the utilization of a tactical mismatch is a simple example of the Kelly Criterion.

The Commonality of All Strategic Approaches
By methodically reading the book, one sees the approach that each traders were using. It is similar to the generalities of the Art of War (AoW) assessment process. They understood the  the Dao of their terrain before identifying their objective and the approach for exploiting its blind spots. 

While these common points are found in each chapter of the Art of War, the reader can pinpoint the general approach for strategic assessment in chapter four.

The AoW's Tactical Approach For Assessing Strategically
Following are those five tactical steps:
1. Measuring the dimensional factors of their situation; 
2. Estimating the potency of their measures; 
3. Calculating the efficacy in terms of the positives and the negatives; 
4. Balancing the order of the measured factors through the use of the "Victory Temple Paradigm"; and
5. Predicting the probability and the possibility of victory.
-  Art of War 4

During any strategic assessment session, the successful strategist usually filters the signal from the mountain of noise by carefully choosing the possible data.  He/she usually  has the tool box and the right data to make the correct estimation.

Having the drive to pursue the targeted intelligence from the field and collecting the right data promptly are the real challenges.

A Summation From the Compass Desk
To compete in a data-driven Wall Street terrain, knowing the basic fundamentals of physics  never hurt.  ... Applying physics and/or economics in a complex strategic setting is quite tricky. It begins by understanding the finite cycles of many factors and how it operates in the grander scheme of things. . Connecting those active dots of information under a finite timeline and reaping the rewards before the competition does, is the real challenge.  Regardless of how successful those models are, each and every good model has its limitations. Do you know what they are?

Beside comprehending the physics and the economics of their setting. it is significant to pinpoint the psychology of the various competitors.  By carefully reading this book, you will discover which "physicist-trader" succeeds in their goals and objectives..

Side note 
The clue is in the Uncertainty principle of Werner Heisenberg's. Click here for the latest update on this subject.   ...  Tao of Physics is a good book for the science neophytes who are looking for new alternatives to viewing the Big Tangible Picture. It combines the generality of physics, new age psychology and eastern mysticism in its text. ... To succeed in an ultra-competitive terrain, one must understand the game of observing and being observed and studied by others.  

Friday, March 8, 2013

More Notes on the Seven Military Classics of Ancient China (Sunzi Art of War and More)

Continue from a previous post

Reflections of the Seven Classics Plus One
While the Sunzi essay delineates the philosophical side of strategy, the Sun Bin book delineates the operational groundwork behind a competitive campaign. In other words. one uses Sunzi principles to understand the configuration of a situation while using the principles of Sun Bin, Wuzi and Wei Liaozi to delineate the configuration of the logistics that is behind the situation.

Serious strategic thinkers of all sorts have always preferred to read Jiang Tai Gong (JTG) essay due to its emphasis on understanding a strategic side of campaign from top-down viewpoint. 

The Wuzi classic has become the relevant guide for those who need a solid view on the subject of strategic preparation.

Applying the Crux of the Seven Classics and Sun Bin to a Competitive Scenario
Unlike the "amateurish" Art of War cult who thrived on inspiring the masses through the action of a quote a minute, we have always believed in the active model of staying ahead of the curve through the action of assessing, positioning and influencing. 

Some of them are focused on the goal of getting to their destination first without understanding the configuration of the Big Tangible Picture. 

When competing in our global economy, the timeline is short while the quantity of resources is limited. Concurrently the quantity of the quality competitors has increased by five -fold. Changes are coming so fast. 

To adjust to those mentioned factors, what would a budding strategist's next move?

Do you really understand the configuration of your  Big Tangible Picture?

Utilizing the Foundation Eight Military Classics (Seven Classics + Sun Bin) as a Competitive Foundation
By reading these eight classics, you will be able to comprehend the configuration of your situation by connecting points from these five macro categories (the civil fundamentals, the martial fundamentals, the leadership fundamental, the tactical essentials and the tactical specifics.)

The Dao of Assessing the Situation
Seeing the causation and the effect from one relevant categories of specifics to another, is one of the numerous keys to good strategic assessment.  The challenge is to identify the appropriate factors and connecting those factors for certain situations.

Comments From the Compass Desk
"Instead of conquering through combat or achieving the fabled hundred victories in a hundred clashes, Li’s aim was victory without combat so as to preserve the state rather than debilitate it in warfare. " - Sawyer's translation of Strategies for the Human Realm: Crux of the T'ai-pai Yin-ching

Do you want to grind your way toward their target without ever understanding the Big Tangible Picture (BTP)? Each negative step would increase the amount of labor while decreasing your threshold of resources.  Most who do, regularly faltered in their campaign. Who wants to join them? Do you?

Understanding the Big Tangible Picture is a good skill to have. especially if one is dealing in a situation with minimum time line and limited resources. It also allows you to comprehend the following:
  • the connectivity of the significant particulars from a top down perspective; 
  • the possible opportunities; and 
  • the approach for capitalizing on it 
Would you consider that skill as a strategic advantage? 

Utilizing it as a process model will be discussed in a future post or in our future book project.

Wednesday, March 6, 2013

The Dao of Profiling a Decision Maker (and Other Strategic Matters)

Side note: Enjoy this humorous note on strategic decision management from our circle of associates 

Once there were a group of medical professionals who went duck hunting. It was consisted of an internist, a psychiatrist, a surgeon, and a pathologist.

The internist was up first and takes aim. A duck flies by. He looks up and thinks, "hmm... could it be a goose, a gander, a duck? how about a swan? an eagle, a hawk? No! It is not likely but still possible. What about another waterfowl? Hmm..." After a moment, the duck was out of the range in one breath. 

It was now the psychiatrist's turn.  Five seconds later, a slew of ducks flew by. His thoughts were like this - "there is a duck - I know it - but does the duck know that I know that it's a duck?"  A few seconds later, this duck disappears.

The surgeon was up next and takes aim. Before a bird was even clearly in sight, he shot his gun. ... It was a loud BANG! In the distance, something dropped from the sky. The surgeon turns to the pathologist and says "Go tell me what that is".

Side note: 
There was an anesthesiologist who was invited to this event and told everyone: "I would rather not go. If you kill a duck, you'll all blame me at the end. ..."

It was the pathologist's turn to shoot.  For the last five minutes, a  heavy wind have been blasting through the terrain from left to right. After looking at his watch, he quietly checked on the wind direction and speed again and began to wait.  15 minutes later, the wind slowly died.

The pathologist walked 25 feet to the left of their location, looked at his watch and waited for the next thirty minutes while his party of hunters were silently watched him.    

A light breeze slowly began to blow from left to right again.  ... The pathologist blew his duck call thrice and  positioned himself in a ready posture behind the tall grass.  He stood silently still, breathing deeply while quietly focusing his attention on the far right side of the horizon.  

Within five seconds, two flying ducks immediately appeared from the far right side of the horizon.  The breeze immediately became stronger and immediately slowed down their flight's momentum.  Within a split second, he exhaled, pulled the trigger twice and successfully shot both ducks.

Hrs before their gathering, the pathologist studied the configuration of the hunting terrain by focusing his time on knowing the climate for that day, the daily and seasonal wind patterns, the different types of flying birds,  the flight tendencies of each bird (esp. the ducks), the best vantage point  and other unique datapoints. 

Regardless of the situation, the successful strategists usually utilized all of the relevant information to their advantage.  The Art of War and The Six Secret Teachings  referred this action as a part of the strategic power analogy.  We humorously referred to it as "The Compass Spin." 

Comments From the Compass Desk
Ask yourself, which profile describes you?  ... Using the medical analogy, are you the internist (the guesser who is focused on getting the reductive answer), the psychiatrist (the deep thinker who ponders on a situation and occasionally does not make the prompt decision), the surgeon (the high-end gambling expediter who does not know the particular end in the mind), the anesthesiologist (another high-end strategist who does not like to make risky decisions) or the pathologist (the person who precisely knows the hows and the whys of any situation before making the timely move)?  Or are you a combination of any of those five profiles?

Look around you. There are many decision makers who have behaved in those modes.  Can you connect with them?

The Final Point
Before executing your grand process of ready, aim and fire, assess your setting, position yourself ahead of the situation and influence your target with timely execution.
# # #

Sunday, March 3, 2013

Compass Trend: IPTV vs OTT

For the last few years, IPTV has been the hot technology.  It has slowly diminished the domination of cable in the marketplace that Comcast was forced to start their own IPTV service.

However,  the next hot trend could be OTT.  Will the technical differences between these two technologies give OOT the advantage? ...  This expert  and this research group believed that OOT is a contender.  ... Since Intel has already entered the IPTV marketplace, we believed that IPTV will be able to maintain their momentum for awhile.
Interestingly, when ATT says that they are not worried about the OTT. you can only presumed that they are slightly worried.  ... ( A trivial mention of a competitor occasionally means that there is a slight concern.)   Idealistically, most "alpha-grade" businesses are always in fear of any new competitive force with a better technological-based product that could disrupt their marketplace.

Dish technology is the other alternative for the customer but the service cost is still high. 

More IPTV news can be found at IPTV Daily.

Comments from the Compass Desk
When assessing any source, it is always recommended to examine whether the source has been indirectly influenced by a specific group or a particular company.

Friday, March 1, 2013

The Compass Trend of IPTV Continues

The IPTV trend continue.  Through our stats research process, we always knew that IPTV  was going to be a hot trend.