Business to the Buddha

Tag: melt down

  • Fiscal Cliff – TRIZ solution







    Fiscal cliff? What’s that?

    I asked Professor Mankad (Sir). He explained it to me in detail. I loved learning that big picture from him. I must admire President Obama for the way he has put in his plan. Everyone in US Admin knows that “We are in trouble”. But how to get your idea win, should be learnt from Obama & Team.

    When Sir explained whole thing with immense patience, I thought about what could be the solution. Sir also suggested that  what are the possibilities and what could be the likely future? I felt – we are (going to be) in deep trouble. Sir suggested that this trouble could be even deeper, longer and disappointing than the 2008 melt down.

    I’m scared. For all such troubles I always look at the other side as solutions. OTHER SIDE here means socialistic approach to solving capitalistic problem. I smsed Sir – could “Sanjha Chulha*” be the solution? It would help provide few  jobs for people in Sanjha Chulha and reduce expenditure of unemployed on food. When that happens, Govt can reduce expenditure of unemployment benefits.
    *Sanjha Chulha means community kitchen.

    The other approach I thought was using TRIZ. Actually that is what Govt must be doing (without the jargon of TRIZ). Before discussing the solution framework, a brief on Fiscal Cliff (Details – About link and Wiki link).

    Fiscal Cliff – is a deep impact due in the budget of Govt. Because as per “Bush tax cut” (of 2003) the taxes would increase at the same time Govt has to reduce spendings e.g. unemployment benefits offered for 99 weeks would reduce to 52 weeks, defense budget reduce by say 50% etc. All of this would result in recession in the USA. The challenge for Govt is – how to control it? Fiscal Cliff is also a function of debt reaching a ceiling % of GDP.

    In TRIZ there is a solution type for such issues. That is named as physical contradiction, which means you want something and you dont want that at the same time. You want Tax cut and you dont want that. You want reduced expenditure but you dont want that.

    Simple solution is – “increase ceiling debt as % of GDP”. Other solution would be, TRIZ offers solution by separation principle.

    1. Separate tax collection based on condition. This is tried arguement is on tax ceiling (Obama says 400k, Congress says 1M).
    2. Separate tax collection based on organization vs individuals. In TRIZ it is kind of separation of parts Vs the whole.
    3. Separate tax collection on time. This separation could be coupled with solution 1.

    1. Separate spends based on condition. spend ceiling on spends of different types
    2. Separate spends based on community vs individuals. Healthcare Vs unemployment benefits
    3. Separate spends on time. Delay spends which could be avoided.

    For testing all these ideas a very simple mathematical model and “goal-seek” of Microsoft Excel can be used. (Though its not that simple – but who wants to complicate things? Objective is to simplify life) politicians/consultants like complexity, who can leverage it.

    Relevant news Euro debt reaching 90%

    Separation principle

    Related blogs –

    1. Double dip

    2. Euro is it dead

    3. Need of the hour

  • Every problem is a nail… if you only have hammer in your tool box!







    In a class of Prof Moradian we were learning about a model, a model which had two dimensions. Each axis has ‘Low’ and ‘High’ as the extremes. I have learnt that for few thing quantification is not necessary, ok! When I saw this combination of ‘Low’ and ‘High’, I understood it is a qualitative measure. I waited for two minutes (a long duration for struggle in mind), at last a typical attribute of a classic personality came out.
    “Sir, how do I define a number is ‘Low’ or ‘High’ on this model and on the scale?”
    I took two minutes because I struggled to put this in my mind – ‘do not try to quantify everything’. I was thinking quantify or not to quantify? It was equally a struggle for Prof Lopez to teach me – don’t try quantification of everything. Old habits die hard! Six Sigma taught me to be data centric and this struggle has always been in mind – clarity with data or instinct with less or no data (I worked as TRIZ/Innovation consultant). Seemingly two different approach six sigma data centric and innovation instinct based.
    I knew it is qualitative, and Prof Mordian said – ‘Pravin, it is not necessary to quantify this measure, come out of the engineering mind’. To save my face I can say I was just questioning my assumptions, you may check possibility thinking and questioning assumptions blog.
    Let me come to the “classic personality” type. Personally, this incident was making the same mistake (of course learning from that too). The trait I want to highlight here is ‘engineerish’ e.g. engineer and mathematician type thinking. What else can you expect from an engineer – numbers, data, technical details and much more concrete information?
    Here, I came up with few future blog ideas of Blue ocean strategy, frameworks and problem solving. I will try to cover them in future. As I wrote in my introductory blog, not necessarily every blog entry will be on relation between Business and the Buddha. I will not offer correlation here, though I can do that. For a change I would quote a real life example which many of us are suffering from –
    Dr Mankad taught us in class of Macroeconomics that – few bright engineers turned MBAs have created many models e.g. financial models that ‘quantified rationality/irrationality’ which became one of the worst problems and resulted in the melt down.
    So, I write here a cliché of many management consultants – Every problem is a nail… if you only have hammer in your tool box! I also encountered it many a times. It is occasionally a struggle to pull people out of their thought process and make them realize that – some problems are not nails. Our myopic thinking can be summarized in (again a cliché) joke to explain the issue –
    Once mechanical, Electrical, Chemical and Computer science engineers were traveling in a car. Suddenly the car stopped and everyone was puzzled. Mechanical Engineer suggested that that there is some problem with the engine. Electrical Engineer suggested that it is due to the fault in ignition system. Chemical engineer said “no-no car was making some strange knocking and the problem was with the fuel.” Suddenly the computer science Engineer intervened and said “I think we need to go out and then come in the car (log out and log in).”
    The message is …
    “Every problem is a nail… if you only have hammer in your tool box!”
    And the lesson – “Because you have a hammer, don’t go searching for a nail”!!