How to save yourself from yourself?

Why Systems Oriented Thinking is the only way out...

Photo by Yuriy Bogdanov on Unsplash

“An obsession with security breeds a feeling of insecurity.” - Tim Ferriss

Have you ever met anyone wanting to be a millionaire but with no work ethic to support that ambition? Or, do you have any friend who aspires to live a healthy life but his habits are not in sync with his aspiration? Even easier, ever met anyone who wants to be at the top of his industry/company but his demeanor doesn’t match that goal?

If the answer is yes, then think for a moment how that very person would be feeling on a daily basis? What would be his state of mind when he is falling short of his north star day after day, week after week, and year after year. Chances are that he might be frustrated or filled with anxiety or overconfident in his abilities and ill-prepared for a potential shock in the future, surely fuzzy in his thinking, and desperate, in extreme cases.

The reason for that is simple - your Human OS Operating System doesn’t like delays, failures, rejections, and disappointments. It would like to avoid these at any cost, choosing to go out of line to avoid these bitter feelings. Sometimes, people act like ostriches, digging their heads or covering their eyes just so that they cannot see the failure staring them right in their face. 

But if the disappointments don’t stop, then the Human OS has the tendency to give up entirely on its goals and not fight for the coveted prize anymore.

That’s exactly why you see so many around you lacking the zest and zeal for life as feelings of failure and disappointment have blunted their enthusiasm for life. Exposure to Social Media even makes the problem worse, as your feelings are supplemented with news of others making it big in life, inspite of they being less talented than you are (at least that’s what most assume).

This is also the reason why many investors have given up on their aspiration of generating life-changing wealth for their families and generations. After many failed attempts to invest in multi-baggers of sorts, they have resorted to saving their money in deposits or buying real estate with piddly rental yields or blindly trusting Salesmen who reach out to them via cold emails, attractive Instagram feeds, or passionate opinions about the Market behavior on Youtube channels. 

The most predictable outcome will be that these Investors won’t see their money compound handsomely, while their ignorance enriches the various market participants along the way.  They may make some money, giving them the illusion that their money is working for them. But, what’s the point of having your staff work only 7 days in a month but paying them 30 days salary ;) That’s exactly how it is when your money isn’t working for you well enough.

Worse, they might take very risky calls to make up for the lost opportunities in the past. Many Tesla or Bitcoin investors are late entrants to the party and hence they are leveraging up on Options contracts for these securities, in record levels never seen before. Call it FOMO on steroids, exactly as this article spells out. This won’t end well for millions of investors globally.

This entire pursuit of quick gains on basis of irrational investing, displaced from any understanding of cash flows, business strategy, accounting principles, or capitalism, is a direct outcome of being driven by goals only, with no focus on systems or any rationale. Though, the few that strike big will attract press coverage and TV interviews. But many will be kissing their hard money bye-bye.

Recently, I was reading Scott Adams's book and I came across his views on being system-driven vs goal-driven. To say the least, his views struck a chord with me and I was hooked. Let’s look at an excerpt from chapter # 6 of the book -

Goal-Oriented people exist in a state of continuous presuccess failure at best, and permanent failure at worst, if things never work out. Systems people succeed every time they apply their systems, in the sense that they did what they intended to do. The goals people are fighting the feeling of discouragement at each turn. The systems people are feeling good every time they apply their system. That’s a big difference in terms of maintaining your personal energy in the right direction.

If you are thinking that a systems person needs to have clarity of his goals, then that may not be true. A systems person may be hazy about the goal but very clear in its direction, and hence he commits to moving in that direction daily, not stressing about reaching there by a particular time or reaching a particular destination.

E.g. Warren Buffet was very clear about becoming rich so he could be independent in life. Now that is very hazy compared to becoming the CEO/Chairman of a Trillion-Dollar Company with stakes in 100s of Operating businesses globally, with a very credible team and a decentralized culture that makes for case studies at Harvard and Standford. That’s what Berkshire Hathaway has become (almost a Trillion-Dollar). But this is not what Warren Buffet focussed upon or even had an inkling of in his teens. He just wanted to be rich, not even famous, just rich. And what fuelled his success story is a string of systems in place that he has followed for 6 + decades. 

I have written a post on Warren Buffet and you can read it here and here. But one of his systems has been ‘Reading 500 pages every day.’ That’s a simple system that he follows to this day but it’s not as simple in its execution. Executing this daily system would require him to do the following -

1. Stay away from distractions (hence the choice to live in Omaha and not New York)

2. Stay away from the herds (hence no attendance at social gatherings/parties/gala dinners/seminars/conferences/board meetings)

3. Not much time with family (his children were mainly raised by Susan, his first wife)

4. Not much time on noise (used his computer only to play games)

5. Staying away from expensive habits or fancy things (lives in the same house for 50+ years, drives a simple Cadillac, eats at Mc Donalds daily)

I could go on, but his life is an expression of his systems in motion. The success he achieved was the result of multiple iterations he had to do, as a response to changing business landscape and opportunities therein. The reason he continues to succeed is that he continues to build upon his systems, instead of basking in the glory of his successes.

Whereas in many people’s lives, the accomplishment of goals creates a kind of chaos -

1. It’s done, now what (That’s the reason Olympic Gold medallists complain of burnouts, anxiety, and other mental issues as shown in the documentary ‘Weight of Gold’)

2. It doesn’t allow you to cherish the present. Hence begins the search for the next high to accomplish, the next dopamine hit, the next climb.

3. Your identity is derived from your goals and hence you tie your own self-esteem with the accomplishment of it. Your self-image takes a blow if you fall short. And hence, you become vulnerable again to anxiety, stress, pressure, or other mental ailments. 

4. Your obsession with goals could lead to you making very painful mistakes, from which there may be no turning back.

But, if you look into the life of a systems person, his success is merely a reflection of his systems in place. And success keeps on piling up for these people, even after they have passed away. 

If you go through the Business Wars podcast covering Apple vs Blackberry, you would realize that Steve Jobs was very clear about the quality of products he wanted to launch and wouldn’t take NO for an answer. That forced his people to their wit’s end to come up with solutions that actually contributed to making the best consumer product of all time i.e iPhone a.k.a. The Jesus Phone.

But the biggest lesson from the podcast was about the co-CEOs of Blackberry being married to the goal of selling millions of Blackberry devices, vesting backdated stock options, and unnecessary focus on the stock price, while they overlooked the quality aspect in their devices. It became about beating Apple at any cost, and what a tremendous cost did RIM (owner of Blackberry) and their shareholders eventually had to pay. Apple eventually dethroned Blackberry, reducing it to a sliver of its previous success. 

In the Netflix Documentary ‘Jiro Dreams of Sushi’, the Chef has only strived to work on his skill to gain mastery. He doesn’t care about the money, but only the quality of his food and the delightful experience he can create for his clientele. He has a waiting period of months for customers to eat in his restaurant in Japan. It’s great that he has become the most celebrated Sushi Chef worldwide, but that was an outcome of his systems-led thinking. He never aimed to become the best chef in the world, he just sought to better his game, daily.

• He would personally go to the Fisher’s Market to select the best catch for his restaurant. He did this for decades, only recently being replaced by his son for the cherry-picking.

• He poured his heart and soul over making sushi, day in day out, for decades.

• During his apprenticeship, he worked even if his boss slapped him. That’s very different from today where people quit their professions because of a frivolous argument.

• He has never hated his job. He fell in love with his work and gave his life to it. He is 85 years old and still going strong.

• Inspite of being the founder of Sukiyabashi Jiro, which has won 3 Michelin Stars since 2007 (only being dropped in 2019 due to no public reservations being allowed), he still states “I haven’t reached perfection.”

This documentary is a must-watch for anyone serious about attaining mastery over his preferred profession.

The goal in any sport is to finish with the best score, but it would be ridiculous to spend the whole game staring at the scoreboard. The only way to actually win is to get better each day. In the words of three-time Super Bowl winner Bill Walsh, “The score takes care of itself.” The same is true for other areas of life. If you want better results, then forget about setting goals. Focus on your system instead. 

What do I mean by this? Are goals completely useless? Of course not. Goals are good for setting a direction, but systems are best for making progress. A handful of problems arise when you spend too much time thinking about your goals and not enough time designing your systems. - James Clear 

If you have read till here, then kudos to your hunger to learn. But let’s give learning some well-deserved break, and take on some action in the direction of becoming system-oriented. Do take a pen and a paper, and write down the answers to the following questions #

1. What do I need to do daily to get better at the skill I aspire to master?

2. What do I need to do daily to get better physically?

3. What do I need to do daily to make my relationships extraordinary?

4. What do I need to do daily to improve upon my job/profession?

5. What do I need to do daily/weekly/monthly to increase the odds of building a multi-million dollar nest egg?

6. What do I need to do daily to build my Emotional Quotient (EQ)?

7. What do I need to do daily that saves me from myself?

8. What do I need to do daily to become a better version of myself?

I will share with you my answers to these questions below #

1. Read Annual Reports/Research Reports/Analytical Blogs/Industry Analysis/Screeners for at least 60 mins per day

2. Avoid unhealthy foods (like sugar) and work out 5 times a week minimum

3. Talk to them daily and express my love and respect for them in my own way. “I love you”, “I miss you”, “Thank You” and “I’m sorry” go a long way in building great relationships. So I use them generously and I mean it when I use them.

4. Deliver on the tasks at hand and if there is any delay, then I communicate the same and set a new timeline for it.

5. I save more than 50% of my monthly income e.g. I avoid spending on the latest gadgets till they are at least 6 months old (till then I have mostly lost interest in them completely and hence I’m still using my iPhone XS). Also, I spend only what’s available with me as Cash, avoiding buying anything on loan even if it costs me nothing to distribute the payments on a monthly basis at 0%. It’s not the cash outflow, it’s the habit of buying now and paying later that I’m avoiding. It makes billions for companies but it leaves ordinary mortals like me with a habit of spending now and hoping later, which I do not subscribe to.

6. I sleep well i.e. 8 hours daily so I can think well, act in the right spirit, be thoughtful of my actions and respect all relationships I engage in. Without proper sleep, a lot of dependant variables get affected, at least in my case.

7. I avoid toxic exposure of any kind i.e. people, social media, videos, groups, or conversations. I do not spend more than 30 mins on social media daily and no more than 1 hr of TV time. I assess myself on all of my daily metrics using the app ‘Way of Life’

8. Take time out to learn daily and also take time out to reflect daily. Reading or watching educational videos form my learning habit. Journalling forms my reflecting habit. Even writing a blog is an expression of my intention to reflect upon my learnings. Our podcast (with my co-host Jai) is another medium for expressing my intention to articulate my learnings in its simplest form.

“A writer is unfair to himself when he is unable to be hard on himself.”
— Marianne Moore

Building a system for yourself is being hard on yourself. It’s being cold or unemotional sometimes. It risks making you look like an outcast or a weirdo. It exposes you to people’s irritation for you being different. It doesn’t feel good many times e.g. days I wanna sleep and not work out at my usual 6:30 am. But I still got to get up and do it. I got to fight the gravity of mediocrity and resist the temptation to give in to the temptations. Only then do I stand a chance to survive and thrive.

I do not know where these systems will lead me. But I’m enjoying the journey along the way and loving the scenes I get to see, the places I get to travel to, the people I get to meet, the respect and love that comes my way, the opportunities that allow me to compound my money handsomely and the magic carpet ride it turns my life into.

You too can hop on the ride, the journey’s just begun. As Jeff Bezos would always say “It’s Day 1”

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Recommendations for the week #

Frederik Gieschen is an amazing writer and he blogs on Substack under the title ‘Neckar’s Insecurity Analysis’. His recent post was a beautiful one regarding following one’s path and letting it unfold with time. It takes a lot of courage and it was inspiring to read an account of someone who is building his work in public.

Jim O’Shaughnessy is the Founder of OSAM Research and an incredible handle to follow on Twitter. If you follow him for 6 months, you could profoundly damage your ignorance and overconfidence ;) His 6 part series on Thinker & Prover is a must-read. It’s a deep dive into how your mind works and how it induces thoughts that drive so much of your action and progress, or inaction and failure.

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I have moved into a new home and am in process of setting it up. Haven’t been able to do a lot of reading in the last week and even the podcasting has been on hold for a few weeks. But starting next week shall get back to my daily cadence on pursuing rabbit holes for topics that interest me and restart our weekly podcast recordings.

Hope our US readers had a great Thanksgiving holiday. All of us in Dubai are looking forward to our long weekend next week.

Stay Safe & Happy System Building !!