Tag: Logic

Flip it!

Daniel Pink has a smart article on flip thinking, a trend in innovation. It’s a matter of rethinking sequence logic: for instance, a math instructor finds that it makes more sense to work on problems in class, and follow with the lecture (uploaded to YouTube, where students watch as homework). You experience the tension of the problem first, and get hands-on guidance from the instructor. Having learned your way around the problem, you see the lecture that contextualizes that learning.

While the idea is great, and Pink offers excellent examples where turning sequences around might work, the more compelling lesson is about creativity: we should rethink our habits and routines, and consider re-engineering our processes, as a matter of course. It’s too easy for ruts to form. We avoid disruptive innovation because it can be painful, but it’s productive pain. [Link]

Credit where credit is due

James Suroweicki explains the logic that drives credit card companies to strangle consumers.

…credit-card companies have created a strange business, in which there’s a fine line between good and bad customers. Their best customers aren’t those who dutifully pay off their balance every month; instead, they’re the ones who charge a lot and pay only a little every month, carrying a sizable balance and racking up interest charges and late fees. These are the “revolvers,” and the credit-card business feeds on them. Credit-card companies don’t necessarily want revolvers to pay off their debts; if they did, there’d be no interest or fees to collect. They want their loans to be, in the words of a banking regulator, “a perpetual earning asset.” And they’ve thought a lot about how to keep those interest payments coming. For instance, they used to keep minimum payments relatively high. But, over time, companies started lowering minimum payments, sometimes to just two per cent of the balance. The lower the minimum payment the less people pay off each month and the longer they stay on the hook.