Be careful of trusting the "experts"

 (or should you?)

David Freedman is interviewed on the problems with expertise, specifically in the medical field

Years ago I often used to listen to the economic discussion hour on Classic FM while driving home from work. One night the presenter said something that I have remembered almost verbatim to this day:

"Research has shown that the experts are wrong 70% of the time. By that measure, wouldn't it make sense to subscribe to the very best advice - and consistently do the opposite? And with that thought I bid you all good night..."

Whether the statistic is correct is probably impossible to say for certain. I have lived long enough, however, to have come to see that the experts are wrong very often indeed. And that in many cases, contrarians are the ones that perform the best. They are the salmon that always swim against the stream of popular thought, of mass migration, and of accepted thinking. Those are the fish which, if not caught and eaten by bears when they clear the rapids, often tend to reach the choicest spawning grounds.

In this book, Wrong: Why experts keep failing us - and how to know when not to trust them, David Freedman makes some startling claims. For instance:

• He asserts that economists have found that all studies published in economics journals are likely to be wrong. 
• Similarly, he claims that tax returns that are completed privately contain far less significant errors than those prepared by professionals. 
• And about two-thirds of the findings that are published in renowned medical journals are refuted within a few years. 

This does tend to make one think. When asked when the right time to buy is, Lord Nathan Rothschild once made this famous reply: "When there's blood in the streets." In other words, doing the exact opposite of what everybody else would be doing.

I remembered this quote one day when I met a fairly young and very substantial landowner and asked him how it was that he was able to acquire such vast land holdings. He told me that when he was younger, he had a little bit of a capital surplus one season. It was around the time of South Africa's change of government in 1994 and a lot of people were selling out at rock-bottom prices in anticipation that the country would collapse.

He felt that it was worth taking a chance at least once. He did not really know much about investment, but he knew that hanging on to cash was a good way of losing it. So for lack of better options he bought land. And that was when he discovered that the best time to buy was when everybody is telling you that you'd be crazy to do so. In fact, by this rule, the more your bank manager advised against it, the greater your chances might be of being right.

And so it is with technology also. At www.cloudconnect.co.za where we deal with future technology, we often come across customers who insist that it is dangerous to dare to break with convention. Copper cables have delivered connectivity to the world for so long, they argue, that it must be good, even though it is ridiculously expensive and the service is shockingly bad. Land-based telephony is safer because that's what everybody uses, right? And why take the risk of doing more business online? Don't you still remember the dotcom crash in the world markets just a a few years ago?

How easy it is to see ghosts when one wishes to believe in them!

Plentiful are the fearful, and narrow is he vision of those who do not understand the future. The truth of the matter is that the future has always been a shark's tank. But it is often no more dangerous than the deadly quicksands of long-established convention. The only difference is that by chaining oneself to old-fashioned thinking in business, death comes far more slowly. In the end, it is in most cases a completely assured end.

That is not to say that one must abandon all good sense and reason. The principles of successful business and innovation have never changed since the beginning of time. The forces of economics never change. Only the application thereof. There is a very big difference, and those who do not understand it are destined to suffer an unexpected awakening.

But then there is also the matter of fun. Staying within the comfort zone that is created by the presence of a large herd of old-fashioned beasts may be many things, but it certainly lacks the fun factor. Being a bold adaptor of new solutions, new thinking, new technology, new way of applying old theory - this holds an element of excitement which simply cannot be had in the mud wallows of mindless convention.

In life it is a fact that anything that stops growing starts dying. Economics know that. Biologists affirm it also. Why do we so often forget it? What is it in us that makes us so desperately afraid to be contrarians? Perhaps that is why we attach such morbid value to the muttered prophecies of experts. After all, expert opinions so often support our own fears and give us all the reasons we need not to try something new.

I often think of myself as a salmon. And when I do, I'm sometimes reminded of at least one expert who admitted the truth to me. It was around a campfire one night when a good friend of mine - a medical specialist - leaned over and whispered to me: "Just between me and you - we don't have a cooking clue what we're doing..."

But that's OK. I have learned in life it's OK to not always know what you are doing. As long as you are doing something. 

Why close the doors when there are still shoppers?

These are recessional times. Unique economic times in which the vast majority of businesses are desperate for more sales. And yet, sometimes I get the impression that poor sales are well-deserved. Why close shop when there are still shoppers around?

I was at the local mall yesterday. The mall closes at 6 pm and I could not help but notice that at many shops the door keepers were standing by the entrances15 minutes before closing time already. Motivated and ready to slam the doors shut precisely at 6. In fact, so eager were several of these stores that they already had half their folding doors closed. This was despite the fact that the mall was still alive with shoppers.

Which made me stand back and think: "And I thought times were bad...?"

Possibly the mall has regulations about punctual closing of shops. Possibly the unions, overtime pay, and employee work hours had something to do with it. But that is not my main concern. My greatest concern of all is the symbolism of the act. In other words the desperate significance of the principle of minimum input. You know? The principle so popular among losers, which dictates that the best policy is to put in the smallest mount of effort, in order not to waste one's energy and risk not being rewarded for it. Who still thinks like that? Evidently many.

Who can still afford in these uncertain times to say no thank you to a few extra sales? Obviously a lot of businesses.

It made me think about all the stories my grandparents used to tell about the great depression. Times were so hard that my grandmother remembered collecting the sheep wool that was caught on barbed wire fences. This they carefully made up into bundles and sold to he wool merchants. No, they were no so desperate that they had to scrounge in order to live. But times were lean and wool prices were high. They simply believed in capitalizing on opportunity, even if it was small. It was a principle that they followed in life, and that principle made them prosper over time.

I know it makes little sense to keep a big store open for a few bucks in extra sales. However, symbolically-speaking at least, my belief is that when times are hard I would be open for longer than the opposition. I would encourage shoppers to stay beyond regular trading hours, in stead of switching the lights off and making that dreaded announcement: "Attention all shoppers. Please note that this shop is now closed. Our regular hours are from 9 till 6 and we look forward to seeing you again tomorrow. Please be so kind as to make your way to the checkout counters now..."

I don't want to come back tomorrow. I want to spend my money with you NOW!

There are businesses that close up in recessions. And then there are those that emerge from it stronger. Our business involves unique technology. We provide solutions that nobody else does. We deliver it by means that few people have tried. And we continually look for even more original ways than that. We like disruptive technology and disruptive ways of sharing it with the market. We believe in being part of the latter category of businesses: those that will grow and thrive even when times are bad.

When people are inconvenienced by the economy they will slam doors shut precisely at 6. But when they are hungry one day, I suspect they will close at 6:15. It will not be the act, as much as the symbolism of it that will impress me. The day I see that, I will know that the fundamental psychology of what is wrong in our economies maybe  be ready to change. That will be my signal of hope.

Why would stores be eager to close early when shops are closing at a rapid rate all around the world? The minimum input principle is symbolic of a cancer in the very thinking model of capitalism.

When old technology must be rescued

Old meets the new - the damaged Outeniqua  Choo Tjoe railway line vanishes into the distance where the feather vapour trail of a modern jet remains. Should old technologies be so easily allowed to drown in the face of modern wonder?

Our technical department has been working on a complicated fax solution for two days now. It is becoming increasingly difficult to keep old-generation technology superimposed on new technology that has already passed beyond the event horizon of advancement.

Just this morning I was thinking - "How much easier the world would run if we could just finally get rid of fax technology!" Let's face it. Faxes are expensive, hard on rain forests, difficult to archive, and awful to use. It deserves to be on the scrap heap of technology development by now.

But some old technologies are priceless. They should never be allowed to fall into disuse. Steam trains is one of those. We live in one of the most beautiful parts of the world. And until two years ago or so, we had been fortunate in having had one of the last remaining steam train services. The Outeniqua Choo Tjoe brought vast numbers of tourists to our region every week. And now it is gone. After catastrophic floods, the Transnet authorities deemed it too expensive to repair the damaged infrastructure. And so the biggest tourist attraction in our fragile economy was allowed to fall into sad disuse.

The Outeniqua Choo Tjoe passed through some of the most beautiful landscapes in the world. But it was derailed, not so much by natural disaster, as by miniaturized thinking.

Following this, various parties, including the Western Cape provincial government under inspiration of leaders such as Minister Alan Winde, have made a valiant effort to get the Choo Tjoe running again. But as with so many other projects, the will to achieve as lost in the miniature world of the bureaucratic brains which have to make decisions.

So what is it about old technology like steam trains which demands that it should continue to live while other technologies deserve to become extinct? After all, steam trains are hard on the environment, are expensive to run, and really have little place in the modern world's fast-paced transport infrastructure.

The answer is a spiritual one. New technology is often aimed at providing physical comforts that are useful and needed, but make no contribution to the human soul. Steam trains, on the other hand, are like poetry to the mind. It reminds of an era when people still have time to live - not just to exist. There is something about the old-fashioned scent of coal smoke, the hoarse whet whistle before departure, and the billowing white steam clouds, that stirs the imagination.

As devoted as we may be to the magic of all the iPhones and digital magic of the future, there are some technologies that will always fill our hearts long after iPhones are gone. One day when we are old, we will probably never pull and old yellowed device from a drawer of keepsakes and declare to a wide-eyed grandchild: "Look! This was still your grandpa's very first iPhone!" What we will want to do, however, is point to a yellowed picture against the wall and say, "Your grandfather rode on that old train when he was still a boy. And would you know it - that old girl is running still. All the way from George to Knysna - just like 60 years ago."

Steam trains last for decades. Digital magic has a half-life shorter than a childhood fantasy. Let's do what we can to get the Outeniqua Choo Tjoe running again.

My colleague, Justin Miles shot this video of the Outeniqua Choo Tjoe during the last of her glory days on the run from George to Mossel Bay. How can we make her heart beat again?

Paying it forward - a case study

Touwsranten Primary School, which received free wireless broadband, thanks to a private sponsor and Digital Village

In a connected world our actions are often like a stone, thrown into a pond. Even very small stones will ripple across the entire surface of big bodies of water - moving reeds and floating object far away from the original source.

The same happens in our lives with many of our deeds, both the good ones, as well as the bad ones. "Playing it forward" is a term that is often used for purposefully propagating a good deed, but making sure that its effects get passed on to others, in the hope that the process will repeat.

Alongside our commercial business, we have a registered non-profit company called Digital Village that is aimed at providing free internet to needy schools and community organizations. This initiative is supported by donor funding, in partnership with commercial businesses and individuals that believe in playing it forward. It is built upon the principle of public-private co-operation on a broad front.

Recently we had a project which illustrated very nicely how a good deed from the business sector played itself forward in a way which benefited more recipients than anticipated - and then returned to to the business community with interest.

Here is how it happened:

A few months ago an international businessman who resides on the Garden Route part-time, made a donation of a large amount of excess wireless internet equipment to Digital Village. Some of this equipment was then used to provide a free internet installation to Touwsranten Primary School - a well-run, but somewhat neglected school in a rural region, just outside the small village of Hoekwil.

It was soon discovered that the Seven Passes Initiative had just recently set up a small container-based office, just a short distance away. Our commercial company had just sold two new computers to Seven Passes, but there was no connectivity. This seemed to be a vitally-important need, since Seven Passes was doing community work that nobody else does - and it has already demonstrated itself as an unusually successful partnership between local farmers and businessmen, and community leaders.

Ryan Philander, one of the management team explained that the Seven Passes Initiative is a youth development and educational organisation that seeks to prevent youth involvement in crime through providing quality after school care. They do this through homework clubs and other educational activities, including sport, music and drama.

Part of their association with the school lay in the fact that Seven Passes was providing computer lessons for the community in the school's computer lab - a valuable outreach gesture which benefited all parties concerned. The Initiative also works towards long-term poverty alleviation through raising the educational level of the community.

The container office of the Seven Passes Initiative

The problem was that the Seven Passes office did not have line of sight to any wireless internet repeaters on a sponsored network. But the container could just barely see the Touwsranten school, where a a Digital Village installation was about to be scheduled. Accordingly, it was decided to set up the Touwsranten school as a community internet hotspot, as well as wireless internet repeater. From there the signal could then be relayed to Seven Passes, and from there the new computers could be connected.

This was done with more sponsored equipment, and soon Seven Passes was sailing on the digital stream to the future. A good deed had now been played forward twice.

But this is not where it ended.

A few days later, it was determined that the wife of a local farm manager had found an opportunity to do accounting work for a local dairy. The problem was that she would have to work from home, and she had no connectivity. Chances of obtaining connectivity at this particular site looked exceedingly bad. But then someone remembered the new repeater at Touwsranten school.

A signal test quickly revealed that the Touwsranten repeater could reach the farm manager's house. A commercial company then sponsored the farm manager's installation, and in so doing, played it forward a third time.

This meant that a housewife with limited income was now empowered to run her own little accounting business from home. In a region that is particularly burdened with high unemployment, this seemed like a very welcome opportunity indeed.

In the process it also benefited the dairy. It found itself in a position to get an affordable accountancy service close to its offices, which was also a way for them to make a contribution to local job creation. Yet, there was still one more surprise waiting. A few days after the final installation had been made, it became apparent that the dairy in question also happened to be one of the valued supporters of the Seven Passes Initiative.

And so the kind support of a local agri business, played itself forward in a full circle to return some benefit to the originator.

In a perfect world, it seems that playing forward goodness would always be a boomerang effect that would return positive results to the benefactor. This does not always happen, but when it does, these are the kind of events that make all the hard work that goes into Digital Village seem so much more worthwhile.

As it turned out, a multitude of people received benefit from this one project - and the effect is still continuing to expand. Digital Village has since entered into a memorandum of understand with the Seven Passes Initiative and will continue to work their new partners to play it forward as far as the ripples can possibly go.

Playing it forward is one of the most satisfying endeavours of life. All it takes, is a little work and a lot of will.

Use mistakes to build a ladder to the stars

A colleague recently admitted to me that she had made a small mistake in dealing with an important customer. I just smiled and shrugged: "Welcome to the my world!"

I have done many things right in life and I have made hundreds and thousands of mistakes. We all do. Somehow, though, it is curious how we tend to remember our mistakes longer than our successes. The fact is that we often learn more from our mistakes than from our successes, and so our mistakes tend to become our most important investments in many cases.

A lot of the time we fear make a mistake so much that we don't even bother trying. And so the ships of our dreams are sunk before we've even left the harbour. Not by the storms of life and the icebergs of unforeseen disaster, but by the slow yet certain decay of shipworm, mildew and woodrot.

In my case, I have always said that my mistakes have been like rungs in a ladder. Afterwards, by standing on each of them, I was able to climb just a little bit higher. And so, by nailing my mistakes between the paralleled beams of our lives we can climb right up to the stars in time.

There is just one very important provision - the ladder of our mistakes must always be used for climbing up - not down!

Yesterday we were speaking about the mistakes we have made in business. Being in the field of future technology, it goes without saying that we also sometimes make mistakes. New discoveries are never made without breaking a few test tubes, burning out some fuses, or perhaps setting your coat on fire. And occasionally it creates embarrassment with a customer. However, there are customers who realize this and work through growth phases as a team.

We have a list of these customers and have found that invariably they become counted among our friends. When a customer has become a friend, he becomes a partner. And partners are loyal beyond the ordinary. This is what separates ordinary suppliers from the extraordinary - the ability to turn customers into partners. Making some mistakes along the way is just the price of a purchasing new friendships.

"A man's errors are the portals of his discovery." - James Joyce (novelist)

Mistakes should ideally be kept as small as possible - Some mistakes can be rungs in the ladder to the stars. But others can be a trapdoor to a dungeon of doom.

Business Fears Change More Than It Fears Failure

As a provider of future technology solutions I learnt that business fears change more than it fears failure. 

Among the majority of today's cavemen, even the big hunters will often view the new fire and say: "This looks like it could burn one's hands. I won't use it. I will rather eat my grubs raw." And so they continue eating raw grubs for weeks, months or years, until one day the mouth-watering scent of barbecues from the caves around them will convince them that fire is safe after all. Ultimately all cavemen learn to use fire, or die. The difference is just that those who are slow at adopting fire eat cold grubs a lot longer.


If it was just a matter of eating cold grubs, the story might have been merely ironic. But it is more serious than that. Fire means the difference between survival and extinction when winter comes. 

Why is technological extinction so popular among today's cavemen? 

We constantly see new technology becoming available at a costs that are entirely feasible. New imaginative ways of financing are presented. Special offers are made available. And yet, many users still shrink away from new technology, thinking that if they haven't seen their neighbours use it, it would be too great a risk to take the leap. There is an old adage that grub-eaters wear like a badge: "If it sounds too good to be true, it usually is." Experienced grub-eaters are well-skilled at thinking of myriads of sound facts to support this supposition. 

However, what grub-eaters forget is that 80% of the things that people fear, never happen. And most of the remaining 20% are not as bad as one would have expected either. 

Futurists predict that VOIP telephony will replace cable telephones. But many users still look on it as black magic. Cloud computing is expected to be the standard of the future. But grub-eaters continue to cling to terrestrial architecture because on the ground it feels safe. Everywhere big cavemen with small brains continue to clutch at yesterday's magic. They are careful to put thick bars before the windows of the jail cells of their minds. The reality is that in most cases, yesterday's magic is the most dangerous of all. 

I have always found myself among early adopters of technology. When tractors became available, my family wasted no time to exchange oxen for tractors. They prospered hugely. We were the first in the district to have cell phones. The neighbours asked us what we could possibly want them for. Today everyone has cell phones and all the farmers have tractors. 

In business, we looked at how we thought our products would look 15 years from now - and then we invented the technology that would make them look like that. We built solutions to problems that did not even exist yet. In information technology, we predicted what the market would want 10 years from now - and we set about delivering it today. Not only did it make us successful, but it also made life a lot more fun. Scary perhaps, but exciting.  

To be slow at adopting life-changing new technologies is dangerous and foolish. In business it is too expensive and too difficult to chase the market and run up to it from behind. Your best chance lies in predicting where it will go, and then ambushing so that it will run straight into your arms. Early adopters of technology are ambushers of the market. High speed broadband, cloud technology, teleconferencing solutions, e-commerce and next generation video surveillance are all elements of the very near future. And all of it is available today already at a cost that is achievable.

In the study of top business leaders, it soon becomes plain that the best among them are all early adaptors of technology. They think differently. That is what places business leaders at the top of the food chain. How many businesses are still stuck with yesterday's connectivity, yesterday's landline-based telephones and yesterday's way of running their operations? 

Will you be roasting meat while your neighbours are eating grubs? If you have found fire, never let go of it. After all, technology is the fire that lights up the world.