Andre Durand

Discovering life, one mistake at a time.
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Archive for the ‘Life’

Killing the goose

May 04, 2009 By: Andre Category: Life

Butterflies in Asia. Hurricanes in America

To be introspective on the nature of cause and effect in ones life is an interesting exercise. It can lead to an uncomfortable conclusion.

Notwithstanding a few circumstances and your God given attributes, most of your life is the result of a chain of decisions. To respect cause and effect in your life will be to respect the role you play in your own situation and to take responsibility for it.

You are in more control of your life than you might give credit. If you find yourself blaming others. If your problems and their solution lie in someone else, this would be a good time to examine your beliefs.

How to render yourself useless

When you externalize your problems and blame others, you render yourself helpless. It’s great for feeding self-pity, but it does little to improve your situation.

Equally irresponsible is a lack of appreciation for cause and effect when the results are a few steps removed. Circumstances are the result of a sequence of events. To go back and examine that sequence can be useful in creating a more constructive path forward. But societal amnesia has reached nearly pandemic proportions, forget H1N1.

What, no more eggs?

In the auto industry, we killed the goose a long time ago. We just forgot, or didn’t connect the effect with the root cause, and now we’re witnessing the full ramifications. You can only distort reality for so long. As an industry, the American auto industry has been largely uncompetitive for far too long. We’ll do better in the future if we didn’t forget the mistakes of the past. It’s time to move forward and compete, in the real-world.

Warren Buffett, the Anti-Trump

May 03, 2009 By: Andre Category: Life

Warren & Charlie – They broke the mold

I had the pleasure of seeing Warren Buffett and Charlie Munger of Berkshire Hathaway speak at their annual shareholder meeting this weekend. I am not a shareholder, so I was there by the grace of Gunnar Peterson, a Ping advisor, and a shareholder of Berkshire.

I feel lucky to have seen Warren & Charlie in action. It’s not just Warren, it’s Warren and Charlie. The are a team. They don’t make them like this anymore. The cast from which these two were created has been broken.

No amount of IQ will replace practical wisdom

What was perhaps the most inspirational was to witness how central a theme was their operational guidelines rooted in the wisdom of practical experience and their personal virtues such as patience, loyalty, trust and the long-term view of value creation.

It was also reinforcing to me to see how far from these timeless virtues our immediate gratification driven society has unfortunately traveled.

Too many just don’t get it

Time and time again, the audience queried Warren and Charlie on their views of ‘trading’ stocks, to which, they repeated that their simple formula for wealth creation was in finding undervalued companies with good management and defensible businesses and then investing in them for the long haul.

Breaking from the pack

Having grown up in the immediate gratification generation, this sort of thinking is not my upbringing, however, upon reflection, I believe I was born in the wrong generation, because I identify much more with their prescription of long-term value creation.

Deepening resolve – taking the long-view

My takeaways from this weekend have no doubt deepened my resolve in areas related to how I would like to participate in society as an individual and business leader. In short, I intend to do the following:

  • Remove the temptation to allow the possibility of short-term gains to cloud my resolve in pursuing truly meaningful long-term goals.
  • Trust and support my managers even more than I do now
  • Work even harder to shelter my company from the sorts of short-term decisions that inevitably lead companies to short-term gains at the expense of truly powerful outcomes
  • Build a culture that not just values, but breed’s respect, teamwork, trust and long-term value creation.
  • Too much IQ – sell a few points

    Warren and Charlie had some harsh words for those that over complicate things. I couldn’t agree more. I’ve become increasingly critical of the sort of wizardry, and fancy mathematics that are being applied to our markets as people try to condense future returns into today’s consumption. I believe these tricks and gimmicks have had the effect of derailing our society and our markets from a steady, sustainable growth path onto a roller coaster of booms and corrective busts.

    Lose the fractional jets

    Just before leaving, I toured Netjets, the fractional jet ownership program that Berkshire invested in. Who doesn’t like seeing jets? They are incredible machines. But nothing but ego can come close to justifying such an expense. So with that, I do have a one recommendation for Warren. Dump Netjets siting a temporary lapse of insanity and buy Dunkin Donuts, it’s more your style. Even in bad cycles, people still need coffee and a good donut.

    Past, Present & Future in 1 gulp

    April 27, 2009 By: Andre Category: Life

    debt1

    We’re Professional Consumers

    We’ve become really good at consumption. In fact, we’re professionals. We’ve become so good in fact, that we can consume our present, past and future, all at the same time!

    Consuming Millions of Year of Solar Energy in 200 Years

    We’re well on our way to consuming millions of years of our past in just a few hundred years. Oil is, after all, nothing but super concentrated solar energy packaged into liquefied bio-mass. Likewise, we’ve become really good at deriving, packaging and selling off our future. All so that we can feed our need to consume today. Junk bonds, short-term negative-interest mortgages and the likes are all about maximizing today’s consumption, with little regard to the full price of that consumption in the same period it is consumed.

    It’s rather ingenious in a way. We’re masters at pushing off payment of today’s consumption into the future. The problem is, in many cases, we’ve been able to condense and consume the future in such high quantities and at such an accelerated pace that reconciliation cannot always be pushed off indefinitely. It typically comes back to bite us.

    Just Another Form of Ponzi Scheme

    In some senses, many of the crisis (bubbles bursting) of the past few decades have been a grand sort of Ponzi scheme, in which everyone has participated. As long as good money enters the front of the funnel fast enough to hide the fact that we’re accumulating an enormous hidden cost to pay down the road, everything is ok. But sooner or later, we always have to reconcile the imbalances.

    My overarching concern is that time and time again, new forms of Ponzi schemes are being created. Each time, very smart people are able to create and package up derivatives of our future that do not account for the full future cost of that consumption in the present.

    Without a shift in what society values, regulations can do only so much…

    Regulation, by the very nature of how it is created (in reaction to something bad happening), will always be one step behind the new Ponzi scheme.

    Generally speaking, the thing I object to is not all of the creativity that goes into how we can create and consume more, but what appears to be an imbalance in accounting for the true cost of that consumption. I believe that we need to return to longer time horizon when it comes to our sense of responsibility. Consuming our past is one thing. Consuming our future without a plan to pay for it in our lifetime is as people say, generational robbery. In many of the bonus reform conversations, it’s become recognized that the structure of many annual bonuses provide management a means of concentrating gains in the current period, while pushing off the cost of those gains into future periods. By extending the view of what should be as bonus for exceptional performance to a longer time-horizon (a horizon that extends continually beyond simply the current year), we can encourage a different behavior, a behavior which will have people balancing current consumption with the potential for future consumption.

    Matching Consumption Increases with True Productivity Gains

    In GAAP accounting, there is a notion that revenue and expense needs to be recognized in the same time-frame. The importance of this is to ensure that companies do not report all of their revenue in one time period, and all of the expense at some future time period (or vice-versa). If we really care about the stability and sustainability of our growth curve, (as versus the roller coaster ride we seem to be on as we condense and consume chunks of our future in a short amount of time) we need to return to our sense of reasonableness with regards the true costs of our consumption in any period of time.

    PingFederate 6 Released

    April 21, 2009 By: Andre Category: Life

    Today we released the most significant version of PingFederate in our history. The product, now truly worthy of the title, “an Internet Identity Security Platform” incorporates years of work we’ve done around federated web services, and is just one more step closer to completing on the vision to build a single platform capable of portraying one’s identity, in all myriad of use-cases, over the Internet. The product in all it’s glory is available now for immediate download, and will be offered on-demand through PingConnect.

    Web 2.0 Fortune Teller

    April 20, 2009 By: Andre Category: Life

    My friend Chuck Mortimore came across this authentication Captcha today. Like asking a Magic 8 Ball, it’s missing the most important piece of information. When?

    andreretired

    Things Change. Not.

    April 20, 2009 By: Andre Category: Life

    Phil Becker dug up this cartoon which was published in 1934. Yes Phil, history does repeat itself.

    1934-cartoon

    Metallica & My First Camaro

    April 14, 2009 By: Andre Category: Life

    When I was 14, I bought a 1969 Camaro from a guy on my paper route for $500 and proceeded to rebuild it from the ground up.

    camaro_montage

    Somehow the music, sights and sounds of those high school years stay with you most of your life. While I enjoy and listen to all kinds of music, I still prefer some of the classic metal I played in my Camaro at 15.

    I got an email today from Hennessey Performance about their 2010 line-up of modified Camaro’s. I’ve owned some fast cars over the years, so I know better than to dump my money attempting to relive my youth, but I have to admit, this Camaro is tempting.

    camero

    I love my (new) iPhone

    April 07, 2009 By: Andre Category: Life

    About every 3 to 6 months, the battery on my iPhone starts to go South, so I take the phone to my local Apple store and replace it (for free with my extended care plan). Without a way to change the battery, it’s pretty much the only option. I’m on my 5th phone in 1.5 years. In fact, since I get a new phone every 6 months, I’ve given up putting screen protectors on it, after all, why bother? Scratched, no problem, get a new one.

    So, I’ve been thinking that I can’t be the only one doing this, and while I love Apple, the company and their products, this revolving door of equipment has got to have a massive impact somewhere in their financials. It occurred to me that DELL used to have a similar customer service experience, but as their market and business matured, they inevitably looked to the customer service experience to cut costs.

    In short, don’t expect to receive this level of product / customer service forever with Apple. When the innovation and hype slows, and the company turns inward with regards its focus to squeeze profits and cut costs, these programs will be the first to go.

    Either that, or they can just build a phone that allows us to change batteries ourselves. 🙂

    Going for it

    March 23, 2009 By: Andre Category: Life

    I met the CEO of Adventnet, parent company of Zoho at some small conference that I don’t even remember about 2 years ago. He was from India, and we talked briefly about his company, which at the time employed 700, and built dozens of enterprise management utilities that they sold over the web for $1000 or less. He had just launched Zoho, mimicking Google for cloud based small business applications. Looking at his website now, I’m blown away with the shear volume of software his group has created. It’s staggering really. He’s done a nice job.

    zoho

    Finding the Good in the Bad

    March 20, 2009 By: Andre Category: Life

    So much of the extremeness of what we’re experiencing in the economy right now is amplified by our emotions. I’m convinced there is a certain amount of suffering or atonement that we feel we must go through to balance the good times we somehow know we couldn’t afford in the past several years. We’re psychologically making up for that now by over-expressing our pessimism. But, there will come a point where we’re simply tired of feeling bad, and while the fundamentals are indeed bad, and the de-leveraging pain real, sentiment will turn, and it’s only natural that we’ll start to look for the good in the bad.

    Today’s CNN headline tonight to me represents the beginning of this turning in the press. We lost 122 points in the DOW today, but, we gained for the week, and instead of focus on what could easily have been positioned as a ‘dead cat bounce’, is now positioned as, ‘could we really have already seen the bottom’?