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Arizona State University
January 16, 2018
Dean Kashiwagi is a professor in the Arizona State University’s Del E Web School of Construction. He is a specialist and researcher in “best value procurement” and has conducted over 900 tests totaling $4.6 billion with a 98% success rate.He took his undergraduate degree from University of Hawaii in civil engineering and his Master’s and Ph.D in industrial Engineering at ASU. He served 14 years in the US Air Force and has written over 100 articles and 11 books including his most recent, “How to Know Everything Without Knowing Anything.”
Interviewer: These are some quotes that we got from your students from the website, "Rate my professor." So I'm gonna read this to you really quick, "Dr. Dean Kashiwagi is one of the most inspiring and life-changing professors I've ever had." Here is a second one, "I am learning too much with him. This class is an adventure. From every hour you spend talking about the lessons in class, you'll spend five thinking about and applying those lessons outside of class." And then the last one, one word, "Dominant." So Dr. Dean what in the world are you teaching in your class, that it's getting these types of quotes from your students?
Dr. Dean: Well, we have totally different philosophy. What we propose is that if somebody looks at reality, and lives long enough, and has enough experience, they will begin to realize that it's impossible to make someone understand something when it seems complex to that student. So our whole approach is to simplify, to minimize the need to think, which minimizes stress, and allows people to understand reality in a very simple manner.
Our general rules for the class which, you know, was a bone of contention with a lot of my peers is that when somebody signed up for a class, we wanted to minimize the amount of work they did, and minimize the amount of thinking they had to do. So the rules are very few, they had to come to class, they had to disconnect from their electronics, they would sit there and we as the teachers made it simple, they were to listen and whatever conclusion they came up with was always the right conclusion. And this is based on the logic of what we call, "Information measurement theory," which is the foundation of the best value approach.
Interviewer: If you had to give us like a very quick couple of minutes explanation of what best value procurement is, can you do that for us?
Dr. Dean: We'll make even simpler. We'll talk about a simple, what we call, "Event in reality." An event is something that has initial conditions and has final conditions. And the change over time of the event conditions is governed by natural law. So basically, anybody who's logical will accept what they observe in reality, will look at this and say, "If somebody understands the initial conditions, they will be able to predict the final conditions."
Dr. Dean: And if somebody sits there and says, "Well, what does this mean?" Well, it means, that the final conditions are actually set in the initial conditions, which means, everything that is governed by natural law and there is nothing that is not governed by natural law, is predictable and if predictable, it can happen only one way. And this is supported by the evidence that everything we've ever seen in our lives, or in the history of mankind, has only happened one way. Which means, the final conditions of any event or the feature, is actually set in the past. And if somebody actually understood this they can predict the future, therefore they can see into the future, therefore time loses its value to this type of person.
Interviewer: So, in that model, uncertainty in the world exist where? Not understanding natural laws?
Dr. Dean: Uncertainty or the concept that events or initial conditions can turn out into two sets of final conditions, is inaccurate. That it has never happened, it never will happen. So basically, the confusion or the uncertainty, or the risk is actually causing people's minds who don't understand simple reality. There is no such thing as uncertainty. Uncertainty means that somebody lacks sufficient information to understand initial conditions.
Interviewer: Right, okay.
So, that search for information or lack of information, those are the big hurdles to overcome in your model?
Dr. Dean: In the model that we use, we want to always simplify. So you simplify when you find out that you don't understand something, which means, by observation you can't quickly understand reality and predict what's gonna happen in the future, you should always go and call an expert who is good in that area that you have confusion about, and have the expert tell you what's gonna happen.
Interviewer: Practical application is explained in your best value procurement practices.
Dr. Dean: Yes.
Interviewer: Do you heck a little bit about?
Dr. Dean: Now, the best value approach, which is the application of information measurement theory or acrid concepts of reality, is simply, the identification utilization of expertise.
Interviewer: When I was reading some of your work and listening to the seminar, it struck me as very similar to some of the work of, Friedrich Hayek and his economic philosophy. I was interested, is any of your philosophy inspired by that?
Dr. Dean: I have to be very honest with you. As I've gotten older, I've realized that there are very few people who actually understand reality. And so anybody who can accept reality as it is happening and understand that, their ideas are always gonna be in congruence to what I'm talking about.
Interviewer: So you're not a reader of philosophy or a fan of any particular thinkers?
Dr. Dean: I am, if they can make it simple, if I can accept it by observation, and if they minimize my need to think.
Interviewer: Now that's interesting.
Dr. Dean: Because as a kid out there, I quickly realized, it's not a good thing to make other people think. When you make people think, you increased their stress level, you force them to go get more information which is, utilization of energy, resources etc.. When in actuality all we have to do is find an expert. And they know they've found an expert when the expert can clearly identify what reality is, and simply explain what's gonna happen before it happens.
Interviewer: Do you think accessed information within the Internet has allowed us to find experts more easily, or is it more difficult with just an overabundance of information?
Dr. Dean: Well, the problem is not that whether we had the Internet in past years and we have the Internet today, the problem is in the amount of people who actually can identify reality for what reality is. In other words, logic tells you that because we have the Internet, it should be much easier to identify and utilize expertise.
Dr. Dean: But that's not the limiting factor, although it will impact how smart people run their lives now and how it helps them to see into the future so that they don't waste their time and effort doing things that in the future, will be totally meaningless. If you truly understand this, if you look at society and say, "Do I have more observant people, or more nonobservant people?" Observant people are people who can see something and don't have to think about it. Nonobservant people are people who are more likely to get confused and immediately start thinking because that's what human beings do. They think, it's a natural law. People get confused, they start thinking.
Dr. Dean: And when they start thinking, they try to drive information to themselves. But because they're not an expert in it, it becomes very difficult to understand what information is accurate and what is inaccurate. They end up stressing out, finally making a decision based on their own background and understanding. And that is why nonobservant people always increase the risk, increase the cost. And, because they're not experts, do not increase the quality of what they're doing.
Interviewer: Is it possible for a nonobservant person to become an observant person? And, how does one become an expert?
Dr. Dean: Well, the first thing is, if the final conditions are set in the initial conditions, what is the biggest event that you see? In your lifetime it's gonna be you. And you were born. When you were born were you different in other people? The answer has to be, 'Yes,' therefore you're predisposed. So if you're predisposed, then you have certain criteria, certain 'characteristics' that make up who you are and how you think. And because you are subject to natural laws, if somebody had all the information about you, you cannot predict what's gonna happen to that person before it happens. Which means, everyone is different at birth, and they're differentiated by things like, 'were they born, who their parents are, birth order, the amount of resources the family has access to, the environment that they're born into, the way everyone is thinking around them,' all these different factors define who they are.
If the logic truly plays out, you can then take this information and predict what's gonna happen to these people throughout their lives.
So, your question, "Can somebody now, go from nonobservant to observant?"
I would have to say without trying to describe because, of course we're on a spectrum here of the ability to observe and the ability to become observant. But if you try to make this simple, I would say that a nonobservant person could never become an observant person. That's why it's predictable. In simplifying as he quickly begin to realize if you look in any sector of our country, any type of social group, or, you expand this to any other countries, the natural law is, the number of observant people are always very few.
Now, how can you utilize this now, so you do not have to think is much? Simple. You're looking at all these concepts are coming out to talk about leadership, to talk about like, how to improve our society etc., etc.
Any time and idea is very popular, which means the majority of people actually believe it, the odds that it is accurate, and will work, is very low. Because the majority people are nonobservant. So they like ideas that actually aren't logical because that's what nonobservant people like.
Dr. Dean: So, if it's very popular, you should quickly realize that it's probably not accurate and won't work. And that's why a lot of programs, both in education and in our government system never work, because, they're created by nonobservant people and the ideas are inconsistent, they don't match reality, and over time just won't work. And people, 'nonobservant people,' will buy into these ideas simply because, they can't see into the future.
Interviewer: All right. So you're not a fan of, '51% wins the day,' Majority rule?
Dr. Dean: The majority here right, will always be nonobservant. But, because the event only happens one way, and no one actually loses, and no one can change anyone else, and everybody's accountable for what they do, the observant people will always win.
Interviewer: So then applying that to best value, you talk about bringing in experts. So you would define an expert as an observant person. Is that accurate?
Dr. Dean: Yes, I can make it even simpler. An expert is one who can identify the initial conditions, and see into the future before it happens. By definition, if you have an observant person, you can quickly understand why they are observant. So, we're gonna kinda flip the tables on you here. I'm gonna ask you the question, and I don't want you thinking, and you give me the answer.
Dr. Dean: If I find an expert, do you agree he would be an observant person, or he or she?
Dr. Dean: If they're observant, are they more likely to think win-win, or win-lose?
Dr. Dean: Are they more likely to believe in natural loss?
Dr. Dean: Are they more likely to increase or decrease their decision-making?
Dr. Dean: In fact, if an expert was almost a total expert or knew almost everything, how many decisions they would make?
Interviewer: Very few. Zero.
Dr. Dean: So an expert thinks more or thinks less?
Dr. Dean: Well, an expert, when they do something for you as a client, or a customer, will they treat you exactly how they would treat themselves, or will they treat you differently?
Interviewer: How they treat themselves.
Dr. Dean: Therefore, is an expert, and their actions predictable or not predictable?
Dr. Dean: You got it.
Interviewer: So for example, let's say we take a specific trade on a construction site, there are gonna be experts in that trade in general. But then if we drill down within that trade, and we find one action within that trade, could there be more experts within that one action that might not be the experts at the total trade?
Dr. Dean: Logic tells you, that if you ask somebody to do just one thing instead of five things, you're gonna have more people who could do the one thing.
Dr. Dean: The overriding rule or natural law is, that in every sector, whether it be a sub trade, or a sub-sub trade, or whether it be in industry, will always have very few experts. Therefore, the problem becomes of anybody who is trying to increase quality and decrease costs at the same time. As the simplest way to explain this is the identification and the utilization. The effective utilization of expertise. And therein lies the crux of how to resolve the issues. But human beings, number one, cannot identify expertise, even if it's in their own company, don't know how to effectively utilize that expertise, because common sense and logic tell you, if you have an expert doing something, what percent of the time do you want them doing your expertise?
Interviewer: I'd say, all the time.
Dr. Dean: Yes, and this is where people stumble, because they don't know how to utilize expertise.
Interviewer: When you go to a restaurant, how do you choose what to order?
Dr. Dean: At my stage in life where I know who I am, I tell somebody what I like to eat and ask them to tell me what would be the best thing for me to order.
Interviewer: So you had that conversation with the server?
Dr. Dean: Absolutely.
Interviewer: Interesting. That's kinda what we would thought.
Dr. Dean: Absolutely. And I can tell you. I've got this experience, right? I got out to Tampa, Florida, and I go into the specific restaurant that is supposed be the most outstanding seafood restaurant in Tampa. And I tell the server, "You know, I only eat fish. I don't eat meat at all," so I can only eat fish.
Dr. Dean: But, I'm born and raised in Hawaii, and I know what good fish tastes like. Basically fish has to be cooked right, it has to be fresh, and I can tell if both of those requirements have been met. He said, "Oh, not a problem, not a problem." I said, "So what do you recommend that I eat?" And he says, "I recommend our mahi-mahi." I said, "Okay. That's what I'll take."
They bring it to me. It is the worst mahi-mahi that I've ever eaten. And I actually...yeah, I like to be polite and I wasn't. Somebody took me there trying to make me happy because they're so happy I came to speak and they wanted to actually show me what good fish tastes like.
Dr. Dean: I have to tell the server that this was probably the worst mahi-mahi that I'd ever eaten.
Dr. Dean: That it is not good, and I said I'm very...it wasn't good at all. You should've known that as a server, that you do not serve this well. "Oh, you must have got the wrong mahi-mahi, they must have..." Okay, okay so, fast forward this, I go back to Tampa, and it's the same thing, people go, "What do you wanna eat?", "I love fish, fresh fish, good fish." They take me to a restaurant, I walk in, and I have this like, eerie feeling, like I'm going back in time. I sit down, and go wow, this is surreal. They come to me, and they say, "Well, what do you want to eat today?" And I say, "Well, what do you recommend?" And then I give them the same spilling from Hawaii, "I know what fresh fish actually tastes like, I know what...how it should taste if it's cooked right," etc., etc. And they bring me out, they recommend also mahi-mahi at that restaurant. And I said, "You know, this defies natural law." Because over those five years I began to realize, that no one in the United States even down in San Diego, knows how to cook mahi-mahi.
Dr. Dean: It's a natural law. You do not order mahi-mahi. For some reason, they conned me. I said, "What do you recommend?" They said, "Our mahi-mahi is just unbelievable." So I order it. It comes, I taste it, it's terrible. Now what...the rest of the story is, the guy who takes me there, he also orders mahi-mahi. And not wanting to be rude but I just told him, "This is...my dish is not good at all." I ask him, "You know, I don't normally ask my host if I can taste their food but, can I taste your mahi-mahi?" He said, "Oh, you sure can, and mine is really good, so hopefully it will make you happy." So I took a taste of his and it was just as terrible. And then it dawned on me. I was back in the same restaurant that I ate in five years earlier. I looked around, I said, "This is the same restaurant." You know, I mean, until you know absolutely everything, you're gonna make mistakes. But the way that you can minimize these 'mistakes' and not meeting your expectations, and being able to predict the future outcome, is by simply going by a few natural laws. And so the natural law I now have is, whenever I eat anywhere outside of the state of Hawaii, I do not order mahi-mahi. This is in Europe, this is in anywhere. They bring up mahi-mahi I say, "Don't even think about it, don't worry about it. I'm not gonna eat that."
Interviewer: Okay, so, let's say I have your same preference for fish, when I'm in Mesa, Arizona where do I go to eat?
Dr. Dean: Oh, in Arizona now you know that we don't have a lot of fish that can walk through the desert. So, so here in Arizona, I would recommend that you don't eat fish.
Interviewer: Okay. Fair enough. You're abiding by your natural law.
Dr. Dean: Absolutely. In fact, if anybody came and visited me, I would actually go out and buy the fish from somewhere where I know I can get it where it's still frozen, and but it's fresh. So it's fresh frozen. And I would bring it to my house and I would cook for them myself.
Dr. Dean: And it would be 10 times better than probably the best restaurants in the area.
Interviewer: Oh, that's great, I now believe you.
Dr. Dean: Yes, I know it's true. It's a natural law.
Interviewer: It's a natural law.
Dr. Dean: So, my kids all know this.
Interviewer: So you went through that experience and you learned one of the natural laws, right? You observed, and experienced, and learned a natural law. You could've accomplished the same thing by just trusting an expert who would've said don't ever eat mahi-mahi outside of the state of Hawaii, correct?
Dr. Dean: Yes.
Interviewer: So, would you say that, there is a value to learning natural laws for yourself, or just to 100% rely on experts? So for example, I have a friend who is probably the closest thing to a beer expert that I know. So when I go to a restaurant, I take a picture of the menu, I send it to him, and he tells me what to order. Therefore, I never really learn what's good or what's not, so I never actually learn the natural law.
Dr. Dean: Okay, you have a couple of issues embedded in your question. The first question is, "Is it important to understand natural laws?" And the answer is, absolutely it's important. The main problem we have in all our industries, and this isn't only in the construction industry, this is in every industry that we have on the face of the earth. Is that people do not understand natural laws.
Dr. Dean: If I can say it more simply, the number of nonobservant people, regardless of their level of education, are not very logical, do not understand natural laws, are more likely to put their brain and think in overdrive, and never truly understand what's going on around them. That is a natural law. If somebody can sit down and listen to somebody else who can explain and teach natural laws and make it simple, I don't know what the cost of that education should be.
Interviewer: All right.
Dr. Dean: That's where you read some of the quotes out of some of my students. That's why they're saying that.
Dr. Dean: Because in a very short time, and listening to us talk about natural laws and teach them about reality, it completely has the capability to, "Open their eyes and change the way they're thinking." So it's very important, I believe. Like, we have a conference once a year. And we have anywhere from, sometimes 50 to 100 people. Maybe, 120 people, come and listen to us. Many of these people are probably nonobservant. In other words, they don't understand why they're coming really and listening to me and they don't appreciate the chance to listen to someone who actually understands natural laws.
Dr. Dean: But, it's just totally unbelievable. If you actually wanted to be good in anything, you would always come to our conference, and just sit there and listen, ask questions, listen some more. To understand natural laws will change your whole perspective on life. For example, if you understand this, and you have an organization, you know, whatever you might be, a vendor, sub-vendor, general [inaudible 00:24:32], it doesn't make a difference you would quickly understand that the number of experts you have are very few. You would then quickly say, "If I have these experts, should I use them in their area of expertise or should I make them do other stuff like, admin, go to meetings, PR, etc., etc., etc.
Dr. Dean: You would quickly say, "No. I need to utilize them in their area of expertise." Would you utilize these people in the middle of the projects or at the end of the projects?
Interviewer: At the beginning.
Dr. Dean: At the beginning. And if these people are actually experts, they could actually lay out the projects from beginning to end in a simple way. And would you keep these experts on those projects for the duration of the project?
Dr. Dean: That'd be stupid. That I can actually tell you, there are people who are highly educated, other people who don't understand what's going on in reality; do not understand what causes problems. We're making it a requirement, that this vendor is legally responsible to keep that expert on that job even if the project lasts for two or three years.
Dr. Dean: It's totally, it's abuse, it's a waste of expertise. That person will never last that entire project, they'll quit and go and work for somebody else.
Interviewer: Right, yeah.
Dr. Dean: But people just don't know how to do this. I can tell it to them, but they won't do it.
Interviewer: There's one kinda natural problem within the organization of, your experts might know that they're an expert, and let's say it's a lower level in your organization, expect to be promoted to the next level, because that's just what we view as our society, right, you promote your top performers but therefore you're losing your experts at their expertise. How do you get around that mentality when their expectation is raise, promotion, because that's the next step on the ladder?
Dr. Dean: You know, I was actually watching one my favorite serials on television the other day. And I don't know if you have seen it, but it's a serial called "Bluebloods."
Dr. Dean: And in this "Bluebloods," it really centers focuses around this one family, where their grandfather used to be the Commissioner of the Police Department of New York city and retired.
Dr. Dean: The current commissioner is his son, and within the police department, the best detective is his oldest son, and the best patrol man they have is the youngest son. Well, the youngest son, because normally, by natural law as people get older, they tend to be better educators, more expert in what they do, explain things more simply. So in a birth order in a family if you have five or six children, the most expert child in this environment would probably be the youngest. That's a natural law. You understand why, right? Because they have more information, they have less stress, they get loved more, everybody loves the baby, they have no constraints because, if they need something, one of their siblings or their parents would give it to him because, there's not a financial constraint.
Dr. Dean: So the youngest are normally the most capable. The youngest son, Jamie, is being told by all his siblings and one of the older siblings is also the assistant district attorney. So you've got quite the Commissioner, the former Commissioner, an assistant district attorney, the best detective in the whole group in the New York Police Department, and then you have this younger guy. And this younger guy actually went to Harvard Law School and graduated. But he felt like he wanted to be a patrolman. And so he's working as a patrolman. And he's going around and doing really good things because he wants to do it, for the right reason.
Dr. Dean: All his siblings including his parents, no, his dad because his mom passed away, and his grandfather are telling him, "You're wasting your time. You need to get up the ladder." And one day, his father, who is the Commissioner, current commissioner, sits him down and says, "Jamie, you need to think about this. You know, you might be wasting your talents being a patrolman. You need to work your way up the ladder. You could be a great detective, no one would ever say that you don't have the capabilities because everybody knows you're capable." And his son asked his dad a couple of questions. He said, "Dad, does it get more political as you move up the chain?" And his father says, "Absolutely."
Dr. Dean: He said, "Dad, if you could turn back the hands of time, knowing that you could be a patrol man, you could be a detective, you could be a commissioner, when did you have the most fun?" And the father said, "When I was a patrolman."
Dr. Dean: So then the son asked him, "If, you could go back and change your decision-making with all the knowledge that you have, who would you be?" And the father said, "Exactly who you are." You'll see in society, not many people understand these things. So everybody is thinking, "Why are you...gotta get promoted, you gotta do this, you gotta do that, right?" But if I was the head of a vendor, a vendors' organization or a contractor, I would quickly realize that I have to identify and utilize expertise. I have to do it in a way that's acceptable in the environment of my company.
Dr. Dean: I would have to do it in a way that it maximized the profit to our company, also maximize the pay to my experts.
Dr. Dean: But at the same time, it created better value and all the client would realize that if we wanted what we want and we want good work, that we need to go to this vendor and utilize their expertise.
Interviewer: Yeah. Is innovation in the world finding new natural laws? Or is it a repackaging of existing ones that are known?
Dr. Dean: Think about this now. Do all the natural laws exist?
Dr. Dean: Do all the conditions exist?
Dr. Dean: What makes one person an observant, a visionary, and an expert, and another person a nonobservant, non-expert in the same environment? It's the constraint that the information isn't there, or is the constraint in the actual person who either has the capability or doesn't have the capability? It's in the person, right?
Dr. Dean: Now, this goes even deeper. You're asking questions right? Without knowing where this is going. Okay, so let me ask you some questions now. Has everything I said made sense?
Dr. Dean: So you all buy in to - every event, has an initial condition and a final condition.
Dr. Dean: And how big can the event be? Can it be somebody's entire life?
Interviewer: Yeah, yeah, I think so.
Dr. Dean: Could it be a company's entire existence from the beginning of the company to when the company went out of business?
Interviewer: Yeah. Sure.
Dr. Dean: Could it be the history of a country?
Dr. Dean: Could be the whole history of the world?
Dr. Dean: No. Let's stay right there. If we're looking at the history of the entire world, that tells us that it'll probably have a beginning point and an end point.
Dr. Dean: It tells us it can only happen one way. It tells us we will probably have more technology, towards the end of the event or the beginning of the event?
Interviewer: Towards the end.
Dr. Dean: Yeah. It then tells you, that if I have an observant person and a nonobservant person, which one would more likely be born in the dark ages?
Interviewer: A nonobservant.
Dr. Dean: Well, you guys are so good at this. Does that make sense? And now we're talking about technology, we're talking about people, we are in the age of technology. We're also in the age of "Part of the history of mankind," which has to follow natural law, so the majority of people are gonna be nonobservant. So therefore now, are we moving toward an age of more automation or less automation?
Interviewer: More automation.
Dr. Dean: More. Are we moving toward an age where people have to think more or think less?
Dr. Dean: Yeah, you got it. You put all those things together and you will begin to see what's gonna happen before it happens. And you can begin to see where so many people have inaccurate concepts in their heads, but because they can't see into the future, and because they can't picture what's gonna happen tomorrow and the next day and the next day, they keep these inaccurate ideas in their head and repeat it day after, after day, after day.
Dr. Dean: If you get away and move out, and look at the whole history of mankind, has mankind learn from their past history? You have to say no. Why? Because, if they actually learn something from the history of mankind, would there be more apt to go to war or less apt to go to war?
Interviewer: Yeah, less.
Dr. Dean: Yeah. Would there be more apt to try to change somebody else's country and control them?
Interviewer: No. No.
Dr. Dean: No. But they do it. See, and the problem with people actually in like a good size of population sample understanding this, is that we have so few people who understand this, so therefore as they're thinking right in their…almost like they have 100 arrows in their pack and they're taking them out, right? They have to time or [inaudible 00:35:15], they are using broken arrows and don't even know it.
Dr. Dean: So it actually seems like they're moving forward, but they're not. Let me give you a good examples. And this gets back to the fact that, if you have some real popular ideas that's selling really well, is more likely having ideas in those concepts that are inaccurate.
Dr. Dean: And I can give you a good one. There is a profound author, his name is Maxwell. He used to be a preacher, I belief. But, he wrote this book like "The 21 Points of Leadership."
Interviewer: Yeah. Okay.
Dr. Dean: Do you remember that book?
Interviewer: Yes, absolutely.
Dr. Dean: It's famous.
Dr. Dean: So in one of these, "Points of Leadership," he talks about the law of attraction, you know, which there are many people who talk about the law of attraction. Then another point of leadership is, Influence. Well, if you really think about this, what influence is, is that the person in question, is being influenced or changed from the environment. Does that make sense?
But the law of attraction is, this same person can never be influenced but attracts the people who represents their thinking. The two ideas are like, diametrically opposite of each other.
Interviewer: Yeah. Yeah.
Dr. Dean: But he's got in there and people just go and teach it... Yeah it's just a marvel to watch. It reminds me of one of my sons. He was getting his master's degree and he was basically getting in that there was no such thing as influence. Influences are an inaccurate idea. And he used a lot of concepts from a lot of great authors, and one of them was, Deming. And Deming always says, "There's no such thing as influence. You cannot control and change people to become something else. You have to accept them for who they are." When they got into this argument and he had some really good professors in, and the professors were asking him, "Well, how do you know this is absolutely true?"
And they said, "Let me give you an idea. Let's take sea world and get a dolphin that's been trained to jump 20 feet in the air. And then pick the fish out to trainer's hand. So, are you saying, and his name was, Jacob Brant… They're saying, "Jacob, are you saying that that trainer had no influence over that dolphin jumping 20 feet in the air?" And he said, "That's what I'm saying."
They said, "How can you justify this? Because if you go out into the wild, you'll never see a dolphin jump 20 feet in the air to snare a fish." And he said simply, "How do you know that a dolphin in the wild cannot jump 20 feet in the air and catch a fish?"
And their answer is, "Wow, we just haven't seen it." And he said, "Because there's no need for a dolphin to jump 20 feet straight up and get fish."
Dr. Dean: So they're not doing it.
Dr. Dean: And they were stunned by the simplicity of his answer.
Dr. Dean: So then, one of the professors says, "We noticed it, that you're quoting Deming quite a bit. Can't you say that you have been influenced by Deming?" Thought about it and he said, "No, I'm not influenced by Deming at all." He said, "The only reason I use Deming, was I knew that you respected Deming and everybody knows he's an expert. So I found the quote that he said, to support what I believe."
Dr. Dean: He says, "I wasn't influenced by Deming. Deming agrees with me. And the only reason I use Deming, is so that you would accept the idea that I'm proposing."
Dr. Dean: You know, those are like phenomenal thoughts.
Interviewer: Right. Do you like, read the news
Dr. Dean: I do.
Interviewer: And do you immediately try to apply your philosophy to what's going on in the news?
Dr. Dean: Absolutely. Every morning...and I don't read books, because they take too long, right?
Interviewer: Yeah, right.
Dr. Dean: And by the time you read it, this is old stuff.
Dr. Dean: Unless it's probably inaccurate, so I don't read many books at all, anymore unless somebody tells me, "This is a phenomenon book." If they tell me this is a phenomenon book, I'll take the book, I'll look at the first few pages, I'll look at the end, and if I can clearly understand what he's saying and it matches reality, I may read the book more. Very few books can do this.
Interviewer: When was the last time you read the whole book?
Dr. Dean: I can't even remember.
Dr. Dean: The only books I remember reading where I really enjoyed it and I knew it was a good book, one is a book called, "Out of Crisis," is by Deming. In fact, I actually had a student who get all the "visionaries," take IMT which is, Information Measurement Theory, and I asked them, "Your master's degree is simply, to go down all the major ideas, and the one who disagrees with IMT the least, that's the guy who will identify as the visionary." And the only person they could identify was Edward Deming.
Dr. Dean: I mean, he was outstanding. Okay, so anyway, you know, I don't read a lot of books, but the last one that I would recommend, people say, "Well, what would you recommend?" I'd say Edward Deming.
Interviewer: Edward Deming, okay.
Dr. Dean: You know, there's no doubt in my mind, because he had so many accurate ideas. Other books that I would recommend, The Bible.
Dr. Dean: Because the bible is profound.
Dr. Dean: So, those are the books that I would recommend.
Dr. Dean: Oh, there's another one. But not a lot of people read it. The book is a book that is given away for free, and can be downloaded off the internet. Now, I believe the young man lived in the mid-1800s, and I believe he retired at like, age 30. And I believe by 35 he had passed away.
Dr. Dean: And the book is called, "As a Man Thinketh." It's totally profound. And you can probably read it in under an hour and a half.
Interviewer: And it's an unbelievable book.
Dr. Dean: Otherwise, I now tend to ask anybody who knows of a good book to capture it in four or five PowerPoint slides and give it to me. Because as an older person, I only have five or six brain cells left and I can't afford to burn any of them out.
Interviewer: Fair enough.
Dr. Dean: So my favorite saying is, to anybody I talk to, please make it simple and please don't make me think.
Dr. Dean: If they can do that, I know I've found an expert.
Interviewer: So, what website do you first go to in the morning?
Dr. Dean: Well, and I don't want to like, plug any of the websites, because the only reason I went to it is because it's the website I initially started with, that's CNN.
Interviewer: Okay, all right.
Dr. Dean: So I go to CNN, and I quickly go through the history that, you know, the news of the day and I look at international, internationally what's going on between countries, I look for dominant individuals and what they are saying, and then, I always check on the financials, so I always go to the market.
Dr. Dean: And see how the stock market is doing.
Dr. Dean: And then basically what I'm looking for are things that are very predictable but people don't understand.
Interviewer: What's an example of that?
Dr. Dean: Okay, here we have the president whose name is Donald Trump
Dr. Dean: And he's not a politician, he's a businessperson. I don't agree with everything he says, but he realizes that he's not accountable for anything that he says.
Dr. Dean: He realizes, it's a matter of PR and marketing.
Dr. Dean: He also realizes that there are more nonobservant people than observant people in the world, and in the United States. So watching him and how he operates, it's like, totally amazing.
Dr. Dean: He says things which are like, totally don't make sense, but it's maybe what the nonobservant people want to hear.
Dr. Dean: And he realizes, "Sure, I can say it. Don't tell me what I can't say and say." And basically, there are people who've taken affront to this. And how people react to Donald Trump tells me their level of expertise and intelligence.
Interviewer: Yeah, yeah.
Dr. Dean: So now we got guys, right, who are like "NBA stars." And one of the guys I think, who is an expert in what he does, is our buddy in the Golden State Warriors, Steph Curry.
Interviewer: Steph Curry.
Dr. Dean: If you go back in Steph Curry's life, you begin to realize that he worked hard, but he genetically, he was different.
Dr. Dean: And he was open to different ideas. He was very injury prone. He sorts out an expert. He always tried to see the future outcome. His discipline was amazing. If you go in some of his videos, especially the video that goes in where he was, I believe a freshman or sophomore in college and they brought all the best point guards in, and looked at what he did, and how the person who started the camp new that he was gonna be a star, it's simply amazing.
Interviewer: Well, into your point, about birth order and heredity, he was also a son of an NBA player.
Dr. Dean: Absolutely. It's genetic.
Dr. Dean: And, as I keep watching him, I mean, he defers, he wants to win, he knows how to work with people. But the one mistake I thought he made, was he said, "I'm not gonna visit the White House because I don't agree with president Trump."
Dr. Dean: That shows me, right, when he steps out of his area of expertise, he's a nonobservant, non-visionary guy.
Dr. Dean: Am I making sense here?
Interviewer: Yeah, I like it.
Dr. Dean: And the second website I go to is the ESPN.
Dr. Dean: And why do I go to ESPN? Simply because I'm looking for dominant performers. That if anybody was observant, they would know that this guy was really good.
Dr. Dean: And so, I opened the website this morning and they have a piece on a guy named Smart, who plays for Boston.
Interviewer: Yeah, Marcus Smart
Dr. Dean: Marcus Smart, you know this fellow.
Interviewer: Sure, we're NBA fans. We're from Chicago
Dr. Dean: Okay, okay, so let's talk about Marcus Smart. Where did he come from? What university?
Interviewer: Oklahoma State.
Dr. Dean: So, as he finished his college career out, did he have any issues?
Interviewer: It was bad stuff. It was maybe an abuse thing or...
Dr. Dean: Yeah, he had problems with his temper, he was violent, you know, it wasn't a good picture. Okay, so he comes into the NBA. And I've watched him often, because I like to track certain people. Well, he's with the Boston Celtics. And the Boston Celtics traded, what's that young guy's name?
Interviewer: I don't know. They got Kyrie Irving. The traded with Isaiah Thomas.
Dr. Dean: Yeah, they traded with Isaiah Thomas. I looked at that and I tried to predict if that was a good move for the Celtics. And I have to believe that that was an outstanding move.
Dr. Dean: Why? Because, here is a young guy, a small guy, yes he had a phenomenal year, but over time, the smaller you are, are you gonna have to work harder or be able to work less?
Interviewer: Yeah, harder.
Dr. Dean: Harder. More likely to get injured or less likely?
Interviewer: More likely.
Dr. Dean: Once you try to push the envelope and become who you are not, and try to do things that it's outside of your actual normal abilities, it's just not gonna work out.
Dr. Dean: Now we get Kyrie Irving. And I watched Kyrie. Is he the best jump shooter?
Dr. Dean: Probably not, but he is a clutch player. And, because he's playing with other athletes, he is able to somehow have an awareness of how to drive to the basket and put the ball in, in the majority of cases, and be very successful.
Dr. Dean: And so I believe for the Boston Celtics this was an unbelievable trade. So I'm watching what happens and it's starting to play out.
Interviewer: Yeah, it really is.
Dr. Dean: You know, and so I like watching this, I mean, I like to watch white people can't understand what's was gonna happen in the future. Now, will they become "The World Champion?" That I don't have enough information on. But as you begin to watch these athletes, you begin to understand the difference between people who can see into the future and people who can't.
Dr. Dean: So let's go to football. Let's go to the NFL. If you had to identify a quarterback, who seems to have all the tools, but then makes major blunders in things that he says and his actions, who would you pick out?
Interviewer: Cam Newton.
Dr. Dean: Cam Newton.
Dr. Dean: That guy is so skilled, such an expert, but when put on the big stage, he loses his composure.
Interviewer: Yeah. He's got a bad pattern right now.
Dr. Dean: Very bad pattern. But his skills are phenomenal. But he just like shows that he's not the complete package. It's almost like if somebody could actually change his mind a little, they could really help him. Now, if you were to pick somebody now, who doesn't seem to be like a superstar like Cam Newton, doesn't have the like total physical attributes, but is just so smart at what he does, who would you pick?
Interviewer: I'd say, Tom Brady. Tom Brady.
Dr. Dean: Tom Brady. And if you looked at his matrix, they're unbelievable. In fact, he would have two more Super Bawls, had the Near Giants not come up with unbelievable, unbelievable catches, right?
Dr. Dean: That changed the games in two Super Bawls, he would not have…what, how many does he have? Five today?
Interviewer: I think he has five.
What natural law allowed…who's the receiver, the New York Giants receiver that catch the ball on top of his head like that?
Dr. Dean: The natural law is, those receivers were phenomenal.
Dr. Dean: They're absolutely phenomenal. And one of those guys is, what's he...he's still playing, right?
Interviewer: Odell Beckham.
Dr. Dean: Odell Beckham. And you'll hear people talk about him like they're not human.
Dr. Dean: But it's a natural law that that happened, simply because, I saw it happen.
Interviewer: Yeah, right.
Dr. Dean: If it didn't happen then we know that it shouldn't have happened. But if it happened, it happened. And all things happen only one way. Well, let me get back to where I started from. Marcus Smart. Here's a kid, exuberant puts in 200% of effort, yeah everybody knew he had kinda like a temper problem, very aggressive. Will you agree with me?
Dr. Dean: Very aggressive. Well, there is an article in today's ESPN about Marcus Smart, that burn on. If you actually took the performance matrix and looked at it, that he is one of the most valuable players on the Boston Celtics team. Even though his percentage might be like 30% shooting percentage or 35%, when he is on the floor, all the metric show that the Boston Celtics get the most out of any player when he's on the floor. And if you take a look at that, right, you begin to see, well, they have all the metrics, right? He's on the floor, he's off the floor. His shooting percentage, how many points etc. But when he's on the floor, the plus points that he brings the team, I believe he's the tops on the Boston Celtics.
Interviewer: You're a fan of the plus-minus statistic?
Dr. Dean: Well, I'm a fan of it simply because, it's by observation you get into a complex situation, all you can understand is when a certain individual gets in there, and when a certain individual's not there.
Dr. Dean: Who brings the biggest plus?
Interviewer: It kind of aligns with your philosophy, because it's the most simple matrix.
Dr. Dean: It is. You don't have to think about it, you don't have to argue about it, you don't have to say, "Wow, you know, it is his team mates, you know, this, it's that," no, it be very simple. He has the biggest plus.
Interviewer: Yeah. Now that's a great application actually.
Dr. Dean: Oh it is. In fact, I was so amazed by the article myself that I'm gonna use it as an exercise for classes when I teach.
Interviewer: That's great.
You read the financial news, so you're up on that, and you're applying natural laws, your understanding of natural laws and leaders who understand best values, to financial news.
Dr. Dean: Yes.
Interviewer: Tesla's leadership management and some of the news that's come out about them, best value, understanding natural laws or not?
Dr. Dean: You know, I don't know. And the reason I say I don't know, is because I actually rode in a Tesla at the Schiphol Airport.
Dr. Dean: See, Schiphol Airport in Europe, they have much more cognizance about our environment that's here in the US.
Dr. Dean: Every organization wants to be more environmentally friendly. So one of the moves they made is all the official cabs are Tesla's.
So I rode in one of them. Wow, amazing. But as I look at Tesla the company, and what's going on, I'm thinking, "Is there a chance that this vehicle is not the automobile vehicle? Either for the environment or for, you know, individuals.
Dr. Dean: I actually bought a Toyota Previa.
Dr. Dean: Have you seen that car? It's like a hybrid. Well, it's actually...my wife bought it, she said, "Honey, it's a good car and it's a hybrid, so it makes use of electricity, and it recharges the battery, and that on, on, on, on, on." And so I said, "Well, go ahead and buy it." Because the natural law, the biggest natural law that impacts that situation where my wife wants to buy a Tesla, is whatever she wants I should let her do it. It doesn't matter what it is.
Dr. Dean: So, anyway, we get this Tesla. Then over time she begins to see that there are problems with the Previa. You know, it's like the technology is good but it hasn't been fully developed.
Dr. Dean: And so they're finding problems, you gotta do this, you gotta do that, and it's very costly, right? Because basically it's technology. And she begins to see that it might not be a good idea to buy technology when it first comes out.
Dr. Dean: So let's switchover now to the Teslas. Okay, I'm riding it, right, and I'm in Europe and I'm very cognizant of what's going on. I heard an idea that instead of the car which is really the most profound thing or turning the car into electronics right? Maybe, it's the smart phone that is the Advanced Technology.
Dr. Dean: And if I could get a smart phone and just slap it in a car, I could have a very high performing automobile and get all the technology that they get out of the Tesla.
Interviewer: Aha, yeah.
Dr. Dean: In fact, the smart phone now and in the Netherlands, not only has the "GPS," but it actually controls moving in garages and everything else. And you begin to see, "Oh, my goodness, if I'd spent all my time developing, putting all the high tech into the dashboard, why not just, 'let the smart phone guys develop, put it in a small smart phone where that smart phone, when the next generation comes I throw it down the way I get the new phone.'
Dr. Dean: And it can control everything.
Interviewer: The scale of Smartphone production is so much larger. You can get through the curve much quicker than you can on a car.
Dr. Dean: Yeah. And it's the idea of like, for example taking the cab, right? The Lyft and Uber. I mean, it takes all the problems away. I mean, so basically now it's amazing watching technology.
Dr. Dean: So, my proposal now is, when somebody asked you, "What do you think of their leadership, or their technology?" There are several things I know because of natural law. Number one, anybody who develops technology is a visionary. The biggest part of them being a visionary is not only the technology but the business aspect of it. And money plays so much. For example, Steve Jobs.
Dr. Dean: Have you ever seen the autobiography on Steve Jobs?
Interviewer: No, I didn't watch that one.
Dr. Dean: Oh you have to buy it. I think it's like five dollars and watch the thing from beginning to end.
Dr. Dean: Have you heard of Albert Einstein?
Dr. Dean: Yeah, have you seen the ten shows on Albert Einstein, that go through the beginning of his life to the end?
Interviewer: I haven't.
Dr. Dean: Oh, you need to go watch that.
Interviewer: Watch those? All right.
Dr. Dean: Yes. Because Steve Jobs and Albert Einstein have two things in similarity. Both of them were into high-tech. Both of them were intent on discovering our physical world and how they could like put technology and understand technology, understand reality. But both of them are measurable failures in the things that mean the most to a lot of people.
Interviewer: Right. Yeah.
Dr. Dean: Which is people.
Interviewer: All right.
Dr. Dean: Both of them were abusive, both of them in the days that they died it was almost like it's a travesty. Amazing. So, I just have been so blessed with picking these people out, looking at their dominant information and then seeing, if I could say, "Who will I model my life out to today?"
Dr. Dean: Very simply, do you think an expert with certain expertise or somebody who can identify and utilize expertise, who you think is more valuable?
Interviewer: Utilizing expertise.
Dr. Dean: You got it.
Interviewer: Well, you can stand on the shoulders of giants.
Dr. Dean: Thereby the last book that I put out is, "How You Can Know Almost Everything Without Knowing Anything."
Dr. Dean: I actually believe that the expertise itself is valuable but it's not the most valuable thing. It is the people, who know how to identify and utilize that expertise to help everyone, that's truly valuable.
That's great. If you had to compare or contrast Costco versus Walmart's application of best value, do you have any comment on that? I mean Walmart, you know, historically is a very price driven, abusive to suppliers Type Company which would seem somewhat contrary to your best value approach.
Dr. Dean: Yes, everything happens for reason, is that not correct? Is anybody in the world truly been abused? In other words, right, do you believe that people are a accountable for their own life?
Dr. Dean: If I take an abuser, and I take somebody who's been abused, which one is more wrong? Well, I would say that the abuser, and people who are getting abused are partners in crime. See, because, if everything can happen only one way, somebody who is being abused is only been abused because they feel comfortable with being abused.
Dr. Dean: In other words, you know, they've made studies of this, right? They find somebody who's being abused, they lock up the abuser, they give rehabilitation to the person being abused and then they think the person's okay now, so they let them go, and then they check up on them periodically and they find out in a couple of years that that person is in another relationship with somebody who, "Is abusing them."
Dr. Dean: And they always asked, "Why?" And by observation, the reason is very simple. It's because they feel comfortable in that situation.
Dr. Dean: And they actually need the abuser. So this answers a whole litany of issues. For example, if you're an observant person, would you more likely be born in a country that's like the United States, or would you more likely be born in a country where there was a dictator?
Interviewer: United States.
Dr. Dean: You guys are experts. Does that make sense?
Dr. Dean: So now, let's look at Walmart and let's look at Costco. You know, I don't know, I don't have enough details, but I can tell you that I try to go to other stores rather than Walmart, if I have the opportunity simply because I like to see competition.
Dr. Dean: And I don't like to see a large organization actually abusing suppler chains.
Dr. Dean: But, it's all part of reality. It's what happens. Right? So is it wrong? No. it's just what it is. And so Walmart, yes they abused the supply-chain. In construction, should general contractors abuse the subcontractors?
Dr. Dean: But they do. And it's not fully realized, anybody who's very observant of the construction industry realizes that as we get more high-tech, that the major "value-added," systems in a building are the electronics, it's the controls of temperature,
Dr. Dean: And it's maybe the piping systems. But, when an owner goes and wants to buy services, do they go to the people who will impact his building the most, or do they go to the general contractor who knows very little about all the systems?
Interviewer: General contractor.
Dr. Dean: And isn't that intrinsic? I mean, this world is like just not logical. Now, I got another question for you, if you were trying to buy building services, trying to buy a building, building a state-of-the-art building, would you want your contractor or contractors to form teams and to work together, to lower the costs? Or would you like to buy services from a contractor with the last-minute took the low prices in all the different areas?
Interviewer: Yeah. Definitely form teams.
Dr. Dean: You form teams. But what's the majority? Natural law of how owners buy systems, buying it from contractors who put their teams together at the very last minute, not even knowing if their submittal actually covers what the owner has required. I mean, what type of industry do we have?
Dr. Dean: Amazing. And Walmart and Costco, I actually love it when people identify and utilize expertise and pay a fair price.
Dr. Dean: And that's what the best values are all about.
Overrated or underrated, working with family members. Do you think we see too many family businesses or not enough? Is best value promote family business or is it say, "No, you know what, you're in a way your sourcing labor and you should source labor from experts."
Dr. Dean: Oh, that's a rally good question. It's interesting because, I actually work with the company now, that three of the major players are my sons. But the reason I work with them, is because they actually understand my mind.
Dr. Dean: Because the best value approach was developed with these kids, and these kids grew up with that.
Dr. Dean: They're thinking like this. And so I actually had three other very smart gentlemen who work with my sons. I would have to say that my sons, right now, are worth three times as much.
Interviewer: Okay, yeah.
Dr. Dean: Even though I pay them the same.
Dr. Dean: So, in that application I believe that working in a family is a good thing. But, remember there are many organizations that don't operate for this reason, so they're family-owned. And a lot of times many of the family people who work in the company may not be experts and may not be "are good for the business."
Dr. Dean: But, this world is so large, and I don't know everyone, and everything happens for a reason. So if you're in a family-owned organization, it's probably the right thing, if you're in a non-family-owned organization you're probably in the right organization.
Interviewer: Great. That's a good answer.
So you would say a child coming into a family business is more valuable or more of an expert because of the initial conditions that they were born into that particular family that ran the business. Will that be accurate to say?
Dr. Dean: I would try to believe that if you had a family and you had let's say, eight kids like I did, that the younger kids would probably be more valuable in the business than the older kids.
Dr. Dean: Simply because the older kids probably are raised at a time when there are less resources.
Dr. Dean: They're more controlled, there are more expectations, there are more stress, more into details...it wouldn't have fit in my family organization. That's as far as our family-own business. Does that make sense?
Interviewer: It does, it makes sense.
Dr. Dean: But, it is the identification and utilization of expertise. That's what it comes down to. So, if I was to look at it totally different, if I found the expertise outside of my family I would immediately hire.
Dr. Dean: And if somebody in my family said, "Well, why are we hiring them?" "Because they have expertise and you don't."
Somebody who's totally visionary begins to realize that their family is just a unit, an organization that gives them experience and understanding who people are. The visionary or the observant person will begin to understand that everyone who they interface with in this world, is as important as their own family members.
Dr. Dean: So people who have more value to organizations are people who treat everybody based on who they are, and not because of, "They're my family," or, "They're my friend," or something else.
Interviewer: Yes. Yes, that's a good point.
So imagine you have top 300 CEOs in a room, and you've got an hour to teach then the three most important things that they should need to know how to run their companies successfully, what do you tell them?
Dr. Dean: Well, I'll probably tell them, that if they know how to identify and utilize expertise, that they would be the top in their class. The next thing I would try to tell them or expose them to, is that they should never try to change anybody. Because the more they try to change people, their risk goes up.
Dr. Dean: So they shouldn't try to radically change the organization in any way. Then the third thing I'd try to tell them is, if they would like to change and be more sustainable, that they would go back to the first point, and they would always identify certain experts that they have, and put them in a different component, and allow them to utilize their expertise and proliferate the concepts, among a very small group. And as time wore on, they could use that "technology debt," that helped them become successful in other parts of the company.
Dr. Dean: But I would never try to change my company, I would never try to radically change, I would take new concepts, identify expertise and utilize that expertise within a smaller component, not threatening my major organization, because every organization has more nonobservant people than observant people.
Dr. Dean: And basically, do not try to change or control any other entity because in the end all that's gonna lead to, they may gain in the short run, but in the long run they'll find out that it's not an accurate concept, normally can be looked at as abuse. In our own personal lives, the less we abuse other people, the better off. I think we'll be.
In all your work at dong consulting and actually working with companies, do you have like a rock star example of a company who heard this and implemented it perfectly? And if so, who was it within the organization, who's the expert, and how did they get the most value out of them?
Dr. Dean: You know, I do know of a company, and it's kinda strange, but we go into the Netherlands, it's an IT company, and the name of the company is, Schuberg Philis.
Dr. Dean: And they came to me, because they heard of our best value approach. And in an industry that has very low success rates, only 25% of projects are actually coming on time or budget where the client is satisfied, is a terrible performing industry. They have no management, no control over anybody in the company, everything was voluntary. And their performance metrics were unbelievable, they were off the chart. I would think that in all the organizations I've seen, that was the most successful organization I've seen that applied best value concepts.
Interviewer: Do you have an example of a really bad implementation?
Dr. Dean: When you say, "Example of a bad implementation," what would we be talking about?
Interviewer: Promoting experts, I guess, an explanation of a firm who does all the, you know, direct manage control things and what a concrete example would have been.
Dr. Dean: Of where it doesn't work?
Interviewer: Right, yeah, or somebody who just did it all wrong. You gave them advice and they did it all wrong.
Dr. Dean: Well, you know, there's so many of those that, it's a blur in my mind.
Interviewer: Yeah, yeah.
Dr. Dean: You know we haven't actually taken an organization over time whether it be a public institution or a private institution, and had enough of an opportunity to reach somebody who actually could understand what we're proposing. So I may not be qualified to answer that question.
Dr. Dean: But there are many bad implementations, because people like the idea of identifying and utilizing the expertise, but they cannot, in the average normal human being, cannot release control, cannot relax and allow the experts do their job, and don't like transparency, and they love to think and make decisions. So this is the majority of society.
Dr. Dean: [inaudible 01:13:41] how many hours do I sleep at night?
Dr. Dean: If I'm not jetlagged, five or six hours is plenty.
Interviewer: All right. Wow
Dr. Dean: You know, when do I wake up? Normally between four and five.
Dr. Dean: And what is the best book you've ever read? Well, you know, I don't read many books anymore so, nothing comes to my mind. What is the best book you've ever read in the last year? Once again this is the same answer. And what is your favorite restaurant? I'm actually…I eat fish but, I'm a vegetarian. So the rule is, if it had eyes and walks, I don't eat it.
Dr. Dean: So my favorite restaurants or restaurants that I can either get fish, where I have my choice of what I want to eat and how I want to eat it, so my two favorite restaurants, one is called Sweet Tomatoes.
Interviewer: All right.
Dr. Dean: And the other one is one that people are shocked at, but it's Golden Corral.
Interviewer: Because you get to choose.
Dr. Dean: People don't like it because it's a buffet and the people who come in, a lot don't like it they think the people overeat, they're messy, it's not a good environment, but I love it because they have certain vegetables that I love, that I can pick, and I don't touch like, 60% of their food bar.
Interviewer: There you go, all right.
Dr. Dean: Yeah. What is something you believe that few others do? Well, it's IMT. It's everything happens just one way, people are predisposed, people are very predictable, and you cannot influence or control other people. Now, what is my favorite quote? Now, today it is, "Please don't make me think."
Interviewer: All right, the next section is, so we sent out, we let people know that we were doing this interview with you, and we got back a couple of questions from people within the industry or experts in this industry. So, we're gonna read, we're gonna...the first is from Bill Michaels, he's the founder and CEO of a [inaudible 01:15:41] Consulting.
Dr. Dean: Yes.
Interviewer: And he said, "The biggest issue in procurement for construction execs is around a labor shortage. With people leaving the trades, immigration law changes, and young people showing little interest in joining the skilled trades. Finding contractors who have labor to complete jobs is difficult. How will the construction industry deal with this issue?
Dr. Dean: You know, the industry as far as I'm concerned right now, is very unstable, and it's also very abusive. Good training is now accepted as on-the-job training.
Dr. Dean: It's not very safe, simply because the people aren't good at what they do, so they get into more accidents. And how should people who are construction executives, have figured this out? They should have A team and a B team, and they should cost it accordingly, and their biggest issue has nothing to do with them. Their biggest issue is the clients, who actually are buying services, who cause risk that the contractors cannot control. That is the biggest issue; it's nothing to do with the contractors.
Dr. Dean: When we actually create a very transparent environment, where the contractors actually control the project to deliver what they propose they can deliver because there are the expert, the change order rate, as far as time and cost is under 1% that's caused by the vendor.
Dr. Dean: Most people don't even know this. So they actually think that there's a problem in the industry because there are not enough people who are good at what they're doing.
Dr. Dean: Yes it's totally, it's like a totally misperceived problem, and the risk is actually being caused, not by the industry, but by the clients who buy the construction services.
Interviewer: So how would you suggest a contractor goes about changing that, if the client is the one paying for the service, and 'calling the shots,' because they're spending the money?
Dr. Dean: Yes.
Interviewer: How do contractors change that?
Dr. Dean: Simply, in understanding that owners actually want to identify and utilize expertise, so basically every job can turn into a best value job. If once a contractor gets the job, that they sit down with the owner and lay out everything from beginning to end, make it simple, identify the risk that they don't control, and have a risk mitigation plan, making it very clear, that risk cannot be, 'passed to other parties, it can only be mitigated.' And if contractors' [inaudible 01:18:34] of expertise can do this, the problem completely goes away.
Dr. Dean: Yeah, this is what the industry doesn't understand. So they're always coming to me, asking for the solutions on, like the unions have these problems and I keep telling them what the answers are. They're very straightforward and simple. It's transparency.
Dr. Dean: And if the contractors can create transparency, every job turns into a best value job and 90% of all risk is actually caused by the owner.
Dr. Dean: And the industry doesn't even realize that and doesn't have "the intelligence," to understand what to do to counteract that.
Interviewer: Next question we got some Judy Whipple, professor at Broad College of Business in the Department of Supply Chain Management, "How do you think 3-D printing will change the construction industry and its supply chain in future?"
Dr. Dean: You have to understand, the problem that causes risk is, human behavior that's very risky. It's not anything that happens, I believe, on the construction site with, if you had, you know, "fairly expert" vendors. Like for BEAM [SP], right? Which is...I think what you're talking about here, the major advantage for BEAM is, that once you put it in this BEAM approach, this program, everything is fixed. See you can't change anything.
Interviewer: All right.
Dr. Dean: So when you can't change it, which is how the client causes problems, it minimizes I would say, 80% to 90% of all problems. And I actually know of a company and in the Far East that did this, and their boss, he was visionary, but he was very...he made decisions continually, and force his team to react to his decisions. Somebody brought BEAM in, and he wanted everything to be automated because, he felt like people weren't doing a good job, because they couldn't react to his changes, but the only way to make BEAM successful is that you don't make changes.
Dr. Dean: So that, by implementing BEAM, they stopped him from like, constantly micromanaging.
Dr. Dean: And it's that they caused their BEAM system to be successful. And people don't see this. It's the human behavior that causes risk, that is gonna be impacted as people start trying to use technology.
Interviewer: And BEAM creates better human behavior, because it forces them to be more like program.
Dr. Dean: Yeah, it's like architects, right? Architects are always being abused. Well, the only reason they're being abused, is they never tell the owner when they can talk, why they're talking, and let them talk to express their ideas at the right time. When you don't tell people when they can talk, and why they're talking, they're gonna talk all the time.
Dr. Dean: And see that's what causes the architects and engineering issues. It's not because we don't have the expertise, it's because somebody doesn't understand the environment. So how's it gonna change the construction industry and its supply chain in the future? Well, it's gonna be very hard changing the supply chain unless, we get the client to stop doing the risky human behavior that they do. In other words, how you stop risky human behavior? You minimize all human behavior that manages, directs, and controls another entity, whether it be in the in the contractor's company, whether it be in the supply chain, anybody who is managing, directing, and controlling is out of there. And that causes all the problems.
Interviewer: That make sense.
Dr. Dean: Yeah. It's not a technical problem, it's a human problem.
Interviewer: Yeah. Yeah. That's great. That's great, thank you very much.
Dr. Dean: Hey, take care. Bye, bye.