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Tag Archives: Malcolm Gladwell

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For human capital formation, 10,000 hours could be crucial.

I was at Lincoln Center several nights ago. Listening to a wonderful performance of Chopin’s Polonaise, I wondered how much the pianist practiced. That took me to Malcolm Gladwell.

In Outliers, Gladwell says that practice is a crucial component of brilliance. Concluding that you need 10,000 hours of practice to display genius, he says that prodigies and unusually high I.Q. individuals are not automatically great. They have to work at it.

Mozart, he explains, had been composing for 20 years before he produced his greatest work. With the Beatles, he reminds us of the hours, 8 hours a day 7 days a week, during which they performed in small Hamburg, Germany cafes. We could also add YoYo Ma, Bill Gates and Wayne Gretsky to the 10,000 hour list. Maybe Tiger Woods also?

The 10,000 hour theory originated with a psychology professor at Florida State University. Looking at musicians, all with talent, Dr. K. Anders Ericsson realized that practice time determined who would excel. Those who had accumulated 10,000 hours of disciplined solitary practice time by age 20 were the “prodigies.” Meanwhile, 8,000 hours meant less expertise and those with 4,000 became amateurs and music teachers.

Still though, other psychologists point to studies that contradict the rule. They say that practice certainly helps. But, “working memory capacity,” for example, can make a huge difference. A musician with more innate working memory capacity will fare better than one with less, no matter how much practice each one accumulates.

And finally, all of this takes us to “The Dan Plan.” Reading about the 10,000 hour rule, Dan McLaughlin quit his job as a commercial photographer to devote 10,000 hours to golf. Although he had never lifted a club, he was convinced that a disciplined regimen would take him to the PGA. Having started during 2010, he projects hitting 10,000 during 2016.

Our bottom line? Having 10,000 hours of human capital formation requires a fairly affluent society. You need lessons, a supportive family and special programs and teachers.

Sources and Resources: A great book, Outliers  introduced me to the 10,000 rule and here, Gladwell presents an excerpt. From there, I looked at Dr. Ericssen’s work and this NY Times article that describes researchers who disagree. But if you just have a few moments, do read “The Dan Plan.” to see how he defines which hours count toward his 10,000, which are ancillary and the progress of his “human capital formation.”

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Your human capital might be affected by your birth date.

In Outliers, Malcolm Gladwell suggests that children born during the Great Depression had an advantage. Economic contraction meant couples had fewer babies. A cohort with fewer children, 1930s babies enjoyed smaller classes and better teachers. Because they were unable to get hired by colleges, over qualified teachers swamped the high schools. As a result, depression babies were more likely to be professionally successful.

Fast forward to the Great Recession. One group of adults called the boomerang generation moved back with their parents. Facing financial insecurity, others also postponed marriage and put off parenthood.

By 2011, the birth rate per 1,000 had plummeted. While the map below is for 2010, it reflects a decline in birth rates that began with the Great Recession, Dec. 2007-June 2009.

Returning to the Gladwell hypothesis, we can ask if the Great Recession will echo the Great Depression. For those who were born from 2008-2011, will their human capital be better nurtured through smaller classes and better teachers?

Births Per 1,000, 2010

Births Per 1,000 in 2010

Births per 1,000

Sources and Resources: A page turner of ideas and facts, Outliers is the wonderful book that introduces a slew of thought provoking hypotheses about success. It took me to statistical web sites here, here and here for my birth rate stats and map. You might also want to look at this Pew Research report.

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Ketchup

Called the “Ketchup Conundrum” by journalist Malcolm Gladwell, we have many mustards but only one ketchup.

Grey Poupon transformed the mustard market. Originally a delicacy in the gourmet section, Grey Poupon was selected over French’s in taste tests. However, a $1.49 8-ounce bottle of French’s was #1, Gulden’s next, and no one had heard of Grey Poupon. So Grey Poupon offered packets in airline meals, changed their bottle and, most appealingly, convinced us that an expensive “French” mustard ($3.99 for 8 ounces) could reflect our sophistication. True, it was made in Connecticut with Canadian ingredients but we did not know that. From there, other mustards appeared and the market multiplied.

Here is the 1988 Rolls Royce ad for Grey Poupon.

The ketchup story is very different from mustard. Using spaghetti sauces as the typical example, Gladwell explains that Prego entered the market by creating a chunky sauce. Their goal was to discover what people liked that the market leader lacked. Then advertise and you make your mark. For Heinz Ketchup, no one yet has uncovered the alternative that would make people switch.

Researching ketchup, I discovered that, “a typical five year old consumes sixty percent more ketchup than a 40 year old.” Probably impossible to quantify, still a 5 year’s old’s potential ketchup intake reflects Heinz’s clever decision to make its packaging kid-friendly. Once they created an E-Z squirt bottle that a little one could manipulate, ketchup consumption climbed by 12%. Currently, Heinz has 60% of the US ketchup market.

Ketchup is the perfect case study for oligopolistic competition. As a market leader with Hunt’s and Del Monte far behind, Heinz makes meaningful market entry tough, competes through product differentiation, and, as the E-Z squirt decision demonstrates, they still innovate. Around the world, depending on the country, their ketchup recipe varies. Heinz Canada tells us that their ketchup eaters prefer a sweeter version than US consumers who like their ketchup spicier.

Perhaps because 91% of all consumers use ketchup (a Mintel condiment study), Warren Buffett’s Berkshire Hathaway and a Brazilian private equity firm will be spending $28 billion to take Heinz private as its new owners. So yes, we have only one ketchup but will we have a new Heinz? Buffett says that its offices will remain in Pittsburgh.

Sources and Resources: As always, Malcolm Gladwell has written a wonderful article. His “Ketchup Conundrum” takes us to our taste buds, competition gurus, food history and my E-Z squirt quote. If you want more on a history of ketchup that starts in China, Slate has the story while for mustard history, in addition to the Gladwell piece, I went to an excerpt from The 2,000 Percent Solution and this NY Times article. For international ketchup preferences, here is the Heinz Canada link and here, Forbes tells more about the firm and its market share.

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Ranking Surveys Typically Are Subjective and Have Unintended Consequences.

I just looked at the U.S. News and World Report ranking for business schools. Then, while I was there, I could not resist checking out the “best” colleges and their new best connected category. The top 3 colleges are Harvard amd Princeton tied for #1 and then Yale #3.The top 3 graduate business schools are Harvard and Stanford, a #1 tie and then Wharton, #3. The best connected list (for example–who has the most wifi coverage) starts with Bowdoin then University of La Verne and Auburn University.

But I kept asking myself…Why?? Whether looking at colleges or income or even GDP, ranking is totally subjective. It all depends on the variables you select, their weight, and how you quantify them.

In an especially excellent 2005 Atlantic article, former Reed College president Colin Diver, detailed the impact of the U.S. News results. Summarizing the downside of ranking while explaining why Reed refused to participate in the process, he took me to a slew of unintended consequences that included an “irresistible pressure toward homogeneity” and the temptation to elevate scores by changing institutional procedures. Meanwhile, he marveled at the quantity of brochures he received from schools hoping to influence the reputational survey he completed annually when he did participate as the Dean of Penn Law.

By contrast, other critics looked at the surveys themselves. In a 2011 New Yorker article, journalist Malcolm Gladwell showed how survey questions reflect the perspective of the designer and skew the results. Focusing on graduate business school ranking by 5 magazines, one Forbes writer perfectly illustrated how different questions generate varied results. In one example he explains that Forbes uses the financial gain of graduates after 5 years as a ranking variable for graduate business schools while U.S. News uses starting salaries. And yet both say they are determining which business school is best.

You probably know where this is going. Ranking schemes exist far beyond the university world. Whether comparing incomes or GDPs, we tend to select variables that reflect our own bias.

Sources and Resources: If you are going to look at one survey, I recommend this new Bloomberg business school ranking because their chart, here, identifies and ranks each variable. The article that was best, though, was the Colin Diver discussion in the Atlantic but always, Malcolm Gladwell is a pleasure and the Forbes comparison of ranking by 5 popular magazines was enlightening. And here are the U.S. News ranks.

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Sometimes it is tough to decide who really is #1.

Ask me who won the Olympics and I, as a former history teacher, might say the Mongol Empire.

If you were to outline the Mongol Empire (1280AD) on a map, 15 contemporary countries would be totally or partially included. Ranging from China to Tajikstan and including the Russian Federation and South Korea, those 15 nations won 285 medals.

The top 6 on my medals list would be:

EMPIRE  MEDAL COUNT
Mongol (1280)  285
British (1910)  181
Eurozone (2012)  178
Roman (100)  175
Napoleonic (1810)  165
Russia (1950)  164

From: pingflux.

Other yardsticks for naming Olympic winners?

Most people say that the US was first with the most medals (104) or because it got more gold (46) than anyone else. Then though, using the gold as our yardstick, for the 2008 Olympics, China, with 51 would have been named #1. Another possibility is to divide a nation’s GDP or its population by its medal count. Among the top winners, for GDP Russia is on top because it “spent” the least while Great Britain wins for the lowest number of people per medal

COUNTRY MILLIONS OF PEOPLE PER MEDAL      $ BILLIONS OF GDP PER MEDAL
GREAT BRITAIN    0.97     $35
RUSSIA    1.68     $29
GERMANY    1.85     $71
US    3.02     $147
CHINA   15.44     $131

From: WSJ.com

All of this took me to a New Yorker article from Malcolm Gladwell on ranking. Focusing primarily on the U.S. News & World Report’s annual “Best Colleges,” he suggests that seemingly clear criteria for determining the “best” are tough to quantify and may not even be valid. when you look closely at them

For me, Gladwell’s conclusions apply also to the economy. Looking at income inequality among nations, happiness among US states, the top money managers on Wall Street or countless other topics, you will discover that the criteria for ranking them deserves a closer look.

Econlife looked more closely at ranking questions here. Also, a thanks to the WSJ Numbers Guy for the ideas and much of the data in this post and you might enjoy reading more about the historic empires that would have won the 20102 London Olympics.

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