Ever heard of William of Ockham?
Not many people have. He was actually a medieval philosopher who is most famous for his creation of Occam’s razor.
I had never heard of him in any of my history or philosophy classes, but when I first heard of Occam’s razor on a TV show (Luther), I was intrigued.
It states that “among competing hypotheses, the one with the fewest assumptions should be selected.”
Now to put that in terms everyone can understand: the simplest solution is often the best.
Personally, I love simplicity.
Time and time again when I hear of governments talk about their “new” tax plan, I figure it’s just another way for them to squeeze more money out of us.
Every time we hear about the government “helping” us, I wonder just how much that help will cost me.
The reason I get nervous is because their ideas are complicated, with all sorts of rules and regulations that make me go “huh?!”
Just look at Obamacare was 2000 pages long…and most of the politicians that signed it into being. Speak of the House Nancy Pelosi uttered her most infamous 16 words: “But we have to pass the [Senate healthcare] bill so that you can find out what’s in it.”
Hearing things like that concern me.
But it’s not just government that concerns me. When businesses adopt more and more complicated rules, I get a bad feeling in the back of my throat.
I still remember the first company I worked for explaining the rules about holidays. It sounded good and everyone was excited, but I wasn’t so sure. Still, I thought I must be wrong because everyone seemed happy with it. A few months later though, I uncovered the truth about our supposed “fair” system. Turns out it wasn’t so good for us, and great for the company.
More recently, another company I have done business with explained their new plan to make things “fairer.” Again, it all sounded good.
Turns out, it was very fair for the company and not so much for the people working there.
You see, the problem with complexity is that it allows for some people to take advantage of the system (ie. the people who came up with it), while most people lose out. Simply, because they have never taken the time to truly understand just what it is.
I was reminded of the importance of Occam’s razor recently when I read a post by David Holland who I follow over on FB.
It’s pretty clever and I’ll admit that I didn’t get it. He also posted a follow-up here – http://resultsrulesok.blogspot.fr/2013/12/circle-challenge-2.html
Give them a go and see if you can figure them out. There’s great little brain teasers.
Now that you know Occam’s razor I recommend you start applying it to everything you do. Especially for those investors out there, if you don’t understand the business, don’t invest in it. It has served Warren Buffet alright despite missing the tech boom completely.
So the next time you hear a plan that’s too complex to understand, don’t be afraid to raise your hand and ask them to explain. If they can’t explain it simply enough, it’s not a good plan. And one that you’ll likely run into trouble with at sometime in the future. Don’t take it from me, just look at Obamacare and all the problems it has caused.
There is magic in simplicity.
There’s only one problem with it, people can’t take advantage of it.