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Views from the Prairie

July 18

Sometimes the little things matter

The Large Hadron Collider is where the Higgs Boson was discovered. No, nobody actually saw it nor was there a solid signal on a measurement. Instead, it was only a blip of other particles that had very strong probability that they were created from the Higgs Boson. This little blip brought the Nobel Prize. In the business world, little blips can be important. We define our corporate culture by what small things we praise and which we fire over.

In management, we are told over and over again to not worry about the little things. While that is mostly true, there are times when the little things matter. The old poem about a horse losing a shoe for want of a nail is just such a case.

In Chaos Theory, small blips in events can cause major changes down the line. We can't know all the possibilities nor can we manage all the outcomes. We choose what small things are important and which to ignore.

What constitutes a small thing is different at different corporations, at different corporate levels, and in different cultures. Take any small thing and some are fired for it, others reprimanded, others have it ignored, while others are praised for it.

Because what small things matter changes over time and culture, we need to keep aware of what things matter to our customers and general public. For example, having an affair at the office was common at one time and in one culture. Today, it is grounds for the CEO to lose his job. Likewise, using certain ethnic slurs used to be common yet that is what caused Papa John's Pizza CEO to be fired recently.

Corporate culture is important. We define our corporate culture daily by the small things that are accepted, punished, praised, or ignored.

One reason to focus on the small things is that these are the things that people around us notice. Friction between people happens around the small things. People observe our values by which small things we notice and act on. The stories that make up the corporate culture are built on small things.

Small things matter because we are working together. Looking back at the solitary "Mountain Man", he could get away with all sorts of eccentric behavior - because he didn't live or work with anyone else (which meant not having a wife). We are interconnected today. We must live and work with others and often our work affects many in the broader community. One price of progress is living and working with others.

Other examples of small things mattering include computer program design and phone design. One reason that Apple has been able to command high prices is that they started with good design and little things fit together. The user experience is consistent. Once a person knows the experience, new programs that fit that experience are easy to use.

Fraud control and virus protection also depend on the little things. In fraud control, even which device being used can indicate whether a transaction is fraudulent or not.

Credit Spigot Turn Off?

From the first, our country was built on credit but periodically, the credit spigot got turned off. In the 1800's, they called it a "financial panic" and those happened over and over again. In the 1900's, we only had the 1907 panic and the one Great Depression. More recently, we had the "Great Recession". However, what would happen if the credit spigot got turned off again?

The 1920's, called the "Roaring Twenties" because of all the credit running around, was a heady time. Many new banks were started by state charters and many had lack credit requirements. Yet, there was also a divergence between those who had credit and those that didn't. Many banks went under during the 1920's along with many farmers who faced drought.

In today's world, we are living on credit. In 2015, Experian reported that 85% of new cars were purchased on credit. The Federal Government is running a massive deficit and needing to borrow more each month. Our country is sucking money from the rest of the world in order to finance the debt.

At what point will the credit spigot be turned off? At some point, other nations may decide that lending money or not can be a weapon in a trade war.

No matter when (as humans are terrible at predicting when) the credit spigot will be turned off, it will lead to a very different investment environment. Right now, a lot of companies are fighting for the spending dollars of the aspirational much like in the 20's. Those are the current high flyers. However, during the 1930's, the companies that did well often focused on providing the basics at a low cost.

Risky World

Biohacking is a reality today. People are doing DNA modifications in their own "garage". Some are actually ingesting or injecting themselves with the results. The risk is that like how computer viruses started in individual's garage, some DNA hacker may make a DNA virus and put all our health at risk.


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