Great Leaders Reward Merit

Life as a nomad on the steppes of Central Asia must have been grim in the year 1200.  

The climate is cold and dry.  You would spend everyday seeking grass for your animals to eat.  You hoped another tribe didn’t destroy your tribe and take your children as slaves.

Your tribe was everything.  They protected you, and helped you acquire resources for survival.  

That is the world into which Temüjin was born.  His father was chief of the ruling clan of the Mongols, but when his father was killed by a rival clan, Temüjin’s family was ostracized and he himself became a slave. 

He escaped, and rebuilt a clan.  But when he was elected head of a tribe, he departed from tradition.  He promoted leaders based on merit and loyalty, not only on blood.  Eventually he became head of all Mongol clans and became Genghis Khan.  

Temüjin means “blacksmith”.* The name fits: he was able to forge an empire from his slave beginnings.  He enjoyed extraordinary loyalty from his followers, and together they built an empire stretching from the Pacific ocean to Southern Europe.  

Genghis Khan is not the only leader to create a meritocracy.  But it is far too uncommon.  Everyone claims to hire and promote based on merit, but they don’t.  We hire people who look and act like ourselves. A 2012 study** indicated that we hire by homophily: we hire people who share our interests, characteristics, and background.  

My book uses Genghis Khan as an example more than for once, because the Mongols built an incredible institution, the largest contiguous empire in world history.  Note: I am not pro-genocide.  But we can learn from those who are, just as we can from others.


*Glasse, Cyril; Smith, Huston (January 2003). The New Encyclopedia of Islam. p. 313. ISBN 978-0-7591-0190-6.

**Rivera, L. A. (2012). Hiring as cultural matching: The case of elite professional service firms. American sociological review77(6), 999-1022.

Great Leaders Tell Great Stories

Medieval nobles were horrible, violent people.  They would beat peasants for fun and trample crops of poor people during their jousting matches.  They burned peasant homes for sport.  Why?  Because they could.  They were the warrior class and had the weapons.  

In the early middle ages, a knight was someone who had money to buy armor and weapons.  Eventually, knights came to be considered a lower tier of the nobility, and titles became hereditary.  But they were still usually uncouth.  They mistreated women and exhibited terrible dining manners.  

The Catholic church tried to remedy the situation with two programs, the Peace of God and the Truce of God.  At the Council of Charroux, the Peace of God was proclaimed in 989.  It called for protection of church property and clerics and of cropland.  The Truce of God was proclaimed in 1027, and called for limits on which days the nobility could engage in violence.  

Peace and Truce of God may have been temporarily useful in some cases, but overall is considered to have been a failure.  Peace & Truce tried to cover too many people on too many topics, as mission creep added in multiple rules (such as treatment of orphans, widows, and animals etc.). But it would have been unsuccessful anyway.  Nobles don’t like to be told what they cannot do.  Also, the rule books were written in Latin, and most nobles could barely read their local languages.  

Peace & Truce 2.0 was much more successful.  It was called Chivalry. This was a system designed to encourage nobles, especially knights, from mistreating everyone.  It was successful because (1) it was written in local languages, (2) it told them things they could do, rather than not do (romance, etc.) and (3) it employed stories.

Most knights forgot they weren’t allowed to kill peasants on Thursdays.  But they remembered the tales of Lancelot.  

Stories should offer opportunity

Instead of saying “you can’t rape villagers on Tuesdays,” the program offered the opportunity to be heroes.  They could rescue villagers from dragons.  Your stories should suggest more opportunity than punishment. 

Stories should be in the language of the hearer

Jesus used stories of farmers planting and harvesting.  It was effective for millenia. But now, people think grocery stores magically manufacture food.  Use the words your people understand.  Use the images they understand. 

Stories should be entertaining enough to be memorable

People remember the frightening dragons and the beautiful Guinevere.  People don’t remember “sales targets in the eastern region will increase by 2.43%” phrases. 

Stories should make the lessons clear

After the chivalric program was implemented and knights read the stories, they knew they should treat women well, eat politely at the dinner table, and help people instead of hurting them.  It was clear.  If you want to be like Lancelot, be good.

Leadership and Alliances

During World War I, the British Navy killed an estimated 750,000 civilians—normal people—by starving them to death with a blockade.  That is just one estimate, but even 10% of that number is unimaginably heinous.

The lesson of the day: Choose your allies carefully.

In the early 1900s, Germany felt alone in the world.  They wanted friends.  They needed alliances to help them feel safe in the new order.  The country  sought an alliance with Great Britain, but was rebuffed.  Everyone else seemed wary of Germany’s participation in the industrial revolution, and they also rebuffed Germany.

So Germany teamed up with Austro-Hungary.

Then the Austro-Hungarian empire pulled Germany into the Great War, a protracted war of attrition.  The country was devastated in a way that led to the rise of Hitler and National Socialism.

Often, the Balance of Power concept pops up in the multinational business arena also.  In the corporate world, confederations proliferate.  Caterpillar and Mitsubishi teamed up in the 1960s.  Other firms share customers or research or distribution channels to combine competencies.  Apple and Microsoft might plot to counter Google’s power.

This is especially true if your company is small, or if you are managing only one team.  Your organization can’t do everything alone, so you should make alliances.  Just be careful whom you choose.  Be both proactive and careful and purposeful. Don’t just let it happen.

An individual can end up in a long-term relationship with someone because that person was sitting on a bar stool near their own stool.  Organizations make the same mistake.

Don’t join forces with a firm whose platform might soon become obsolete.  Avoid those focused on stealing your knowhow in exchange for simple introductions to government regulators.  Say no to those with outdated views of the market or of the world.

Be purposeful in choosing friends, spouses, and corporate partners.

:::  Be fierce.  Be kind.  Be knowledge-hungry.  :::

Why You Should Join an MLM Scam

Every generation must re-learn that MLM (multi-level marketing or network marketing) is extremely profitable—for a tiny percentage of participants.

And that is okay.

One estimate is that 2% in any MLM organization make outsized profits, and the rest lose money.  That estimate might be high or low.

People become part of the 98% if they (1) care how their actions affect other people, and (2) are not born to sell.  The 98% are marks, or targets, for the 2%.

Yes, anyone can learn to sell.  But to sell complete lifestyle change, to sell religious conversion, requires a competence package that few possess.

I can sell, and have some of the other necessary skills, and I lost $70,000 in one year.  The company continually changed policies to benefit the 2% and harm the 98%, because they knew the 2% were their real customers and the rest of us were cannon fodder for the 2%.  I realized that I would never become part of the 2%.  So I quit.  Weirdly, I was again convinced to try another of those companies a year later.

Here is the good news.  Almost everyone who tries to make money in MLM becomes a better person.  I have seens hundreds of people try MLM, and they develop skills:
* ability to emotionally expose themselves and talk to people
* ambition
* basic self-improvement, sometimes even improved personal hygiene
* accounting and accountability
* basic marketing mindset
* long-range planning
* ability to discern good and bad opportunities

So even if you lose money, you still receive benefits (skills) that you can use in legitimate spheres of your life.


Here are some definitions and clarifications.

MLM scam: Some of these companies focus on product, and compensate distributors for selling products. They are legit. But if a company’s focus is the payment plan for recruiting, it wants you as cannon fodder to keep people at the top profitable. The legal definition of Pyramid Scheme involves having a real product or not. If the product is a liter of fruit juice for $40, be suspicious.

Personal direct marketing:  These companies are almost 100% product focused.  They are not MLM.  Pampered chef, Avon, and various candle companies do not offer a path to wealth, but are legitimately ways to earn side money at home. (Some scams do offer huge profits for doing very little work.)

Cellular Level:  A common product claim from MLM companies is that their vitamins or fruit juice benefits your body “at the cellular level.” Clarification:  Everything we eat benefits or harms us at the cellular level.  Organic kale and lead paint chips affect us at the cellular level.

The Vikings Have Really Improved

This year begins with a new series,

Developing Leadership Skills from History.


Should we teach business skills in schools?   Do business skills matter?

14D0B110-84C1-46F7-9CE8-0423F05B0DEEFor 373 years, the Vikings terrified Europe. The Germans were powerless before the Danes.  Vikings called the Franks in the powerful Carolingian Empire “beggars,” because they would beg for their lives.

“Here, take all of our treasure, just please leave us alone,” the Franks would cry.

But when the Vikings became Christians and the Viking age ended, the tide turned completely back.  It was not the Vikings who controlled their domains, but the Germans.  Merchants of the German Hanseatic League set up trading cities, hired armies, and established banking.  The Hanse merchants were simply better at marketing, supply chain management, and scaling.  For 300 years, the merchants controlled the economies of the Baltic and most of Scandinavia.

So as it often in history, the abacus was mightier than the battle axe.  

Japan borrowed that lesson.  In the first part of the 20th century, their military controlled Asia.  Japan grew an empire that covered (at the peak) between 1/4 and 1/3 of the world’s population.  But they lost it all pretty quickly.  So they built an economic powerhouse, and Japan is much more prosperous.  The abacus was more powerful than the katana sword.  Japanese are much more happy. 

The Viking descendants did catch up on business skills.  Now they sell tiny plastic toy blocks at 10,000% profit (Legos).  And they sell furniture cheaply by outsourcing most of the manufacturing to the customer (IKEA).

Are you developing your business skills?  Remember that basic business skills do help build economies.

:::  Be fierce.  Be kind.  Be knowledge-hungry.  :::

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