Freakonomics Radio - Are you doing something new and different today ?

Today on marketplace (NPR), this bit on freakonomics radio caught my attention !

http://marketplace.publicradio.org/display/web/2010/10/19/pm-freakonomics-radio-a-government-official-in-venture-capitalists-clothing/

If you have not listened to it go listen, it is really worth 2 minutes of your time. Here is why I liked and decided to share with you today.

It will not take you long to see if your company encourages your ideas or not !

If you are struggling with concept of change or innovation, you can hear how an individual is trying to make the government work like a venture firm & encouraging new ideas. I am sure you will walk away with a feeling that your change/innovation is not that disruptive.

Last but not the least, you can also see how Organizations like xPrize foundation are making a difference in the world of innovation !

Please feel free to post your thoughts on this post !

Thanks
Nagesh,
The views represented in this blog are my personal views and are not a reflection of or opinions of any of the institutions I am associated with or have worked for.

Accountability & Liability - Are we letting our cognitive biases and decision heuristics take over ?

In US, we have or we have been experiencing two major crisis leading serious leading serious economic impacts for citizens, namely the financial crisis and now the oil spill crisis.

Let's look at how we handled the financial crisis : Primarily created by leading financial companies, taking on risky bets. Our Response was to bail them out with Tax Payer money. Even though now these banks are starting to make billions of dollars again, there is no sign of holding any single institution accountable. In simple terms, information on who exactly to blame is clearly not available to our brain, and more over the framing of the problem by our leaders was clearly in favor helping the banks out to avoid a crisis (framed in terms of minimizing losses everyone affected). This resulted in no single company or individual being accountable and the average tax payer took on the complete risk of bail out.

Fast forward to today, Let's look at how we are handling the oil crisis. It is clear, the way all these oil companies are run, this disaster could have happened at any major oil company doing deep sea drilling and none are capable to fixing it (as no one has come out said they can help ). Since the facility was BP's facility, Information is readily available to our brains who is at fault and the Framing of the problem by the government is clearly blaming BP and no one else (framed in terms maximizing gains for everyone affected). This is resulting in holding a single company accountable and liable for the disaster and not effectively putting our collective IP and Resources to work.

Does this sound right?

So what's My take#

Both these calamities have similar root cause - The worst case scenario was never modeled, allowing both financial companies and oil companies take on risks that were not logical. Both have lead to serious economic impacts to common people. Additionally, The problem with oil crisis is now way beyond BP's control and is a disaster that probably exceeds the impact of Katrina, yet, however there is no talk of pulling all the Oil companies together to putting the entire industry to task.

The only difference is that banks were in financial trouble and BP is slowly getting there.

So if I remove my biases and ignore how the our leaders have framed the problem, these two crises should be treated identically as the problems have similar root causes and similar impacts. Alas, I guess we are all human and at some level our cognitive biases rule. It is probably imperative on all of recognize this before taking sides for the greater good.

Thanks for reading, your comments are welcome and appreciated.

Thanks
Nagesh
The views represented in this blog are my personal views and are not a reflection of or opinions of any of the institutions I am associated with or have worked for.

One More Airline Merger ! Does it mean anything to anyone?

I started writing this post, the day the merger was Announced. Figured, I will complete it and post the blog today, Sept 17,2010, as the merger is formally blessed and the transition will begin.

United is Merging with Continental, Delta Merged with Northwest, US Airways Merged with AmericaWest ... List goes on

So really do these mean anything to anyone?

Let's Start with Me, as a representation of the "The flying Consumer"

Just the week before the deal was announced, I flew from DFW to SFO on American, SFO to Rochester, NY on United and finally Rochester, NY to Dallas on Delta. I pretty much concluded there is NO Difference in experience or service. All of them wanted to charge for bags, Had the same level rules for frequent travellers, treated the passengers same way, the look and feel inside the planes was no different.

So for me the choice boils down to two things

1. Which airline can save me time by given me a direct flight or better connections
2. Which airline can save me some money by offering me a lower fare

This was true before this merger, or the previous Delta/North West Merger and this will be true tomorrow as these airlines these mergers will have very little impact on how these airlines operates.

In my opinion myths that are always raised during these kinds mergers will stay myths. Some of them are

1. There will be less choice : Never turns out to be true, if this airline cuts down routes there will always be an American, Southwest, Jetblue etc eager to add those routes
2. Prices will raise : Never turns out to be true, as there will be someone trying to fill seats or trying to expand to the route if they see prices raising. Even if we assume airliness will not expand, Companies Like CISCO, Microsoft will push more telepresence and conferencing to cut travel costs. So the chances of unreasonable fare hikes is very low.
3. Service will be better as the combined airline will have more resources : Never turns out to be true, as the combined airline is immediately looking for cost savings rather than trying to be better to meet it's merger and wall stree expectation. This will come at cost of service and confusion in the short run

So for now - Just travel safe and and ignore the hype/noise around airline mergers as it probably means nothing to an average traveller.

Thanks

Nagesh

The views represented in this blog are my personal views and are not a reflection of or opinions of any of the institutions I am associated with or have worked for.

The Right Kind of Bailout. Finally heard about One Today !

I am not sure whether you are tired of hearing the word bailout, but I sure am !

Airline Industry, The Banking Industry, The Auto Industry and even countries now !

However, today as I heard Robert Reich, Professor of Public Policy at the University of California, Berkeley on Marketplace on NPR, for the first time I really felt , he talked about a bailout, that made sense, hopefully someone is listening:

The argument was simple : Robert Reich's Quote "Financial capital moves instantly around the globe to wherever it can earn the best return. Human capital -- the skills and insights of our people -- is the one resource that's uniquely American, on which our future living standards uniquely depend." UnQuote

For full commentary visit : http://marketplace.publicradio.org/display/web/2010/03/10/pm-reich-commentary/

My understanding in simple terms: We should not let the budget short falls of state and local government impact our school and universities, so we should bail them out to ensure education at all levels is affordable. This kind of bailout will create the human capital needed for a sustainable economy in the long run.

My Take: I whole heartedly agree with Robert Reich. His commentary reminded me of my first blog : Wake Up - If you did not already know you should, which was all about our ability drive value. I truly, can say today I heard about a bailout that made sense and hence decided to blog it.

Thanks
Nagesh

The views represented in this blog are my personal views and are not a reflection of or opinions of any of the institutions I am associated with or have worked for.