The tendencies of basic biological, social and technological evolutions can be explained in scientific, physical terms. Directionality seems to be imputed and the author argues that Non-Zero Sum games has been the driving force for biological life. The core of biological and human history can be traced back to more numerous, larger, more elaborate, more interdependent forms of NZS games being played. “Non-Zero Sumness” can be thought of as the tendency which gives time its directionality, helping explain how NZS was likely to lead to complex life forms and technology which further enriched how these life forms interacted
Key Takeaways
Game theory was developed by von Neumann. Zero sum games are games in which one person’s win means another person’s loss (sports) whereas Non-Zero sum games aren’t necessarily negative for one party. The authors argue that NZS games are a driving force for the world has been shaped. NZS games can be win/win, win/lose, lose/win, or lose/lose
Human history has shown that technological advancements allow for richer and more widespread NZS thinking and actions to occur, and social structures evolve from these interactions to more fully capitalize on these positive sum interactions, increasing social complexity and depth. NZS is not always win/win, but it trends in that direction and this causes people to become more embedded in webs of mutual interdependence.
Hunting large prey requires coordination which spurs altruism, reciprocity, social complexity, and positive sum games. “The best place to store your excess food is somebody else’s stomach.”
The author argues that population density is the overriding factor in predicting technological evolution and social complexity in a group of people
A quick summary of NZS would be the extent to which outcomes are shared, also known as skin in the game
Writing builds trust in a society (lenders don’t have to worry about debtors cheating them and vice versa, etc.) which helps streamline much of life and leads to positive sum outcomes
Increasing NZS leads to a more interconnected and codependent world where you not only care about your local neighbors but also the global community as trade commerce and ideas seamlessly transfer from one area to another
Increasing seamlessness in travel, commerce, communication, mostly driven by improvements in technology lead to new areas and opportunities for NZS, and how open and willing countries are to adopt the new technology and drive it’s future success and ability to capitalize on these positive sum games.
Technology, freedom, and increasing wealth seem to be inherently and intimately intertwined
NZS is responsible for reciprocal altruism love has evolution selected for those who could cooperate with each other and survive and this helped in hard times when others with chip in to pay back your favor
Time’s arrow does not necessarily point towards complexity but competition, survival, and natural selection push species to become more adapted and more complex in their thinking and behavior just in order to survive. If there was no competition and no threat of being eaten, animals don’t naturally just become more complex. Positive feedback at play
Natural selection beautifully fills in open inches
Truly valuable traits evolve independently. For example eyesight and reciprocal altruism evolved in multiple times and species. These are prime behaviors that have helped species survive for eons and are traits that we can bank on
What I got out of it
Really interesting idea that non-zero games, technological advancement, win/win have spurred evolution towards complexity in behavior
The purpose of The Container Store is clear: to improve the quality of our customers’ lives through the gift of organization, fueled by our 7 Foundation Principles. Those principles begin with our commitment to our employee-first culture, of course, but they also ensure that we ultimately create value for ALL of our stakeholders, including vendors, customers, community, and shareholders – so that everyone associated with our business thrives
Key Takeaways
The 7 Principles: We use principles rather than rules because rules are too rigid. I often tell my people that retail is like real life – it’s far too situational to use the typical phone book sized procedural manual. Instead, just use these principles to guide you. Once we agree on the ends, you are free to choose the means to achieve those ends. Employees are their most productive when they use their own unshackled, intuitive genius to handle any situation. That goes for everybody in the company, whether it’s our finance people negotiating with a bank, a salesperson helping a customer, or a distribution center employee talking to a truck driver in the 110-degree Dallas heat. All employees can make decisions based on the same set of values, principles, and information as everyone else
1 Great Person = 3 God People (or much more!)
Pay up for the best people (up to 50-100% more!) and allow them to fail.
The best people demonstrate the following traits:
Commitment and accountability
Planning, organizing, and attention to detail
Communication IS leadership
Professionalism
Problem solving
Teamwork/”wake”
Ability and attitude
Being part of a great team is one of the the best human experiences
Once you hire the best people, give them space to run, even if they fail. Trust people and help hem grow into the type of people they want to be
“Fill the other guy’s basket to the brim. Making money then becomes an easy proposition” – Andrew Carnegie
Carnegie thought that this was his one beacon, his one guiding light, that he attributed all his business success to
The more win-win relationships you create, the more you’ll succeed
What we’re trying to do is create synergy. That’s the most pleasurable, joyful way of doing business. Those who make the most money for the longest time adopt this form of capitalism – creating these mutually beneficial, long-term relationships. So why don’t people seek out win-win situations more often? I’m convinced it’s because of their own insecurity. If you’re secure in yourself and your own abilities, you won’t feel threatened by filling the other guy’s basket. You won’t worry that someone else will succeed more than you will, or somehow will use your own spirit of fair play against you. On the contrary, you’ll be open hearted and supportive. You’ll realize that helping other people succeed is actually the best way to succeed yourself. That’s why it’s so important to be mindful of our wake. With every action we take, we’re not just affecting other people far more than we realize. We’re also creating powerful waves and endless ripple effects that ultimately find their way back to us.
It’s hard to overstate how crucial these close relationships are to our success – it’s why our vendors give us exclusive, custom-made products, fast delivery, and high quality. And it’s why they give us great pricing. We can’t beat the mass merchants on volume, but we can always beat them on relationships
Our vendors often tell us, “Your people know our products better than our own employees do!” Because many of our vendors started as entrepreneurs, we filled their basket with encouragement, product ideas, and, when times got tough, deep loyalty
Man in the Desert Selling
Discover all the customer’s problems and solve them. Don’t assume you know what they need. Truly understand what they’re trying to solve for and do that. Often times customers don’t know what solutions are available and need to be coached
Strong long-term relations, built on affection, hard work, trust, and respect, are a huge key to success in business and in life
We all benefit from giving – life is full of win-win propositions
Communication IS leadership
We must practice consistent, reliable, predictable, effective, thoughtful, compassionate, and even, yes, courteous communication every single day to successfully sustain, develop, and grow our business
We share company goals, financial details, daily sales results, real estate expansion plans, marketing plans, major initiatives, sales campaign results, company-wide leadership meeting notes, product information – truly, the list goes on and on. and this communication comes in many forms: scheduled meetings, off the cuff encounters, voice mail, video, company conference calls, email, and old-fashioned written memos – any way possible. And, of course, the daily ongoing communication that happens between employees – sharing perspectives and insight – is a key component of our communication/leadership-driven culture
The best selection, service, and price
Stick to what you know and do it well
Competitive advantage to sell the hard stuff because you need more knowledge and better trained staff to sell it
Having low prices and high margins creates a tremendous economic incentive to turn those high margin products into your biggest sellers. It’s another thing the world thinks is impossible. I’m mystified that so many retailers put so much effort into building up the volume of their low-margin, commodity-type products – mostly because that’s the way things have always been done. But why not perfect the selling methodology of your highest-margin products? Why not give those products the best shelf space, train employees in those products more, advertise them more, and work harder with vendors to create high margin for both of you? In others words, why not spend more time in the gold mine rather than the copper mine? It’s the best way for any business to succeed.
Intuition does not come to an unprepared mind. You need to train before it happens
Must blend logic and intuition – and intuition requires proper training
One reason training is more important at TCS than other retailers is because our motto is “we sell the hard stuff.” We actually tell our buyers to look for products that are hard to sell. Why? Because we know other retailers won’t touch those products, giving us an exclusive and yet another reason for our customers to shop with us. It may seem crazy to base a store around things that are hard to sell, like our elfa shelving system. But we make it work, selling tons of products like elfa that make people come back for more – a new shelving system for every closet in the house (like potato chips they can’t stop eating). And we make it work because our deep commitment to employee training creates unparalleled customer service.
Air of Excitement
Create a culture, an environment, that people are excited about and can thrive in. You can copy a company two-dimensionally, but you can’t copy its heart and soul
The smartest thing you can do is hire your customers. DO that long enough and they’ll end up running your business
All about natural laws of human behavior
Hosts an annual “we love our employee’s day” held every Valentine’s day, an annual chili cook off, and an annual distribution center derby
Celebrate mothers on Mother’s Day and fathers on Father’s Day, host baseball games, celebrate Halloween, have family movie night every year, and great holiday parties every December.
Sometimes it’s the little touches that matter the most. Like finding your desk decorated with balloons and signs on your birthday, receiving a heartfelt card on the anniversary of the day you joined the company or an engraved silver spoon when you have a baby. These days, people often spend more time with their coworkers than with their own family, so we encourage our employees to bond in ways very much like a close-knit family
Some people may say that these events detract from more “productive” work, but this is classic zero-sum thinking. What conventional business minds don’t understand is that all the positive feeling this activity generates is really the fuel that drives our company. Without it, we’d be just another retailer with no spark, no air of excitement – and, I’m quite certain, no profits
Conscious Capitalism
Serve all stakeholders
Profit is not the #1 priority which paradoxically leads to higher profits
There are 4 key tenets:
Having a higher purpose beyond generating profits
Harmonizing the needs of all stakeholders to create win-win outcomes for all
Having leaders who are motivated primarily by serving the firm’s higher purpose and creating value for all stakeholders
Creating a conscious culture based on qualities like trust, accountability, transparency, integrity, loyalty, egalitarianism, fairness, personal growth, love, and care
Other
You get your best ideas when relaxing, when mind and body can wander
Women make better executives as they are better listeners and communicator
TCS never had any layoffs. They aim to make their employees better people overall. Treating employees with respect and affection is the fastest and most effective way to gain success. If you take better care of your employees, they take better care of the customer, which leads to more customer loyalty and financial success. Business is all about making sure everyone thrives
A company is stronger if it is bounded by love rather than by fear
“Our Wake” – the ripples our actions make are greater than we can imagine
Positively spring-load every counterparty relationship so that when down times come, which they always do, you have built the trust and respect to come out stronger. In this case, everyone conspires to assist you
Kip describes the culture at TCS as “yummy” which he means to say is caring, communicative, and “feels good”
As important as what you do is how you do it – be clear, open, honest
Companies take on the traits of their top people
When Kip was young he kept a “Philosophy Epistle File” – a common journal for storing inspiring quotes and ideas
A person’s first 25% of effort is mandatory, but after that it is due to the boss and culture
Good management is wise allocation of resources – say “no” unless it is a top priority
Price is mostly an issue about perception rather than reality
At the time of publication, TCS achieved a 21% CAGR over 36 years
At the moment of commitment, the world conspires to assist you
As a manager, you need to help our employees understand the values our company is based on, then help them develop attitudes and behavior consistent with those values
Why do so many companies die young? Mounting evidence suggests that corporations fail because their policies and practices are based too heavily on the thinking and the language of economics. Put another way, companies die because their managers focus exclusively on producing goods and services and forget that the organization is a community of human beings that is in business – any business – to stay alive. Managers concern themselves with land, labor, and capital, and overlook the fact that labor means real people.
What I got out of it
Some great perspective on culture and how important it is in building a business, purposely sell the hard stuff, also makes clear how hard it is to swim against the tide, no matter how dedicated and hard you work (offline retailer with finite shelf space going up against the rising tide of ecommerce)
