Pareto, Elites & Unequal Distribution

A fantastic book that repudiates classical and neo-classical models of economy which has led to countless busts and never was able to predict those busts and still clamors to be the best out there. These are the economyhths which are decimated in the book and a new order and model is what is required to counter the unknowns is enunciated but still this is not foolproof as we can never predict the next earthquake but lest be prepared. Some pages were fascinating and one such excerpt is the one below that I connect with is worth giving here to induce interest in this book Economyths by David Orrell. Happy reading!

It’s not that many young people do not have aspirations. It is that they are blocked Such elitism is unjust socially And it can no longer mark economically. Alan Blilburn MP (2009).

Economists are taught that, in principle at least, a well-run market economy is fundamentally fair, so while luck and random effects may be involved, our actual chance of success depends only on merit. The whole point of a competitive market, after all, is that everyone has an equal shot. This belief in an underlying equality influences everything from taxation policy to the pay packages of CEOs. Yet in recent decades, the income distribution has become increasingly skewed, with most of the benefits of increased productivity accruing to the top few per cent of the population. Ibe reason, as this chapter shows, is that markets are not fair and balanced, and the rich really do get richer.

Economic models in general have continued to shy away from distinguishing economic agents based on power, influence, access to information, connections, gender, race, class, or any other characteristic. As Norbert Häring and Niall Douglas note in their book Economists and the Powerful, such imbalances are ‘defined away by standard assumptions of most mainstream economic models’. Milton Friedman even argued that properly functioning free markets would automatically render them irrelevant: ‘there is an economic incentive in a free market to separate economic efficiency from other characteristics of an individual. A businessman or an entrepreneur who expresses preferences in his business activities that are not related to productive efficiency is at a disadvantage compared to other individuals who do not. Such an individual is in effect imposing higher costs upon himself than are other individuals who do not have such preferences. Hence, in a free market they will tend to drive him out.’ According to theory, sexism, racism or any other form of discrimination is inefficient, so in a pure (i.e. symmetrical) market it wouldn’t exist. Economic transactions are more or less the same, regardless of who is involved or when they take place. It is amusing to compare this picture with the highly ritualized, Vatican-like hiring practice standard in economics departments, which according to one sociological study is characterized by elitism, hierarchy, networking, and male-bias.) Of course, no economist would claim that the real economy is perfectly fair or stable, or that each participant has access to exactly the same information.

As seen with the subprime crisis, though, these assumptions soon begin to look ridiculous when you compare them with the real world. Markets aren’t just slightly asymmetric, they’re totally out of whack. Is it really OK to assume that Goldman Sachs and subprime mortgage holders are competing on a level playing field and have access to the same information? Is Wal-Mart versus the local corner store really a fair fight? And does it really make no difference where you are born, who your parents are, what schools you went to, who your friends are, or what your history is?

Circulation of the Elites
The French statesman Georges Clemenceau is attributed with the saying that ‘Any man who is not a socialist at age 20 has no heart. Any man who is still a socialist at age 40 has no head.’ Following a similar kind of trajectory, perhaps, neoclassical economics started off in an idealistic vein. aim of people like Jevons, Walras and Pareto was to put economics on a rational basis, and thus improve the living standards of the general population. Jevons was brought up in a Unitarian tradition concerned with social conditions, and spent much of his free time walking the streets of the cities he lived in — Sydney, Manchester, London — observing the conditions of the poor and contemplating the connections between poverty and economics. Walras inherited his socialist ideals from his father, and spent a number of years working in the cooperative movement before taking up his professorship at Lausanne.

As a young man, Vilfredo Pareto was a dedicated democrat, and took pleasure in- attacking the Italian government for corruption and corporatism. After the May 1898 riots in Milan, which were organized by the Italian Socialist Party and resulted in the deaths of hundreds of people, Pareto offered his home in Switzerland to socialist exiles and leftist radicals. Even by 1891, though, when Pareto was 43, it appeared that his head was pulling in another direction. He wrote to Walras. ‘I give up the combat in defense of liberal economic theories in Italy. My friends and I get nowhere and lose our time; this time is much more fruitfully devoted to scientific study.’  He began to believe that his youthful passion for leftist ideals had been based on emotion rather than logic, and that all human societies were inherently corrupt and irrational.
Pareto’s cynicism about human motivations was no doubt fuelled in 1901 when he returned home from a trip to find that his wife had run off with the cook and 30 cases of possessions. Under Italian law, Pareto couldn’t get a divorce. He had inherited a large sum of money from an uncle in 1898, enough to make him financially independent. In 1907 he resigned his university position and retired to his villa near Lake Geneva, where he lived with a woman 30 years his junior called Jeanne Régis, a large stock of the finest wines and liqueurs, and eighteen Angora cats (the house was called Villa Angora).

Pareto continued to blast off incendiary books, articles and letters, but his aim switched from trying to change society, to analyzing it from his detached vantage point — rather as an entomologist might analyze the social goings-on of an anthill, but with more spite and irony. In his million-word tome Treatise on General Sociology, he argued that human behavior is driven by irrational desires, which are then justified by particular ideologies. To understand society, one therefore had to focus on the underlying irrational desires, which he classified into six types. The most important were innovation (Class I) and conservation (Class Il). Everyone was motivated by a mix of these classes, but one could nevertheless speak of ‘Class I’ types, who are clever and calculating, and ‘Class Il’ types, who are slower, more bureaucratic, and dependent on force.

Pareto had earlier discovered the power-law distribution of wealth (the 80-20 rule) in Italy and other countries, and wrote that it ‘can be compared in some respects to Kepler’s law in astronomy; we still lack a theory that may make this law of distribution rational in the way in which the theory of universal gravitation has made Kepler’s law rational’. Today, we would describe it as an emergent property of the economy. In his retirement, Pareto came to see this highly-skewed power law as a kind of snapshot that revealed the underlying dynamics of any society.

At the top is a small elite consisting of a mix of Class I and Class Il people who are engaged in a Machiavellian struggle for power. There is always a degree of social mobility, so the composition of the elite changes as people enter or leave. The balance between the two classes therefore varies with time, in a process Pareto called the circulation of the elite. If too many innovative and intelligent Class I people (Machiavelli’s foxes) get in power, then the conservative Class IIS will plot a takeover. If the elite is dominated by Class IIS (Machiavelli’s lions), then it will become overly bureaucratic and reactive and the Class Is will make their move. This process can be smooth and gradual; but, if the circulation becomes blocked, so that ‘simultaneously the upper strata are full of decadent elements and the lower strata are full of elite elements’, then the social state ‘becomes highly unstable and a violent revolution is imminent’.
Pareto demonstrated his argument with numerous case studies. Perhaps the best illustration, though, was the coming to power in Italy of Mussolini’s Fascist government. Mussolini liked the idea of powerful lions taking over from foxes grown corrupt and ineffectual, and appointed Pareto Senator of the Kingdom of Italy. In 1923, Pareto finally managed to obtain a divorce and marry Jeanne Régis, before dying the same year.

How to get Rich
While Pareto’s sociological arguments have dated a bit in the last hundred years, his observation that wealth is distributed according to a power law has remained accurate — except that the elite has grown relatively smaller and more powerful. figure below is a summary of how the world’s wealth was distributed among the total 3.7 billion adults in the year 2000, according to a United Nations report. Adults required a relatively modest net worth of 2,138 to count themselves in the wealthiest 50 per cent To be in the top 10 per cent (370 million adults) they needed S61 This group owned over 80 per cent of the total wealth Anyone with $510,000 was in the top I per cent (that’s 37 million adults)- Together, this small sliver of the world population controlled 40 per of the world’s financial assets. Contrast that with the bottom half, who collectively controlled about 1 per cent of the wealth. Someone born into the world at random would stand a 50 per cent chance of ending up in that group of 1.85 billion adults. (As discussed in the update on page 216, wealth distribution in many countries has become considerably more skewed in recent years.)
Rather impressively, the power-law distribution of wealth extends all the way up to the world’s richest billionaires. In 2009 the world’s richest person was Bill Gates, with a net worth of $40 billion. To put that in perspective, suppose that you made a plot of the wealth of everyone on the planet, in order from richest to poorest. If you continued the plot up to the 99th percentile, then the vertical scale of the graph would have to be around half a million dollars (this will have changed slightly since 2000). But if you wanted to contain Bill Gates, or his friend Warren Buffett, then the vertical scale would need to expand by a factor of about 80,000.

image
Bar graph the wealth distribution in Yr 2000. The top decile (10 per cent) controls 80 percent of the total wealth. Deciles 6 through 10, which represent the bottom 50 percent of the population, control about 1 per cent in total

Wealth is also of course not distributed evenly in geographical terms. In 2000 the USA and Canada together had 34 per cent of the wealth, Europe had 30 per cent, rich Asian-Pacific countries had 24 per cent, and the rest of the world including Latin America and Africa held 12 per cent. This mix is changing as countries like China, India and Brazil continue to experience explosive growth and claim a larger share of the world’s economic pie. From these data alone, one can therefore conclude that the world economy is highly asymmetric. A small number of people enjoy a huge proportion of the world’s wealth, while billions live in poverty. same kind of pattern is seen repeating itself fractally over different scales. Every city has its own local elite, as does every country or region. Tie sprawling metropolis of greater Säo Paulo, Brazil, for example, now has some 500 helicopters, more than any other city in the world. The rich find them a good way to avoid traffic jams that can extend for over a hundred miles.ll Also they’re hard to steal.

Apart from his discovery of the power-law wealth distribution, another aspect of Pareto’s work to have passed the test of time was his insistence that humans act primarily on the basis of psychological, motivations, and justify those actions on the basis of ideology. Ellie ruling elite always has a very good argument as to why it should be in charge and have most of the wealth and be flying the helicopter. Today, that argument goes by names such as the invisible hand, the efficient market, or mainstream economics.

Broken Symmetry
Adam Smith’s concept of the invisible hand is usually taken to refer to the price mechanism. However, his first use of the expression, in his 1759 work The Theory of Moral Sentiments, is on the subject of wealth distribution: ‘The rich divide with the poor the produce of all their improvements. They are led by an invisible hand to make nearly the same distribution of the necessaries of life which would have been made, had the earth been divided into equal pro- portions among all its inhabitants, and thus without intending it, without knowing it, advance the interest of the society, and afford means to the multiplication of the species.’ The invisible hand refers here not to the magic of the market, but to an early version of trickle-down economics.
Since the economy has patently failed to align itself with this happy picture, at the level of individual countries or the entire globe, one might ask what forces have created such a skewed distribution. According to Smith’s later work The Wealth of Nations (1776), free markets tend to drive prices towards ‘The natural price, or the price of free competition’. That applies to the price of labor, so it follows that an individual’s earnings should reflect the person’s inherent value to society. Efficient market theory similarly argues that markets allocate resources efficiently, and that includes wages. If Quetelet’s picture of the ‘average man’ is correct, and our abilities are randomly distributed according to a normal distribution, then one might expect wealth to be symmetrically distributed in the same way — most people would be in the middle, and there would be only a few who are very poor or very rich. The reality in most countries is obviously very different, so either our financial elites are incredibly talented, or something else is going on. One prevailing economyth is that the economy is inherently stable and at equilibrium i.e., it is symmetrical in time and so history doesn’t matter. However, there is the old saying that ‘the rich get richer’, and it certainly seems that to make a lot of money, it helps to have some in the first place.

Imagine as a thought experiment that a city-sized group of people are given a windfall of $100 each, under the condition that they must keep it invested in a rather volatile and unproductive stock market. Each person makes their own investments, with an average real return of 0 per cent and a standard deviation of 5 per cent. After one year, most people’s nest eggs will be in the range $90 to $110, and will be distributed according to the bell curve with a peak at 100 and a standard deviation of 5. As time goes on, though, the distribution becomes increasingly skewed. If we follow the worth of the investments as they are passed down through generations for 150 years (about the age of economics), then the resulting wealth distribution looks like a figure, which is quite similar to the actual wealth distribution in above figure. Obviously this is not a serious model of how wealth changes with time. It only tracks the value of imaginary investment port- folios, and ignores other kinds of economic transactions (more realistic agent-based models can be constructed, if desired). However, it does demonstrate the simple fact that, left to their own devices, investments will tend to concentrate themselves in fewer and fewer hands. To use the physics term, it is an example of symmetry breakings At the start of the simulation, everything is perfectly symmetrical. Each person has exactly the same initial amount of money. also have identical chances of success with their investments -— no one is assumed to be more talented at picking stocks, But over a period of time, some start to pull ahead of the pack reason is that there is a positive feedback effect at work A person whose sum has grown already from the initial $100 to $1,000 can hope to make another $I00 in the coming year. They might instead lose that much, but at least they have the opportunity, Someone whose savings fund has shrunk to SIO can only hope to make another dollar.
As the simulation is run for more years, the wealth becomes increasingly concentrated, until eventually only a few people are left gambling with the entire wealth of the community. If a person were born at random into such a population, their chance of being in the elite would be negligibly small. So even though the laws that govern this toy economy are symmetrical and non-discriminatory, the system tends to evolve towards an increasingly skewed state. Time matters.

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Machiavellian Wisdom

Most controversial and misunderstood author of 15th century ambassador and statesman is Machiavelli. Even though his concepts are ethically divisive, for common good and safety of citizens some are inevitable but the cruelty is still debatable. One example is the North Korean case where the accusation is the state has master-minded the assassination of current leader’s step-brother. In Machiavellian ethics, it may be allowed but the cruelty and atrocity in my opinion is still unacceptable – may be a middle ground is to devise ways that removes total threat and incapacitates that threat whatsoever without any harm to both the country and the individual – is what needed than total eradication but in extremes where annihilation if perpetrated by an individual as in cases of terrorism requires a befitting reply in similar kind to protect innocents – no doubt there.
Philip Bobbitt argues in his book ‘The Garments of Court and Palace’ about the general misunderstandings of Machiavelli’s masterpieces in the light that he was the first to foresee the advent of republic from monarchial to fiduciary to constitutional democracy as an evolvement to princely states to a modern era country-hood hinged on republican values.

Some excerpts:

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Princely Morality of State

  1. It is the nature of man that he’ll behave badly in order to get what he wants
  2. As a consequence, sometimes this will create a situation in which necessity – the necessity of preserving the sate – requires that a prince depart from the customary virtues in order to to cope with adversaries who are deceitful, greedy,n etc.
  3. Therefore, it is a prudent rule that the prince who governs a state must do unto others as they would do unto him.

Imagine you wish to train yourself to be poker player.Part of the training must be learning all the trick of the cardsharp, dealing from the bottom of the deck, palming a card, marking a deck, etc. You must learn these things so you can spot them when someone is trying to cheat you. But must you practice these tricks yourself? I suppose it depends on how good your game is, and whether the person with whom you are playing will enforce the rules once you have exposed the cheat. To the question. ‘Must it be this way? Can’t we do better?, the answer does not lies entirely within your power.

It is instructive that Machiavelli was thoroughly honest in his public service and dealings. When accused of corruption by jealous courtiers, an investigation cleared him of all charges. And despite the fact that he was chronically underpaid. There’s something appealing, to the present world about the misleading portrait of Machiavelli to which we are accustomed. It is consistent with our current contempt for bureaucrats, for politicians, for lawyers – the superstitious reaction of people who are frightened by the forces that they identify with those who are trying to master those forces, rather like blaming a volcanologists for a volcano eruption. Perhaps it was always so, at least since the birth of state that gave us the bureaucrats, lawyers and politicians that are its creation.

Statecraft as Stagecraft

The idea that the perception of a prince’s acts and qualities are an important elements in his ability to govern is a persistent and subtle theme of Machiavelli’s. In other words, the promises that the obligations of love impose on others, on which we rely, can always be unilaterally broken, because we can always break the commitments love exact from us without the consent of the loved one.
by contrast, the fear and dread imposed by another person, a person with power to execute his threats, creates habits and responses it is not in our power to dissolve unilaterally

The book also addresses the dichotomies like:

  1. The Prince is mirror book
  2. The Prince advocates autocracy, while The Discourses endorses a republican form of government
  3. The Prince separates ethics from politics
  4. Machiavelli both asserts and contradicts the claim that man can control his fate
  5. The Prince, with its flamboyant exhortation to liberate Italy, is a dramatic departure from the rest of the book

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A wise and enlightening read on politics and its machinations. Staying in power and doing good and reining the masses to ensure goodness should prevail in spite of human tendencies to topple, wreak havoc and endanger welfare schemes – requires a thoughtful study of masters to adopt a humane yet powerful approach to statecraft that embodies common and progressive goodness at heart while providing stability and growth for a nation especially at its infancy from a 3rd world to an advanced nation.

How “Holacracy” can help your organization now?

Brian J. Robertson crafts a wonderful management style that removes politics and decentralizes power that it empowers all in the game and ultimately make the organization agile, true to agile methodologies in software development. This book details the whole system and advices how to organize the teams and rules to play by a organization by Holacracy. There’s section which enlists the takeaways that you can still apply in non-Holacarcy organizations. The advice for those who aren’t able or ready to fully adopt Holacracy falls into four categories:

  1. Change your language, change your culture
  2. Rewrite your role descriptions
  3. Work on your organization,not just in it
  4. Streamline your meetings

Change Your Language, Change your Culture

Language is commonly seen as the verbal expression of culture, but language can also create culture. Try adopting some of these terms in your daily communications with your team and see how it changes your experience of working together.
Tensions and Tensions Processing:
Try replacing the language of “problems” and “solutions” with “tensions” and “proposals”. “Tension” in Holacracy, is a neutral term that simply means the feeling of a specific gap between current reality and a sensed potential. A tension is not a problem and it doesn’t necessarily need a solution; rather it points to an opportunity to move the way things are in present moment a little closer to the what things could be – which is usually a change for the better. To handle tension is by processing it.
Proposals rather than Problems:
Next shift is the habit of offering “Proposals” rather than just lamentations, when you feel a tension, take the next step, and ask yourself, “what would improve the situation? what could I propose?. Encourage your team to do the same. Proposal need not be perfect solution – it’s a way to start the conversation from a proactive, creative place, rather than the a negative one.
Any Objections?:
The next time you find yourself seeking buy-in from your tem around a decision, experiment with changing the way you communicate. Don;t ask, “Does everyone agree?” or “Does everyone like my proposal?” Those questions set you up for a long and tedious discussions. Instead ask, “Does anyone see any objections to this proposal?” and define an objection as “ a reason why this proposal would cause harm, or move us backward”. Another way to phrase the question would be “Does anyone see any reason why this isn’t safe enough to try, knowing we can revisit the decision if it doesn’t work?”.
Roles versus People:
When you’re assigning actions or projects to a member of your team, try referring to these actions or projects as being assigned to the particular role that person is filling. This helps to decouple the often fused “role and soul” and this to defuse the tensions that sometimes arise out of that conflation
Dynamic Steering:
Use a language that’s helpful in shifting your team from a ‘predict-and-control’ mindset to one that is more responsive and adaptable, with less analysis-paralysis. It is akin to naturally riding a bicycle allowing for some ‘weave and shift’ due course rather than riding it in a rigid manner and going nowhere. When we become attached to specific predicted outcome, there’s a risk we will get stuck fighting reality when it doesn’t conform to our prediction. If we find that we are not on the path we set out for ourselves, we may conclude, sometimes subconsciously, that something must be wrong. That judgement of reality inhibits our ability to respond, and encourages us to push against the unwelcome truth – to try to force reality to conform to our predicted vision. That’s not a very effective strategy for navigating the ever-changing complexity of business today. When reality conflicts with our best-laid plans, reality usually wins.

Rewrite Your Role Descriptions

Role is not a person, and one person can – and probably does – fill several roles. Differentiating these roles and the accountabilities they carry can go a long way toward making expectations explicit and avoiding treading on other people’s toes. Roles in Holacracy are dynamic, living things that change over time. Unlike traditional job descriptions, which are often vague, theoretical and soon outdated, Holacracy role definitions are based on the reality of what activities are experienced as useful in the organization, and they stay in sync with evolving reality. Holacracy’s governance process allows for continual clarification and refinement pf roles on the basis of actual tensions.

SAMPLE ROLE DEFINTION

Every role can have a purpose, domains and accountabilities

Role:

    Marketing

Purpose:

     Lots of buzz about our company and its services

Domains:

  • The company’s mailing list and social media accounts
  • Content on the company’s public website

Accountabilities:

  • Building relationships with potential customers in target markets defined by the Marketing Strategy role
  • Promoting and highlighting the organization’s services to potential customers via the web and social media channels
  • Triaging speaking invitations and other PR opportunities sent to the organization, and routing good opportunities to the Spokesperson role

Work on your organization,not just in it

Just don;t work in a organization but start working on it. One opportunity to start with is clearly defining your role and that of your team members. Another approach is to encourage your colleagues to ask themselves, “What would I do if this were my business?”

Streamline your meetings

Check-in and Closing rounds:
These can be easily added to the beginning and end of almost any meeting. their purpose is simple: the check-in round allows all present to notice and share whatever is on their minds that might be distracting them, so that the team is more present and focused, ready to move on to business at hand, while the closing round gives each person an opportunity to share reflections about the meeting. Just remember, in both rounds, people speak one at a time, with no discussion or response allowed. This is essential, to avoid your meetings devolving into personal discussions and to create a “safe space” for people to open up.

On-the-Fly Agenda Building:
Rather than going through a preset list of items that you think you should talk about, try driving your meetings with agenda built on the fly, in the meeting. This limits the agenda to items that someone feels enough tension about to bring up right then and there, and thus ensures that anything you spend time on is actually worth it, at least to someone.

The “What Do You Need?” Approach:
When dealing with an agenda item raised by a team member, it’s always helpful to start with the question “What do you need?”. This keeps the discussion focused on resolving the issue at hand.  It also helps to remind everyone that the only goal is to satisfy the person who raised the issue, without being diverted into other people’s related concerns. You’ll know you’re ready to move on when the person wo added the agenda item can answer yes to the question “Do you have what you need?”, even if other person aren’t satisfied. Their concerns can be dealt with as separate agenda item if necessary-which leads to the next element you may find useful.

One Tension at a Time:
This simple rule works wonders for streamlining a meeting and keeping it on track. It’s all too easy to start off addressing one issue, then find yourselves diverted by a half dozen related concerns, as everyone piles pet peeves on top of the original tension. The result is usually unsatisfactory for everyone, as often not much gets effectively resolved.

Integrated Decision Making:
This is a format that allows collaborative decision making

The Key to the Gate

This guide by EksAyn Aaron Anderson is very practical and noteworthy to emulate.

For most of the CEOs, gatekeepers like personal secretaries and receptionists guard access. It is their job to keep those barriers and filter who is worthy of the decision maker’s time. With the gatekeeper, your goal is to positively differentiate yourself. While the gatekeeper holds the key to gate and then beyond to the decision maker. You need to leave a positive, memorable impression that lets you stand out from all other salespeople that contact him each day. The distinguishing factors come when you act with solid principles: treat everyone with respect and as a friend, act with integrity, and be genuine and gracious. Some of the principles listed here:

Aim High:
Water flows downhill-so does influence. Sell to the people who can actually make decisions: Research and find the real decision maker and the gatekeepers

It’s a Process and not an event:
Getting an appointment is not an event, it is a process and you may or may not get the appointment at first call or after few rejections, the key is to try al possible ways

Treat Gatekeepers like Gold:
Acknowledging and recognizing a gatekeepers effectively is a three step process:

  1. Find something that you can honestly and sincerely compliment her on
  2. Write a note to the decision maker or boss
  3. Copy the gatekeeper on the email
    The principle of recognizing others is timeless. Again be sincere and honest. Most gatekeepers of high –level executives ate professional, helpful and polite – that’s why they are gatekeepers of high-level people. There may be times when you may chose not to compliment a gatekeepers when his/her conduct did not merit it.

Jujitsu Emails:
Jujitsu is an ancient Japanese fighting technique that uses skill to outmaneuvered the opponent. It is the art of using people’s weight and momentum against them. If II  am 150 pounds, and a 300 pounds solid guy is charging me, the outcome doesn’t look very promising for me. However, if I can use his 330 pounds of force against him by tripping him or getting out of the way of his momentum where he can’t stop, I can use my smallness to my advantage and his bigness to his disadvantage. The same principle can be applied to emails. As you start with the top person emailing, it is better to follow up with the gatekeeper and enquire on it. if the gatekeeper suggests to talk to a lower level, as her send that email to recommended person and copy you or alternatively you can do as well keeping the top level and gatekeeper in loop. this carries more weightage on the recommended person to act.

Chase and Dance:
Best salespeople are the best salespeople because they act nothing like a stereotypical salesperson. They act real, honest human – like a friend – who just wants to help. They are willing to admit that they may not have all the answers, their product may not be a fit, etc. They are willing to step back, remove the pressure and create space. They are conscious to reflect the tone and intensity level of the gatekeeper.

Chase:

  1. Gatekeeper: I think that we already have a product that oes what you’re selling. I don’t thnk we need your product. (stepping back)
  2. Salesperson: But I don’t think you understand how good our product really is. It beats the competition, It’s awesome. I really want to talk to mike so he can see how much money he is wasting using your current product. (steps in again and pushes).
  3. Gatekeeper: Like I said, I think that what we have works just fine (Stepping back and starting to run)

Dance:

  1. Gatekeeper: I think that we already have a product that oes what you’re selling. I don’t think we need your product. (stepping back)
  2. Salesperson: Great. Maybe you’re right. Maybe our product isn’t for you. We don’t want you to do business with us unless it is good for you. That’s why I wanted to talk to Mike. I wanted to find out his needs and the needs of your organization, and then let him know what we offer and see if there’s a fit. If there is a fit, great. If not, no big deal. (mirrors the emotion the gatekeeper shows of “we don’t need you”. Notice that the salesperson doesn’t “need” the sale either. This is mirrored emotion while stepping back.)
  3. Gatekeeper: I might be able to squeeze you in week after next (stepping in)

Chase:

  1. Gatekeeper: He is not gong to be able to meet with you for few weeks. We have quarterly numbers to do plus prepare for an annual conference (Stepping back)
  2. Salesperson: Well, I am only going to be in your area on those days. Is there any way to squeeze me in? Plus, of he likes our product he will need to take advantage of it very soon or he will miss out on our current promotion. (steps in and pushes)
  3. Gatekeeper: Sorry, it isn’t going to work this month. (Stepping back and holding onto her position)

Dance:

  1. Gatekeeper: He is not gong to be able to meet with you for few weeks. We have quarterly numbers to do plus prepare for an annual conference (Stepping back)
  2. Salesperson: Perfect. That is fine. I’m very busy myself. Whether it is now or next month, no big deal. Take your time (Mirrors the emotion and steps back too)
  3. Gatekeeper: Great. I will set up for the first week of next month. However, if things change, it might work for me to get in a bit earlier. I will let you know. (Stepping in)
  4. Salesperson: Perfect. If he can meet earlier, I will try to accommodate his schedule. (Mirrors the emotion and steps in, too.)

The Art of Getting Your Way:

Diplomacy is the art of letting others have your way – Daniel Vare. The principles here are:

  1. Listen more. You have two ears and one mouth
  2. Aim to understand others first

A Negotiation Example:

  1. My friend asked me to help in the purchase/negotiation of a car. In car dealership, after test driving a mustang, I made sure to mention the car was good and we are serious.
  2. I told the salesperson that we would need a great price for the car. “What o you need”? replied the salesperson (this was his way of asking me to name my position first). What If I said him, “I need $3000 off of the price?” Why could that be a compromising position? Because he may be willing to come down more than just $3000. What if he is willing to discount $4000 or $5000 from the sticker price. I stood my ground using a simple two step process: Compliment and Turn it around and ask a question
  3. My response: Great question, how low can you go? (maintaining control by asking another question. Notice I didn’t answer his question at all)
  4. The salesman replied, “I can o back to my boss an ask him how low he can go? but what do you need? (he was gain asking me ti name the position)
  5. Wow you’re a great negotiator. I still need you to go to your boss and ask him how low can he go? (this went on further and I didn’t name mine and answered all questions diplomatically and politely and calmly. It went on for few minutes before the salesman went to ask his boss)
  6. He came back with an answer: $246000. (that was $3000 from the sticker price)
  7. I replied “That’s trouble”
  8. Salesperson said, “we can do for $20600” (Much of what we say we do not say with words but with our body language and tone of voice).
  9. We walked towards the door, then a plea came that we do it for $19600

In the example above, we used negotiation principles by not naming our position first, and we used positive reinforcement by appreciating the gatekeeper for moving us in the direction of a sale. This could be applied in any negotiation situation.

Assumptive Questions:

During any negotiation, the way you ask questions is crucial and can mean the difference between getting the appointment/sale or not. It is imperative to speak confidently when asking for the appointment. Timid questions are asked in Yes/No format and is to be avoided. Confident salespeople phrase their questions confidently and assumptively as if the person has already said yes!?
Assumptive questions are just that – assumptive. You don’t ask if you can meet with her, you ask when. When it comes time to ask for the appointment, a confident and successful salesperson does not say, “So can I get an appointment with Mark?” Notice that this is yes/no question and easily opens up the door for the reply to be no. If you have done all the ground work, you have a right t ask the question assumptive. Being too assumptive may lead you to be deemed pushy!!.

Yes/No question: Can I get an appointment?
Powerful/Assumptive Question: Thanks for helping me out. Does this week or next week work for Tim? or What time works best so I can accommodate his schedule?

Augustus Caesar–The First Emperor of Rome

I had the opportunity earlier to read the biopic on Julius Caesar by same author and this is a great follow on. Of course Cicero’s biography (which I also read) lends interest to know more about Augustus – as to what happened aftermath to Caesar elder’s assassination. And this book throws a good light on the story of what happened leading to Augustus takeover. The triumvir – Lepidus, Antony and Augustus ruled Rome in the immediate aftermath of brutal murder of Julius Caesar. How Augustus out manoeuvred and luck helped Augustus is the story and how in later years he judiciously administered his kingdom till his seventies – recaptured by Adrian Goldsworthy is a fantastic historic page-turner. Some thing to remember – jotted for posterity from the book…

  • Proscriptions, mass murder, rule by force and coercion were the rules for civil war era of Rome after Julius Caesar’s attempt to be a dictator – slowly the Rome was descending from democracy to dictatorship – as it wasn’t working well as before.
  • Augustus married Scribonia – Antony’s daughter to maintain the triumvir intact but he divorced her to take another senator’s wife Livia. His only daughter Julia was born to Scribonia.
  • Jesus was born during his reign of Rome and surrounding provinces which include Judea
  • Agrippa was the second hand man and loyal to Augustus – a great coliseum still stands under his name in Rome – An able administrator and warrior, built numerous structures in the 30 – 20 BC during Augustus reign. He married Augustus daughter Julia and had 2 sons who died in battle campaigns
  • Augustus depended on Livia’s son (from an earlier marriage) Tiberius as his heir but only to abandon all duties and to go on exile due to unresolvable differences and was out of the kingdom for a decade, meanwhile Augustus was eagerly waiting for the two grandsons – Caius and Lucius (sons of Agrippa) to come of age and take over the kingdom in future. They too perished.
  • Augustus again recalled Tiberius to announce him as his heir and he died in his 70s when Tiberius assumed power smoothly
  • Virgil created Aeneid – masterpiece in Latin – to be preserved for centuries – similar to Homer’s Iliad
  • Mausoleum of Augustus, The Temple of Divine Julius, The Curia Julia (senate house – converted to church), The Forum Romanum, The Rostra (speaker’s forum), The Arca Pacis (Altar of Peace), The Pantheon of Agrippa – were the testimonials whose remains and in some cases in full – remind us of the roman glory of Augustus

It’s one of cruelty, deception, intrigue and force to get hold of power and the other to maintain the supremacy with benevolence and greater good to citizens. I believe Augustus achieved both in his time to be named the first emperor but good for emulation for successors in olden days, I think we need a person like Augustus to bring order from chaos and rule the state and bring same benefits under the democratic system is a must. We have seen so many examples to emulate but time has to dawn for that to happen in various places to make citizens happy, safe, solid and progressive!

Age must bring composure, calmness, mental fortitude and benevolence and that too a king having this and becoming an emperor is a feat and Augustus tread this path to attain greatness given his long illustrious life to create the Roman dynasty only to be reinstated of similar glory by Marcus Aurelius – that’s my observation. Well in modern days, dynasty happens albeit with democracy where people elect heirs but American Presidential system is preferred to stop one person to hold power for very long, this long tenure is not good unless we get ruler’s like Augustus or Marcus – a rare in rarity.

Office Politics–how to thrive in a world of lying, backstabbing and dirty tricks

Oliver James has done a good piece to help office goers. People who cause more harm in work fall under traits involving Psychopathy, Machiavellianism or Narcissism. Rate the following traits from 1 to 5 from strongly disagree to strongly agree.

  1. Tend to exploit and trick others for self-advancement
  2. Use lies and deception to get their way
  3. Use ingratiation to get their way
  4. Manipulate others for selfish reasons
  5. Tend not to feel regretful and apologetic after having done wrong
  6. Tend not to worry about whether their behavior is ethical
  7. Lacking empathy and crassly unaware of the distress they cause others
  8. Have pretty dim view of humanity, attributing nasty motives and selfishness
  9. Be hungry for admiration
  10. Want to be center of attention
  11. tend to take it for granted that other people will make extra effort to help them’

More than 25 out of max 60 fall in any one above categories and they abound in our office environment. So you need to cultivate a couple of strategies to overcome and thrive in office politics:

  1. The importance of acting: Simulate appropriate emotions and be adept at office politics with less emotional labor
  2. Astuteness: Have the radar to pick signals early and react accordingly to situations. Understand innate needs, roadblocks and solve them for your colleagues and bosses.
  3. Ingratiation: if you need something from someone, make them feel good, they are more likely give you what you want.
  4. Chameleonism: It is the mirroring of another’s mannerisms or speech pattern back to them, and in most cases, whatever ingratiatory tactic is employed, be it flattery, charm or some kind of inducement )professional or personal) a measure of chameleonism is usually essential. It could be applied in any situation, a boss to subordinate or the reverse.  To have a friendly minutes with them is a good strategy towards that. Chit chat after office hours, letting them talk more with open ended questions, participating in their talk is good.
  5. Flattery: You have to find something about the other person that genuinely admire, the it sounds likely to be more true than deliberate which may lead to your downfall.
  6. Favor Rendering: A simple and fundamental ingratiation method is to do favors for colleagues, actions that help them which are not required as part of your role (‘favor-rendering).
  7. Assertiveness: This entails actions like making demands, setting deadlines and checking up on others. Being assertive indicates that you are not prepared to back down and that you understand alternative views, but are not swayed by them. The astute are better able to read with whom to be assertive, when and where. Most of the risk attached to assertiveness is when it is attempted with superiors insisting on your position with a a boss is unwise if it is clear that, however they may be, they have decided on the course they are going to take. Whilst it may be strategically sensible tin the long run to have registered your opposition to a plan, so that if it goes wrong, there is a record that you showed your disagreement, that is all assertiveness may be able to achieve.
  8. Self-promotion: skillfully executed self-promotion produces admiration and higher valuation by bosses. What I more there are risks attached to not doing it: your worth may be underestimated because it is unnoticed. Make sure it doesn’t run into risk of seeming boastfulness.
  9. Feedback seeking, reputation building and networking also to be pursued.