When I was eight years old, I became obsessed with science fiction. I checked out and read every single science fiction book in our local library. Then I discovered the college library. Then interlibrary loans. Many times I would read a book a day. Sometimes two. Routinely, late at night, on school nights. I got caught and chastised by my parents repeatedly. But then at the end of 3rd grade, I tested out at an 11th grade reading level, my parents literally saw the light (under my bedroom door) and looked the other way. (Sadly, I admit, recently there were entire years that passed by with me reading not a single work of fiction. Work could suck that way.)
One of the novels read during my young explosion of literacy was the forgettable 1964 science fiction novel, The Greks Bring Gifts by Murray Leinster. Yet it wasn’t forgettable for me. I read it twice even. Aliens visited earth in a massive ship. They brought the gifts of advanced world-changing technology. Gifts of astounding productivity. Almost all human industries were obsoleted. No one would ever have to work at again. Humanity saved and living a true life of leisure. The altruistic aliens had to leave soon, going away for years. So our best scientists were taught how to maintain the technology. It was incredibly complex. But earth’s scientists caught on. All except one, one who was previously thought to be the best young scientist on earth. It just didn’t make sense to him. It seemed like complex gibberish. He was humiliated and shunned. The world was euphoric. The aliens left. Life was groovy. No one worked anymore. A life of leisure for all.
Until one day, the technology began to break. Earth had been fooled. Our scientists had been duped. They had been taught nonsense. No real clue on how the technology really worked. The human population was in panic. We had forgotten our own means of producing for ourselves. Our work ethic had vanished. And the aliens were gone. As all the marvelous technology failed, the aliens would soon appear again with new terms. They had produced the ultimate Trojan Horse to conquer earth upon their return. The Grek “gifts” would not be free.
The hero was the only scientist not tricked. My eight year old brain committed to memory two lessons:
- Never ever give in to peer pressure when you are not convinced. Even if it makes you look stupid. Everyone else CAN be wrong.
- If you are the only one standing alone in skepticism, be very careful lest ye lose all power.
So how did my early lessons from The Greks Bring Gifts relate to GE?
When I first joined GE out of college, it was a culture of (sometimes brutal) logic:
“Fix, Sell or Close”
“Speed, Simplicity, Self Confidence”
And a favorite from an Aircraft Engines executive, “You can’t make income without shipping engines”
Oh such a simple, performance culture! An engineer’s logical culture. Success thru producing, selling, shipping a product. But the culture was changing. The influence of the Capital business stronger and stronger. Income could be produced with financial transactions. Securitization, asset tranches, mixing, repackaging, buying, selling. Complex transactions. I remember once questioning… doesn’t this assume we are almost always smarter than our trading partners? “We are smarter.”
And maybe so… usually. But the culture was changing from an engineer’s mindset to a financial one. The old joke about the engineer and the economist walking along and falling into a deep hole became relevant. The engineer says, “Don’t worry, I will find a way out of this hole.” But try as he might, he just couldn’t find a way up and out. The economist says, “I will find a solution.” He thinks and thinks and then says, “No worries, we will just assume a ladder.”
I have to wonder, how many times, big and small, did the financial wizardry assume ladders? Honest, hard-working, brilliant employees in the changed culture assuming ladders. Some of them becoming real, some never so.
I know I occasionally forgot lesson #1 from The Greks Bring Gifts. And many times I ignored lesson #2. How many brilliant humans within GE, and market analysts outside GE never learned or forgot lesson #1 until it was too late. Lost in the complexity, living the group think. Eventually five hundred billion dollars of market capitalization ceasing to exist.