This book is for innovators and entrepreneurs...if you're looking for "how to improve my process using lean tools...." this is NOT your book.
According to the author this is not your generic: do what you love, share ideas, prioritize, be proactive business help book.
Andy's right on the mark when he describes his book. Within these pages is a very straightforward listing of how to identify future opportunities that produce true wealth.
It's not a sugar coated business book where everyone is going "strive to do our best"...it's bare bones and in your face. Maybe that's what I love most about it.
It's not a "get rich quick" book.
The book outlines 12 rules with a bonus rule for identifying areas that are waiting for new technologies to make things easier.
Facebook, Apple, Microsoft and Intel fit within these rules and all of them are job killers. Andy also explains why this is a good thing and I agree with him.
Andy Kesslers 12 rules + a bonus rule
- If it doesn't scale, it will get stale
- Waste what's abundant to make up for what's scarce
- When in doubt get horizontal
- Intelligence moves out to the edge of the network
- Wealth comes from productivity; Everything else is gravy
- Adapt to humans; Don't make them adapt to you
- Be Soylent - Eat People
- Markets make better decisions than managers
- Embrace exceptionalism
- Be a market entrepreneur and attack political entrepreneurs
- Use zero marginal cost to create a flood
- Create your own scarcity with a virtual pipe
- BONUS Rule: Money sloshes to the highest returns
I'm not going to explain every rule...that's why you are going to need to read the book.
In rule #7 "Be Soylent - Eat People", Andy creatively classifies the entire human population into several groups and subgroups.
Creators, Servers, Sloppers, Sponges, Slackers, Thieves, Slimers and a few others.
While the first time I read this chapter I was surprised as to the offending titles he used to lump individuals together I must say he made some very good insights.
"..the road to wealth passes through the graveyard of today's jobs"
- Microsoft Word replaced secretaries
- Oracle replaced in house accountants
- Google replaced the librarian
- BlackBerry replaced mail carriers
- Digital cameras killed Kodak film developers
- "It's only been in the last 10 yrs we've gotten rid of operators, tellers, travel agents and stockbrokers and replaced them with a flat-panel screen and a mouse connected to the internet."
"...the real task is to figure out which jobs going forward need to be eaten. That's where you find the opportunity for upside and wealth."
POINT - get rid of humans and you have probably found a rich vein of productivity.
"If that means over a generation replacing low- skill jobs with higher-skilled careers developing more productive tools, then you are creating wealth for the entire economy."
While Andy can sound a little arrogant at times he's giving us some very valuable information. I'm glad I picked up this book and will happily recommend it others.
Notes I want to remember:
Real success comes from hiding the technology from users. Can you say iPhone!
How do you find something that scales: Find something where the price goes down and the demand goes up. Simple question. If this were cheaper next year...would I buy more
a product is no sooner created than it, from that instant, affords a market for other products to the full extent of its own value...the shoemaker when he exchanges his shoes for bread has an effective demand for bread. Knowing bread exists means the shoemaker busts his hump to make shoes to be able to afford the bread.
Money is just a placeholder of value
The only real wealth is wealth that is created through productivity.
Effectiveness is how outputs compare with what was planned or desired - doing the right things, while efficiency is the ratio of the amount of actual outputs to actual inputs - doing things right.
Productivity is really just doing the right things while doing them right.
Wealth gravitates to those that find it first or, better yet, make it happen.
Efficiency is about getting the cost to drop again, by 10% or 15%,...not the 90% or 99% that costs have already dropped to induce scale and generations of wealth. When efficiency takes over you are at the very end of this cycle.
The trick is to identify those who stand in the way of increased output.
Politics is the art of achieving power and prestige without merit.
If organic food uses fewer chemicals it should cost less but it actually costs more.
Sponges will try to limit the supply of workers to decrease competition and most likely increase prices and pay above and beyond their true economic value. Ex. bogus licensing requirements...want to cut hair...better pass the beautician exam and get a beautician license. Stockbrokers need to pass a Series 7..oddly real people like you and me don't need the same license to make trades on E-trade.
Markets are all about price discovery. Shares are traded back and forth, bumping up and down until they settle at the right price, whatever the right price really means. More subjective than objective.
Corporations have no legal way of testing just how smart you are, so they rely on colleges and universities to do their screening for them.
If it can be had for free, it will be had for free or close to free. ...if someone can copy your stuff, they will, so you might as well be the one to do the copying. If it can be digitized, it can be given away. Like it or not, piracy rules. Courts have huge marginal costs and can't compete with zero marginal cost pirates....Like it or not the Web is and will remain the Wild West.
Media is about control of a pipe Ex World of Warcraft, Call of Duty: Modern Warfare 2
Profits are just the difference between the value of a good or maybe service from the people who produced it, and the value to their customers. So it reflects the degree a business understands the real needs of their customers.
