Friday, August 25, 2006

Strategy versus execution schizophrenia

By nature I am a strategy guy. I spend my time thinking about the future mostly because I really do believe that "only the paranoid survive" (http://www.amazon.com/gp/product/0385483821/104-5435827-2375938?v=glance&n=283155) yet I have worked long enough to understand that really execution is king. I still find this reality very difficult because "going analytical" is a bit like swimming underwater: when you get back the the surface you realize that you have been away for some time and things may have changed without you noticing. This is where I find the magic of time management does the job: have regular meetings to allow you to monitor and interact with the execution and leave the rest of the time for strategic free thinking.

Tuesday, August 22, 2006

A little noise to nudge people into taking risk

I listened to Aaron Brown present his idea that for an exchange to be efficient the deals need to be incentivised with a chance of large payouts. This makes sense to me, what is more motivating: Getting the average every times or getting a random return but with the chance of a high value? I think human nature cannot accept the hard reality of what an average return implies and naturally will search for risk in order to give him a chance for a better return.