Discovery Like a Rolling Stone
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OCTOBER 2017 Discovery THE QUARTERLY NEWSLETTER OF KOCH COMPANIES Like a rolling stone At a board meeting in July, Charles Koch develop a mindset that promotes need for dissatisfaction with our current raised more than a few eyebrows when personal growth and embraces change. state of affairs, a vision for a better state he quoted Bob Dylan, the iconic singer- Internally, we have to convince ourselves and a path to achieve that vision. songwriter who was awarded the 2016 that we can and will do what’s needed. “But that goal of self-transformation is Nobel Prize for literature. “But there are also external factors to impossible to achieve if we’re unwilling — To illustrate a point Koch was making, consider. We all need an environment or afraid — to drive change.” he repeated a line from Dylan’s song, that makes transformation possible. “It’s Alright, Ma (I’m Only Bleeding)”: That’s true for an organization and it’s VIVID MENTAL MODELS “He [who is] not busy being born is also true for society. The Dylan quote wasn’t the only busy dying.” memorable — or “That’s so very true,” explained Koch. surprising — phrase “We can’t afford to stand still, to get Charles Koch mentioned comfortable or settle for the status quo. at that summer board That’s the equivalent of dying. meeting in Wichita. After discussing What we’re looking for the importance and are opportunities to create inevitability of creative destruction, and the value with our capabilities. natural human tendency – Charles Koch to resist change when things are comfortable, “Because of creative destruction, Koch suggested an everything around us is constantly unexpected remedy. reborn. So we have to incessantly rethink Microfilmed records, such as this reel “Sometimes,” Koch and reimagine what we can do. of Koch credit card receipts from 1980, were once considered state-of-the-art. quipped, “we need a “Either we drive creative destruction, Few would settle for such outdated mental enema.” or it will drive us out of business.” technology today. GATHERING NO MOSS “What we’re trying to do internally with THIS ISSUE... ® Koch went on to describe the two MBM and externally with our various 2 Freakonomics feedback dimensions of transformation that are social and political investments,” Koch 4 Exposing ourselves to the future essential for improvement. said, “is to get rid of barriers so that people are more likely to succeed.” 7 “We can’t afford that!” “For self-transformation to be 8 Perspective: Brad Razook and Jeff Ramsey possible,” said Koch, “each of us must In both cases, Koch noted, there is a Letters and other submissions become the property of Koch Industries, Inc., and may be reproduced in whole or in Postal Pipeline part, including the author’s name, for any purpose and in any manner. Letters may be edited for length or clarity. The following are social media responses to Charles Koch’s interview on the Freakonomics blog this summer. Luis Alberto Luzania Michael Ameres The best takeaway I gathered is that the Great interview. A smart and humble economic way of thinking is critical, guy. I love the idea that Koch Industries and when applied does wonders for will reward excellence no matter the managing one’s affairs — specifically Michelle and Mike Godown position in the company. Too much of when he discussed leveraging your our society is set in stone and excellence comparative advantage to create Great interview with an amazing American. gets the same rewards as mediocrity. maximum value for others. I think this Thank you for providing the unbiased can be applied not just to business but facts the rest of the media ignore, and all other aspects of people’s lives. respecting us enough to allow us to form Jason Wallbaum our own opinions. The most important takeaway for me Lyle Gray was that Koch is willing to work with Denis Bernicky anyone — whatever their ideas and While I would probably agree with values — to better society, even if they Mr. Koch on half of his views and I really enjoyed this interview and have to disagree on other items. They do what compromise on others, I have to give say it profoundly altered the way in which they feel will be best for society, even if him huge credit for participating in this I think about Charles Koch and the Koch it will hurt their profits. podcast. It was well done, entertaining brothers. Far more nuanced and frank and enlightening. Both parties in the than I expected and in the end, even where U.S. try to demonize opponents … I disagree, I understand and respect his usually very much unfounded. motivations. Well worth the listen. http://bit.ly/2gtMrL1 Dear Mr. Koch, I can’t thank you enough for the support of the Koch Endowed Scholars Fund. I just finished the Freakonomics podcast Discovery containing your interview. I had not Thanks to your company’s generosity, dancer Gabi Ponio and October 2017 previously heard you speak, and I found cellist Jennifer Ripley, both of Broken Arrow, received full Volume 23 | Number 4 the content surprising and refreshing. scholarships to study at this year’s institute. Most often I have supported Democratic On behalf of the thousands of students whose lives have been DISCOVERY ONLINE candidates, which puts me at odds with the changed by this one-of-a-kind program over the past 40 years, KOCHnews.com/media- candidates [often] receiving your support. thank you again for your contributions and ongoing support. resources It was comforting to hear that your support Julie Cohen, president and CEO for any one party or issue is not blind, EDITORIAL BOARD Oklahoma Arts Institute – Quartz Mountain but instead based upon a rationale for Susan Armitage nationwide improvement. It made me want Oklahoma City, Oklahoma Philip Ellender to reach across the aisle more and seek Jeff Gentry non-political solutions to our problems. Greg Guest Great articles in the July 2017 Discovery newsletter. My big Jim Hannan Primarily, I do criminal defense work. You takeaway was the reminder that, as a supervisor, I need Amy Hennes are exactly on point with criminal justice to model the behaviors that facilitate transformative AND Charles Koch reform. It is irresponsible, unnecessary, incremental change. Steve Lombardo and unfair for us to incarcerate individuals Walt Malone for drug offenses. Rehabilitation and Matthew Hall Brad Razook treatment is a much better option. KBS Benefits Dave Robertson Atlanta, Georgia Peter Ventimiglia I encourage you to continue to do interviews and podcasts. I have a better opinion of you afterward, and I am sure I just wanted to say thank you for the GREAT newsletter. EMAIL US that others feel the same. I always enjoy the inspiration and information. [email protected] Chad A. Gaddie Tammy Dailey www.KOCHind.com Attorney at Law Guardian logistics supervisor © 2017 Koch Industries, Inc. St. Joseph, Missouri Carleton, Michigan Koch is an EOE. M/F/D/V. 2 International News Charles and Liz Koch talk about their journey and joys as parents in this new video. On June 18 (Father’s Day in the United States), the latest in the “CGKon” series of videos was released. Thank you. This was very, very nice. As a father of four children, I appreciate this even more so. I guess we can “CGKon Parenthood” featured Charles Koch, together with be proud to work for such a gentleman! his wife of 44 years, Liz, and their two children, Elizabeth and Jean Ries Chase. The video included many never-before-seen images and Director of Government and Public Affairs a frank discussion of the joys and challenges of parenting. Bertrange, Luxembourg For many employees of Guardian affiliates, that video was their first exposure to Charles Koch. Here are some of the unsolicited comments they shared after viewing the video. Key takeaways for me as parent (besides not teaching our kids anything about life that we aren’t willing to live by) is to spend much time with them as they tend to grow Thank you very much for pointing to this very interesting very fast. The last thing you want to be remembered for link! I think that every responsible parent should watch as a parent is being the one who was never there when this material! they were growing up! DISCOVERY ONLINE Pawel Hubka Thanks heaps and please keep them coming. They are KOCHnews.com/media- Automation & Control Engineer | Częstochowa, Poland quite inspirational! resources Darshan Nagarsekar National Head, Sales & Marketing - Agricultural Products Gujarat, India Waouhhh, impressive, I like it a lot! Thanks for sharing it with us. Sandra Reslinger Thank you! I think it is a wonderful video! HR Business Partner | Bertrange, Luxembourg Natalia Pace Marketing & Communications Coordinator | Liria, Spain Thanks for sharing this. The videos are truly so inspirational and full of exciting facts about the I love them! Great Man & his family. Sophie Weckx Tajender Kumar Media Relations Specialist - Europe Bertrange, Luxembourg EMAIL US Area Sales Manager | Gujarat, India [email protected] charleskoch.com 3 EXPOSING OURSELVES TO THE An important part of Koch Industries’ Vision is the desire to double earnings, on average, every six years. That goal requires a compounded average growth rate of 12 percent per year. For most mature companies, 12 percent growth is not just a challenge, it’s an outright impossibility. But the realities of Moore’s Law put Koch’s growth goals to shame. Gordon Moore, the co-founder of Intel, predicted computing speed would double every two years — which it did for more than 40 years in a row. That exponential increase in computing power not only made computers more powerful, it made the cost of computing much less expensive.