Johnson: A 27-person pre-mortem uncovered four path-critical risks I missed
Paul Johnson · Gary Klein with Paul Sonkin and Paul Johnson – Conducting Pre-Mortem Analysis (Capital Allocators, EP.109) · Sep 23, 2019 · at 38:11
Investor and author Paul Johnson shares results from conducting a pre-mortem before launching a project.
0:00 / 0:11exact quote · 11.1s
720p mp4 · rendered on demand · StarZero watermark
“I ran a pre-mortem a year ago on a project we were going to launch. 27 people in the room. Wrote 27 things down on the first pass. Five of them were path critical. Of those five, I'd only thought of one.”
quote is from the automated transcript, cleaned for reading: filler sounds and stutters are removed, nothing is rephrased. names can be misheard (the analysis reads context, assessments check outside sources). how →
More from Paul Johnson
Johnson: Markets Form Robust Consensus With Few Smart Participants
“The sad part about wisdom of the crowds is, we figured it out, is you don't need as many people as you think to get a wise crowd. You think you'd have to have all these really smart, sophisticated people. Ends up, you don't. The robust, we call it a robust con…”
Johnson: Engineers Make Terrible Investors When Ignoring Crowd Psychology
“Some of my former friends that are engineers make terrible investors. Not all engineers make, but my friends that were former engineers, because they kept thinking it's an engineering problem. I said, no, it's a, I mean, it is potentially an engineering proble…”
Johnson: External red teams are too time-prohibitive for daily investment decisions
“And the problem with red teams, particularly in the investment businesses, since we're making decisions almost daily or certainly fairly frequently, having a red team coming in and prepping them is probably prohibitive in terms of time and energy.”
Paul Johnson: Investment research is useless unless pitched effectively to scale positions
“And now I'm a complete convert, which is that unless you can pitch this stock, get the portfolio manager, not only buy it, but then scale the position. It just doesn't matter. It's the proverbial tree in the woods.”
Johnson: Investor diversity and independence are fundamentally distinct market mechanisms
“Diversity and independence are completely different issues. Lack of diversity is when everyone's thinking the same way. Independence is slightly different, where people are diverse, but when they go to express their opinion, then they're collectively influence…”
Johnson: Non-diverse shareholder bases make stocks prone to violent moves
“Just because you lack diversity or independence doesn't mean they're wrong. And there's a subtlety there that's not insignificant. We're not saying that Amazon is mispriced. We're just saying the crowd's not very diverse. So if an event happens that challenges…”