Tuesday, August 12, 2014

The Red Paperclip and Other Inspiring Stories

Talk by Johan Jaaffar to participants of Te Dx Merdeka Square at the Methodist College Kuala Lumpur, Brickfields on 17 August 2013

I love this story about the red paperclip.

What can you do with a paperclip?

Just one red paperclip.

Use it to clip some papers, of course. Or straighten it to open a lock. Or just throw it away. Not Kyle MacDonald. Through a series of online trades over a period of one year, he bartered his way to owning a house.

He first traded his red paperclip for a fish-shaped sheet of paper on 14 July 2005. Fourteen transactions later, on 5 July 2006, he got a two-storey farm-house in Kipling, Saskatchewan, Canada.

MacDonald, the Canadian blogger, has earned his place in history as someone whose ingenuity, tenacity and clever idea have changed the way we solve problems. The story of one red paperclip is now taught in business schools and discussed as a case study in motivational talks.

The moral of the story is: there is no limit to imagination and creativity. And more importantly, ingenuity. MacDonald did something with an everyday item that we all take for granted, Showing us that even little things have value. Just read his wonderful story in One Red Paperclip: The Story of How One Man Changed His Life One Swap At A Time.

He has inspired us too.

We are too used to the idea that you need a proper job, work hard, save, and borrow from a bank to buy a house. MacDonald was 25 at the time, with no permanent job, when he started his adventure. The idea was to trade something for “bigger” and “better”. He changed the rules of how things get done.

We are familiar with incredible stories of people becoming rich for doing something extraordinary. The founders of Microsoft, Google and Facebook, to name a few, stumbled onto something incredibly simple but had impact on the lives of millions. They started their business in garages and dormitories, equipped with ingenuity and lots of hard work. They made it big. We have heard about rag-to-riches stories many times before.

We learned how with problems, challenges and adversities come ideas and solutions. We admire innovators and creators of things that redefined our way of life –while making themselves extremely rich by doing so.

But trading a paperclip for a house is a different ball game altogether.

The next time you see a paperclip lying on the table, remember this, you might end up owning a Ferrari many online transactions later.

Tina Seelig of Stanford University mentioned the paperclip story in her book What I Wish I Knew When I Was 20: A Crash Course on Making Your Place in the World.

The book tells stories of people with ideas – some of which are outrageously simple but defy expectations and challenge assumptions. She mixes real-life stories and experiences with classroom innovations and boardroom decisions. It is part motivational book, part management mantra, but mostly a lesson in disregarding the impossible, on how to recover from failures and look at problems as opportunities in disguise.

What would you do with $5 (RM16)?

Like the paperclip, it is nothing much. That assignment changed the way her students thought, solved problems and managed their finances. In short: Leveraging on limited resources, Seelig found through her experiment that her students were capable of coming out with ideas that were original and inventive. You never know what the human mind can do when properly challenged.

The whole idea of the “Five-Dollar Challenge”, according to her, is about inculcating and nurturing an “entrepreneurial mind-set”. At the same time, she realised that her students must not measure “value” in terms of financial rewards only. For the next assignment, she substituted the $5 for 10 paperclips.

Remember, MacDonald started with one.

Students must not be trapped in the traditional education mould, she argues. What you learn in schools is different from the real world. You can’t apply textbook solutions to real problems outside. You have to innovate, be creative and think out of the box. According to Seelig, “Bridging the gap to tackle real-world challenges can be extremely difficult, but it’s doable with the right tools and mind-set.”

When I was the editor of a newspaper, I sent rookie reporters to places with no real assignments in mind. I sent them to bus stations, the National Mosque, a morgue, a hospital, a massage parlour, Pasar Chow Kit, you name it.

They were lost initially. But my message was simple:

Dont Come Back Without A Story!

Incredibly, they came back with interesting ones. I met one of these reporters recently, an award-winning journalist herself. She said that the assignment I gave in 1994 had changed her outlook, perspective on life, and professional viewpoint. She had written about a masseur at Jalan Alor, who had two of her children studying abroad.

Let me talk about sportsmen and women and film stars and, of course, Psy. Yes, that Psy!

In the introduction to his book, The Creative Economy: How People Make Money From Ideas, John Howkins quoted from Fortune magazine that basketball superstar Michael Jordan’s personal economic value during his prime years, gained through copyrights and merchandising, exceeded the Gross National Product (GDP) of the Kingdom of Jordan.

Copyrights and merchandising are new catchwords in the global economy today. There are many such stories in which sportspersons, film stars, dot-com starters and digital entrepreneurs are rewriting the economic logic. Companies started in garages and by college drop-outs are leading the world in wealth creation, value for investors and market capitalisation.

Wayne Rooney is currently not the best footballer in the English Premier League.

He’s paid £120,000 a week. That is a staggering RM600,000 a week or RM2.4 million a month. A clerk earning RM2,000 a month in Malaysia would have to slog 1,200 months to earn that much money. He will never see that kind of money unless he works till he’s 100 years old.

Golfer Tiger Woods was once the highest paid sportsman – he earned $78 million a year or RM249.6 million or $148 a second (RM473.6). The hat he wears on his head – it would take a Thai garment worker 38 years to earn what he collects from Nike in a day.

The Howkins book challenges us to rethink the way we look at businesses. Ideas matter. Creativity reigns supreme. And creativity brings in money, lots and lots of money.

There is a company that employs 13 people, yet its turnover a year exceeds RM3.2 billion ringgit. In fact, there are many such companies – not at all labour intensive, yet performing better than companies that employ thousands of people. What matters is that everyone can make a difference. A creative economy, Howkins argues, is the exchange of products, services and experiences whose economic values are based in ideas.

Thanks to advancements in communication technology, things are changing for the better. The world is never the same again. Both the old and the young are embracing the latest applications in the world of communications.

In the creative economy, ‘Content is King’ and in the entertainment industry, the quality of content differentiates the men from the boys. The creative content industry is the most robust, exciting and challenging industry today. It demands nothing less from the best and brightest to keep ahead of the pack. This is the world of great achievements, spectacular misses, bloated ambitions and unthinkable riches.

The industry allows almost everyone to participate. The entry level is cheap. What you need is creativity, audacity and the lots of luck. Psy would not have been created had YouTube not been in place. Facebook (FB) is everyone’s favourite social media tool. One in seven humans has an FB account. Twitter is fast growing in strength, a staggering 400 million tweets are sent out a day. There will be many more surprises.

The world of entertainment is changing beyond belief. Movies are being made differently today. James Cameron waited until computer-generated-images (CGI) were perfect before proceeding to make his Avatar.

 The Lord of the Rings would not have been made the way Peter Jackson wanted had the relevant technology not been ready.

Despite the soaring cost of movie-making (for an American movie, averaging between RM256 million to RM385 million a movie), Hollywood movies have not lost their luster. A good director of photography (GOP) in a typical Hollywood movie will be hired for a fee at least twice more than the cost of an average Malaysian movie.

People are willing to spend to watch movies in cinemas or on various other platforms offered today. There is no one vehicle to get entertained – the principle is you can get your favourite film or TV show anywhere, any time. The potential for film and TV stars, not to mention sports personalities or even celebrity chefs are tremendous. There is money everywhere. If a plump, thirty-something Korean with only two YouTube postings could demand more than RM1.5 million per appearance on stage, you know the world of entertainment has drastically changed.
How much is a film star worth today? For a big Hollywood star, $20 million a movie is nothing. That is RM64 million, mind you. I joked about McCauley Culkin. For the second Home Alone movie, he was paid more than the amount ever received by a famous Malay film star in 40 years!

Talk about fairness.

Howkins’ book is about the relationship between creativity and economics – neither is new but what is new “is the nature and extent of the relationship between them and how they combine to create extraordinary value and wealth.”

He has a point: people with their own ideas today “have become more powerful than people who work machines and, in many cases, more powerful than the people who own machines.” He argues that creativity is about using ideas to make more ideas and a creative ecology is one where people can be creative and turn ideas into products.

Content Is King

I was in Afghanistan in the spring of 1989 – at the peak of the Afghan Civil War. President Najibullah was hanging by a thread as the Russians abandoned him. I was in Jalalabad and around the Kunar Valley. I met Gulbuddin Hekmateyar, Prof Raff Sayoff, and many leaders of the various Mujahideen groups in the south.

Back then, they were heroes and freedom fighters hailed by the West as the ragtag army that defeated the second most powerful nation in the world. Even Sylvester Stallone was there to remind us of the famous Pashtun proverb: Beware the venom of the cobra and the vengeance of the Afghans.

They are all terrorists now.

I met Mir Mohammad, who was hardly 14 at the time, a child soldier indeed. I was accompanied by Amir, a UIA student who left his studies to be the spokesperson for the Hisbi Islami group.

And I met this man – an old fighter reading the Quran, regardless of what was happening around him. 

Look carefully.

Look at his idea of security – boxes of ammunitions waiting to explode if hit by a bullet.
I didn’t get to know him – or his name – as bullets were whizzing pass us and we were terribly scared.

But I learned about bravery, determination and fortitude that day.

For many, sheer hard work and determination are needed to achieve great things in life. For MacDonald, it was ingenuity. For the likes of Tiger Woods, Rooney and Jordan, it was practice and sheer hard work. For the old man, it was about fighting for freedom. For God, Nation, Family and the future of his generation.

But there is another dimension to that – how they were motivated and inspired to achieve that. One simple idea can change the world. Determination too.  Greatness is made of these – little things that turn bigger and better. And the men and women behind them, whose ideas passed the test of time.

My two-cent worth of advice?

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