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    #165 William Shockley (Creator of the Electronic Age)

    en-usFebruary 01, 2021
    What invention did William Shockley lead at Bell Labs?
    How did Shockley's beliefs affect his professional relationships?
    What does 'Broken Genius' by Joel Shirkin explore?
    What mistake did Shockley make regarding product development?
    What lesson about adaptability can be learned from Shockley's story?

    Podcast Summary

    • The Tragic Tale of William Shockley: Brilliant Mind, Self-Destructive BehaviorsWilliam Shockley's life story serves as a reminder of the importance of avoiding self-destructive behaviors and learning from others' experiences to maintain success and reputation

      The life of William Shockley, a brilliant scientist and inventor, serves as a cautionary tale against self-destructive behaviors. At the height of his career, Shockley led the team at Bell Labs that created the transistor, a crucial invention that revolutionized technology and modern life. However, despite his achievements, personal and professional missteps led him to public ridicule and isolation. As Charlie Munger, a successful businessman, once said, "When people tell me they've learned from experience, I tell them the trick is to learn from other people's experience." In the case of Shockley, there are valuable lessons to be learned from his mistakes. The book "Broken Genius" by Joel Shirkin explores Shockley's life in detail, highlighting his brilliant mind and tragic downfall. At age 33, Shockley was married and had all the resources for a comfortable life. Yet, he chose to set himself up for public ridicule and lost everything, including his reputation, friends, and even his oldest friend who became his most potent enemy. This story emphasizes the importance of avoiding common pitfalls and learning from the experiences of others.

    • Shockley's personal challenges hindered his successShockley's pessimistic attitude and inability to effectively work with others hindered his success in both his personal and professional life.

      Shockley's pessimistic worldview and inability to effectively work with and relate to others were the root causes of many of the challenges he faced throughout his life, including during his time at Bell Labs and during World War 2. Despite his intelligence and confidence, Shockley had never run an organization or led a team before, and he lacked experience and self-awareness when it came to dealing with people, particularly those who were less intelligent than himself. This weakness led to strained relationships with coworkers, friends, and family, including his wife, and ultimately contributed to his tragic suicide attempt. Shockley's inability to recognize and address his deficiencies in this area proved to be a major hindrance in his personal and professional life.

    • William Shockley's War Contributions and Personal StrugglesWilliam Shockley made significant contributions to modern science and operations research during the war, but his difficult personality and inability to cope with mediocrity led to strained relationships and personal turmoil, overshadowing his finest moments.

      William Shockley's work during the war was pivotal in shaping the foundation of modern science and operations research in the US, but his personal life was marked by tragedy and conflict. He was a brilliant scientist, but his inability to cope with mediocrity and his difficult personality led to strained relationships, including with his own children. Shockley's work for the military during World War 2 earned him high praise and recognition, including the National Medal of Merit. However, his finest moments were overshadowed by his later failures and personal turmoil. Despite his contributions to the invention of the transistor, his temper and abusive behavior led to a estrangement from his colleagues and family. Ultimately, Shockley's legacy is a complex one, marked by both remarkable achievements and deeply troubling personal behavior.

    • Shockley's Ego and the Formation of Silicon ValleyShockley's significant role in the invention of the transistor was overshadowed by Bardeen and Bratain, leading to his transformation and eventual departure from Bell Labs, which paved the way for the formation of Silicon Valley.

      Shockley's role in the invention of the transistor was significant, but he felt overlooked and jealous of Bardeen and Bratain, leading to a transformation in his personality. Despite his passive involvement, he made crucial theoretical contributions and was instrumental in the team's success. However, his ego was bruised, and he wanted all the credit for himself. The team's unity was important to them, and they tried to keep it together, but Shockley's responses were bizarre and he eventually left to start his own company, leading to the formation of Silicon Valley. Shockley's appreciation for the future of technology and his understanding of entrepreneurship were ahead of his time. His limitations as a manager were recognized, and he was not promoted, leading to his dissatisfaction and eventual departure from Bell Labs.

    • The Importance of People Skills for Brilliant MindsBrilliant minds need emotional intelligence and effective communication skills to succeed. Shockley's lack of people skills hindered his personal and professional growth, while Noyce's excelled in collaboration and led to his success.

      While Shockley was a brilliant scientist, his lack of people skills hindered his personal and professional growth. His uncaring attitude towards his colleagues and family led to strained relationships and a miserable life. Despite his genius, he failed to understand the importance of learning how to connect with people. Shockley's approach to motivating people, such as using a stopwatch during interviews, was unconventional and counterproductive. Contrastingly, Bob Noyce, who Shockley recruited, excelled in people skills and collaboration, leading to his success in the tech industry. Ultimately, the importance of emotional intelligence and effective communication cannot be overstated, even for the most brilliant minds. As Andrew Carnegie wisely said, "A sunny disposition is worth more than fortune."

    • Bill Shockley's Fear of Intellectual CompetitionBill Shockley's belief in his own intelligence and unwillingness to collaborate hindered the success of his semiconductor company, despite his ability to recruit top talent.

      Bill Shockley's belief in his own intelligence and unwillingness to collaborate with his talented team members led to the downfall of his semiconductor company, despite his ability to recruit some of the brightest minds in the field. During the hiring process, Shockley gave a test to new employee Jim Gibbons, who correctly answered that 126 matches were needed to determine a winner. Shockley became agitated and accused Gibbons of having heard the problem before. This incident showcased Shockley's fear of intellectual competition and his belief that all good ideas came from him. This attitude made it impossible for him to effectively lead his team, ultimately leading to the failure of Shockley Semiconductor. Despite his impressive reputation and ability to recruit top talent, his inability to collaborate and share ideas doomed the company.

    • Shockley's focus on social science and business inexperience led to his company's failureShockley's obsession with social science and theoretical business ideas hindered his company's success, while focusing on transistors and reliable manufacturing led to Intel's eventual success

      Shockley's obsession with social science and his lack of business experience led him to make decisions that ultimately failed his company. Despite hiring a brilliant team, Shockley's insistence on building a 4-layered diode instead of focusing on transistors, his isolation from the market, and his inability to manufacture the product reliably resulted in his company never making a dollar and going out of business quickly. This decision contrasted with the growing market for transistors, which would eventually lead to the success of Intel, founded by Robert Noyce and Gordon Moore. Shockley's fixation on social science and his theoretical business ideas, developed while working for the government and Bell Labs, proved detrimental to his company's success.

    • The importance of humility and adaptability in leadershipA leader's ego and inflexibility can hinder a company's success. Embrace unexpected ideas and adapt to new innovations for optimal growth.

      A leader's ego and inflexibility can hinder a company's success, even if they believe they are the sole source of genius ideas. Shockley, a brilliant scientist, struggled to adapt when his team invented the transistor, an innovation that went against his belief in a top-down creative process. Instead of embracing their ideas, he insisted on pursuing his own vision, which led to the company's downfall. This story highlights the importance of humility, openness to feedback, and the ability to adapt in a leader, as well as the potential for innovation to come from unexpected places.

    • Shockley's Ego Hinders Shockley Semiconductor's SuccessShockley's extreme competitiveness and unwillingness to collaborate led to the formation of Fairchild Semiconductor and Intel by his former employees.

      Shockley's extreme competitiveness and controversial behavior led to a breakdown in relationships with his employees at Shockley Semiconductor. Despite the company's lack of financial success, Shockley's ego and insecurity caused him to clash with his benefactor, Beckman, and his own team. When Beckman suggested cutting expenses, Shockley responded with defiance, leading the researchers to threaten to quit. A compromise was reached, but Shockley's behavior ultimately led to the formation of Fairchild Semiconductor and later Intel by the "Traitorous 8." Shockley's inability to collaborate and his unwillingness to share the spotlight hindered the success of his own company.

    • The Traitor's 8 and the Birth of Fairchild SemiconductorThe team's departure from Shockley Semiconductor, led by Bob Noyce, resulted in the formation of Fairchild Semiconductor. Shockley's unlistening behavior drove them away, but their collaboration led to industry success.

      The story of the Traitor's 8 at Shockley Semiconductor serves as a key to understanding Shockley's life and the birth of Silicon Valley. Shockley's behavior, such as getting up and leaving when confronted with disagreements, led his team to resign and form their own company. Bob Noyce, one of the rebels, had a more rational approach to running a semiconductor company. When Shockley failed to listen to his team's concerns, they decided to work together and start their own business. Arthur Rock and Bud Coyle played crucial roles in convincing the team to form Fairchild Semiconductor. This story illustrates the importance of avoiding stupidities and learning from successful figures in industry, as Steve Jobs did with Bob Noyce. It's a reminder that taking the opposite approach to Shockley's behavior can lead to great success.

    • Leveraging the right market at the right time for successBeing in the right market at the right time with a compelling product can propel a company to success, even with imperfect teams or resources.

      The right market at the right time can propel a company to success, even if the team or product aren't perfect. Robert Noyce and Jack Kilby, co-founders of Intel, leveraged the national focus on science and technology following the Soviet Union's launch of Sputnik 1 to build a successful business. Initially, they faced competition from Shockley Semiconductor, but their product, transistors, became in high demand due to the government's prioritization of space exploration. Noyce and Kilby's success wasn't solely due to their team or product, but the market's pull that brought their product to the forefront. Additionally, having the right investors, like Arthur Rock, played a significant role in their success. The story of Intel illustrates the importance of being in the right place at the right time and the power of a strong market demand in shaping a company's trajectory.

    • Personal growth and effective teamwork are keys to successInvest in personal growth and effective teamwork for a successful life and career. Learn from those who have struggled and succeeded to build strong relationships and collaborate effectively.

      Personal growth and effective teamwork are essential for success. Shockley, despite his scientific genius, failed to recognize his interpersonal weaknesses and struggled to build a successful team. Noyce and Moore, on the other hand, continuously learned and adapted, recognizing the importance of strong relationships and effective collaboration. Rockefeller emphasized that people skills can be acquired, and investing in great managers is crucial for building a successful team. Ed Thorpe, who lived a balanced life and prioritized relationships, is a role model for a well-rounded and successful life. Shockley's inability to learn from his mistakes and his unwillingness to work with others led to a disappointing and unfulfilling life. It's important to learn from those who have come before us and strive for personal growth and effective teamwork in our own lives.

    • The cost of rigid beliefsRefusing to adapt and learn from others can lead to personal and professional downfall. Be open-minded and consider alternative perspectives.

      Rigid adherence to one's beliefs and failure to adapt or consider alternative perspectives can lead to the downfall of a company and personal relationships. This is exemplified by William Shockley, who believed he had the perfect theory of management and refused to acknowledge his mistakes or consider input from his employees. His refusal to adapt and learn from others ultimately led to the failure of his company, Fairchild Semiconductor, which went on to be the seed of Silicon Valley. Shockley's obsession with his own beliefs also extended to his beliefs about race and intelligence, which further alienated him from others and damaged his reputation. The main lesson here is the importance of being open-minded, considering alternative viewpoints, and developing strong people skills. As Jeff Bezos' grandfather wisely said, "It's harder to be kind than it is to be clever."

    • The importance of relationships in personal and professional successBeing kind and building meaningful relationships is crucial for personal and professional growth. Isolation and confrontational behavior can hinder success and limit potential impact.

      Despite having intellectual brilliance, being kind and building meaningful relationships is essential for personal and professional success. The life of Robert Noyce's rival, William Shockley, serves as a cautionary tale. Shockley's inability to connect with people, including his own children, led to missed opportunities and isolation. He demanded credit for all ideas and became confrontational when challenged, pushing away potential collaborators. Shockley's obsession with recording every detail of his life reveals a lack of joy and fulfillment. His public statements about his family were hurtful and dismissive, further isolating him. Ultimately, Shockley's broken relationships and miserable personality hindered his potential impact on the world of technology.

    • William Shockley's Reverse CharismaWilliam Shockley's intense competition and lack of warmth impacted his personal and professional relationships, highlighting the importance of emotional intelligence beyond professional success.

      The personality of William Shockley, a pioneer in the field of semiconductors, was characterized by intense competition and a lack of warmth or charisma. He saw everyone, even strangers, as competition and would race them in swimming pools. His wife, who was still alive after his death, shared that he expressed love to her only once in their 30-year marriage. Shockley's personality was described as "reverse charisma," the opposite of Robert Noyce, who was known for his charisma. Despite his significant contributions to the technology industry, Shockley's personal life and relationships were marked by a lack of emotional connection. This story serves as a reminder of the importance of empathy and emotional intelligence in addition to professional success. If you're interested in learning more about Shockley's life and the peculiar ideas about motivation in his company, consider reading the book mentioned in the podcast.

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    (1:00) America is today in the midst of a great technological revolution. With the advent of the silicon chip, information processing, and communications, the national economy have been strikingly altered. The new technology is changing how we live, how we work, how we think. The revolution didn't just happen; it was engineered by a small number of people. Collectively, they engineered Tomorrow. Foremost among them is Robert Noyce.

    (2:00) Steve Jobs on Robert Noyce: “He was one of the giants in this valley who provided the model and inspiration for everything we wanted to become. He was the ultimate inventor. The ultimate rebel. The ultimate entrepreneur.”

    (4:00) When you read biographies of people who've done great work, it's remarkable how much luck is involved. They discover what to work on as a result of a chance meeting, or by reading a book they happen to pick up. So you need to make yourself a big target for luck, and the way to do that is to be curious. Try lots of things, meet lots of people, read lots of books, ask lots of questions.  — How To Do Great Work by Paul Graham. (Founders #314)

    (7:00) Bob Noyce had a passion for the scientific grind.

    (10:00) He had a profound and baffling self-confidence.

    (15:00) They called Shockley’s personalty reverse charisma. —  Broken Genius: The Rise and Fall of William Shockley, Creator of the Electronic Age by Joel Shurkin. (Founders #165)

    (25:00) What the beginning of an industry looks like: Anywhere from 50 to 90% of the transistors produced would turn out to be defective.

    (33:00) Young engineers were giving themselves over to a new technology as if it were a religious mission.

    (41:00) Noyce's idea was that every employee should feel that he could go as far and as fast in this industry as his talent would take him. He didn't want any employee to look at the structure of Intel and see a complex set of hurdles.

    (43:00) This wasn't a corporation. It was a congregation.

    (43:00) There were sermons. At Intel everyone, Noyce included, was expected to attend sessions on "the Intel Culture." At these sessions the principles by which the company was run were spelled out and discussed.

    (45:00) If you're ambitious and hardworking, you want to be told how you're doing.

    (45:00) In Noyce's view, most of the young hotshots who were coming to work for Intel had never had the benefit of honest grades in their lives. In the late 1960s and early 1970s college faculties had been under pressure to give all students passing marks so they wouldn't have to go off to Vietnam, and they had caved in, until the entire grading system was meaningless. At Intel they would learn what measuring up meant.

    (49:00) When you are trying to convince an audience to accept a radical innovation, almost by definition the idea is so far from the status quo that many people simply cannot get their minds around it. They quickly discovered that the marketplace wasn’t just confused by the concept of the microprocessor, but was actually frightened by its implications. Many of my engineering friends scoffed at it was a gimmick. Their solution? The market had to be educated. At one point, Intel was conducting more seminars and workshops on how to use the microprocessor than the local junior collage’s total catalog of courses. Bob Noyce, Gordon Moore, and Andy Grove became part of a traveling educational roadshow. Everyone who could walk and talk became educators. It worked.  —  The Intel Trinity: How Robert Noyce, Gordon Moore, and Andy Grove Built the World's Most Important Company by Michael Malone. 

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    #355 Rare Bernard Arnault Interview

    #355 Rare Bernard Arnault Interview

    What I learned from reading The House of Arnault by Brad Stone and Angelina Rascouet. 

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    (3:00) While other politicians were content to get their information from a scattering of newspapers, he devoured whole shelves.  — Young Titan: The Making of Winston Churchill by Michael Shelden. (Founders #320)

    (7:00) Arnault had understood before anyone else that it was a true industry. — The Taste of Luxury: Bernard Arnault and the Moet-Hennessy Louis Vuitton Story by Nadege Forestier and Nazanine Ravai. (Founders #296)

    (9:00) Arnault is an iron fist in an iron glove. — The Taste of Luxury: Bernard Arnault and the Moet-Hennessy Louis Vuitton Story by Nadege Forestier and Nazanine Ravai.

    The public conception of Sam as a good ol’ country boy wearing a soft velvet glove misses the fact that there’s an iron fist within. —  Sam Walton: The Inside Story of America's Richest Man by Vance Trimble.

    (12:00) People often ask me, “When are you going to retire?” And I answer, “Retire from what?” I’ve never worked a day in my life. Everything I’ve done has been because I’ve loved doing it, because it was enthralling. — Am I Being Too Subtle?: Straight Talk From a Business Rebel by Sam Zell. (Founders #269)

    (16:00) “I am not interested in managing a clothing factory. What you need, and I would like to run, is a craftsman’s workshop, in which we would recruit the very best people in the trade, to reestablish in Paris a salon for the greatest luxury and the highest standards of workmanship. It will cost a great deal of money and entail much risk.” — Christian Dior to Marcel Boussac

    (17:00) Arnault believed that luxury brands could be larger than anyone at the time imagined.

    (20:00) Arnault said this 35 years ago: “My ten-year objective is that LVMH's leading position in the world be further strengthened in the luxury goods sector. I believe that there will be fewer and fewer brand names capable of retaining a worldwide presence and that those of our group will be among them as we will provide them with the means for growth.”

    (25:00) There are huge advantages for the early birds. When you're an early bird, there's a model that I call surfing—when a surfer gets up and catches the wave and just stays there, he can go a long, long time. But if he gets off the wave, he becomes mired in shallows. But people get long runs when they're right on the edge of the wave, whether it's Microsoft or Intel or all kinds of people, including National Cash Register. Surfing is a very powerful model.”  —  the NEW Poor Charlie's Almanack: The Wit and Wisdom of Charlie Munger. (Founders #329)

    (25:00) One thing I learned from having dinner with Charlie was the importance of getting into a great business and STAYING in it. There’s a tendency in human nature to mess up a good thing because of an inability to sit still.

    (25:00) The incredible career of Les Schwab: Les Schwab Pride In Performance: Keep It Going! by Les Schwab. (Founders #330)

    (30:00) Dior in his autobiography: It is widely, and quite erroneously, believed that when the house of Christian Dior was launched, enormous sums were spent on publicity: on the contrary in our first modest budget not a single penny was allotted to it. I trusted to the quality of my dresses to get Christian Dior talked about. Moreover, the relative secrecy in which I chose to work aroused a positive whispering campaign, which was excellent (free) propaganda. Gossip, malicious rumours even, are worth more than the most expensive publicity campaign in the world.

    (31:00) Munger: “There are actually businesses that you will find a few times in a lifetime, where any manager could raise the return enormously just by raising prices-and yet they haven't done it. So they have huge untapped pricing power that they're not using. That is the ultimate no-brainer. Disney found that it could raise those prices a lot and the attendance stayed right up. So a lot of the great record of Eisner and Wells came from just raising prices at Disneyland and Disneyworld and through video cassette sales of classic animated movies. At Berkshire Hathaway, Warren and I raised the prices of See's candy a little faster than others might have. And, of course, we invested in Coca-Cola-which had some untapped pricing power.”

    Charlie Munger: The Complete Investor by Tren Griffin

    (33:00) The benefits Arnault receives from owning commercial real estate: He makes money from his own stores, from leasing space to rivals—and from the appreciation of premium real estate. When LVMH buys a building, it takes the best storefronts for its own brands and often asks rivals to move out when their leases expire.

    (35:00) Arnault is all about details. He has 200,000 employees and he’s paying attention to details about landscaping in the Miami Design District.

    (36:00) If we lose the detail, we lose everything. — Disney's Land: Walt Disney and the Invention of the Amusement Park That Changed the World by Richard Snow. (Founders #347)

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    Related Episodes

    #180 Jeff Bezos (Invention of a Global Empire)

    #180 Jeff Bezos (Invention of a Global Empire)

    What I learned from reading Amazon Unbound: Jeff Bezos and the Invention of a Global Empire by Brad Stone.

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    [1:47] Every interesting thing I've ever done, every important thing I've ever done, every beneficial thing I've ever done, has been through a cascade of experiments and mistakes and failures. I'm covered in scar tissues as a result of this.

    [6:19] I absolutely know it's hard, but we'll learn how to do it.

    [8:30] Thinking small is a self fulfilling prophecy.

    [12:13] Begin any conversation about a new product in terms of the benefit it creates for customers.

    [19:08] Bezos deployed his playbook for experiments that produced promising sparks: he poured gasoline on them.

    [22:41] You can regulate yourself quite easily or think about what you're going to do with your existing resources. Sometimes, you don't know what the boundaries are. Jeff just wanted us to be unbounded.

    [25:48] If I have to choose between agreement and conflict, I'll take conflict every time. It always yields a better result.

    [27:19] Don't come to me with a plan that assumes I will only make a certain level of investment. Tell me how to win.

    [35:50] He preached the wholesale embrace of technology, rapid experimentation, and optimism about the opportunities of the internet instead of despair.

    [45:17] Bezos’ one constant edict: Go faster.

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    #97 Enzo Ferrari (Ferrari vs Ford)

    #97 Enzo Ferrari (Ferrari vs Ford)

    What I learned from reading Go Like Hell: Ford, Ferrari, and Their Battle for Speed and Glory at Le Mans by A. J. Baime.

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    [0:01] Racing was the most magnificent marketing tool the industry had ever known.

    [2:42] Founders vs Managers 

    [3:43] Founders Podcasts on Henry Ford: #9, #26, and #80. 

    [4:29] The passion Enzo Ferrari had for his products 

    [5:50] The same broad features keep recurring over and over again/ In their detailed appearance these broad features are never twice the same. 

    [8:09] Steve Jobs on passion. 

    [12:00] Steve Jobs on building the Macintosh/ Artisans have soul in the game. 

    [13:05] Enzo Ferrari’s schedule at 58 years old / His early life 

    [17:08] Ferrari’s 3 principles for winning 

    [20:20] How Enzo Ferrari started his company / Racing as marketing / Ferrari’s personality and his philosophy on building a business

    [24:49] Enzo Ferrari’s extreme level of dedication 

    [25:48] How Enzo Ferrari described his product 

    [26:54] How and why the Ford/Ferrari negotiations begin

    [35:37] How Enzo Ferrari described the process of building a product

    [38:07] The advantage founder led companies have / I made a mistake here. I said Les Miles when I meant Ken Miles. Les Miles is a football coach. Ken Miles is a race car driver. 

    [40:58] Creative Selection: Inside Apple's Design Process During the Golden Age of Steve Jobs by Ken Kocienda 

    [42:06] Enzo Ferrari on why he doesn’t have a social life. 

    [42:57] You don’t understand. When I go in there, if I don’t really and truly believe I am the best in the world, I had better not go in at all.

    [49:05] Enzo Ferrari played chess while everyone else was playing checkers.

    [52:20] It would be a waste of life to do nothing with one’s ability

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    #90 Charlie Munger (Poor Charlie's Almanack)

    #90 Charlie Munger (Poor Charlie's Almanack)

    What I learned from reading Poor Charlie's Almanack: The Wit and Wisdom of Charles T. Munger.

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    Cicero, learned man that he was, believed in self-improvement so long as breath lasts.

    In business we often find that the winning system goes almost ridiculously far in maximizing and/or minimizing one or a few variables-like the discount warehouses of Costco.

    "Invert, always invert." It is in the nature of things, as Jacobi knew, that many hard problems are best solved only when they are addressed backward.

    It's quite interesting to think about Wal-Mart starting from a single store in Arkansas-against Sears with its name, reputation and all of its billions. How does a guy in Bentonville, Arkansas, with no money, blow right by Sears? And he does it in his own lifetime-in fact, during his own late lifetime because he was already pretty old by the time he started out with one little store. He played the chain store game harder and better than else. Walton anyone invented practically nothing. But he copied everything anybody else ever did that was smart. So he blew right by them all.

    Charlie's redundancy in expressions and examples is purposeful: for the kind of deep "fluency" he advocates, he knows that repetition is the heart of instruction.

    He enjoyed challenging the conventional wisdom of teachers and fellow students with his ever-increasing knowledge gained through voracious reading, particularly biographies.

    He never forgot the sound principles taught by his grandfather: to concentrate on the task immediately in front of him and to control spending.

    I would say everything about Charlie is unusual. I've been looking for the usual now for forty years, and I have yet to find it. Charlie marches to his own music, and it's music like virtually no one else is listening to. So, I would say that to try and typecast Charlie in terms of any other human that I can think of, no one would fit. He's got his own mold.

    Charlie Munger has spent a professional lifetime studying lives that have worked well and others that have glitches or have experienced failures.

    Despite his healthy self-image, Charlie would prefer to be anonymous.

    I am a biography nut myself. And I think when you're trying to teach the great concepts that work, it helps to tie them into the lives and personalities of the people who developed them. I think you learn economics better if you make Adam Smith your friend. That sounds funny, making friends among 'the eminent dead,' but if you go through life making friends with the eminent dead who had the right ideas, I think it will work better for you in life and work better in education. It's way better than just giving the basic concepts.

    His underlying philosophical view was one of deep and realistic cynicism about human nature, including a distaste for pure mob rule and demagogues.

    Find out what you're best at and keep pounding away at it. This has always been Charlie's basic approach to life.

    Take a simple idea and take it seriously.

    Charlie likes the analogy of looking at one's ideas and approaches as "tools." “When a better tool (idea or approach) comes along, what could be better than to swap it for your old, less useful tool?Warren and I routinely do this, but most people, cling to their old, less useful tools."

    Henry Singleton has the best operating and capital deployment record in American business...if one took the 100 top business school graduates and made a composite of their triumphs, their record would not be as good as Singleton's.

    You have to figure out what your own aptitudes are. If you play games where other people have the aptitudes and you don't, you're going to lose. And that's as close to certain as any prediction that you can make. You have to figure out where you've got an edge. And you've got to play within your own circle of competence.

    The other aspect of avoiding vicarious wisdom is the rule for not learning from the best work done before yours. . .There once was a man who assiduously mastered the work of his best predecessors, despite a poor start and very tough time. Eventually, his own work attracted wide attention, and he said of his work: “If I have seen a little farther than other men, it is because I stood on the shoulders of giants."

    In my whole life, I have known no wise people who didn't read all the time-none, zero. You'd be amazed at how much Warren reads-and at how much I read.

    There is no better teacher than history in determining the future. There are answers worth billions of dollars in a $30 history book.

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    #112 Frank Lloyd Wright

    #112 Frank Lloyd Wright

    What I learned from reading Plagued by Fire: The Dreams and Furies of Frank Lloyd Wright by Paul Hendrickson. 

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    [0:01] Frank Lloyd Wright suffered a personal catastrophe that would have destroyed a man of lesser will and lesser ego. 

    [7:20] Ben Franklin writing about vanity 250 years ago: Most people dislike vanity in others, whatever share they have of it themselves; but I give it fair quarter wherever I meet with it, being persuaded that it is often productive of good to the possessor. 

    [12:38] He held a press conference on Christmas Day to explain his actions. He said ordinary people can not live without rules to guide his conduct. He - Frank Lloyd Wright - is not ordinary. 

    [13:44] Frank Lloyd Wright had a single minded pursuit of his own potential

    [18:50] Nothing is at last sacred but the integrity of your own mind. 

    [19:30] Find something you love to do and don’t stop until you die

    [23:00] Everything is malleable. Including the truth. 

    [25:25] All Frank Lloyd Wright had was a complete faith in himself

    [31:57] Frank Lloyd Wright had a point of view—a conviction— and he tied his point of view to larger ideas

    [35:29] Frank Lloyd Wright was terrible with money: So long as we had the luxuries, the necessities could pretty well take care of themselves.  

    [36:20] The early career of Frank Lloyd Wright / his mentor was one of the greatest architects ever 

    [39:30] You are going to go far. You’ll have a kind of success; I believe the kind you want. Not everybody would pay the price in concentrated hard work and human sacrifice you’ll make for it. 

    [50:05] Wright turned down a fantastic opportunity. He preferred to bet on himself

    [53:28] Wright’s mid life crisis and the abandonment of his family. 

    [56:00] We’d like to be painters, we’d like to be poets. We’d like to be writers, but as everybody knows—we can’t earn any money that way. What do you want to do? When we finally got down to something which the individual says he really wants to do, I will say to him you do that—and uh—forget the money. If you say that getting the money is the most important thing, you will spend your life completely wasting your time...

    You’ll be doing things you don’t like doing in order to go on living, that is to go on doing things you don’t like doing, which is stupid! It is absolutely stupid! Better to have a short life that is full of what you like doing than a long life spent in a miserable way. And after all, if you do really like what you’re doing, it doesn’t matter what it is—somebody is interested in everything—anything you can be interested in, you will find others who are...

    But, it’s absolutely stupid to spend your time doing things you don’t like and to teach our children to follow in the same track. See, what we are doing is, is we’re bringing up children and educating them to live the same sort of lives we are living—in order that they may justify themselves and find satisfaction in life, by bringing up their children, to bring up "their" children, to do the same thing. So, it’s all retch and no vomit—it never gets there. Therefore, it’s so important to consider this question...

    "What do I desire?" —Alan Watts 

    [1:01:50] The volume of work Wright completed after the age of 60 was astonishing. A third of his total output came after the age of 80! 

    [1:17:30] What the tumultuous relationship of his parents gave Frank Lloyd Wright: “A will and inner strength that seems unquantifiable.” 

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    #102 Akio Morita (Sony)

    #102 Akio Morita (Sony)

    What I learned from reading Made in Japan: Akio Morita and Sony by Akio Morita. 

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    [0:01] Forty years ago, a small group gathered in a burned-out department store building in war-devastated downtown Tokyo. Their purpose was to found a new company, their optimistic goal was to develop the technologies that would help rebuild Japan's economy.

    [5:00] I was born the first son and fifteenth-generation heir to one of Japan's finest and oldest sake-brewing families. The Morita family has been making sale for three hundred years. Unfortunately, the taste of a couple of generations of Morita family heads was so refined and their collecting skills so acute that the business suffered while they pursued their artistic interests, letting the business take care of itself, or, rather, putting it in other hands. They relied on hired managers to run the Morita company, but to these managers the business was no more than a livelihood, and if the business did not do well, that was to be regretted, but it was not crucial to their personal survival. In the end, all the managers stood to lose was a job. They did not carry the responsibility of the generations, of maintaining the continuity and prosperity of the enterprise and the financial well-being of the Morita family. 

    [8:18] Tenacity, perseverance, and optimism are traits that have been handed down to me through the family genes.

    [9:25] I was taught that scolding subordinates and looking for people to blame for problems—seeking scapegoats—is useless. These concepts have stayed with me and helped me develop the philosophy of management that served me very well.

    [10:28] I had to teach myself because the subjects I was really interested in were not taught in my school in those days.

    [14:09] The emperor, who until now had never before spoken directly to his people, told us the immediate future would be grim. He said that we could “pave the way for a grand peace for all generations to come," but we had to do it "by enduring the unendurable and suffering what is insufferable."

    [23:58] When some of my relatives came to see me, they were so shocked by the shabby conditions that they thought I had become an anarchist. They could not understand how, if I was not a radical, I could choose to work in a place like that.

    [24:28] Ibuka and I had often spoken of the concept of our new company as an innovator, a clever company that would make new high technology products in ingenious ways.

    [29:36] We were engineers and we had a big dream of success. We thought that in making a unique product, we would surely make a fortune. I then realized that having unique technology and being able to make unique products are not enough to keep a business going. You have to sell the products, and to do that you have to show the potential buyer the real value of what you are selling. 

    [32:20] There was an acute shortage of stenographers because so many people had been pushed out of school and into war work. Until that shortage could be corrected, the courts of Japan were trying to cope with a small, overworked corps of court stenographers. We were able to demonstrate our machine for the Japan Supreme Court, and we sold twenty machines almost instantly! Those people had no difficulty realizing how they could put our device to practical use; they saw the value in the tape recorder immediately.

    [38:03] Marketing is really a form of communication. We had to educate our customers to the uses of our products.

    [39:15] We would often have the market to ourselves for a year or more before the other companies would be convinced that the product would be a success. And we made a lot of money, having the market all to ourselves.

    [40:20] The public does not know what is possible, but we do. So instead of doing a lot of market research, we refine our thinking on a product and its use and try to create a market for it by educating and communicating with the public.

    [42:33] Everybody gave me a hard time. It seemed as though nobody liked the idea [the Walkman]. “It sounds like a good idea, but will people buy it if it doesn't have recording capability? I don't think so." I said, “Millions of people have bought car stereo without recording capability and I think millions will buy this machine.

    [46:38] "We definitely want some of these. We will take one hundred thousand units." One hundred thousand units! I was stunned. It was an incredible order, worth several times the total capital of our company. When he told me that there was one condition: we would have to put the Bulova name on the radios. That stopped me. We wanted to make a name for our company on the strength of our own products. We would not produce radios under another name. When I would not budge, he got short with me. "Our company name is a famous brand name that has taken over fifty years to establish," he said. "Nobody has ever heard of your brand name. Why not take advantage of ours?" I understood what he was saying, but I had my own view. “Fifty years ago," I said, “your brand name must have been just as unknown as our name is today. I am here with a new product, and I am now taking the first step for the next fifty years of my company. Fifty years from now I promise you that our name will be just as famous as your company name is, today."

    [49:04] When I attended middle school, discipline was very strict, and this included our physical as well as our mental training. Our classrooms were very cold in winter; we didn't even have a heater; and we were not allowed to wear extra clothes. In the navy,I had hard training. In boot camp every morning we had to run a long way before breakfast. In those days I did not think of myself as a physically strong person, and yet under such strict training I found I was not so weak after all, and the knowledge of my own ability gave me confidence in myself that I did not have before. It is the same with mental discipline; unless you are forced to use your mind, you become mentally lazy and you will never fulfill your potential.

    [52:06] Norio Ohga, who had been a vocal arts student at the Tokyo University of Arts when he saw our first audio tape recorder back in 1950. He was a great champion of the tape recorder, but he was severe with us because he didn't think our early machine was good enough.He was right, of course; our first machine was rather primitive. We invited him to be a paid critic even while he was still in school. His ideas were very challenging. He said then, "A ballet dancer needs a mirror to perfect her style, her technique."

    [54:21] Nobody can live twice, and the next twenty or thirty years is the brightest period of your life. You only get it once. When you leave the company thirty years from now or when your life is finished, I do not want you to regret that you spent all those years here. That would be a tragedy. I cannot stress the point too much that this is your responsibility to yourself. So I say to you, the most important thing in the next few months is for you to decide whether you will be happy or unhappy here.

    [59:40] My argument again and again was that by saving money instead of investing it in the business you might gain profit on a short-term basis, but in actual fact, you would be cashing in the assets that had been built up in the past.

    [1:00:00] One must prepare the groundwork among the customers before you can expect success in the marketplace. It is a time-honored Japanese gardening technique to prepare a tree for transplanting by slowly and carefully binding the roots over a period of time, bit by bit, to prepare the tree for the shock of the change it is about to experience. This process, called Nemawashi, takes time and patience, but it rewards you, if it is done properly, with a healthy transplanted tree. Advertising and promotion for a brand-new, innovative product is just as important.

    [1:01:19] If Japanese clients come into the office of a new and struggling company and see plush carpet and private offices and too much comfort, they become suspicious that this company is not serious, that it is devoting too much thought and company resources to management's comfort, and perhaps not enough to the product or to potential customers. Too often I have found in dealing with foreign companies that such superfluous things as the physical structure and office decor take up a lot more time and attention and money than they are worth.

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