Wednesday, November 15, 2006

My Uncle Pete

I grew up watching my uncle work long hour in his store. He has never gone to school, but is able to do complex number calculations without the help of a calculator. He owned a general store. He had an uncanny ability to make every customer feel special. Every customer would walk out of his store thinking that he got the best deal. My respect for his business acumen has only grown over the years.
During the late 90s, I was enticed by the trend that later came to be known as dot-com bubble. I wanted to be part of that gold rush. I had a casual conversation with uncle Pete about different companies making tons of money by selling their projects to other companies. I talked to him about this despite thinking that it would be hard for uncle Pete to understand the intricacies of a new technology. He summed up his thoughts on dot-coms somewhat like this, “I don’t really understand much about the computers and internet. To my simple mind, for a successful business, you have to make more money than you spend. It looks like a lot of companies are getting capital and buying expensive projects without having figured out a way to make their money back.”
I did not lose a single penny during the dot-com bubble. This was not because I listened to the uncle, but because I did not have any money to invest.
Few days back, I had a conversation with uncle Pete on the health care system. I talked about the rising cost of health care, and how everybody is at a loss to figure out a way to make health care more affordable. To this he said, “ I am sure the best brains of the world are working on this problem. I do not really understand the details. I see any business as a transaction between the seller and the buyer. When these two parties get to make the main decisions, the seller does his best to woo the buyer and buyer shops for the best value for his money. I see health care as a transaction between a health provider and a patient. But it looks like neither of these parties is an important decision-maker. That can make it all hard to work well.”
Just like I thought about his answer to the dot-com question, I am wondering if the basis for such a humongous problem can be described in such a simple way.
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