Reject the rat race and embrace the parable of the contented fisherman. I’ve lived in Silicon Valley for all of my adult life, whole-heartedly embracing the culture of innovation. I’m repeatedly energized with the amazing people I’ve been able to meet. But I’m not an idealist – as much as I love living here, I…
The Find The Umbrella parable is likely apocryphal but it’s a useful way to explain why absolute rules in companies can backfire from their intentions. While there are many versions of the story, here’s the one I’ve told: A salesperson flies to meet a client only to find an unexpected severe thunderstorm is drenching the…
Shrinkflation happens when companies keep the price of an overall package the same while reducing the size or quantity of the items in the package. The word is a portmanteau of the words shrink and inflation. The first use of the term is often attributed to Pippa Malmgren. Shrinkflation is a sneaky way to combat…
People tend to be precise with small numbers and imprecise with larger ones. Young kids love to explain that they are not 4 years old but rather 4 and a half – with an emphasis on the half. But hardly anyone says they are 54 and a half. They might not even admit they are…
Would you drive 20 minutes out of your way to save $5 on a $15 calculator? Would you drive the same distance to save $5 on a $125 leather jacket? According to research from Richard Thaler, 68% of respondents would drive to get the calculator but only 29% for the leather jacket. On the surface,…
Ever wonder why it’s so difficult to catch a cab on a rainy evening? Common sense suggests the reason is that people prefer riding to walking when it’s raining. Given a fixed supply, cabs are less likely to be available since more people want them. While this explanation seems obvious, economic theory suggests otherwise. As…
Years ago, I took a class called “Managing With Influence” from Jeffrey Pfeffer, professor of organizational behavior at Stanford University and author of the book subtitled “Profiting from Evidence-Based Management.” During the class, Professor Pfeffer claimed layoffs do not improve financial performance – except in the very short term. He based this on a careful analysis of…
In the Upside of the Downturn, Geoff Colvin suggests death rates go down in a recession. Regardless of the accuracy of the claim, it’s worth remembering the recession provides new opportunities for companies willing to take risks. To emphasize this point, Colvin subtitled his book “Ten Management Strategies to Prevail in the Recession and Thrive in the Aftermath.”…
Financial Week must be a little bit schizophrenic. A Sept 1, 2008 article titled “CFO turnover hits a record high” stated that, according to Crist Kolder Associates: CFO volatility—a measure of how often an executive leaves his or her finance post—reached its highest level in 13 years in 2007, with 128 CFOs departing their jobs,…
Financial Week reports that “according to a study to be released [in October] by executive recruiter Crist Kolder Associates, roughly half of the CFOs at Fortune 500 and S&P 500 companies stay in their posts for less than three years.” This equates to the average tenure of an NFL running back. Before you get too impressed,…