value and opportunity

First a big “thank you” to the reader who sent me an EMail and pointing me to this book.

Everyone who works in a big company knows the feeling: You had a really stressful day with many meetings etc. but by the end of the day you go home and are frustrated because you got nothing done. Or you have those colleagues who are always busy but if you need something from them, you never get an answer. Or you have been watching the Bloomberg screen on a really bad day all day long and achieved exactly nothing.

According to the author, those are examples of being caught in so-called “shallow work”, activities which are relatively easy to conduct but don’t create any progress or insight.

The opposite of the shallow work is the “Deep Work”, time you spend fully concentrated on solving issues and making teal progress. The author gives many good examples of very productive persons who managed to do a lot of “Deep Work” in their lives.

However it is not so easy to get into a “Deep Work” state of mind as the author explains. There are to many distractions available and the brain at first seems to avoid the “deep Work” state and tries to stay in the shallow zone as long as possible.

Typical distractions mentioned are for instance surfing the internet or attending all kinds of meetings etc.

However he explains that there are quite a lot of ways to trick one’s own mind and make it easier to get “Deep Work” done. One of the easiest ways is trying to get rid of distractions or trying to maintain a clear schedule for the work day or work week. A more extreme version is to move physically to a location where distraction is minimal. An easier version seems to be just to take a walk in nature, Funnily enough he mentions how he himself got rid of reading Business Insider, a quite addictive but shallow news site. This is something I had done myself a couple of months ago.

I think the book includes directly and indirectly many great lessons for investors. In investing, the “Shallow Work” is mostly reading “news” sources like Zero Hedge or Business Insider which give you very little actual knowledge. Or watching stock prices going up or down or TV hosts explaining why stocks moved up or down.

By the way, a lot of Charlie Munger quotes show that he and Buffett seem to have fully understood the concept, such as:

“We both (Charlie Munger and Warren Buffett) insist on a lot of time being available almost every day to just sit and think. That is very uncommon in American business. We read and think.”

For me “Deep Work” in investing is much more reading primary information sources such as annual reports, shareholder letters of good fund managers or good (and usually long) articles about certain industries, countries etc. Or actually trying to build up a model to evaluate a company with the main drivers of value creation.

Personally, for me the easiest way to get into a  “Deep Work” state is trying to  write things down and summarize them, being it a blog post for my private investments or a 1 page memo at work. If I only read stuff (for instance this book) then usually it doesn’t have the same effect like if I actually summarize it in a written form

Another point I found very important for investors is to avoid reading too many irrelevant news sources. I use a RSS reader but I have eliminated news sources like Zero Hedge, Business Insider, Techcrunch or Valuewalk which seem to mass produce news alerts which sound interesting but have very little substance.

Summary:

All in all, I found this a very useful book. Despite a certain focus on the academic world (the author is a professor), I think it is also relevant especially for investors but also for any other “knowledge worker”. I highly recommend to invest some “Deep Work” into reading this book.