Monday, March 19, 2018

Theranos: Knives Out, Razors In

The knives are out for Elizabeth Holmes.  If my social media feeds are any indication, the young entrepreneur, who recently settled charges of massive fraud by the SEC, should already be in jail.  It’s a kind of crowd-sourced Schadenfreude directed at the one-time, youngest-in-the-world, self-made female billionaire whose company is today one secured-loan away from bankruptcy.

In the world of virtual knives, it’s a Twitter melee.  And in the world of razors, the SEC action suggests Holmes and her company are best described by Occam’s advice: The simplest explanation is usually the best.  In other words, Theranos was nothing less than one giant scam.

But there’s another razor, Hanlon’s, that shaves in a different direction, advising never to ascribe to maliciousness what can be explained by ineptitude.  In other words, assume stupidity before assuming evil.  This explanation doesn’t excuse fraud, and Holmes (despite not admitting wrongdoing in her SEC settlement) probably won’t ever squirm off that hook.  But there’s a reading of the Theranos saga that might be more satisfying if we couple charges of massive fraud with an equally massive dose of incompetence.  And not just by Holmes, but by the entire entrepreneurial ecosystem that’s designed to support and protect young entrepreneurs whom we encourage to be bold, take chances, and put a dent in the universe.

In Outliers, Malcolm Gladwell describes a typical plane crash as the result not of a single, catastrophic event, but of seven factors, most of them small and benign in themselves: slightly poor weather, the plane being a bit behind schedule, a pilot being tired, two pilots never having flown together, and the like.  The conventional commercial jetliner, Gladwell writes, “is about as dependable as a toaster.  Plane crashes are much more likely to be the result of an accumulation of minor difficulties and seemingly trivial malfunctions.”[1]

So let’s tell the tale of Theranos with Hanlon and Gladwell in mind.

Monday, March 12, 2018

A Once-In-A-Lifetime, Cookie-Cutter Experience

Last month, my wife and I had the opportunity to cruise for a week in the Galapagos.  By any measure, even those of the jaded world traveler, it is a once-in-a-lifetime experience.

On Thursday of our cruise week, we were anchored in the harbor of Santa Cruz, one of five populated islands in the chain.  After chasing Darwin finches and hanging out with giant tortoises during the day, we were entertained onboard ship that evening by a local Galapagon band and native Ecuadorian dancers, a special treat.  After about an hour of singing and dancing, it was time for dinner, and I found myself the first one downstairs in the dining room.  Steve, our friendly, spic-and-span steward, stood patiently behind the serving line, waiting for my fellow guests to arrive.

“We’re going to be a little late tonight, Steve,” I said.  “Some of us are still upstairs dancing.”

Steve looked at me, smiled, and came as close to rolling his eyes as a professional steward on board a cruise ship ever dares.  “I know,” he said.  “It happens every Thursday night.”

That’s when it struck me: One person’s once-in-a-lifetime experience is another person’s cookie-cutter Thursday night.  In fact, our entire cruise to the Galapagos was actually the practiced craft of a team of trained professionals offering a series of carefully tested, cookie-cutter processes that insured guests were safe, sound, and on schedule as their once-in-a-lifetime experiences unfolded. 

Thursday, March 1, 2018

Historical Postcards Redux

The most popular post I've ever written dates back to 2008.  It's called "Historical Postcards and the Battle of New Orleans."  It's not my favorite post, or my best written, and I can't explain its popularity.  But it gets at something that still really fascinates me, the question of national memory.  Why do we remember certain events and people (the Civil War, Joe DiMaggio) while others slip away (the Korean War, Stan Musial)?  And what become the indelible images, the "postcards," that are stamped in the memory of a generation?

In the 2008 post, I took a stab at naming the five events that had the greatest impact on my generation (mid-to-younger Boomers): 9/11, the Challenger disaster, the moon landing, the assassination of Martin Luther King, and the assassination of JFK.

It's now a decade from that 2008 post, and the Pew Research Center has asked roughly the same question, expanded to include a "series of related events."  As you can see, 9/11 ranks first, followed by the election of our first black President and the tech revolution.

This list, which includes events over some sixty years, can be broken down by generation.  Pew has done that: