Looking back at these writings of mine, I feel as though I may have been a bit unfair on us. I did try to blunt my accusations of avarice (and perhaps decadence) by pointing out that it was the general air of insatiable greed of the era that we live in that spawned the obscenities and the likes of Madoff. But I did concede the existence of a higher level of greed (or, more to the point, a more sated kind of greed) among us bankers and quantitative professionals. I am not recanting my words in this piece now, but I want to point out another aspect, a justification if not an absolution.

Why would I want to defend bonuses and other excesses when another wave of public hatred is washing over the global corporations, thanks to the potentially unstoppable oil spill? Well, I guess I am a sucker for lost causes, much like Rhett Butler, as our quant way of tranquil life with insane bonuses is all but gone with the wind now. Unlike Mr. Butler, however, I have to battle and debunk my own arguments presented here previously.

One of the arguments that I wanted to poke holes in was the fair compensation angle. It was argued in our circles that the fat paycheck was merely an adequate compensation for the long hours of hard work that people in our line of work put in. I quashed it, I think, by pointing out other thankless professions where people work harder and longer with no rewards to write home about. Hard work has no correlation with what one is entitled to. The second argument that I made fun of was the ubiquitous “talent” angle. At the height of the financial crisis, it was easy to laugh off the talent argument. Besides, there was little demand for the talent and a lot of supply, so that the basic principle of economics could apply, as our cover story shows in this issue.

Of all the arguments for large compensation packages, the most convincing one was the profit-sharing one. When the top talents take huge risks and generate profit, they need to be given a fair share of the loot. Otherwise, where is the incentive to generate even more profits? This argument lost a bit of its bite when the negative profits (by which I indeed mean losses) needed to be subsidized. This whole saga reminded me of something that Scott Adams once said of risk takers. He said that risk takers, by definition, often fail. So do morons. In practice, it is hard to tell them apart. Should the morons reap handsome rewards? That is the question.

Having said all this in my previous articles, now it is time to find some arguments in our defense. I left out one important argument in my previous columns because it did not support my general thesis — that the generous bonuses were not all that justifiable. Now that I have switched allegiance to the lost cause, allow me to present it as forcefully as I can. In order to see compensation packages and performance bonuses in a different light, we first look at any traditional brick-and-mortar company. Let’s consider a hardware manufacturer, for instance. Suppose this hardware shop of ours does extremely well one year. What does it do with the profit? Sure, the shareholders take a healthy bite out of it in terms of dividends. The employees get decent bonuses, hopefully. But what do we do to ensure continued profitability?

We could perhaps see employee bonuses as an investment in future profitability. But the real investment in this case is much more physical and tangible than that. We could invest in hardware manufacturing machinery and technology improving the productivity for years to come. We could even invest in research and development, if we subscribe to a longer temporal horizon.

Looking along these lines, we might ask ourselves what the corresponding investment would be for a financial institution. How exactly do we reinvest so that we can reap benefits in the future?

We can think of better buildings, computer and software technologies etc. But given the scale of the profits involved, and the cost and benefit of these incremental improvements, these investments don’t measure up. Somehow, the impact of these tiny investments is not as impressive in the performance of a financial institution compared to a brick-and-mortar company. The reason behind this phenomenon is that the “hardware” we are dealing with (in the case of a financial institution) is really human resources — people — you and me. So the only sensible reinvestment option is in people.

So we come to the next question — how do we invest in people? We could use any number of euphemistic epithets, but at the end of the day, it is the bottom line that counts. We invest in people by rewarding them. Monetarily. Money talks. We can dress it up by saying that we are rewarding performance, sharing profits, retaining talents etc. But ultimately, it all boils down to ensuring future productivity, much like our hardware shop buying a fancy new piece of equipment.

Now the last question has to be asked. Who is doing the investing? Who benefits when the productivity (whether current or future) goes up? The answer may seem too obvious at first glance — it is clearly the shareholders, the owners of the financial institution who will benefit. But nothing is black and white in the murky world of global finance. The shareholders are not merely a bunch of people holding a piece of paper attesting their ownership. There are institutional investors, who mostly work for other financial institutions. They are people who move large pots of money from pension funds and bank deposits and such. In other words, it is the common man’s nest egg, whether or not explicitly linked to equities, that buys and sells the shares of large public companies. And it is the common man who benefits from the productivity improvements brought about by investments such as technology purchases or bonus payouts. At least, that is the theory.

This distributed ownership, the hallmark of capitalism, raises some interesting questions, I think. When a large oil company drills an unstoppable hole in the seabed, we find it easy to direct our ire at its executives, looking at their swanky jets and other unconscionable luxuries they allow themselves. Aren’t we conveniently forgetting the fact that all of us own a piece of the company? When the elected government of a democratic nation declares war on another country and kills a million people (speaking hypothetically, of course), should the culpa be confined to the presidents and generals, or should it percolate down to the masses that directly or indirectly delegated and entrusted their collective power?

More to the point, when a bank doles out huge bonuses, isn’t it a reflection of what all of us demand in return for our little investments? Viewed in this light, is it wrong that the taxpayers ultimately had to pick up the tab when everything went south? I rest my case.

We have to bite the bullet and face the music; we may be a bit on the rude side — when judged by the western norms of pasticky grace popularized by the media. But we don’t do too badly when judged by our own mixed bag of Asian cultures, some of which consider the phrase “Thank you” so formal that it is almost an insult to utter it.

One of the Asian ways of doing things is to eat noodles like a mini vacuum cleaner. This Singaporean friend of mine was doing just that while lunching with me and our French colleague. I hardly noticed the small noises; after all, I’m from a culture where loud burps at the end of a meal are considered a compliment to the host. But our French friend found the suction action very rude and irksome, and made French comments to that effect (ignoring, of course, the fact that it is rude to exclude people by talking in a private language). I tried to explain to him that it was not rude, just the way it was done here, but to no avail.

The real question is this — do we paint a thin veneer of politeness over our natural way of doing things so that we can exude grace a la Hollywood? The thinness of this kind of grace echoes loud and clear in the standard greeting of a checkout clerk in a typical American supermarket: “How’ ya doing today?” The expected response is: “Good, how are you?” to which the clerk is to say, “Good, good!” The first “Good” presumably to your graceful enquiry after his well-being, the second expressing satisfaction at your perfect state of bliss. I once decided to play the fool and responded to the ubiquitous “How’ ya doin’?” by: “Lousy man, my dog just died.” The inevitable and unhesitating response was, “Good, good!” Do we need this kind of shallow grace?

Grace is like the grammar of an unspoken social language. Unlike its spoken counterparts, the language of social mores seems to preclude multilingualism, leading to an almost xenophobic rejection of other norms of life. We all believe that our way of doing things and our world views are the only right ones. Naturally too, otherwise we wouldn’t hold on to our beliefs, would we? But, in an increasingly flattening and globalizing world, we do feel a bit alien because our values and graces are often graded by alien standards.

Soon, a day will come when we all conform to the standards prescribed to us by the global media and entertainment networks. Our amorphous “How’ ya doin’?”s and “Good, good”s will then be indistinguishable from the prescriptions.

When I think of that inevitable day, I suffer a pang of nostalgia. I hope I can hold on to the memory of social graces judged by lesser standards — of gratitude expressed in timid smiles, affections portrayed in fleeting glances, and life’s defining bonds conveyed in unspoken gestures.

Ultimately, the collective grace of a society is to be judged, not by polished niceties, but by how it treats its very old and very young. And I’m afraid we are beginning to find ourselves wanting in those fronts. We put our young children through tremendous amount of stress, preparing them for an even more stressful life, and unwittingly robbing them of their childhood.

And, when I see those aunties and uncles cleaning after us in eating houses, I see more than our lack of grace. I see myself in my twilight years, alienated in a world gone strange on me. So let’s spare a smile, and nod a thank you when we see them — we may be showing grace to ourselves a few decades down the line.

In the last couple of weeks, I plunged right into an ocean of economist hands as I sat down to do a minor research into this troubling phenomenon of skyrocketing food prices.

The first “hand” pointed out that the demand for food (and commodities in general) has surged due to the increase in the population and changing consumption patterns in the emerging giants of Asia. The well-known demand and supply paradigm explains the price surge, it would seem. Is it as simple as that?

On the other hand, more and more food crops are being diverted into bio-fuel production. Is the bio-fuel demand the root cause? Bio-fuels are attractive because of the astronomical crude oil prices, which drive up the prices of everything. Is the recent OPEC windfall driving the price hikes? What about the food subsidies in wealthy nations that skew the market in their favour?

Yet another economics hand puts the blame squarely on the supply side. It points an unwavering finger at the poor weather in food producing countries, and the panic measures imposed on the supply chain, such as export bans and smaller scale hoarding, that drive up the prices.

I’m no economist, and I would like just one hand, one opinion, that I can count on. In my untrained view, I suspect that the speculation in commodities market may be driving the prices up. I felt vindicated in my suspicions when I read a recent US senate testimony where a well-known hedge fund manager, Michael Masters, shed light on the financial labyrinth of futures transactions and legal loopholes through which enormous profits were generated in commodity speculation.

The real reasons behind the food crisis are likely to be a combination of all these factors. But the crisis itself is a silent tsunami sweeping the world, as the UN World Food Program puts it.

Increase in the food prices, though unpleasant, is not such a big deal for a large number of Singaporeans. With our first world income, most of us spend about 20% of our salary on food. If it becomes 30% as a result of a 50% increase in the prices, we certainly won’t like it, but we won’t suffer that much. We may have to cut down on the taxi rides, or fine-dining, but it is not the end of our world.

If we are in the top 10% of the households, we may not even notice the increase. The impact of the high food prices on our lifestyle will be minimal — say, a four-star holiday instead of a five-star one.

It is a different story near the bottom. If we earn less than $1000 a month, and we are forced to spend $750 instead of $500 on food, it may mean a choice between an MRT ride and legging it. At that level, the increase in food prices does hurt us as our grim choices become limited.

But there are people in this world who face a much harsher reality as the prices shoot up with no end in sight. Their choices are often as terrible as Sophie’s choice. Which child goes to sleep hungry tonight? Medicine for the sick one or food for the rest?

We are all powerless against the juggernaut of market forces creating the food crisis. Although we cannot realistically change the course of this silent tsunami, let’s at least try not to exacerbate the situation through waste. Buy only what you will use, and use only what you need to. Even if we cannot help those who will invariably go hungry, let’s not insult them by throwing away what they will die yearning for. Hunger is a terrible thing. If you don’t believe me, try fasting for a day. Well, try it even if you do — for it may help someone somewhere.

Even with all the superior qualities, being a boss is tough. Being a good boss is even tougher; it is a tricky balancing act. One tricky question is, how friendly can you get with your team?

At first glance, this question may seem silly. Subordinates are human beings too, worthy of as much friendliness as any. Why be stuck up and act all bossy to them? The reason is that friendship erodes the formal respect that is a pre-requisite for efficient people management. For instance, how can you get upset with your friends who show up thirty minutes late for a meeting? After all, you wouldn’t get all worked up if they showed up a bit late for a dinner party.

If you are friends with your staff, and too good a boss to them, you are not a good boss from the perspective of the upper management. If you aspire to be a high powered and efficient boss as viewed from the top, you are necessarily unfriendly with your subordinates. This is the boss’s dilemma.

From the employee’s perspective, if your boss gets too friendly, it is usually bad news. The boss will have your hand phone number! And an excuse to call you whenever he/she feels like it.

Another unfortunate consequence of accidental cordiality is unrealistic expectations on your part. You don’t necessarily expect a fat bonus despite a shoddy performance just because the boss is a friend. But you would be a better human being than most if you could be completely innocent of such a wishful notion. And this tinge of hope has to lead to sour disappointment because, if he your boss is friendly with you, he/she is likely to be friendly with all staff.

By and large, bosses around here seem to work best when there is a modicum of distance between them and their subordinates. One way they maintain the distance is by exploiting any cultural difference that may exist among us.

If you are a Singaporean boss, for instance, and your staff are all expatriate Indians or Chinese, it may be a good thing from the distance angle — cultural and linguistic differences can act as a natural barrier toward unwarranted familiarity that may breed contempt.

This immunity against familiarity, whether natural or cultivated, is probably behind the success of our past colonial masters. Its vestiges can still be seen in management here.

The attitude modulation when it comes to the right amount of friendship is not a prerogative of the bosses alone. The staff have a say in it too. As a minor boss, I get genuinely interested in the well-being of my direct reports, especially because I work closely with them. I have had staff who liked that attitude and those who became uncomfortable with it.

The ability to judge the right professional distance can be a great asset in your and your team’s productivity. However, it cannot be governed by a set of thumb rules. Most of the time, it has to be played by ear and modulated in response to the changing attitudes and situations. That’s why being a good boss is an art, not an exact science.

But when it comes to hard-headed business decisions, backtracking may often be the only thing to do. It makes sense to cut further losses when there is little point in throwing good money after bad. Such containment efforts are routine events in most establishments.

The biggest loss containment effort that I had a personal stake in happened in the US in the early nineties. I began noticing its worrying escalation in a hotel room in Washington DC. I was student delegate in the annual conference of the American Physical Society (APS). Despite the happy APS atmosphere (where many graduate students find their future placements) and the beautiful pre-cherry-blossom weather, I was a worried man because I had just seen a TV commercial that said, “Ten billion dollars for a particle accelerator??!! What the heck is it any way?”

The ten billion dollar project under attack was the so-called Superconducting Super Collider (SSC) in Texas, which was eventually shut down in 1993. The cancellation came in spite of a massive initial investment of about two billion dollars.

To me, this cancellation meant that more than two thousand bright and experienced physicists would be looking for jobs right around the time I entered the job market. This concern represented my personal stake in the project; but the human impact of this mammoth backtracking was much deeper. It precipitated a minor recession in the parts of Dallas to the south of the Trinity River.

Similar backtracking, though at a much smaller scale, may happen in your organization as well. Let’s say you decided to invest two million dollars in a software system to solve a particular business problem. Half a million dollars into the project, you realize that it was a wrong solution. What do you do?

It may look obvious that you should save the company a million and a half by stopping the project. This decision is exactly what the collective wisdom of the US Congress arrived at in 1993 regarding the SSC. But it is not that simple. Nothing in real life is that simple.

Corporate backtracking is a complex process. It has multiple, often interconnected, aspects that have to be managed with skill.

If you decide to backtrack, what does it say about your business acumen? Will it trigger a backlash from the top management accusing you of poor judgment? In other words, will your name be so much in the mud that you would find it impossible to secure a job and support your family?

Let’s say it really wasn’t your fault and you had valid arguments to convince everybody of your innocence. Would that make it simple enough to pull the plug on the project? In all probability, it would not, because all big projects involve other people, for no man is an island. Stopping a project half-way through would probably mean sacking the whole project team.

This human cost is something we have to be aware of. It is not always about dollars and cents. If you are kind soul, you would have to move the team to some other (potentially unproductive) project, thereby eroding the savings that would’ve accrued from stopping the project. Wouldn’t it have been better to have continued with the original project, doomed though it was?

In most corporate cases, it will turn out to be wise to shutdown doomed projects. But don’t underestimate the costs involved. They are not always counted in monitory terms, but have human dimensions as well.

It is far wiser never to embark on dubious projects. When you must get involved in uncertain projects, review your exit options carefully. For instance, would it be possible to reshape the project in a different but still salvageable direction?

And if and when you do have to shut them down, do it with decisiveness. Do it with skill. But most importantly, do it with decency and compassion.

Who do you turn to when you pine for information? Your management would have you listen to them. From the employee’s perspective, this may not be the smartest move. But fret not, there is an alternative.

There is a city underground. Parallel to the world of corporate memos and communication meetings, this rumour city trades information, often generating it as needed.

Employees flock to the rumour mills, not out of their inherent malevolence for their employers, but because of a well-founded and mutual mistrust. Management tends to be cautious (and therefore less than candid) with their announcements, while over 80% of office rumours turn out to be accurate, as some studies show.

Let’s take a hypothetical situation. Suppose five years ago, your CEO took to the podium and declared that there would be absolutely no retrenchments. How many of you would have believed it? Those who believed would almost certainly wish they had listened to the grapevine instead.

This credibility gap that a typical management team suffers from can be addressed only though open and candid communication. Therein lies the rub. The management cannot always be as candid as they would like to be. And, they certainly cannot afford to be as candid as the employees would like them to be.

Lack of candour in an atmosphere of uncertainty breeds rumour. Rumours, as defined in psychology, are hypotheses with widespread impact. They abound when the management refuses to trust the employees with strategic information. This lack of trust and information leaves them with no choice but to interpret the developments themselves. In such interpretations lie the origins of office rumours.

Rumours are not to be confused with gossip. While rumours are based on conjecture and are presented as future, corporate-wide eventualities, gossip can be idle or with malicious intent directed at individuals. And gossip is usually presented as fact. In highly competitive settings, gossip can inflict irreparable damage on unsuspecting victims.

Once a rumour attains a high level of credibility, the top brass will be forced to talk. But the talk has to be candid and serious. And it has to be timely. If they wait for too long, their attempts at a tête-à -tête would resemble feeble attempts at damage control. And if the talk is a mere torrent of clichés and rhetoric, it will be taken as an effort to gloss over potentially catastrophic changes. In fact, such weak communication fuels more rumour than it quells.

Given that critical job-related information usually flows down the grapevine, the employees are going to talk. The only sure-fire strategy for any management is to make use of the underground rumour mill — the classic “if you can’t beat’em, join’em” paradigm.

If you are a part of the top brass, here is what you can do. Circulate as much accurate and timely information as you possibly can. If you cannot do it officially through formal channels, try informal ones, such as lunches and pantries. This way, you can turn the rumour mills to serve your purpose rather than let them run amok.

Do not underestimate the power of the grapevine, lest all your corporate communication efforts should come to naught.

One of my secret tactics is to develop a sense of proportion, harmless as it may sound. Proportion can be in terms of numbers. Let’s start with the number of individuals, for instance. Every morning, when we come to work, we see thousands of faces floating by, almost all going to their respective jobs. Take a moment to look at them — each with their own personal thoughts and cares, worries and stresses.

To each of them, the only real stress is their own. Once we know that, why would we hold our own stress any more important than anybody else’s? The appreciation of the sheer number of personal stresses all around us, if we stop to think about it, will put our worries in perspective.

Proportion in terms of our size also is something to ponder over. We occupy a tiny fraction of a large building that is our workplace. (Statistically speaking, the reader of this column is not likely to occupy a large corner office!) The building occupies a tiny fraction of the space that is our beloved city. All cities are so tiny that a dot on the world map is usually an overstatement of their size.

Our world, the earth, is a mere speck of dust a few miles from a fireball, if we think of the sun as a fireball of any conceivable size. The sun and its solar system are so tiny that if you were to put the picture of our galaxy as the wallpaper on your PC, they would be sharing a pixel with a few thousand local stars! And our galaxy — don’t get me started on that! We have countless billions of them. Our existence (with all our worries and stresses) is almost incompressibly small.

The insignificance of our existence is not limited to space; it extends to time as well. Time is tricky when it comes to a sense of proportion. Let’s think of the universe as 45 years old. How long do you think our existence is in that scale? A few seconds!

We are created out of star dust, last for a mere cosmological instant, and then turn back into star dust. DNA machines during this time, we run unknown genetic algorithms, which we mistake for our aspirations and achievements, or stresses and frustrations. Relax! Don’t worry, be happy!

Sure, you may get reprimanded if that report doesn’t go out tomorrow. Or, your supplier may get upset that your payment is delayed again. Or, your colleague may send out that backstabbing email (and Bcc your boss) if you displease them. But, don’t you see, in this mind-numbingly humongous universe, it doesn’t matter an iota. In the big scheme of things, your stress is not even static noise!

Arguments for maintaining a level of stress all hinge on an ill-conceived notion that stress aids productivity. It does not. The key to productivity is an attitude of joy at work. When you stop worrying about reprimands and backstabs and accolades, and start enjoying what you do, productivity just happens. I know it sounds a bit idealistic, but my most productive pieces of work happened that way. Enjoying what I do is an ideal I will shoot for any day.

Specialization is good. It lets us cut deep into a specific field of endeavor; but at the expense of a broad overview of everything, naturally. Specialization is expected of professionals. You wouldn’t be happy if you found out that your dentist is, in fact, a well-known philosopher as well. Or that your child’s ENT surgeon secretly teaches astrophysics in the local university.

Isn’t there a danger lurking behind our habit of demanding super specialized silos of knowledge? One obvious danger is the loss of synergy and potential innovation. A case in point — a particle physicist at the European Organization for Nuclear Research (CERN) faces the problem of accessing various files on different computers and networks. Being conversant in computing issues, the physicist devices a nice way of describing the file (or, as it is known now, the resource) and suddenly the first URL (Universal Resource Locator) is born. The rest is history — we have the World Wide Web, the Internet. Fifteen years later, you have e-commerce and YouTube!

If CERN had insisted that their physicists do only physics and leave their computing problems to the IT department, the Internet may not have materialized at all. Or, it may have taken a lot longer to materialize.

The need for specialization is not limited to individuals. It permeates into the modern workplace in the form of a typical division of labor such as HR, Finance, IT and Business. This division has worked well for ages. But every once in a while, the expertise in such silos becomes so split and scattered that the organization loses sight of its basic objective. People in the silos begin work against each other, competing for resources and recognition, rather than collaborating for common success.

The most common pariah in a typical organization is the IT department. These poor folks always get shouted at if anything at all goes wrong in the system. But when everything is working fine, nobody even notices them. In today’s age of ubiquitous computer literacy, why not assume a bit of system responsibility so that the turnaround time in PC troubleshooting (and consequently productivity) can be improved?

In fact, we know why. When it comes to computers, there is no limit to how bad things can get. As the IT proverb says, to err is human, but to completely foul up things requires a computer. End users may screw up the system so completely that even a competent IT department (a rare commodity) may find it impossible to restore normalcy. But, in order to fight this self-destructive (though well-intentioned) tendency, IT departments have gone to the other extreme of making it so bureaucratic and practically impossible to get their help in anything at all!

Another group that gets a bad rap in a highly regulated organization is the auditors. Their thankless job is to look over everybody’s shoulder and make sure that they are following the rules of the game (or rather, complying with policies and regulations). Auditors’ noble intentions get eclipsed by one fatal flaw: they seem to measure their success by how many violations they can find. Instead of working hand in hand with those being audited, the auditors come across as though they are conspiring against the rest.

There is productivity to be gained by blurring the edges of rigid silos in organizations. When silos talk to each other, teamwork happens and those in the silos realize that they all work toward a common goal.

In high school, I used logarithm tables to work out results in physics and chemistry experiments. Calculators were not allowed. Though inconvenient, this practice honed my arithmetic skills — skills that calculators and spreadsheets have eroded by now.

Similar erosion is taking place in our reading skills as well. We don’t read to retain information or knowledge any more. We search, scan, locate keywords, browse and bookmark. The Internet is doing to our reading habits what the calculator did to our arithmetic abilities.

Easy access to information is transforming our notion of (dare I say, respect for?) knowledge in a fundamental way. In a knowledge economy, knowledge is fast becoming a cheap commodity. We don’t need to know stuff any more; we just need to know how to find it.

I was talking to a lecturer the other day. According to him, a good lecturer is not the one who knows most and has a deep understanding of the subject, but the one that can locate the answer the fastest.

The power of instant information came with the Internet, which made experts of all of us. We can now make intelligent comments and informed decisions on anything.

Suppose, for instance, your child’s doctor recommends the procedure “myringotomy,” quite possibly something you have never heard of before. But you can Google it, read (sorry, browse) the first couple of search results, and you will know the rationale behind the doctor’s advice, the exact procedure, its risk factors and benefits, and so on. In ten minutes, you will know what took the doctor years of hard work to learn.

This easy access to knowledge may, quite mistakenly, diminish your respect for the medical degree. This diminished reverence for knowledge is unwise; a little knowledge is a dangerous thing. A doctor’s expertise is not so much in memorizing a webpage worth of information, but also in knowing all the special circumstances where that information doesn’t apply. Besides, the webpage you happened to read may be just plain wrong. We should be careful not to mistake easy information for deep knowledge. Let’s guard our respect for true knowledge and wisdom despite our access to ready information.

Such misguided lack of respect is evident in the workplace as well, where managers think they can always hire specialized knowledge at will. I had a friend who was planning to roll out a product using Bluetooth, back when it was an emerging technology. I pointed out the obvious flaw in his proposal — he didn’t know much about Bluetooth. His reply was, “No big deal! I’ll just hire somebody who does!”

My worry is, when everybody wants to hire a Bluetooth expert and nobody wants to know how it works, there won’t be an expert any longer.

Knowledge is not cheap, although our easy access to it through the Internet may indicate otherwise. When we all become users of information, our knowledge will stop at its current level, because nobody will be creating it any more.

We are not there yet, but I worry that we are heading that way. I worry about the support structure of our knowledge base. How will our knowledge empire stand when all its foundations are gone?

People management is better rewarded than technical expertise. This differentiation between experts and middle-level managers in terms of rewards is a local Asian phenomenon. Here, those who present the work seem to get the credit for it, regardless of who actually performs it. We live in a place and time where articulation is often mistaken for accomplishments.

In the West, technical knowledge is more readily recognized than smooth presentations. You don’t have to look beyond Bill Gates to appreciate the heights to which technical expertise can take you in the West. Of course, Gates is more than an expert; he is a leader of great vision as well.

Leaders are different from people managers. Leaders provide inspiration and direction. They are sorely needed in all organizations, big and small. They are not to be confused with middle-level folks who keep harping on the “big picture,” the “value-chain” and such, and spend all their working hours in meetings. You know who I am talking about. Why should they get such hefty salaries when they know and do so little?

Unlike people mangers, technical experts are smart cookies. They can easily see that if they want to be people managers, they can get started with a tie and a good haircut. If the pickings are rich, why wouldn’t they?

Going the other way is a lot harder though. For a pure people manager to become a technical expert, it takes a lot more than losing the tie. But why would anybody want to be an expert in the current corporate climate here? Slim pickings, really.

Is it time to hide your knowledge, get that haircut, grab that tie, and become a people manager? It comes down to your personal choice. Knowledge gives you technical authority and a sense of indispensability. But it also sets you up for a stunted career progression. So the choice is between fulfillment and satisfaction on the one hand, and convenience and promotions on the other.

I wonder whether we have already made our choices, even in our personal lives. We find fathers who cannot get the hang of changing diapers or other household chores. Is it likely that men cannot figure out washing machines and microwaves although they can operate complicated machinery at work? We also find ladies who cannot balance their accounts and estimate their spending. Is it really a mathematical impairment, or a matter of convenience?

At times, the lack of knowledge is as potent a weapon as its abundance. Yes, knowledge is a double-edged sword. Use it wisely!

The reason for death in sedentary jobs is the insidious condition called deep vein thrombosis. This condition develops because of extended hours spent sitting, when a blood clot forms in the lower limbs. The clot then travels to the vital organs in the upper body, where it wreaks havoc including death.

The trick in avoiding such an untimely demise, of course, is not to sit for long. But that is easier said than done, when job pressure mounts, and deadlines loom.

Here is where you have to get your priorities straight. What do you value more? Quality of life or corporate success? The implication in this choice is that you can’t have both, as illustrated in the joke in investment banking that goes like: “If you can’t come in on Saturday, don’t bother coming in on Sunday!”

You can, however, make a compromise. It is possible to let go a little bit of career aspirations and improve the quality of life tremendously. This balancing act is not so simple though; nothing in life is.

Undermining work-life balance are a few factors. One is the materialistic culture we live in. It is hard to fight that trend. Second is a misguided notion that you can “make it” first, then sit back and enjoy life. That point in time when you are free from worldly worries rarely materializes. Thirdly, you may have a career-oriented partner. Even when you are ready to take a balanced approach, your partner may not be, thereby diminishing the value of putting it in practice.

These are factors you have to constantly battle against. And you can win the battle, with logic, discipline and determination. However, there is a fourth, much more sinister, factor, which is the myth that a successful career is an all-or-nothing proposition, as implied in the preceding investment banking joke. It is a myth (perhaps knowingly propagated by the bosses) that hangs over our corporate heads like the sword of Damocles.

Because of this myth, people end up working late, trying to make an impression. But an impression is made, not by the quantity of work, but by its quality. Turn in quality, impactful work, and you will be rewarded, regardless of how long it takes to accomplish it. Long hours, in my view, make the possibility of quality work remote.

Such melancholy long hours are best left to workaholics; they keep working because they cannot help it. It is not so much a career aspiration, but a force of habit coupled with a fear of social life.

To strike a work-life balance in today’s dog eat dog world, you may have to sacrifice a few upper rungs of the proverbial corporate ladder. Raging against the corporate machine with no regard to the consequences ultimately boils down to one simple realization — that making a living amounts to nothing if your life is lost in the process.

The conversation between two tired minds usually lacks an essential ingredient — the listener. And a conversation without a listener is not much of a conversation at all. It is merely two monologues that will end up generating one more setback to whine about — spousal indifference.

Indifference is no small matter to scoff at. It is the opposite of love, if we are to believe Elie Weisel. So we do have to guard against indifference if we want to have a shot at happiness, for a loveless life is seldom a happy one.

“Where got time?” ask we Singaporeans, too busy to form a complete sentence. Ah… time! At the heart of all our worldly worries. We only have 24 hours of it in a day before tomorrow comes charging in, obliterating all our noble intentions of the day. And another cycle begins, another inexorable revolution of the big wheel, and the rat race goes on.

The trouble with the rat race is that, at the end of it, even if you win, you are still a rat!

How do we break this vicious cycle? We can start by listening rather than talking. Listening is not as easy as it sounds. We usually listen with a whole bunch of mental filters turned on, constantly judging and processing everything we hear. We label the incoming statements as important, useful, trivial, pathetic, etc. And we store them away with appropriate weights in our tired brain, ignoring one crucial fact — that the speaker’s labels may be, and often are, completely different.

Due to this potential mislabeling, what may be the most important victory or heartache of the day for your spouse or partner may accidentally get dragged and dropped into your mind’s recycle bin. Avoid this unintentional cruelty; turn off your filters and listen with your heart. As Wesley Snipes advises Woody Herrelson in White Men Can’t Jump, listen to her (or him, as the case may be.)

It pays to practice such an unbiased and unconditional listening style. It harmonizes your priorities with those your spouse and pulls you away from the abyss of spousal apathy. But there is no such thing as a free lunch. It takes years of practice to develop the proper listening technique, and continued patience and deliberate effort to apply it.

“Where got time?” we may ask. Well, let’s make time, or make the best of what little time we got. Otherwise, when days add up to months and years, we may look back and wonder, where is the life that we lost in living?

Coupled with overwhelming statistical supremacy, certain countries have special superiority in their chosen or accidental specializations. We expect to find more hardware experts in China, more software gurus in India, more badminton players in Indonesia, more entrepreneurial spirit and managerial expertise in the west.

We need such experts, so we hire them. But how much should we pay them? That’s where economics comes in — demand and supply. We offer the lowest possible package that the talent would bite.

I was on an expatriate package when I came to Singapore as a foreign talent. It was a fairly generous package, but cleverly worded so that if I became a “local” talent, I would lose out quite a bit. I did become local a few years later, and my compensation diminished as a consequence. My talent did not change, just the label from “foreign” to “local.”

This experience made me think a bit about the value of talent and the value of labels. These values translate to compensation packages that can be ordered, from high to low, as: Western (Caucasians), Western (of Asian origin), Singaporean, Asian (Chinese, Indian, etc.).

I’m not saying that all Caucasians in Singapore do better than all Indians and Chinese in terms of income; but the trend is that for the same talent, Caucasians tend to be better compensated that their Asian counterparts. Nothing wrong with that — it’s all about demand and supply, and the perception of value and such economic fundamentals. Besides, this compensation scheme has worked well for us so far.

However, the locals are beginning to take note of this asymmetric compensation structure. When I was considering hiring a Caucasian, my ex-boss commented, “These Ang-Mos, they talk big in meetings and stuff, but don’t do any work!” He may have oversimplified; I know many “Ang-Mos” who are extremely talented and fully deserve the higher-than-local compensation they enjoy. But this perceived disparity between what the talent is worth and how much it costs (as depicted in the movie I Not Stupid) is beginning to hurt employee loyalty to such an extent that firms are experiencing staff retention issues when it comes to local talents.

The solution to this problem is not a stricter enforcement of the confidentiality of salaries, but a more transparent compensation scheme free of anomalies that can be misconstrued as unfair practices. Otherwise, we may see an increasing number of Asian nationals using Singapore as a stepping stone to greener pastures. Worse, we may see locals seeking level playing fields elsewhere.

Let’s hire the much needed talent whatever it costs; but let’s not mistake labels for talent.

In addition to the appraisal, we also get our “key performance indicators” or KPIs for next year. These are the commandments we have to live by for the rest of the year. The whole experience of it is so unpleasant that we say to ourselves that life as an employee sucks.

The bosses fare hardly better though. They have to worry about their own appraisals by bigger bosses. On top of that, they have to craft the KPI commandments for us as well — a job pretty darned difficult to delegate. In all likelihood, they say to themselves that their life as a boss sucks!

Given that nobody is thrilled about the performance appraisal exercise, why do we do it? Who needs it?

The objective behind performance appraisal is noble. It strives to reward good performance and punish poor shows — the old carrot and stick management paradigm. This objective is easily met in a small organization without the need for a formal appraisal process. Small business owners know who to keep and who to sack. But in a big corporate body with thousands of employees, how do you design a fair and consistent compensation scheme?

The solution, of course, is to pay a tidy sum to consultants who design appraisal forms and define a uniform process — too uniform, perhaps. Such verbose forms and inflexible processes come with inherent problems. One problem is that the focus shifts from the original objective (carrot and stick) to fairness and consistency (one-size-fits-all). Mind you, most bosses know who to reward and who to admonish. But the HR department wants the bosses to follow a uniform process, thereby increasing everybody’s workload.

Another, more insidious problem with this consultancy driven approach is that it is necessarily geared towards mediocrity. When you design an appraisal process to cater to everybody, the best you can hope to achieve is to improve the average performance level by a bit. Following such a process, the CERN scientist who invented the World Wide Web would have fared badly, for he did not concentrate on his KPIs and wasted all his time thinking about file transfers!

CERN is a place that consistently produces Nobel laureates. (I once found myself with two Nobel laureates in a CERN elevator!) How does it do it? Certainly not by following processes that are designed to make incremental improvements at the average level. The trick is to be a center for excellence which attracts geniuses.

Of course, it is not fair to compare an average organization with CERN. But we have to realize that the verbose forms, which focus on averages and promote mediocrity, are a poor tool for innovation management.

A viable alternative to standardized and regimented appraisal processes is to align employee objectives with those of the organization and leave performance and reward management to bosses. With some luck, this approach may retain fringe geniuses and promote innovation. At the very least, it will alleviate some employee anxiety and sleepless nights.

Staff retention is a major problem in the current job market in Singapore. Our economy is doing well; our job market is red hot. As a result, new job offers are becoming increasingly more irresistible. At some stage, someone you work closely with — be it your staff, your boss or a fellow team member — is going to hand in that dreaded letter to HR. Handling resignations with tact and grace is no longer merely a desirable quality, but an essential corporate skill today.

We do have some general strategies to deal with resignations. The first step is to assess the motivation behind the career choice. Is it money? If so, a counter offer is usually successful. Counter offers (both making them and taking them) are considered ineffective and in poor taste. At least, executive search firms insist that they are. But then, they would say that, wouldn’t they?

If the motivation behind the resignation is the nature of the current or future job and its challenges, a lateral movement or reassignment (possibly combined with a counter offer) can be effective. If everything fails, then it is time to say goodbye — amicably.

It is vitally important to maintain this amicability — a fact often lost on bosses and HR departments. Understandably so because, by the time the counter offer negotiations fail, there is enough rancor on both sides to sour the relationship. Brush those wounded feelings aside and smile through your pain, for your paths may cross again. You may rehire the same person. Or, you may end up working with him/her on the other side. Salvage whatever little you can for the sake of positive networking.

The level of amicability depends on corporate culture. Some organizations are so cordial with deserting employees that they almost encourage desertion. Others treat the traitors as the army used to — with the help of a firing squad.

Both these extremes come with their associated perils. If you are too cordial, your employees may treat your organization as a stepping stone, concentrating on acquiring only transferable skills. On the other extreme, if you develop a reputation for severe exit barriers in an attempt to discourage potential traitors, you may also find it hard to recruit top talent.

The right approach lies somewhere in between, like most good things in life. It is a cultural choice that an organization has to make. But regardless of where the balance is found, resignation is here to stay, and people will change jobs. Change, as the much overused cliche puts it, is the only constant.

There is only a thin blurry line between the schemes that thrive on other people’s greed and confidence jobs. If you can come up with a scheme that makes money for others, and stay legal (if not moral), then you will make yourself very rich. We see it most directly in the finance and investment industry, but it is much more widespread than that. We can see that even education, traditionally considered a higher pursuit, is indeed an investment against future earnings. Viewed in that light, you will understand the correlation between the tuition fees at various schools and the salaries their graduates command.

When I started writing this column, I thought I was making up this new field called the Philosophy of Money (which, hopefully, somebody would name after me), but then I read up something on the philosophy of mind by John Searle. It turned out that there was nothing patentable in this idea, nor any cash to be made, sadly. Money comes under the umbrella of objective social realities that are quite unreal. In his exposition of the construction of social reality, Searle points out that when they give us a piece of paper and say that it is legal tender, they are actually constructing money by that statement. It is not a statement about its attribute or characteristics (like “This is a glass of water”) so much as a statement of intentionality that makes something what it is (like “You are my hero”). The difference between my being a hero (perhaps only to my six-year-old) and money being money is that the latter is socially accepted, and it is as objective a reality as any.

I conclude this article with the nagging suspicion that I may not have argued my point well enough. I started it with the premise that money is an unreal meta-thing, and wound up asserting its objective reality. This ambivalence of mine may be a reflection of our collective love-hate relationship with money – perhaps not such a bad way to end this column after all.

Put it that way, investment sounds like a positive concept, which it is, in our current mode of thinking. We can easily make it a negative thing by portraying the demand for the investment value of money as greed. It then follows that all of us are greedy, and that it is our greed that fuels the insane compensation packages of top-level executives. Greed also fuels fraud – ponzi and pyramid schemes.

Indeed, any kind of strong feeling that you have can be bought and sold for personal gain of others. It may be your genuine sympathy for the Tsunami or earthquake victims, your voyeuristic disgust at the peccadilloes of golf icons or presidents, charitable feeling toward kidney patients of whatever. And the way money is made out of your feelings may not be obvious at all. Watching the news five minutes longer than usual because of a natural disaster may bring extra fortune to the network’s coffers. But of all the human frailties one can make money out of, the easiest is greed, I think. Well, I may be wrong; it may actually be that frailty that engendered the oldest profession. But I would think that the profession based on the lucrative frailty of greed wasn’t all that far behind.

If we want to exploit other people’s greed, the first thing to ask ourselves is this: why do we want money, given that it is a meta-entity? I know, we all need money to live. But I am not talking about the need part. Assuming the need part is taken care of, we still want more of it. Why? Say you are a billionaire. Why would you want another billion? I think the answer lies in something philosophical, something of an existential angst, although those with their billions would the last ones to admit it. The reason behind this deep-rooted need for more is a quest for a validation, or a justification for our existence, and a meaning and purpose for our life. It is all part of that metaphorical holy grail. I know, it sounds a bit nutty, but what else could it be? The Des Cartes of our time would say, “I have loads of money, therefore I am!”

To be fair, this column won’t give you any get-rich-quick, sure-fire schemes or strategies. What it will tell you is why and how some people make money, and hopefully uncover some new insights. You may be able to put some of these insights to work and make yourself rich – if that’s where you think your happiness lies.

By now, it is clear to most people that they cannot become filthy rich by working for somebody else. In fact, that statement is not quite accurate. CEOs and top executives all work for the shareholders of the companies that employ them, but are filthy rich. At least, some of them are. But, in general, it is true that you cannot make serious money working in a company, statistically speaking.

Working for yourself – if you are very lucky and extremely talented – you may make a bundle. When we hear the word “rich,” the people that come to mind tend to be

1. entrepreneurs/industrialists/software moguls – like Bill Gates, Richard Branson etc.,
2. celebrities – actors, writers etc.,
3. investment professionals – Warren Buffet, for instance, and
4. fraudsters of the Madoff school.

There is a common thread that runs across all these categories of rich people, and the endeavors that make them their money. It is the notion of scalability. To understand it well, let’s look at why there is a limit to how much money you can make as a professional. Let’s say you are a very successful, highly-skilled professional – say a brain surgeon. You charge $10k a surgery, of which you perform one a day. So you make about $2.5 million a year. Serious money, no doubt. How do you scale it up though? By working twice as long and charging more, may be you can make $5 million or $10 million. But there is a limit you won’t be able to go beyond.

The limit comes about because the fundamental economic transaction involves selling your time. Although your time may be highly-skilled and expensive, you have only 24 hours of it in a day to sell. That is your limit.

Now take the example of, say, John Grisham. He spends his time researching and writing his best-selling books. In that sense, he sells his time as well. But the big difference is that he sells it to many people. And the number of people he sells his product to may have an exponential dependence on its quality and, therefore, the time he spends on it.

We can see a similar pattern in software products like Windows XP, performances by artists, sports events, movies and so on. One performance or accomplishment is sold countless times. With a slight stretch of imagination, we can say that entrepreneurs are also selling their time (that they spend setting up their businesses) multiple times (to customers, clients, passengers etc.) All these money-spinners work hard to develop some kind of exponential volume-dependence on the quality of their products or the time they spend on them. This is the only way to address the scalability issue that comes about due to the paucity of time.

Investment professionals (bankers) do it too. They develop new products and ideas that they can sell to the masses. In addition, they make use of a different aspect of money that we touched upon in an earlier column. You see, money has a transactional value. It plays the role of a medium facilitating economic exchanges. In financial transactions, however, money becomes the entity that is being transacted. Financial systems essentially move money from savings and transforms it into capital. Thus money takes on an investment value, in addition to its intrinsic transactional value. This investment value is the basis of interest.

The first indication of the meta-ness of money comes from the fact that it has a value only when we assign it a value. It doesn’t possess an intrinsic value that, for instance, water does. If you are thirsty, you find that water has enormous intrinsic value. Of course, if you have money, you can buy water (or Perrier, if you want to be sophisticated), and quench your thirst.

But we may find ourselves in situations where we may not be able to buy things with money. Stranded in a desert, for instance, dying of thirst, we may not be able to buy water despite our sky-high credit limits or the hundreds of dollars we may have in our wallet. One reason for this inability of ours is obvious – we may be alone. The basic transactional value of money evaporates when we have nobody to transact with.

The second dimension of the meta-ness of money is economical. It is illustrated in the well-worn supply-and-demand principle, assuming transactional liquidity (which is a term I just cooked up to sound erudite, I confess). I mean to say, even if we have willing sellers of water in the desert, they may see that we are dying for it and jack up the price – just because we are willing and able to pay. This apparent ripping off on the part of the devious vendors of water (perfectly legal, by the way) is possible only if the commodity in question is in plentiful supply. We need commodity liquidity, as it were.

It is when the liquidity dries up that the fun begins. The last drop of water in a desert has infinite intrinsic value. This effect may look similar to the afore-mentioned supply-and-demand phenomenon, but it really is different. The intrinsic value dominates everything else, much like the strong force over short distances in particle physics. And this domination is the flipside of the law of diminishing marginal utility in economics.

The thing that looks a bit bizarre about money is that it seems to run counter to the law of diminishing marginal utility. The more money you have, the more you want it. Now, why is that? It is especially strange given its lack of intrinsic value. Great financial minds could not figure it out, but came up with pithy and memorable statements like, “Greed, for lack of a better word, is good.” Although that particular genius was only fictional, he does epitomize much of the thinking in the modern corporate and financial world. Good or bad, let’s assume that greed is an essential part of human nature and look at what we can do with it. Note that I want to do something “with” it, not “about” it – an important distinction. I, intrepid columnist that I am, want to show you how to use other people’s greed to make more money.

Despite such reservations, I decided to write this post on how to live your life — after all, this is my blog, and I can post anything I want. So today, I will talk about how to lead a good life. The first thing to do is to define what “good” is. What do we mean when we call something good? We clearly refer to different attributes by the same word when we apply it to different persons or objects, which is why a good girl is very different from a good lay. One “good” refers to morality while the other, to performance in some sense. When applied to something already nebulous such as life, “good” can mean practically anything. In that sense, defining the word good in the context of life is the same as defining how to lead a good life. Let’s try a few potential definitions of a good life.

Let’s first think of life as a race — a race to amass material wealth because this view enjoys a certain currency in these troubled times that we live in. This view, it must be said, is only a passing fad, no matter how entrenched it looks right now. It was only about fifty years ago that a whole hippie generation rebelled against another entrenched drive for material comforts of the previous generation. In the hazy years that followed, the materialistic view bounced back with a vengeance and took us all hostage. After its culmination in the obscenities of the Madoffs and the Stanfords, and the countless, less harmful parasites of their kind, we are perhaps at the beginning stages of another pendulum swing. This post is perhaps a reflection of this swing.

The trouble with a race-like, competitive or combative view of life is that the victory always seems empty to the victors and bitter to the vanquished. It really is not about winning at all, which is why the Olympian sprinter who busted up his knee halfway through the race hobbled on with his dad’s help (and why it moved those who watched the race). The same reason why we read and quote the Charge of the Light Brigade. It was never about winning. And there is a deep reason behind why a fitting paradigm of life cannot be that a race, which is that life is ultimately an unwinnable race. If the purpose of life is to live a little longer (as evolutionary biology teaches us), we will all fail when we die. With the trials and tribulations of life volleying and thundering all around us, we still ride on, without reasoning why, on to our certain end. Faced with such a fundamental and inevitable defeat, our life just cannot be about winning.

We might then think that it is some kind of glory that we are or should be after. If a life leads to glory during or after death, it perhaps is (or was) a good life. Glory doesn’t have to be a public, popular glory as that of a politician or a celebrity; it could be a small personal glory, as in the good memories we leave behind in those dear to us.

What will make a life worthy of being remembered? Where does the glory come from? For wherever it is, that is what would make a life a good life. I think the answer lies in the quality with which we do the little things in life. The perfection in big things will then follow. How do you paint a perfect picture? Easy, just be perfect first and then paint anything. And how do you live a perfect life? Easy again. Just be perfect in everything, especially the little things, that you do. For life is nothing but the series of little things that you do now, now and now.