Tag: improvements

Sergei Bubka and Academia

There is this famous story that says that the Soviet government promised pole vaulter Sergei Bubka some huge sum of money “every time he broke the world record”. Being rather smart, Bubka would break the world record each time by one centimeter (the least count for pole vault measurement), utilizing the fact that the nature of the event (where you set the bar and try to clear it, where success in each attempt is binary) to his advantage.

The thing with academia is that ‘paper count’ matters. And it appears that the quality of papers cannot be objectively measured and so the quality of the journals in which they are published are taken as proxy. And I hear that for decisions like getting a PhD, getting tenure, reputation in the community, etc. there is some sort of informal “paper count” that one needs to clear. You don’t progress until you’ve published a certain “number of papers”.

What this does is to incentivize academics to publish more. The degree of “delta improvement” shown in a particular paper over it’s predecessor (assuming each paper can be seen as an improvement over one particular previously known result) doesn’t matter as much as the number of improvements thus shown. Hence, every time the academic notices a small epsilon improvement, he finds it significant – it gets him a paper! The actual practical utility of this improvement be damned.

This is all fine in academia where one doesn’t need to bother about lowly trivialties such as “practical utility”. But it does start to matter when the academic migrates to industry, and there is no shortage of people doing this movement. Now, suddenly, what he needs to think about it practical utility. But that doesn’t come naturally to him. The academic strives for delta improvements. And each time there is a delta improvement he finds it significant – after all, that is what he has been trained to do during his long stint writing papers.

I must confirm I’m not saying here that ex-academics strive only for delta improvements, but just that they find each delta improvement significant, irrespective of the magnitude of the delta. In that way, they are different from Bubka.

But take that out and there is no difference. Both are incentivized by the number of delta improvements they make, rather than their magnitude. In the first case the Soviet Government ended up transferring more than what was perhaps necessary to Bubka. Similar flawed incentives can lead to corporations losing a lot of money.

PS: I must admit I’m generalizing. Of course there exist studmax creatures like Cat, who refuse to publish unless they have something really significant (he told me of one case where he refused to add his name to a paper since he “didn’t want to be known for that work” or something like that). But the vast majority gets its doctorates and tenures by delta publishing, so I guess I’m allowed to generalize.

Arranged Scissors 5 – Finding the Right Exchange

If you look at my IIMB grade card, one subject stands out. It is one of the two Cs that I have on the card, and the other was in a “dead rubber” (5th/6th term where grades didn’t matter for placements). This C was in introductory marketing management. Where the major compoenent was a group project called the application exercise (ap-ex). I frequently crib that I did badly in that project because four out of six people in my group did no work, or even negative work (and this is true). Digging deeper, however, I think the more fundamental issue was that the two of us who worked didn’t really know what we were doing. We failed to understand the concept of STP till a few years after the project was over.

STP is one of the most fundamental concepts in marketing. It stands for Segmentation, Targeting and Positioning. I quickly appreciated Positioning, but took a long time in trying to figure out the difference between segmentation and targeting. In my defence, they are highly inter-related concepts, and unless you look at it from the point of view of social sciences (where each unique point fetches you one mark in the board exam) it is not intuitive that they are separate concepts.

So you segment the “population” based on various axes. Taking these axes in conjunction, you end up “segmenting” the population into a large number of hypercubes. Then you do the “targeting”. Find the set of hypercubes that you want to sell your product to (in the context this post is about, sell yourself to). And so once you have found your “target segment” or set of “target segments” you “position yourself” and go out to sell. And then you need to figure out the “4 Ps” of marketing. Product (fixed here – it’s you). Price (irrelevant if you don’t plan to take dowry). Forgot one P. The other is Place (where you will sell).

The arranged marriage market can be broadly be divided into two – OTC and exchanges. OTC (over the counter) is the case where you have a mutual acquaintance setting you up with a counterparty. The only difference here between arranged and normal scissors is that in the arranged case, it is your parents who are set up with the counterparty’s parents rather you getting set up directly. Since it is a mutual acquaintance doing the setting up, the counterparty is at max two degrees away, and this makes the due diligence process a lot easier. Also, you have one interested third party who will keep nudging you and pushing hte process back and forth and generally catalyzing it. So people in general prefer it. Historically, there were no formal exchanges (apart from say a few “well known village elders”). Most transactions were OTC.

One problem in financial OTC markets is counterparty risk (which is what has prompted the US government to prop up AIG) but this is not a unique problem with OTC arranged marriage market – counterparty risk will always be there irrespective of the method in which the relationship was formed. Apart from providing counterparty protection, one important role that financial exchanges play is to improve liquidity in the market. The number of transactions that happen in the exchange ensure that the market is efficient and prices are fair. Liquidity is an important asset in the arranged marriage exchanges also.

The problem that I’m trying to describe in this post is about segmenting the exchanges based on their most popular commodity types. I don’t have reall live examples of this, but then for each product you will want to go to a different exchange. For example (this example may not be factually correct) both the Chicago Board of Trade (CBoT) and Chicago Mercantile Exchange (CME) trade in both corn futures and cattle futures. However, the volume of corn futures that are traded on CBoT is significantly larger than the volume of corn futures traded on the CME. And the volume of cattle futures traded on the CME might be siginicantly larger than the corresponding volume in CBoT.

So if you want to buy cattle futures, you are better off going to the CME rather than the CBoT since the former has significantly greater liquidity in this product, and thus you are assured of getting a “fairer” price. Similarly, to buy corn you should rather go to CBoT than CME. I suppose you get the drift. Now, the same is true with the arranged marriage market also. If you want to get listed on an exchange, you will need to make sure that you get listed on the right exchange – the exchange where you are most likely to find people belonging to your target segment.

To take an example, if you think you want a Tamil-speaking spouse, you are significantly better off listing on tamilmatrimony.com rather than listing on telugumatrimony.com, right? Of course this is just a simplistic example which I have presented because the segmentation and difference in markets is clear. Things in the real world are not so easy.

There are various kinds of marriage exchanges around. In fact, this has been a flourishing profession for a large number of years, and even the recent boom in louvvu marriages has done nothing to stem the flow of this market. You will have every swamiji in every mutt who will want to perform social service by opening a marriage exchange. Then, you have a few offline for-profit exchanges. Some of them work on a per-deal basis. Others charge you for listing, since it is tough for them to track the relationships that they’ve managed to create. Then, this is one business which has clearly survived the dotcom bust of 2001-02. The fact that this business is flourishing can be seen on the left sidebar of this page where I suppose a large number of them will be advertising. In fact, I encourage you to click through them since that will result in precious adsense revenue for me.

There is nothing wrong in carpet bombing, but that comes at a price. Notwithstanding the listing fees (which are usually nominal), you will have to deal with a significantly large number of “obviously misfit” CVs and bump them off. Especially if you live far away from the exchanges and have someone else broking for you, you don’t want to burden them too much, right? So the problem is in doing your segmentation and targeting. And then researching the exchanges to find which exchange has most liquidity for products belonging to both your segment as well as your target segment. And get listed on them ratehr than wasting precious time, energy and money listing on exchanges that are unlikely to be useful.

Since I began this (extremely long) post with marketing fundaes, I should complete it with some more (which is irrelevant to the rest of this post). A standard process for advertising is AIDA (Awareness-Interest-Desire-Action). Typically for a relationship to “happen”, you need a minimum of D from at least one of the parties, and a minimum of I from the other party. The normal arranged marriage process, however, assumes that an I-I is a sufficient condition for a sufficient lifelong relationship, and don’t give enough time and space for people to check if D is there. Hence the disasters. Hence the tilt towards the CMPs.

Arranged Scissors 1 – The Common Minimum Programme

Arranged Scissors 2

Arranged Scissors 3 – Due Diligence

Arranged Scissors 4 – Dear Cesare

Car Ownership

People, especially in the US, make a big deal about home ownership. In fact a large part of the current economic meltdown has its roots in the American craze for home ownership. Fannie and Freddie were created to help home loans become cheaper, then there was the CDO wave. Then came subprime. NINJA (no income no job amortized). All that. Boom. Bust. Jai.

A related concept that no one seems to talk about is car ownership. They say that the safety of a neighbourhood goes up if the proportion of owner-occupied homes goes up. And this is the underlying theory behind most of the home ownership craze.

|||ly, road safety is directly proportional to the proportion of owner-driven vehicles on the road. Take Bangalore for example. Till the late 90s, the traffic there was excellent and well-behaved. Some roads were already clogged, yes. But drivers were in general very well behaved. And the reason behind that was that most people owned their bikes and cars. They had a greater incentive to make sure that there was no damage done to their vehicles nad drove more carefully.

Yes, personal safety also plays an impact and is independent of whose vehicle the driver is driving, but I think in the progression of severity of accidents, vehicle safety gets compromised before personal safety. In other words, there is a one-way implication here – if you drive keeping in mind the aim of not damaging your vehicle, it is more likely that you are not going to get injured. The reverse doesn’t necessarily hold. And that is why car ownership is so important.

So what happened in Bangalore in the early 2000s when traffic suddenly became horrible? This thing called BPO happened, which brought with it the mostly chauffeur-driven taxis. Now, on one hand, these guys had perverse incentives as their efficiency was measured on the speed from which they got from point A to point B. Apart from this, most of them were not driving their own vehicles (this was a departure from the earlier wave of taxis and autos, most of which were owner-driven) and so they didn’t care so much about damaging their vehicles, which led them to drive more rashly.

Similar is the case with Delhi, which is known to have always had horrible traffic. Being the political capital, Delhi has always had a reasonably high proportion of chauffeur-driven cars. Which is why, for a long time, its roads have been known to be rasher than roads in other cities. And things still haven’t improved.

The thing with car ownership is that it forms a positive-feedback loop. Suppose the number of chauffeur-driven cars goes up. Then, the traffic in general becomes more rasher. And driving becomes more of a headache for you. Which increases your incentive to employ someone to drive your car. Which further pushes up the proportion of chauffeur-driven cars. This is what has happened in Delhi over the last 50 years. This is what has happened in Bangalore over the last 10 years.

In order to make our streets safer, we need to incentivize people to drive their own cars and bikes (one clarification – by own, I mean either your own or something that belongs to close family or friends; in both cases, incentive to keep vehicle safe is high). If I’m not wrong, people can claim tax exemption against the salaries they pay their driver. This needs to go first. Next, insurance companies need to have different levels of payout for self-driven and driver-driven accidents (I know this is going to be hard to be implement).

Yes, this might increase unemployment since driving other people’s vehicles is a major occupation nowadays. But is greater unemployment too high a price in order to ensure greater safety? (ok I can quickly think of one counterargument for this – if people become unemployed, the chances they’ll become goons rises, which makes society in general less safe)

Sit down behind the wheel, and be counted. Say no to drivers. Drive your own car. It is in your own, your car’s , other people’s and other people’s cars’ interest. You don’t need to be driven. You need to be in the driver’s seat.

Process

A couple of days back, I was debugging some code. And yes, for those of you who didn’t know, coding is a part of my job. I used to have this theory that whatever job you take, there is some part of it that is going to be boring. Or to put it in the immortal words of a brilliant co-intern at JP Morgan “chootiya kaam”. And in my job, the chootiya part of the kaam is coding. That doesn’t mean that I’m not enjoying it, though. In fact, for the first time in nine years (note that this takes me to a time before I’d started my BTech in Computer Science) I’m enjoying coding.

Coming back, I was debugging my code yesterday. It was one of those impossible bugs. One of those cases where you had no clue why things were going wrong. So I started off by looking at the log files. All clean, and no bugs located. While I was going through them, I got this idea that the strategy sheet might offer some clue as to why things aren’t doing well. Half the problem got diagnosed when I was looking at the strategy sheet. Some problem with cash management.

And when I thought looking at the trades might help. The bug was presently discovered. And then it hit me – that I’d unwittingly followed what seems like a “process”. Everything that I did had been guided by insight and instinct. Yet, the steps that I followed – 1. look at the logs; 2. look at the strategy sheet ; 3. look at the trades – seemed so much a preset process. It seemed to be like one of those things that I’d just ended up reading in some manual and following.

I realize that most “standard processes” that are followed by  various people in various places are stuff that were initially not meant to be processes. They were just an imprint of somone’s train of insights. It was as if someone had a series of insights that led to a solution to whta might have been a difficult problem. And then, he realized that this kind of a process could be followed to deal with all such similar problems. And so he wrote down the process in a book and taught a set of people to implement them. The field thus got “fighterized“.

The argument I’m trying to make here is that a large number of so-called “standard processes” are just an imprint of someone’s insight. They just happened to get into place because the inventor noticed this pattern in a bunch of things that he was doing. They need not be the best way of doing what is supposed to be done. Maybe there isn’t even a single best way of doing it that might work every time.

People who are likely to have worked on processes later in their life cycle are likely to have been people who are process-oriented themselves, and given how these kind of people work, it would have been likely that they would have resisted changes that could make the process worse in the short term. They are more likely to have been incremental in their approach. With a succession of such people working on improving the process, the process of refining the process would’ve ended up taking a hill-climbing algorithm and is likely to have ended up in a local maximum.

Once again, the large changes to the process would’ve happened when someone who was willing to take a large step backward worked on them, and it is again likely that such a person would be driven more by insight rather than by process.

My hypothesis is that most processes are likely to have been largely defined by people who are themselves not very process-oriented, and who thus will expect a certain level of insight and discretion on the part of the person implementing the process. And one needs to keep this in mind while following processes. That it would be good if one were to take a critical view of every process being used, and not be afraid to take a backward step or two in process development in order to achieve large-scale improvements.

Arranged Scissors 2

One of the greatest sins in the normal relationship process is tw0-timing. If your statistically significant other figures out that there is yet another other who might also be statistically significant, she is not going to take things lying down. The most likely scenario will be that the yet another other will indeed become statistically siginficant – since the original SSO puts ditch. It might be a stretch but I’ll anyway say that tw0-timing is probably the worst mistake you can commit in the course of a relationship.

The arranged marriage market puts no such constraints. Even if you are ten-timing, people won’t mind. Especially if you are an NRI. The typical NRI process goes like this. Boy lands and is given a “shortlist” – a sheaf of CVs and photos. During the drive home, the shortlist is made shorter. The next day, “interviews” are arranged with each girl in the shorter list, typically at her house. End of the day, after sampling data from various sources, boy picks the one that he thinks will be likely to be most statistically significant in the long term.He takes her out for lunch the next day, puts a ring on her finger the following day and flies off, promising to return in a few months for the wedding. Occasionally, he claims he can’t get leave from his employers for another year and so puts off thaaLi also before he returns to vilayat. Girl can follow him later. For now she’ll follow him on Twitter (sorry, bad PJ).

Local boys don’t have it that lucky. At least, it is unlikely that they ten-time. There are two quirks of the arranged marriage market which pull in opposite directions when it comes to two-timing. On one hand is discretion. You don’t announce that you are “seeing someone” until it’s all fixed and proposal has been made and accepted. Discretion also means that you don’t want to be caught together in public. It also means that you can’t write funny things on each other’s facebook walls. And it obviously rules out PDA – in fact, all forms of DA are strongly discouraged until the contract has been signed. Heck, my cousin was putting DA during her engagement and that led to much gossip and condemnation. So no DA till marriage.

So yeah – one of the “advantages” of this discretion is that it allows you to two-time. What tugs from the other side is the time to decision. Due diligence in the whole process is outsourced, to the bankers. Typically it is finished even before the parties concerned get a chance to  explore each other – and in this, this process differs from the typical M&A process. So now that the due diligence has already been done, bankers prefer that the parties reach a decision quickly.

I don’t know how this happened, but the time to decision is fairly short. In olden days, I’m told that the due diligence was the beginning and end of the deal process. All that the parties had to do was sign. Things slowly improved – to showing photos, to being shown glimpses, to being allowed to talk for two minutes. I don’t know where things stand in terms of the general market, but I’ve been trying to insist on a proper blading process to allow enough time for tiki-taka.

Ok here is the grand unification for this post. The time to decision is a function of discretion and ability to two-time. Given the discretion that has normally been practised (i suppose this came about because societies were tightly knit and small and things would become awkward for all parties involved if each expression of interest were made public), the cost of two-timing became quite low. Thus, in order to make sure that the counterparty is not two-timing their kid, parents started demanding that decisions be made early. This cut both ways – the counterparty’s parents also wanted to make sure their kid wasn’t being two-timed. From the point of view of bankers, the short time-to-deal was an absolute win.

From the point of views of the interested parties, all it did was to increase the incentive for Common Minimum Programmes. Time allotted is generally too short to properly check out the counterparty, and you need to prioritise. You want to check for obvious mistakes. In the short time, you want to make sure that the counterparty is not an obvious misfit. Realizing that you will never have that time to figure out propely if a prospective counterparty has those “spikes”, you settle for someone who “clears the basic cutoffs”.

You thus get yourself a common minimum programme spouse.

Earlier in the series:

Arranged Scissors 1 – The Common Minimum Programme

Disco Raaga – Taana – Pallavi

This is one of those posts that I’ve been intending to post for over a couple of months, but each time I think about this, I don’t happen to be in front of a computer, and even if I do, I don’t feel like writing about it. So here I am – finally blogging this. As I write this, I’m listening to the Ledzep Live Album The Song Remains the Same. This post is about this album, and other related stuff.

As you might have figured out from the title of this post, one thing I’ve noticed about this album is about the approximate Carnatic format that the songs in this take on. It may not be in the strict order that Carnatic music prescribes, but these songs are roughly there. I’m currently listening to Dazed and Confused, and after the first few lines of the Pallavi were sung, Page has now gone off into an extended Aalapana of whichever Raaga this song is set in.

Periodically, they return to the song, and play a few more lines. Now, Plant is doing his bit by improvising with a few lines of his own. Jones and Bonham are dutifully doing their background stuff – Bonham will get his footage later in the album – for Moby Dick features a full-blown Tani Avartanam. It ends the same way Tani Avartanams in Carnatic concerts do – with the main line of the Pallavi being sung at the end of it. I know I might be force-fitting some Carnatic concepts into this album; nevertheless, all these improvements make for extremely interesting listening.

A few days after I had first noticed this, Udupa told me that a large number of concerts in the 70s were like this – the musicians would simply jam on stage in the middle of the songs. Created music on the spot. Spontaneous stuff. Unfortunately, Udupa continued, the trend changed a few years back when less informed audiences started demanding that more songs be crammed into the three hour concert, thus reducing the scope for such improvisations.

The best thing about Carnatic concerts is that each one is unique. You might look at two concerts – played by the same set of musicians and with the same line-up of krithis, but there is a very good chance that the two are markedly different. This is because Indian Classical music, in its concerts, encourages the musician to innovate, to play whatever comes to his mind at that point of time – while adhering to the fairly strict rules. It is this element of innovation that makes each concert special, and an experience in itself.

Western Classical music differs in this regard – especially in the orchestra form – since the large size of the troupe leaves little scope for innovation and the musicians are literally forced to play it by the book. In that context, it seems like it was genres such as rock which brought in the spontaneity and innovation into western music.

Nowadays, bands don’t tour as much as they used to a couple of decades ago, which means that whenever they visit a city (which is once in a few years), the fans in the city will want to hear as many songs as possible. And that kills innovation. It is not the bands’ fault – they are simply responding to the market. And I don’t know what it could be that could get them back to their RTP days.

Here is one of my retirement plans. For each song that I like, describe a Carnatic Raaga into which it can approximately fit into. Tinker around with the stanzas, to create a Pallavi-Anupallavi-Charana format. Try to make the raagas as rigid as possible – Vakra scales will be preferred. And then put RTP. Use some Western instruments too – for example, I definitely want the Bass guitar to be a regular feature in Carnatic concerts. I think the result is likely to be phenomenal.

It’s been a few years since I picked up the violin. I plan to do it sometime. And implement what I’ve described here. Hopefully I’ll do a good job. In the meantime, if there are any bands out there which want to implement this concept, they can feel free and do it – I promise I won’t sue them later for IPR.