Reading Notes: The Power of Habit

Author: Charles Duhigg

Format: Audible

Subject: Human Behaivor

Rating: 10/10


This book explains why we habitually do things that are bad for us, and why we often struggle to introduce habits that are good for us.  Most of what we do everyday are actually habits.  Habits are in effect, short cuts, that eliminate the need to make decisions, and to save mental energy.  Our brains establish habits for pretty much everything.   and they do so without regard of whether the habit is good or bad for us.   What our brains do know, is that if they perform the habit, they will get a shot of dopamine.

A habit loop consists of four parts and three steps.  The three steps are: a cue, a routine, and a reward.  The three steps perform a habit loop.  We experience a trigger, we perform a routine, and then we get a reward.  Performing the habit loop delivers a powerful shot of dopamine to our brains.  But at the heart of a habit is the craving.  The reward we receive from the habit satisfies one of our cravings.  Cravings are what makes habits so difficult to eliminate.

We could try to simply resist the craving, but trying to change habits through sheer willpower is very difficult.   Willpower is finite.  If we try to introduce a habit through sheer willpower, then we will need to conserve our willpower for the moment(s) that we expect to perform the new activity.

However, if we can introduce the new behavior by re-engineering one of our existing habit loops, then we are much more likely to succeed.  The easiest way to re-engineer a habit is to keep the old cue, deliver the old reward, and change the routine.

In order to change a routine, we need to understand what cue triggers the routine.  Cues almost always fit into one of 5 categories:  Location, Time, Emotional State, Actions of Others, Preceding Last Action.   We also need to identify the reward and underlying cravings the habit is trying to satisfy.  We can find an appropriate substitute reward by recognizing the cue, changing the reward, and then waiting 15 minutes to see if the craving has been satisfied.   If it has, we have just found a new routine that we can begin executing the next time the cue is triggered.  Otherwise, we substitute a different reward, until we do satisfy the craving.

Habit Loop

Favorite Quotes:

  • The Golden Rule of Habit Change: You can’t extinguish a bad habit, you can only change it.
  • Champions don’t do extraordinary things.  They do ordinary things, but they do them without thinking, too fast for the other team to react. They follow the habits they’ve learned.  – Tony Dungy
  • We are what we repeatably do.  Excellence is not an act, but a habit.
  • But to change an old habit, you must address an old craving. You have to keep the same cues and rewards as before, and feed the craving by inserting a new routine.
  • Good leaders seize crises to remake organizational habits.
  • Studies have documented that families who habitually eat dinner together seem to raise children with better homework skills, higher grades, greater emotional control, and more confidence.  (As a side note, my wife considers family meals as sacred.  And by doing so, she has introduced an excellent keystone habit into our family’s routines.)
  •  Exercise is a keystone habit that triggers widespread change.
  • When a habit emerges, the brain stops fully participating in decision making.
  • Willpower isn’t just a skill. It’s a muscle, like the muscles in your arms or legs, and it gets tired as it works harder, so there’s less power left over for other things.


Reading Notes: Creativity Inc: Understanding the Unseen Forces That Stand in the Way of True Inspiration

Author: Ed Catmull

Format: Audible

Subject: Culture

Rating: 10/10


This book is very much the story of Pixar.  Which is a story that I found very enjoyable in itself.  But, the book also contains a lot of ingredients that make the company such a success.  Catmull, who is one Pixar’s co-founders, does an excellent job sharing his experiences over the decades long time frame the book covers.

Catmull believes that creative problem solving is critical for businesses is any industry.  The book outlines the process of making creativity a part of an organizations daily culture.

A hallmark of a healthy and creative culture is that people feel free to express ideas, opinions, and criticisms.  The word honesty carries baggage that can hold people back. So, encourage candor over honesty.  Pixar puts smart people in a room together to solve problems, and encourages them to use candor in their conversations with one another.  They refer to these meetings as a Brain Trust.

An Effective Feedback system is built on empathy; an idea, that we are in this together.  The purpose of feedback is to move the process forward.  Effective feedback requires candor, trust, and empathy.  A note is a good way to give feedback.  A good note is timely and specific, it should inspire,  it clarifies what is wrong or missing, it doesn’t have to include a fix to the problem, and it makes no demands.

Catmull also stresses the importance of “Getting the Team Right.”  He believes that great teams are far more important than great ideas.  He also encourages managers to hire people that are smarter than they are and have a lot of potential. (“hire for potential, not the past.”)  Find, develop, and support good people.    A good team is made up of people who complement each other.   Understand the mix of talent in the group, match the right people with the right task.


What I like most about the book:  

I really enjoyed listening to the many challenges that were overcome while making Pixar hits such as  Toy Story, Up, Monsters Inc.

Favorite Quotes:

  • The best way to predict the future is to invent it.
  • Quality is the best business plan.
  • If you give a good idea to a mediocre team, they will screw it up. If you give a mediocre idea to a brilliant team, they will either fix it or throw it away and come up with something better.
  • You are not your idea, and if you identify too closely with your ideas, you will take offense when they are challenged.
  • Failure isn’t a necessary evil. In fact, it isn’t evil at all. It is a necessary consequence of doing something new.
  • Don’t wait for things to be perfect before you share them with others. Show early and show often. It’ll be pretty when we get there, but it won’t be pretty along the way.
  • Getting the right people and the right chemistry is more important than getting the right idea.
  • If you aren’t experiencing failure, then you are making a far worse mistake: You are being driven by the desire to avoid it.
  • What is the point of hiring smart people, we asked, if you don’t empower them to fix what’s broken?
  • You don’t have to ask permission to take responsibility.
  • Be patient. Be authentic. And be consistent. The trust will come.
  • It is not the manager’s job to prevent risks. It is the manager’s job to make it safe to take them.
  • If there are people in your organization who feel they are not free to suggest ideas, you lose.
  • Societal conditioning discourages telling the truth to those perceived to be in higher positions.
  • There is nothing quite as effective, when it comes to shutting down alternative viewpoints, as being convicted you are right.
  • Measure what you can, evaluate what you measure, and appreciate that you cannot measure the vast majority of what you do.

Reading Notes: Zero to One

Author:  Peter Thiel / Blake Masters

Format: Audible

Subject:  Entrepreneurship

Rating: 10/10


Zero to One is easily the most interesting book that I have read in the past several years.  And, that is saying a lot since I was initially very skeptical about including it on my reading list.  The book held my attention from beginning to end.  Thiel’s covers a variety of topics that are designed to get the reader thinking.  At its core, Zero to One, is essentially a book of ideas.  And many of those ideas challenge the status quo.

Blake Masters narrated the Audible version of the book.  His dictation style has a nice flow to it.  Other narrators could learn a thing or two from him.

Zero to One vs Zero to N:

  • Zero to One: is vertical progress. New technologies. It creates something where nothing existed before.
  • Zero to N: is horizontal progress. It is the act of iterating over existing technology.

Thiel’s Core Beliefs:

  • Globalization is doomed without technological innovation
  • Capitalism is the opposite of competition
  • We can shape our core future

Lessons Learned from Bubble vs Thiel’s Viewpoint:

Lessons Learned?

Creating a Monopoly:

  • Must be a order of magnitude better than the next option (10x)
  • Target a small group of particular people concentrated together and served by few or no competitors
  • Once you dominate the niche market then expand to adjacent markets
  • Don’t disrupt
  • Avoid first mover advantage; target making the last great development in a specific market and reap the rewards of a mature ecosystem.
  • Founders should know each other very well before starting the company.
  • Everyone should work in the same physical space. (No telecommuting.)
  • Everyone should be a full-time employee.
  • Lower CEO pay increases the chances for the start-up to succeed.
  • Advertising Works

Maintaining a Monopoly:

  • Create Network Effects: the more people using your product, the greater the network effects are.
  • Economy of Scale: Lowers production and distribution costs
  • Branding: Increases awareness.

Theil’s Seven Questions All Businesses Should Answer:

  1. Engineering – Can you create a breakthrough technology instead of incremental improvements?
  2. Timing – is now the right time to start your particular business?
  3. Monopoly – are you starting with a big share of a small market?
  4. People – Do you have the right team?
  5. Distribution – Do you have a way to not just create but deliver your product?
  6. Durability – Will your market position be defensible ten or twenty years into the future?
  7. Secret – have you identified a unique opportunity that others don’t see?

Sales people compared to their products:

  • Advertising -> Account Executive
  • Customers -> Business Developer
  • Companies -> Investment Bankers
  • Yourself -> Politicians.

Theil’s Favorite Interview Question:

“What important truth do very few people agree with you on?”

  • Causes people to reflect on self-created knowledge.
  • To become socially unpopular by taking a different stance.
  • Rationale: brilliant thinking is rare but courage is in even shorter supply than genius.

Other Ideas:

  • Entrepreneurs should create monopolies
  • Competition lowers price and eliminates profit.
  • Capitalism generates profit.
  • Even a bad plan is better than no plan.
  • School and College prepares you to be average at a lot of things.       And an expert at nothing.
  • Success is not a matter of luck.
  • If you cannot beat your rival it may be better to merge with them (Paypal: Thiel and Musk)

Reading Notes: The Outsiders

Author:  William N Thorndike Jr

Format: Audible / Kindle

Subject:  Capital Allocation

Rating: 8/10


The outsiders is an investigation into what makes a truly great CEO.  The Outsiders is written about eight exceptional CEOs.  These CEOs delivered returns that trounced the S&P500 over the long-term.  These CEOs are in many ways the polar opposite of the household name CEOs we think of today.   The book spends a significant time covering the importance of sound Capital Allocation strategies.

Useful Quotes:

  • CEOs need to do two things well to be successful:  run their operations efficiently and deploy the cash generated by those operations.
  • There are two basic types of resources that any CEO needs to allocate:  financial and human.
  • Stiritz “disdained the false precision of detailed financial models” and instead focused on a handful of key variables:  market growth, competition, potential operating improvements, and cash generation.
  • These CEOs “used leverage selectively, bought back a lot of stock, minimized taxes, ran decentralized organizations, and focused on cash flow over reported net income.”
  • Warren Buffett has proposed a simple test of capital allocation ability:  has a CEO created at least a dollar of value for every dollar of retained earnings over the course of his tenure?
  • Buffett believe the key to long term success is “temperament,” a willingness to be “fearful when others are greedy and greedy when they are fearful.”
  • Buffett upon finally closing Berkshire’s textile business: “Should you find yourself in a chronically leaking boat, energy devoted to changing vessels is likely to be more productive than energy devoted to patching leaks.”
  • “It is impossible to produce superior performance unless you do something different.” – John Templeton
  • You are not wedded to a particular business or industry

 Capital Allocation Tool Kit

  • Raising Capital:
    1. Tap internal cash flow
    2. Issue debt
    3. Raise Equity
  • Deploying:
    1. Invest in existing operations
    2. Acquire other businesses
    3. Pay down debt
    4. Issue dividends
    5. Repurchase stock


Piercing Conversations and Conversational Capacity

I had the privilege to attend a local Vistage meeting as a guest this morning.  The speaker was Craig Weber and the topic was about piercing conversations and conversational capacity.  Weber is an engaging speaker and did an excellent job of educating the group on the concept of conversational capacity.

The idea behind conversational capacity is that for any given group of people, there is a list of topics and / or issues that we could rank from most difficult at the top to the easiest at the bottom.  If we started at the bottom of the list the group could have productive conversations and proactively solve issues.  But as we work our way to the top of the list, the group will eventually stall out and become unproductive.  The higher up the list a given group can productively converse is a measure of its conversational capacity.

Weber states that when conversations get difficult most people tend to begin either “minimize” the conflict or trying to “win” the conflict.  The problem is that these two behaviors are unlikely to lead to the best possible outcomes.  And the most effective teams will find a way to operate in the “sweet spot” which is the middle ground between minimizing and winning.

After explaining the concept, Weber went on to provide some tips on how to build the conversational capacity in our given groups.

Tips for Maintaining the Correct Mindset in Meetings:

  • Ask yourself, “What am I seeing that others are missing?”
  • Ask yourself, “What are we all missing?  What are our blind-spots?”
  • Ask yourself, “What do others see on this issue that I don’t?”

Actions for effective decision making:

  • State your Position.
  • Explain your thinking.
  • Test your hypothesis:  “What am I missing?”
  • Inquiry

Common behaviors of Minimizers:

  • Passive body language.
  • Withholding their concerns.
  • Asking leading questions in an effort to backdoor their positions.
  • Feigning agreement.
  • Emailing opposing ideas as opposed to face-to-face conversations.

Common behaviors of Winners:

  • Aggressive body language.
  • No inquiry into opposing ideas or positions.
  • Dismissive of others ideas.
  • Stating opinions as fact.
  • Use of hyperbole.
  • Asking leading questions in order to sabotage other persons position.

Other interesting ideas and quotes from the presentation

  • Management’s business is building an organization that works!
  • Authority figures should generally weigh in last.
  • Your ego is the biggest enemy to your conversational capacity.
  • “Be that as it may,” is a very sophisticated way of saying “Whatever!”
  • A drowning person might know that they are drowning, but that is no substitute for knowing how to swim.
  • Most often in life, in order to actually get smarter, we have to feel dumber first.
  • The job of the executive is to to be right at the end of the meeting, not at the beginning of the meeting.

Harley Davidson Decision Levels:

  1. Top Down – No input required.
  2. Consultative – My Decision, but I want input.
  3. Consensus – Group Decision, and group input needed.

Reading Notes: Men Are Waffles, Women Are Spaghetti

Authors:  Pam Farrel / Bill Farrel

Format: Audible

Subject:  Relationships

Rating: 5/10


One morning last fall, I was having a casual conversation with a coworker about a remodeling project my wife and I were planning.  “I drive my poor wife crazy,” I said.  We will be discussing the project and next thing I know she is rambling off a seemingly never-ending list of ideas, questions, and concerns.  My response, “Whoa, one thing at a time!”  That is when my coworker laughed, and jokingly told me that I was a waffle.   She told me about a book she had read with her husband as part of their small group at church.  I was immediately intrigued.  In fact, I downloaded the book and began listening to it that day on my way to lunch.

The title of the book aptly defines its thesis that men process thoughts and emotions very differently than women.  Men tend to compartmentalize thoughts and emotions and subsequently deal with them one at a time.   The author relates these compartments to the individual squares you see on a waffle.  On the other hand, women tend to approach thoughts an emotions as part of a grand picture where everything is interconnected with everything else.  Hence the term spaghetti.  When you combine the two concepts, you wind up with spaghetti and waffles.

What I liked Most About the Book:  The title says it all.  Having a better understanding of how men and women process thoughts and emotions differently pays some hefty dividends.  The concept helps me communicate better with my wife, friends, and coworkers.

What I liked Least About the Book:  The author took an exceptional lesson and stretched it way to far.  This book could have easily been about a quarter of the length.  After the author teach the title-lesson, they spend the rest of the book desperately trying to project other aspects of their individual personalities and marriage onto the audience.

Memorable Quotes:

  • A man will strategically organize his life in boxes and then spend most of his time in the boxes he can succeed in.
  •  The bottom line with men is: they feel best about themselves when they are solving problems. Therefore, they spend most of their time doing what they are best at while they attempt to ignore the things which cause them to feel deficient.

Reading Notes: Secret Powers of Negotiating

Negotiation: discussion aimed at reaching an agreement.

Author:  Roger Dawson

Format: Kindle

Subject:  Negotiations

Rating: 8/10


Negotiating is a big part business and everyday life, so I was eager to dive into the details of this book.  Dawson didn’t disappoint me in the least; this is a well written book.   The author intermixes a variety of negotiating tactics with real-life examples.  The chapters and tactics build upon one another in an easily understood manner.  Furthermore, the book does an excellent job of mapping out the negotiation process from beginning to ending.  Dawson also covers strategies for dealing with impasses, stalemates, mediation, and arbitration.

After reading this book, I truly believe that I am an above average negotiator.  As a matter of fact, I have also already used several of these tactics during negotiations in both my personal and professional life.  Lastly, I am completely confident that this book has already paid for itself many times over since I read it last fall.

What I liked Most About the Book:  I gained a ton of insight about the topic of negotiating, and it was an easy read.

Knowledge Nuggets:

  • Be Prepared to Walk Away
  • Never Offer to Split the Difference
  • Always ask for more than you expect to get.
  • Be a Reluctant Buyer or Seller
  • Flinch at Proposals
  • Refer to a Higher Authority
  • Use Bracketing

Reading Notes: Making It All Work

Author:  David Allen

Format: Audible

Subject:  Productivity

Rating: 2/10


I am a big fan of David Allen’s book:  Getting Things Done, so I was very excited to listen to Making It All Work.  Unfortunately, that excitement quickly disappeared, and then turn to disappointment the more I listened.

I thought this book would serve as either a building block for the GTD system, but it is pretty much a rehashing of the previous book.  The core focus of the book seemed to be implementing the GTD system into your personal life.  That is all fine and well, because I really like the system.  In fact, incorporated GTD into all aspects of my life while reading the first book.

I listened to about two-thirds of Making It All Work before I gave up on it.  I am quite certain that I won’t be missing out on any key information that I won’t pick up on somewhere else.

What I liked Most About the Book:  The topic of the GTD system.

What I liked Most About the Book:  The lack of any new pertinent ideas or techniques.  The Horizons discussed in the book are hardly new concepts.

New GTD Concept:  Horizons

  • Projects: 10,000 Feet – The are the shorter items that take need to be completed in about a year’s time and will take more than one action to complete.  Pretty much standard GTD.
  • Areas of Focus:   20,000 Feet – This is essentially a list of all the roles you assume or want to assume in life:  husband, father, accountant, mentor, manager…  So the purpose of this list is to serve as a trigger for your weekly review.
  • Goals and Objectives:   30,000 Feet – A list of Projects that will take more than a year to complete.  You only need to review once a quarter or so.  This list will help trigger projects.
  • Vision:   40,000 Feet – Where do you want to be in five years.  Are your actions taking you there?  What about your projects?
  • Purpose:  50,000 Feet – What is your reason for being? to your ancestors, your descendents, or your god?

Reading Notes: The Catcher in the Rye

Author:  JD Salinger

Format: Hardback

Subject:  Coming of Age

Rating: 6/10


The Catcher in the Rye is a well known American classic.  I am quite sure this book was assigned reading at some point during my high school education.  However, I never got around to reading it until now.  I found the method of storytelling to be pretty difficult to read.  The protagonist, Holden, generally rambled and skipped from topic to topic at random.  Also, the overall plot is pretty thin.  However, the book is loaded with symbolism, so I  understand why so many book lovers and academics love it.

I tolerated the novel as opposed to loving it.  And, the thin plot and ending are quite anti-climatic.  To be fair, I read this book in my late thirties as opposed to reading it in high school.  But, I doubt I would have enjoyed this book much more if I had read it when I was sixteen years old.  Having said that, I am certainly happy I have read it and have a better understanding of “what all the fuss was about.”

Favorite Quotes:

“Anyway, I keep picturing all these little kids playing some game in this big field of rye and all. Thousands of little kids, and nobody’s around – nobody big, I mean – except me. And I’m standing on the edge of some crazy cliff. What I have to do, I have to catch everybody if they start to go over the cliff – I mean if they’re running and they don’t look where they’re going I have to come out from somewhere and catch them. That’s all I do all day. I’d just be the catcher in the rye and all. I know it’s crazy, but that’s the only thing I’d really like to be.”  Holden

If a girl looks swell when she meets you, who gives a damn if she’s late?”  Holden

I don’t exactly know what I mean by that, but I mean it.”  Holden

If you had a million years to do it in, you couldn’t rub out even half the ‘Fuck You’ signs in the world. It’s impossible.”  Holden

The mark of the immature man is that he wants to die nobly for a cause, while the mark of the mature man is that he wants to live humbly for one.”  Mr. Antolini

Reading Notes: Rich Dad, Poor Dad

Author: Robert T Kiyosaki

Format: Audible

Narrated By: Tim Wheeler

Subject: Personal Finance

Rating: 4/10


Rich Dad, Poor Dad is written in the form of a narrative containing life lessons of the author from both his Rich Dad and Poor Dad. I went through an entire spectrum of emotions while listening to this audio book.  The character known as the “Rich Dad” made several excellent and inspiring points during the many lessons he taught to the author.  However, an equal amount of those lessons were full of of bad advice and Ad Hominem attacks against anyone that didn’t agree with his logic.

The book makes a lot of subtle and not so subtle attacks on traditional education, and implies that most educated people are idiots and have grand senses of entitlement; It often uses the Poor Dad, who is a college educated teacher, to make this point.  To be fair, the author makes an excellent point about the lack of strong financial education in our public schools and homes. He also does an excellent job of motivating people to take responsibility and accountability in their own financial futures.

In conclusion, I found Rich Dad, Poor Dad to be way more inspirational than educational.

What I liked Most About the Book:

The average person could read this book as the only personal finance education they ever received and would have a better chance at success.

What I liked Least About the Book:

The average person can follow this book verbatim and make a lot of really terrible personal finance decisions.

Favorite Quotes:

Rule #1: You must know the difference between an asset and a liability, and buy assets. If you want to be rich, this is all you need to know.

An asset is something that puts money in my pocket. A liability is something that takes money out of my pocket.

That is why I say that someone’s Net Worth is worth less than they think.

I can’t afford it shuts down the brain…  How can I afford it? opens up the brain.

People who avoid failure also avoid success.

An intelligent person hires people who are more intelligent than he is.

Winners are not afraid of losing. But losers are. Failure is part of the process of success. People who avoid failure also avoid success.

There is a difference between being poor and being broke. Broke is temporary. Poor is eternal.”

Accounting is possibly the most confusing, boring subject in the world….”