GOD – the remarkable invention of a criminal genius??

The other day I was having an interesting discussion with a good friend (he is currently selling sanitary napkins for a health care major in Vizag and he lives alone by the seaside) of mine from IIMC who is writing a book on philosophy (at least that’s what he claims). I don’t remember how we got about discussing religion and GOD starting with randomness (guess that’s what talking about randomness does) but we did and suddenly an idea struck me. Could the concept of GOD have been a remarkable invention of one of our ancestors –most likely a criminal genius??

Humans being have a remarkable ability to find patterns (even in randomness) and develop cognitive shortcuts (biases). On one hand these abilities help us make sense of the immensely complicated world around us and help us in times of danger by reducing the processing times of our decision making. On the other hand, they are responsible for us drawing incorrect conclusions from information, both insufficient and incorrect and get thoroughly confused between correlation and causality. Why did ancient human beings have to resort to a supra human entity to explain the then unpredictable/apparently completely random natural phenomena like earthquakes, floods and epidemics instead of accepting the fact that they don’t understand the causes and that they need to investigate further? Why is it so difficult to deal with uncertainty?

My guess is that the concept of GOD is a brilliant conception of an evil genius, a genius who exploited the human mind’s innate weakness to his benefit. It’s a masterstroke. Multiple sources of uncertainty can now be neatly encapsulated into a single one – GOD. Also the causes of destructive/constructive random events can now be explained through anger/happiness (emotions that are pretty easy to relate to and understand) of GOD and correlated to activities performed by humans. It shouldn’t be very difficult for a genius to find spurious correlations. The biggest benefit to the genius is obviously the ability to influence people at will.

Now the only question that needs to be answered is the following - how did the person predict GOD’s moods given that he really does not understand how they work? Pretty simple, all he had to predict was to consistently predict a bad outcome and hope for the best (that is the occurrence of the bad outcome J) and he would have had a pretty good run.

So my humble submission is that GOD is a remarkable invention- an abstraction much ahead of its time and could only have been conceptualized by a remarkable genius having a remarkable understanding of probability and yes RANDOMNESS.

My latest orkut photo

Edwise - exploiting the long tail of education

I recently finished reading Chris Anderson's 'The Long Tail'. It is one of the best business/economics/culture books I have read in recent times.In it Anderson talks about how the empahsis is shifting from blockbusters to niches and how infinite choice is creating unlimited demand.Anderson gives a lot of examples of companies exploiting the long tail of demand in various industries - e.g. Amazon(books), Google(adverstising), Netflix(dvds), Itunes(Muisc) etc. As I was reading the book I was trying to think of local companies trying to tap the demand in the long tail and players taking advantage of the long tail in other industries. The first company which came to my mind was this company called Edwise. Edwise provides educational consultancy (for free almost!) and value added services to students interested in studying abroad.

Unlike the big companies mentioned in the book which cater to the demand in he 'head' as well as the 'tail', Edwise caters to demand only in the 'tail'. The business model of edwise is pretty simple. It has tie ups with a large number of universities in countries like US,Canada,UK, Singapore, Australia, Switzerland, New Zealand and Hongkong. These institutes do not include the top rung universities which essentially makes them a part of the long tail of education in the respective countries. Consultancy here means helping the student choose a set of countries, courses and institutes.Value added services mean various services required by a student starting from couriering the application forms to the institutes the student has selected to finding accomodation in the place where the student has finally enrolled.

Ok now here is the interesting part about how Edwise makes money without charging the student a penny. Edwise gets a commission from the university(Edwise should have a tieup with it ofcourse!) for every student who joins it.It gets a commission from the value added services it provides.What about the costs??Almost all the costs involved are fixed costs.And the major costs I can think of are rents for decent sized rooms which can accomodate on an average 2-3 counsellors, a broad band connection at each of the places and man power costs. I leave it upto you to estimate the profits(atleast I think its a profitable venture).

What I like most about this whole idea is the way it fits beautifully into the framework proposed by Anderson in the long tail.In 'the long tail' he says:

1)Give people a lot of choice.
2)Help them choose.

Thats exactly what Edwise has done. Edwise gives the student enormous choice using the power of the internet, hundreds of universities to choose from and it also helps them choose by recommending institutes and courses to students. Edwise can provde so much choice because the marginal cost of a tie-up with a new institute is negligible.The demand for each of the universities from a country like India will be very low but the cumulative demand for all the universities will be a sizeable number given that not all students can get into the blockbuster universities like MIT, Stanford, Harvard, LSE or other top rung universities and that different students have different preferences.

The student wins because he does not pay anything, the university wins because it gets more students and in a lot of cases foreign students are charged more than locals and Edwise wins too.

Check out The Long Tail and Edwise

Books - My second love

My love for books is surpassed only by my love for Mathematics.The sight of books fills me with joy undescribable. I have always nurtured this dream(supposed to be a secret) of setting up a library because I know how difficult it is to get access to great/good books in India and I wanted to do my bit to make things slightly better.

The credit for developing the reading habit in me goes to my mom who made sure that never missed a single book fair when I was in school despite not being a voracious reader herself. I shall always remain grateful to her for this.

My love for books in mathematics was kindled during my IIT coaching days and the credit for this goes to one Mr.Koteshwara Rao, one of the best mathematics teachers I have met.Even after nine long years, I can still recollect with great fondness, the enthusiasm, passion and energy he exuded while teaching.It was he who introduced us to Bernard and Child's Algebra, Dorofeev's Elementary Mathematics, Tom Apostol's Calculus, Shklarsky's Problems in USSR mathematical olympiads, some of the best books of high school mathematics ever.The sheer joy of solving problems or reading these books is inexplicable.

Though initially I was only interested in collecting good books on mathematics, it was IIT, Kharagpur's library (one of the biggest technical libraries in Asia) which exposed me to great books in a lot of other domains(though mostly scientific like physics, computer science, aerospace etc) and it was then that I started collecting non-mathematical books.

My love for books only kept growing and my intersts have only widened. While I was working for a software development firm in Hyderabad, I used to buy a lot of books about Computer Science and Engineering and software development.Bjarne Stroustrup, Gang of Four, Sipser, Ullman, Brooks, Kernighan and Ritchie, Pressman - all great authors.Thanks to the increase in disposable income, I also bought books like GEB, Selfish Gene and other non-fiction books once in while. During the 3 years I was in Hyderabad, my book collection swelled to around 800 books.

CAT coaching had a big big impact on my reading habits. The preparation for the RC section in CAT(considered one of the toughest sections mainly because of our reading habit which is almost nonexistent)consisted of reading passages from very varied domains including philosophy,politics, business, literature, sociology, anthropology, psychology and science. I started buying books like Arundhati Roy's the Algebra of Infinite Justice, Bertrand Russel's History of Western Philosophy, Jack Welch's Straight from the Gut etc.My reading speed no doubt improved but more importantly my perspective broadened.From here on a lot of books on philosophy, economics, business etc found a way to my library.

My stay at IIM, Calcutta reinforced this trend further.IIMC's library is one of the biggest Management Libraries in Asia,it was here that I got to read some absolutely fantastic books on economics, finance, mathematics(surprisingly!) and gerneral management.I also started buying a lot books thanks to the guy who came to our Hostel with the latest business best sellers.

I can proudly say that I am now an owner of more than 1000 absolutely wonderful books in a wide variety of subjects like mathematics, physics, computer science, artificial intelligence, philosophy, economics, business, genetics, biology and history.

Some of the books I have read recently:
My rating scale - very bad, bad, ok, good, excellent

Fooled by Randomness - Excellent
The Long Tail - Excellent
ROI selling - Good
Valuation - Excellent
Interpreter of Maladies - Good
The Google Story - Ok
Understanding Arbitrage - Good
It's Not About The Bike - Excellent
The McKinsey Way - Good
The monk who sold his ferrari - Ok


Currently I am reading "Blue Ocean Strategy".

The Paint industry-1

Though the paint industry may seem very unglamorous and low tech,in reality it is one of the most challenging and complicated industries to be in.This series of posts will try and tell you why it is so.

Paint - the product

One has the feeling that all paints are the same, but infact there are atleast three different categories, namely decorative, automotive and industrial.That the characteristics and the purpose of the productsin each category are quite different should be obvious from the names.Industrial paints are used in harsh environments(e.g. boilers),have to be able to withstand high temperatures, have to be very durable.Automotive paints are used for automobiles, decorative paints are used for housing and furniture.There are also many subcategories in each category.In the decorative category we have various subcategories like enamels, wood finishes, wall finshes(interiors, exteriors) etc.In the industrial category we have marine, powder coating, CRPs etc.In each subcategory we have various types.For instance in the wallfinish subcategory of decorative paints we have distempers, emulsions etc.This subdivision is based on various attributes like quality, texture and so on.In this series of posts I will be dealing only with decorative paints as my knowledge is limited to it.

Decorative paints

One peculiar feature of decorative paint is that it doesnot fit neatly into FMCG or white goods.Infact paint shares the characteristicsof both FMCG and white goods.The distribution channels are very similarto that of the FMCG while interms of cost and durability it variesfrom that of an FMCG to a white good(if painting a house is involved).Nowadays paints also come with guarantees like those of white goods.The demand for decorative paints in a country like India is veryseasonal.The demand is highest during festivals like Diwali,Pongal etc.One will be surprised to know that apart from usual dealer incentives,there are otherfactors like elections etc which also influence the demand for paint andthis makes life of the demand forecasters extremely difficult.

Expectations of consumers

Consumers also expect a lot from paints.They expect
Durability
Washability
Ability to cover up cracks
Protection
Provide lustre
Anti-poster properties

Knowledge of consumers

Knowledge of consumers as far as paint is concerned is very low.Except forthe selection of the shade where the involvement is high,the involvement of the customers is very low in purchase. The main people who influence the purchase process arepainters, contractors, dealers, architects.

What you buy is unfortunately not what you get

Though the consumer buys a tin of paint what he/she is actually interested in, is the painted surface and not the tin of painthe/she actually purchases.What complicates matters for thepaint companies is that the though the quality of paint isunder their control, the quality of the finished surface dependson a lot of factors(skill of painters, substrate condition, surface preparation,painting system, application tools,environment) not under their control.

4Ps of painting success

Proper surface preparation
Proper dilution
Proper priming
Proper painting

To be continued...

Curiosity and talking to people -2

Yesterday after dinner while I was on my way to the library when I met a friend of mine, a FP student in campus doing his Ph.D in the field of Operations Research. I casually asked him what his thesis topic was and who his guide was.I came to know that he was doing his thesis under one of the most feared profs in the Operations Management Department.To show my symapathy to him is not the only reason for this post, the main reason is to give an idea about the kind of problems he was working on.
He was working on problems regarding the assignment of aircrafts of different sizes to different trips at different points in time given the routes and the demand on each route.He was telling me that airlines in developed countries have developed complicated mathematical models to optimize the assignment and have saved millions of dollars in the process. He was trying to develop some models for indian airline companies.He was telling me that there was a lot of problem getting data regarding indian airline companies unlike those in US.One interesting idea that came up during the discussion was regarding how low cost airlines could be looking for alliances with other means of transport providers like railways and even road transport providers to make a lot of small towns which are close to cities but which are directly inaccessible by air because of lack of airports.This has advantages for both the business traveller and the reasonably affluent town dweller and could also increase revenues for the airlines because of the potential increase in demand(we have not discussed feasibility and profitability).This will also relieve the traveller from the worry of finding the connecting means of transport to her destination.Though the idea of connecting flights is not new, extending it to other means of transport might be novel.
Whether or not the idea is novel or not, the point I am trying to make is that a little bit of curiosity can go a long way in helping us learn about new ideas if not generating new ones. This reminds me of the advice of a CEO which I have read somewhere,he says its more important to be interested than be interesting.

Curiosity and talking to people

This post is dedicated to the anonymous 'commenter' who urged me to talk to people and explore things around me. The other day me and my friend went to watch the movie 'Rang De Basanti' at the Inox theatre at The Forum, Calcutta.The evening show was at 5:25pm and we reached the place 20 mins in advance.Both of us were very hungry so we went to the food court which was on the topmost floor.The food court had all kinds of stuff from Puchkas to Pizzas in stalls of different sizes.We went to the puchka stall to have some puchkas. The guy manning the stall told us that we needed to get a 'Burp!' card to buy stuff and that cash was not accepted at the stalls. Me and my friend wondered why the payment procedure had to be so needlessly complicated.The MBAs ;) that we were we decided to investigate the logic behind the 'Burp Card'.

The Burp card is a swipe card akin to your credit card. Only that the limit is determined by the amount you pay at the counter.You also need to pay Rs.25(caution deposit for the card I guess) extra for the card which is refunded if you return the card. You have use the card at the food stalls to buy stuff and based on your purchases the amount gets deducted from the card. All this is fine but we still couldnt figure out what purpose the card solved.

When we went back to the puchka guy, we asked him what the advantages of the Burp card system were.The guy told us that the Burp card system helps 'The Forum' management keep track of the sales generated at each store.The stall owners dont pay a fixed rent for the stall space, instead they pay 'The Forum' a percentage(which is outcome of the negotiations between the stall owner and 'The Forum' management) of the stall's sales. The advantages of this system are obvious. In case the sales are high 'The Forum' guys gets to benefit and in case of lower sales the stall owner doesnt get affected very badly like he does in case of a high fixed rent.'The Forum' management determines the ranges of the prices of the food items which are sold and it can also get rid of the stalls which have not been performing well as it has the sales information.
Interesting stuff I thought(revenue sharing, a concept I studied in supply chain management)...

We were not disappointed with the movie either..excellent visuals and very nice songs.All in all it was good fun.