Increasing Returns or: Problems are our Friend

“Hey, I have a little expertise in government pensions.  I could increase your annual return if you just let me invest a small portion . . . .” – Bones

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My current computer techs.  Yeah, I’m not kidding.

In my first job after getting my master’s degree I ended up in a department with 10 other folks, all of us technically minded.  During college, I had built my own computer and had also done a fair amount of programming.  I even knew DOS (no, I’m not yelling “TWO” in Spanish – DOS stands for Disk Operating System, and it was what originally put MicroSoft® into a profit making position).  I knew DOS due to some patient friends, and I bought my original PC from a certain frequent commenter (GS) to this site for about $100.  When I started my new job, I knew more about computers than most of the people in the group.

And when anyone in the group had problems, they’d ask Willie (the other guy who knew computers pretty well) or they’d ask me to fix it for them.  This actually predates the company having an IT department or even a coherent IT policy.  If employees with computers made more money for the company than employees without computers?  Buy the employees computers.  If the employees are too stupid to use/fix their own computers?  We’ll get new employees.

So when I was asked a question, I generally (80% of the time) knew the answer quickly.  About 20% of the time, I had no idea, but knew enough on what sorts of things to try that might get to a solution for my coworkers friends.  (This job was generally sitcom-level fun.  We were all recent college grads and we were constantly at each other’s houses for parties, dinners, and what-not.)

Soon, I’d seen most problems you could have with PC software – since I was solving my own problems plus the problems of 10 other people (Willie and I would collaborate on the toughest problems).  The company finally got an IT department, but the first commandment was:  Don’t Let John or Willie Know Where We Keep The Servers.  I have no idea why they did that, since we didn’t know much about servers at all.  Maybe they thought we’d take our trial and error methods to the entire company and erase the payroll files while we were installing new screensavers?  Maybe they were wise in not letting us know where the servers were?

Anyway, the point I’m trying to make is that neither Willie nor I knew all that much about computers when we started, but we knew just a little bit more than our friends.  A little bit of knowledge combined with solving the problems of 10 people builds the foundation for a LOT of knowledge.

I know a little bit (tiny bit) about making computer chips.  Intel®, however, knows a LOT.  Intel© has been making computer processor chips for nearly fifty years.  So they have fifty years’ worth of experience, right?

No.  Intel™ has about 100,000 employees.  Let’s pretend that 10% of the staff solves problems in production – learning how to make chips quicker, more reliable, minty smelling, etc. at any given time.  That’s 10,000 people.  For fifty years.

Doing the math, Intel® has invested up to 500,000 man-years into making awesome chips.  To catch them?  You’d have to duplicate that level of investment.  Numerous examples exist where entire geographic areas become excellent at doing some sort of manufacturing – Japan led the consumer electronics boom.  China makes I-Phones® faster than any other country could.  Detroit.  Well, it used to make cars.  And as much as I kid, Detroit still has amazing technical skills when it comes to cars.  Silicon Valley?  Yeah.  They’re the current bright spot for information innovation.  Southwestern Art?  Go to Santa Fe.  Really good at lying?  Try Washington D.C.

This isn’t a new phenomenon.  If you look into the trash piles of ancient Britain, you find that during the Roman period, the dishes used by the common man were – pretty nice.  (And archeologists LOVE dishes.  They break, and you have to get new ones, so they tell you a lot about what’s going on with a culture.)  Dishes were shipped to Britain from Southern Gaul (France) where they specialized in making plates.  Once Britain was cut off from the collapsing Roman Empire?  The dishes got crappy – the British hadn’t had to make their own dishes in hundreds of years.

When Rome collapsed, dishes got bad, not only in Britain, but everywhere.  When the trade routes and common currency collapsed, the plate makers had to do something else to survive.  The trade routes, currency, had created a center of excellence that disappeared pretty quickly once the Empire was gone.

Solving problems to get better works for Nations.  It works for Regions.  It works for Companies.  And it works for Individuals.

If you want to be awesome, solve hard problems.  Sometimes the biggest problems are the biggest blessings . . . except that DOS is about as familiar as hieroglyphics nowadays, so solving that problem is probably not important.

Did I mention that you should learn to solve important problems?  Yeah.  My bad.  Important problems.  Solve those . . . .

Author: John

Nobel-Prize Winning, MacArthur Genius Grant Near Recipient writing to you regularly about Fitness, Wealth, and Wisdom - How to be happy and how to be healthy. Oh, and rich.