Time and distance are necessary ingredients for reflection. I’ve had more than 9 months of time and more than 700 miles of distance from college. I’m asking myself some fundamental questions — what did I take away from my classes and relationships? What mistakes did I make and how can I learn from them? And what, if anything, would I do differently? It’s been fun to think about this and second-guess myself with every sentence. The recurring question of “Is this or was this reality? Or are you making up a narrative to make yourself feel better?” Anyways, here are some thoughts:
I mostly enjoyed my classes. I studied Industrial Engineering and while the curriculum was not easy, it was not that hard. It left me enough time to pursue other things like extracurriculars, building friendships, and yes, this newsletter. That being said, there are maybe only 4-5 core concepts and frameworks that I think about regularly from 4 years of classes — I’m not sure if that’s great ROI…
I developed and cultivated some amazing friendships. I would rate myself slightly below average on the developing and slightly above average on the cultivating side of things — I’m a reluctant first time customer but a loyal repeat one.
In large part, I think the value of college for me — as I suspect it is for many — was in simply growing up. For me, this means becoming more comfortable with yourself while still being open to new experiences. It means thinking about what kind of friends you want to surround yourself with and becoming better at identifying who “your people” will be so you surround yourself with people who rub off on you in some positive way.
Anyways, I appreciate you indulging me there. I want to become more comfortable sharing personal stories and lived experiences. I think that’s where I can do some of my best writings.
In this issue of Snapshots, I want to talk about:
Hot Seat by Jeff Immelt
Why the Artificial Intelligence revolution hasn’t happened yet
Narvar revisited in the context of what type of writing I want to do
Professional ghostwriters, Akira Kurosawa, and Private Equity’s Amazon play
Book of the week
When I covered From Third World to the First about Lee Kuan Yew and the Singapore success story, I started with the following paragraph:
I would describe the central challenge of leadership as context-switching. As a leader of a country or company, you have many levers at your disposal. Each situation requires a different mindset to solve the problem. I distinctly remember reading the first chapter of Bob Iger’s biography, The Ride of a Lifetime, and thinking about how difficult it must be to switch between opening a new Disneyland location and responding to the Orlando nightclub shootings at the same time. So how do you select which lever to use and to what extent do you use it?
Imagine doing that for one of the most mythical companies in the history of not just the United States, but probably in the history of capitalism. And imagine doing that as the successor to one of the most mythical CEOs in the history of not just the company, but in the history of capitalism.
That’s where Jeff Immelt finds himself on 7th September, 2001 — the date that he became General Electric’s 10th CEO. More people had walked on the moon. And if that date’s proximity to an infamous date sends shivers down the spine of Americans today, it didn’t send any shivers down Immelt’s spine on that date as he was blissfully unaware of what was about to happen.
The hot seat couldn’t have been hotter. Then it got hotter still.
On the eve of 9/11, Immelt realized that the tragic loss of 2 employees and the substantial direct $600 million hit to GE’s insurance businesses was just the start. The Aviation business was the Koh-i-noor in GE’s crown jewel. They powered the flight of America’s aircraft fleet. And overnight, America had stopped flying.
The legend of Jack Welch — General Electric’s previous CEO — only partially matched its reality. While Welch’s metric-driven approach had made General Electric’s shareholders incredibly rich, Welch’s cult of personality pervaded every part of GE. According to Jeff, Welch had a crew of sycophants who made Jeff’s succession hard.
GE’s historical role in holding the mantle of innovation had been taken over by tech companies. With their fresh legs and the suitable track of the internet, they were running laps around GE. On the other hand, GE’s balance sheet was bloated by its lending services which made it look like a star athlete. In fact, it was an all-star well past its prime.
Context switching? Phew. This was going to be much harder than that.
Knowing that this would be hard, Immelt lays out a self-written recipe of success:
I’d always believed an important determinant of success could be found in how one answered three questions: How fast can you learn? How much can you take? And what will you give to those around you? I knew a lot of my strengths and weaknesses, but did I have all the tools I needed?
In the rest of book, Jeff tries to find the right answers to these questions. And even though he had written the questions himself, he wouldn’t be able to answer them.
So, why did that happen? Why did the rightful heir—an heir who had worked at GE for his entire life after business school—fail in answering the questions he had asked? Was it destiny? Was it organizational inertia? Or was it the unique failings of a single man?
Stay tuned to find out next week.
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In his 1926 novel The Sun Also Rises, Ernest Hemingway writes a dialogue between supporting players Bill Gorton and Mike Campbell. The dialogue is about how Mike went bankrupt, “Gradually and then suddenly.”
That’s the current state of affairs in the world of Artificial Intelligence as it continues to nip away at the most important problems we face—climate change, healthcare, etc.—at their edges.
The big hurdle to get to the “suddenly”? According to UC Berkeley’s Michael I. Jordan:
The problem had to do not just with data analysis per se, but with what database researchers call provenance—broadly, where did data arise, what inferences were drawn from the data, and how relevant are those inferences to the present situation?.
Some companies have looked to plug in some of these gaps, but they mostly remain open. Jordan also lays out the path forward and the challenges we face:
While the building blocks are in place, the principles for putting these blocks together are not, and so the blocks are currently being put together in ad-hoc ways. Thus, just as humans built buildings and bridges before there was civil engineering, humans are proceeding with the building of societal-scale, inference-and-decision-making systems that involve machines, humans, and the environment. Just as early buildings and bridges sometimes fell to the ground—in unforeseen ways and with tragic consequences—many of our early societal-scale inference-and-decision-making systems are already exposing serious conceptual flaws.
Unfortunately, we are not very good at anticipating what the next emerging serious flaw will be. What we’re missing is an engineering discipline with principles of analysis and design.
This makes me think of an article I featured on a previous issue of Snapshots about how companies are adjusting how they list recipes based on the vagaries of Google’s SEO algorithm. Path dependence is a powerful force and it seems like a bad idea to have AI use cases and efficacy determined by the profit motive of a single corporation.
Business move of the week
Part of the reflection I’ve been doing is about this newsletter:
What makes an issue or a section successful? Are they the same thing?
Is this a newsletter that people read or skim?
Should my goal of building great relationships through the newsletter still be the thing I optimize for?
Although I am not 100% sure about the answers to these questions, I am confident in one thing: my best writing comes from my observations, not my analysis. It’s only when I notice something in my day-to-day engagement with consumer-facing companies that I can write something genuinely differentiated.
This is good and bad news. Good because I know what works. Bad because what works if very difficult to reproduce organically on a weekly cadence.
Perhaps one of the few times I did manage to get this right was when I wrote about Narvar. Unfamiliar with them? Well, that’s probably by design. Since the newsletter has grown substantially since then, I thought it would be useful to share the essay again:
There’s an accepted sentiment in e-commerce now is that success can only be found by either being the empire or the rebels. The empire consists of Amazon, Walmart, Target, et al where you can buy anything you want. The rebels are powered by Shopify, an association that may be second best only to Apple’s “Think Different” ad driven association with the greatest leaders of our generation.
But there is a growing resistance from the middle. Companies that are neither the empire nor the rebels. Companies that are big enough to do without bending their knees for the empire but don’t want to hang out with the tiny rebels.
Put another way, there are long tails and fat head. But there’s also a big belly of brands to be powered.
This belly might ignored by analysts, but it is not ignored by industry operators. One such operator is Amit Sharma, the CEO of Narvar:
First, #beardgoals. Second, Amit founded Narvar in 2012. It is an enterprise SaaS platform that aims to increase long-term brand loyalty at every step of the post-purchase experience for the customer.
📽️ The Humanistic Philosophy of Akira Kurosawa: Armed with my Criterion Channel subscription, I have become interested in Japanese filmmaker Akira Kurosawa’s work. While I have enjoyed individual films, I don’t yet have the context across a lifetime of work to tie them through themes. This video does exactly that.
💵 Private Equity’s Amazon play: Over the last year, there has been an emerging playbook of rolling up Amazon brands at different revenue levels and help them scale up to their next revenue milestone. It’s essentially a focused private equity play.
While there have been some clear winners, I’m interesting in hearing the bear case of this playbook. When does it break down? What kind of businesses is it suitable for? What are the key risks?
That wraps up this week’s newsletter. You can check out the previous issues here.
If you want to discuss any of the ideas mentioned above or have any books/papers/links you think would be interesting to share on a future edition of Sunday Snapshots, please reach out to me by replying to this email or sending me a direct message on Twitter at @sidharthajha.
