Once there was a rich man who had a very big and beautiful house. He was living a luxurious life. Despite having enormous wealth, he wanted to acquire even more wealth. He had an unquenchable thirst for wealth. His desire for making more money made him restless. He started living a very distressed life. One day a monk visited a place where he was living. The rich man offered him shelter and served delicious food to him. When the monk was about to leave, the rich man uttered his problem to him. Out of compassion, he handed over four lamps to him to solve the problem. The direction and a number were written on each lamp. Whenever you need money, light the lamp and start going in the direction written on the lamp. Start digging the place where the lamp was extinguished and you will find enormous wealth. He advised him not to light the fourth lamp. The monk left the palace after giving the instructions. Desperate for money, he immediately lights the first lamp and starts moving in the direction written on the lamp. The lamp extinguished in the deep forest. He started digging the place and found a pot full of gold and silver coins. He became very happy. He repeated the same with the second and the third lamp. He found even more wealth in those places as directed by the monk. He thought the fourth lamp paved the way for even more wealth but the monk wanted to keep that wealth for himself. He lit the fourth lamp and started moving in the direction written on the lamp. The lamp extinguished at the isolated and deserted place. He dug up the place and found the stairs giving way to an entrance gate. He went down the stairs and opened the gate. His eyes were delighted by seeing the breathtaking palace full of magnificent items. The palace contained many rooms. As he opened the first room, he found that the room is full of diamond jewelry. He started dancing in joy. Suddenly, he heard a strange voice emanating from one of the rooms. When he opened the room, he found an old man grinding the mill. "What are you doing?", told the rich man to an old man. The old man replied, "Please come here and grind it. I need some rest." The rich man started grinding the mill. The old man laughed loudly. "Why are you laughing like a mad man", asked the rich man to an old man. He replied, "Now I am a free man. I came here due to the fourth lamp handed over to me by an old monk." The rich man became terrified and stopped grinding the mill. The old man instructed him not to do this otherwise the palace will collapse and he will be buried under it. You have to keep grinding the mill until a greedy man like you comes here and takes your place.
The story has many useful insights.
Always listen to the elders especially to your parents to avoid the mistakes they did earlier in their life. Spend more time in their company. Their mistakes become your source of wisdom to navigate the unknown territory of life. The presence of white hairs on their head indicates their wisdom. The deep experiences of their life have enriched their soul. Learn from them.
While pursuing a goal, know when to stop. One must have the wisdom to discern when to back off. Otherwise, one keeps on moving in circles and goes nowhere.
Avoid bad qualities like greed, lust, anger, close-mindedness, etc. to live a serene and blissful life. No matter how good we are in others of life. Unless we work in these areas, we remain unsuccessful in our personal as well as professional lives.
Avoid situations in life where the impact of one thing going wrong will wipe you out of the equation of life. Avoid the single point of failure. It gives rise to a mental model known as multiplying by zero. The events that will massively impact life are called black swan events. Stay away from the negative black swan events like debt, a bad marriage, a flamboyant lifestyle, etc.
Multiplying by zero is a useful tool for system thinking. A system is composed of various components which are interacting with each other. The strength of any system depends upon its weakest link. When the consequences are high, appropriate measures need to be taken to avoid failures. These parts are interacting with each other to determine the quality of the life. The multiplication describes the properties of the numbers. For example, 2*3 means the addition of 2 three times(2+2+2) or the addition of 3 two times(3+3). Similarly, 0*3 means the addition of 0 three times(0+0+0) or the addition of 3 zero times. It doesn't matter how big the numbers are, if multiplied by zero, they nullify everything.
To understand it clearly, let's consider the example of life. Life is a system that is composed of components like health, wealth, spirituality, relationships, and professional work that earns bread and butter. Good health helps us to appreciate the things we have, wealth gives a freedom to pursue whatever we like, spirituality makes us silent, peaceful, and blissful, good relationships increase the sense of worth and belonging, and are one of the key components of happiness, Professional work and the unique skill sets we possess makes us financially independent. If any of the above components are missing from life, it reduces the value of life to 0.
Systems thinking is a discipline for seeing wholes. It is a framework for seeing interrelationships rather than things, for seeing ‘patterns of change’ rather than ‘static snapshots. Peter Senge
Extending the idea of multiplying by zero to other areas gives us better insights. Consider the case of a restaurant that is located in an amazing place that has outstanding aesthetics full of dim lights, romantic music with a wonderful ambiance, and humble waiters to greet you but if the cuisine they are serving is not good will nullify the effect of the rest of the components. Bad food cannot be compensated for the other factors. However, other factors like slow service can be compensated for good food. Identify the most critical component in the system and try to increase its value as much as possible.
A company that has good branding, useful product, and outstanding service but if the CEO made a racist remark will bring down everything. Similarly, in a competitive team if any one of the team members is constantly complaining will bring down the morale of the rest of the team members. The two key ideas to keep in mind while applying the mental model of multiplying by zero to any system is:
Identify the critical component in the system that is acting as zero for the entire system.
Find out a way to convert the value of a component from zero to one.
History teaches us a lot. The study of history makes us smarter by learning from the mistakes of others. An East German theft is an excellent example that demonstrates the idea of multiplying by zero. After the cold war, East Germany wanted to be at the top of cutting-edge technology. They wanted to build an indigenous computer. The computer was a critical technology that give them an edge over their competitors. Despite their best intentions, they created a culture within their country that suppresses innovation and creativity.
They squandered a large amount of money to import the embargoed goods from other countries. They even sent their spies to other countries to steal information necessary for building indigenous computers. They were not letting their scientists attend conferences happening in other countries due to security reasons. Their scientists were not getting enough exposure to build the niche technology. Even if they imported the embargoed components from other countries, they don't know how to troubleshoot them in case of failures.
The East Germans knew how to operate the components but didn't know the basic principles that make them work. They were not thinking from the first principles. They were dependent on clone technology. They weren't building anything on their own. No industry can become a leader by relying on cloned technology. Research happened in a collaborative environment. The East German system to build a computer has multiple components like sending spies to steal information from enemy countries, spending huge amounts of money to buy embargoed products, and providing support to their scientists. Despite all their efforts, they won't be able to build the indigenous computer.
They missed the important component known as innovation in their system. They spent enormous effort on improving the other components but overlooked the innovation. Innovation can't happen out of thin air. History has shown that people fail dozen times before becoming successful. One must have the historical knowledge to test their own hypothesis and keep on refining it unless one becomes successful. They need the necessary expertise to rely upon if anything goes wrong. If they collaborated with others, they might be able to successfully build the computer.
Learning and Innovation go hand in hand. The arrogance of success is to think that what you did yesterday will be sufficient for tomorrow. William Pollard
Crop diversity is the variety and variability of crops and plants used in agriculture including their genetic and phenotypic characteristics. In Ireland, people were dependent on potatoes for their survival. It became a staple food for them. The potatoes which were planted in Ireland lacked genetic variation. Along with that, they were from the same species. All the potatoes were clones of each other. In 1845, a fungus affecting potato plants spread across the country. Since the plants lacked variability, the entire crops got destroyed. The majority of the population lacked their main source of food for up to five years.
Never put all the eggs in one basket. The food equation of Irish people consists of only potatoes. The failure in the production of potatoes put the lives of the Irish people at risk. The better approach is to put multiple crops in their food equation. It changes the multiplicative equation into an additive equation. If one of the crops get extinct, they can rely on other crops for their survival. Diversity in skills is the mantra for survival.
You must be diversified enough to survive bad times or bad luck so that skill and good processes can have the chance to pay off over the long term. Joel Greenblatt
Sometimes we are so engrossed in improving one part of the system that we fail to take into consideration the whole picture. For example, fragile health is the weakest component of a person. He started doing exercise to improve his health. The intensity of an exercise varies from person to person. If he expends too much energy on exercise then less energy is available to carry out the other tasks which will bring the entire equation down. Sustainable development is the motto to perform optimally. Once the weakest link is identified then make incremental progress to overcome the weakness. Don't hurt yourself by doing too much.
In some cases, the components aren't putting the entire system down but reduce the efficiency of a system. These are known as bottlenecks. As the neck of the bottle puts a limit on the amount of water that can flow through it. Similarly, the bottleneck in the system limits the delivery of output. If the CEO of a company is not delegating the power of decision-making to others then most of the resources in an organization will remain idle until the command is given to them. Bottlenecks are those people that make other people wait.
The entire bottleneck concept is not geared to decrease operating expenses, it’s focused on increasing throughput. Eliyahu M. Goldratt
A bottleneck can also be a part of the system that is under the maximum strain. Improving the areas other than bottleneck is not going to improve the efficiency of a system. The way to deal with the bottleneck is to allocate additional resources to balance the load. Sometimes we need to rethink the whole system in a new way to make it better and more efficient.
A constraint is the fundamental limitation of a system whereas a bottleneck is a part of a system that can be alleviated. A day has twenty-four hours is an example of a constraint whereas a machine that keeps on breaking is an example of a bottleneck. When improvement is made upon the worst part of the system then some other part of the system will become the new bottleneck. No matter what one does, there will always be a bottleneck present in the system. Always make an effort to shift the bottleneck to the less disruptive state.
While solving the problem of bottlenecks one has to ensure that the worst problems will not be created in the future. Be vigilant about the situations that will solve the short-term problems but create long-term problems down the line. Once a company was not meeting its required production quota. The company's manager went to the production line to find the root cause of the problem. His keen eye found that cheaper thread kept on breaking while sewing. To save 30 cents on the thread, the company was losing 300 dollars per hour. The degradation in the quality of the product will move problems in the future. Cure the disease rather than the symptoms. Strike on the root cause to improve the efficiency of a system.
The human brain evolved to protect its energy. Humans have a weird habit of not changing themselves unless no change becomes the least comfortable option. Humans resist change because it takes enormous energy to overcome inertia. New ideas came to our minds when we are faced with challenges. Thus, bottlenecks foster innovation.
Most of the products we are using these days are invented during wartime. Initially, America was dependent on Japan for the production of silk. Silk was used as a parachute fabric, Army combat helmet, artillery gunpowder bags, etc. When tension broke out between the two nations, America was forced to think about the substitute that led to the discovery of Nylon. Nylon is known as artificial silk whose properties are far better than natural silk.
Rubber is considered an essential war material because it is used in making tires for aircraft, tanks, and other vehicles. Initially, America was relying on Asia for the production of rubber. Due to the rising tensions, America was forced to think about substitutes which led to the discovery of synthetic rubber known as Ameripol. It is more cost-effective than natural rubber.
The impediment to an action always advances an action. Marcus Aurelius
In world war 1, many people were malnourished due to food rationing. Inadequate nutrients led to the development of rickets in soldiers and children. Rickets causes soft bones due to a lack of Vitamin D in the body. Doctors were forced to find out the solution to a problem. The German pediatrician Kurt Huldschinsky discovered that patients suffering from rickets when exposed to ultraviolet lamps recovered from the disease. The ultraviolet lamp simulates sunlight which prompts the body to produce Vitamin D thereby curing rickets. Now ultraviolet lamp is used to cure various skin diseases.
The best way to avoid system failure is to incorporate redundancy for the critical components in the system. Mother nature teaches us a lot about redundancy. Humans have two eyes, two ears, two lungs, and two kidneys to ensure that if one of them will fail then the other one can take over and the human will still survive. Some organisms give birth to millions of offspring in the hope that some of them will survive and pass on their genes to the next generation.
Redundancy is well-known in the field of engineering. Aircraft has multiple engines so that the other one will take over in case of failure. Big companies like Google, Amazon, Facebook, etc. have multiple data centers spread across the continents so that the damage is recoverable in case of any disaster. Redundancy plays an important role in the financial world. Always keep six to eight months of expenses in liquid amount or in terms of fixed deposit to deal with an emergency. Avoid debt because it not only makes you fragile but also hampers your ability to deal with unexpected storms.
Adding additional components to the system increases complexity. Most of the time, additional components remain idle and consume resources. For naive persons, redundancy seems like a waste of resources. Sometimes redundancy outweighs the risks compared to the benefits. In 1996, a safety device in the fermi reactor broke off which blocked the pipe that carries the coolant to the reactor core. Luckily, the reactor was not active at that time.
Redundancy or Safety measures can backfire sometimes. Multilane highways are designed by the government to prevent accidents. Seat belts, Airbags, Anti-Lock Breaking systems, etc. are the recent technologies introduced inside vehicles to prevent accidents. The increase in safety measures prompts the driver to drive more rashly which makes him more prone to accidents.
Conclusion: Systems are everywhere. Find the critical components or the bottleneck that is bringing the entire system down. Take appropriate measures to reduce the impact of the bottleneck or convert the zero component to one. Diversify your skills to avoid a single point of failure. As the old proverb says, "Never put all the eggs in one basket."
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The delicacy of shedding light on such things is wondrous ✨