#260 One from Many VISA and the Rise of Chaordic Organization

Summary Notes


Dee Hock, the founder of Visa, recounts his journey from a successful corporate executive to a life of simplicity and self-discovery, driven by an inner voice urging him to seek more than money and power. Despite his rational mind's protests, Hock left Visa and embraced isolation, nature, and literature, finding fulfillment beyond material success. Reflecting on his career, Hock admits to falling short of his own ideals for Visa, yet he highlights the importance of learning from failure. In a candid exploration of his personal and professional life, Hock emphasizes the value of listening to one's inner voice and the continuous pursuit of growth, even in the face of setbacks.

Summary Notes

Early Departure from the Business World

  • D. Hawk left Visa and the business world in 1984, despite being at the peak of success.
  • He felt compelled by an inner voice to pursue a different path, though he did not know what lay ahead.
  • Hawk's decision was driven by a sense of preparation for something greater, though it was unclear what that would be.
  • The transition was difficult and seemed irrational, especially for someone with a conservative and logical background.
  • Hawk's departure was met with disbelief, as he could not fully articulate the compelling reasons behind his actions.

"Turning my back on Visa in 1984 and walking away at the pinnacle of success was the hardest thing I have ever done."

This quote highlights the difficulty Hawk faced in leaving his successful position at Visa, indicating the strength of his conviction to follow his inner voice.

"It was frightening. It was maddening. I felt a damned fool to even think about it."

Hawk expresses the internal conflict and fear he experienced when considering leaving Visa, emphasizing the unconventional nature of his decision.

Life After Visa

  • Hawk's years after leaving Visa were filled with personal passions such as family, nature, books, and imagination.
  • He views life as an experience rather than a pursuit of control or material possessions.
  • Hawk's new life direction aligns with his belief in the importance of being open to new possibilities.

"Life is not about control. It's not about getting. It's not about having. It's not about knowing. It's not even about being. It is a magnificent, mysterious odyssey to be experienced."

This quote encapsulates Hawk's philosophy on life, suggesting that the true essence of living is in the experience itself, not in the accumulation of knowledge or possessions.

D. Hawk's Influence and Legacy

  • Hawk's thinking was considered unique and insightful, leading the speaker to explore his other works.
  • The speaker kept Hawk's "Autobiography of a Restless Mind" on their nightstand, reflecting on Hawk's maxims regularly.
  • Hawk's death prompted the speaker to revisit and discuss his works in tribute to his influence.

"I pick it up, if not every week, a few times a month. I just pick it up, turn to a random page, and just read a few of his thoughts."

The speaker describes their habitual engagement with Hawk's writing, indicating the ongoing impact of his ideas on their life.

Patrick Collison's Tribute to D. Hawk

  • Patrick Collison, co-founder of Stripe, tweeted about Hawk's passing, highlighting his underrated innovation.
  • Hawk's vision for a global electronic value exchange system was ahead of its time.
  • Hawk's outsider perspective contributed to his success in creating Visa, challenging traditional banking models.

"He was a very underrated innovator and someone who inspired me and my brother."

Patrick Collison's quote reflects the admiration and inspiration he and his brother found in Hawk's work, underscoring Hawk's role as a visionary entrepreneur.

The Nature of Visa and the Chaotic Organization

  • Visa was conceived as a cooperative global payment system, akin to a "financial United Nations."
  • Hawk's book "One from Many: Visa and the Rise of Chaotic Organization" explores the creation of Visa and its unique organizational structure.
  • Hawk's upbringing and personal experiences influenced his revolutionary ideas about organization and management.

"A truly global payment system required something akin to a financial United Nations, a social structure in which multiple competing institutions could cooperate just enough to build something far bigger than any one of them could build alone."

This quote explains the cooperative nature of Visa's organizational structure, which was essential to its success as a global payment system.

D. Hawk's Early Life and Formative Experiences

  • Hawk grew up in a modest family with limited education and resources.
  • His love for literature, nature, and a sense of independence were nurtured from a young age.
  • Hawk felt estranged from institutional settings such as school and church, preferring the freedom of his private world.
  • His early experiences with institutions sowed the seeds of his later ideas about organizational structure and management.

"With school and church came crushing confinement and boredom. It is, though, everyone began to shed their humanity at the door of institutions."

This quote reflects Hawk's early discomfort with traditional institutions, which later influenced his innovative approach to organizational design.

Early Influences and Rebellion Against Orthodoxy

  • D. Hawk experienced a clash between the natural world and structured institutions like church and school.
  • He chose to align with the natural world, finding it more genuine and without authoritarian structures.
  • Hawk's rebellion was a refusal to accept traditional ideas and conform to authoritative pressures.
  • His outsider perspective and experience in various jobs shaped his thinking and later success.

"I rebelled. It was persistent, stubborn, and at times stupid refusal to accept orthodox ideas, to be persuaded by authoritarian means, or to seek acceptance by conformity."

The quote highlights Hawk's resistance to traditional structures and his inclination towards independent thinking, which later influenced his approach to creating and managing organizations.

Employment History and Disillusionment with Institutions

  • Hawk began working from a young age due to his family's financial situation, taking on various manual labor jobs.
  • His debate skills earned him a scholarship to a community college, where he became increasingly aware of the discrepancies between institutional claims and actions.
  • Hawk's first jobs exposed him to "mechanistic industrial age organizations" which he grew to dislike.

"At age ten, I was hand harvesting fruit and vegetables at a penny for the pound. At twelve I was thinning sugar beets."

This quote illustrates the early start of Hawk's work life and the types of manual labor jobs he had to undertake due to his family's financial constraints.

Realizations and Innovations in the Workplace

  • Hawk's early career involved taking on a leadership role at a small finance company branch where he and his young team disregarded the company manual in favor of common sense and ingenuity.
  • This approach led to significant business growth, but also increased conflict with corporate orthodoxies.

"Within two years, business tripled, and the office was leading the company in growth, profit, and quality of business."

The quote demonstrates Hawk's success in applying unconventional methods in the workplace, which resulted in impressive business performance.

Mentorship and Understanding Bureaucracy

  • Hawk met Dick Simmons in Los Angeles, who educated him on the inner workings of large companies and the prioritization of procedure over purpose.
  • The experience with the "sign problem" taught Hawk about the inefficiencies and absurdities of corporate bureaucracy.

"What you don't understand is that in companies like this, procedure is more important than purpose."

This quote encapsulates the lesson Hawk learned about the misplaced priorities within corporate structures, which would influence his future endeavors.

Struggles with Depression and Determination

  • Hawk faced unemployment, financial struggles, and depression, which he had to overcome to support his family.
  • His refusal to apply for unemployment benefits stemmed from a deep-seated aversion, the reasons for which he did not fully understand.

"Sick at heart, I drove slowly home to explain to a bewildered, pregnant young mother of two that entering that line was something I could not do."

The quote reveals Hawk's internal conflict and sense of pride that prevented him from seeking unemployment assistance, leading to a renewed determination to find work.

Lessons in Ethics and Human Nature

  • Hawk's experience with a wealthy but greedy business owner taught him the importance of ethics in business partnerships.
  • This encounter reinforced the idea that one should only work with people they admire and trust.

"The sheep turned and walked out the door. They never saw or heard from one another again."

This quote reflects Hawk's decision to walk away from an unethical situation, prioritizing his values over monetary gain.

The Path to Entrepreneurship

  • Hawk's traits of being stubborn, opinionated, unorthodox, and rebellious were seen as failures in traditional corporate environments.
  • His experiences led him to the realization that he was not suited for such organizations, setting the stage for his entrepreneurial journey.

"After 16 years of unorthodox management and unblemished results, the sheep, by the standards of industrial age command and control organization, was a failure."

The quote summarizes Hawk's realization that his approach to work was not compatible with conventional corporate structures, ultimately leading him to pursue a different path.

Early Life and Career Struggles of D. Hawk

  • D. Hawk spent 16 years in various businesses, experiencing both success and failure.
  • Despite setbacks, he maintained a voracious appetite for learning, delving into diverse subjects without the intention to master them.
  • His interdisciplinary learning led to new perspectives and patterns, hinting at answers to questions he hadn't yet formed.
  • D. Hawk faced significant personal and professional challenges, including unemployment, depression, and financial strain with a family to support.

"Throughout the 16 years of successful business failure, the sheep continued to read poetry, philosophy, biography, history, biology, economics, mythology, anything and everything that satisfied his curiosity about connectedness and relationships."

This quote illustrates D. Hawk's dedication to learning and his broad intellectual pursuits, which eventually influenced his innovative thinking in business.

The Turning Point at National Bank of Commerce

  • D. Hawk's lowest point preceded a significant career opportunity at the National Bank of Commerce.
  • The bank's connection to the Bank of America card (later Visa) and its unique approach to job interviews signaled a change in D. Hawk's fortunes.
  • Despite his initial reluctance, D. Hawk decided to follow his intuition and joined the bank, accepting a lower position with faith in the future.

"He's about to get the job at the National bank of Commerce. This is going to be where he gets the opportunity to do visa."

This quote marks the pivotal moment in D. Hawk's career, leading him to the opportunity that would become the foundation for his work with Visa.

Personal Growth and Self-Management

  • D. Hawk emphasized the importance of managing oneself before attempting to lead others.
  • He internalized advice from Emerson about the futility of trying to escape oneself, leading to a confrontation with his self-doubt and insecurities.
  • This period of introspection and self-acceptance was crucial for D. Hawk's development and prepared him for the challenges ahead with Visa.

"Everywhere you go, you take your giant with you."

The quote from Emerson that stuck with D. Hawk underscores the idea that one cannot escape their own self, a concept that D. Hawk took to heart in his personal growth journey.

The Birth of Visa and Overcoming Industry Chaos

  • D. Hawk became involved in the early credit card industry, which was plagued by fraud and inefficiencies.
  • He recognized the need for a new organizational concept to address the rampant issues in the system.
  • D. Hawk's approach to problem-solving was informed by his belief in focusing on how things ought to be, rather than getting bogged down by current problems or traditional methods.

"Suddenly, like a diamond in the dirt, there it lay, the need for a new concept of organization and a precarious toll hold from which to make the attempt."

This quote captures the moment of clarity D. Hawk experienced when he realized the potential for a revolutionary change in the organization of the credit card industry, which would eventually lead to the creation of Visa.

Principles of Influencing the Future and Organizational Structure

  • D. Hawk's method of influencing the future involved understanding the current state of affairs, its history, potential developments, and how things ought to be.
  • He applied first principles thinking to dissect the credit card industry's problems and envisioned a better organizational structure.
  • D. Hawk's ideas about organization and leadership were influenced by his studies and reflected in the decentralized, cooperative model he later implemented at Visa.

"Influencing the future requires mastering four ways of looking at things as they are right, as they were, as they are, as they might become, and as they ought to be."

This quote encapsulates D. Hawk's holistic approach to problem-solving and his forward-thinking philosophy, which guided his efforts in transforming the credit card industry and establishing Visa.

Understanding of Money and Its Evolution

  • D. Hawk discusses the fundamental nature of money, emphasizing its function over form.
  • He identifies that money is anything used as a measure of equivalent value and medium of exchange.
  • Hawk highlights that the physical manifestations of money (coins, currency, credit cards) are not its essence.
  • Money has evolved into alphanumeric symbols, which can be electronically exchanged.
  • This realization led to the concept of banks as custodians and exchangers of guaranteed alphanumeric data.

"The nature of a bank is its essential function was the custody, exchange, and loan of money. But what was money? Money was not coin, currency, or credit card. That was form, not function."

This quote explains that the true nature of money is not in its physical form but in its function as a medium of exchange and a measure of value.

Vision for a Global Electronic Value Exchange System

  • Hawk envisions a future where money is purely alphanumeric data, moving globally at the speed of light.
  • He foresees any institution capable of moving, manipulating, and guaranteeing this data as a bank.
  • Hawk contemplates the potential for a new form of global currency to emerge from this system.

"Money had become guaranteed alphanumeric data. Thus, a bank would become no more than an institution for the custody, loan, and exchange of guaranteed alphanumeric data."

This quote encapsulates Hawk's realization that the essence of banking could be reduced to the management of data, rather than physical money.

The Genesis of Visa

  • Hawk's understanding of money's evolution prompts the idea of a global electronic value exchange system, which becomes Visa.
  • He describes the initial skepticism and opposition he faced, yet was driven by a powerful belief in the necessity of this new system.
  • Hawk's vision was to coordinate with thousands of banks and millions of customers, which required a departure from traditional organizational structures.

"Any organization that could guarantee, transport and settle transactions in the form of arranged electronic particles 24 hours a day, seven days a week, around the globe, would have a market."

This quote captures the ambitious scope of Hawk's vision for an organization that could manage electronic transactions globally without interruption.

The Formation and Growth of Visa

  • Visa was established as National Bank America, Incorporated (NBI), with Hawk as president and CEO.
  • The organization overcame initial challenges to become highly profitable and the largest system for the exchange of value in the world.
  • Hawk's relentless commitment and unorthodox approach were key to Visa's success.

"Within five years, the worldwide system was unified under the name Visa and was, by a considerable margin, the largest system for the exchange of value in the world."

This quote summarizes the rapid growth and success of Visa under Hawk's leadership.

Leadership and Sales Philosophy

  • Hawk's leadership style involved convincing others of his vision, often requiring persistence in the face of resistance.
  • He believed that unless someone has definitively refused, they are in the process of saying yes.
  • Hawk was initially reluctant to lead NBI but was compelled by the commitment of the member banks.

"I held fast to the notion that until someone had repeatedly said no and adamantly refuses another word on the subject, they are in the process of saying yes and don't know it."

This quote reflects Hawk's philosophy on persuasion and his approach to overcoming objections in the process of selling his vision.

Reflections on Leadership and Personal Sacrifice

  • Hawk's journal entries reveal his internal struggle with the demands of leadership and the sacrifices he made.
  • Despite his reluctance, he accepted the role to fulfill his vision and provide for his family.
  • Hawk's personal writings illustrate the emotional toll and the sense of duty that influenced his decision-making.

"What foolish logic would rationalize becoming president of NBI? It means giving up grass, rain, trees, birds, insects, all the natural living things."

This quote highlights Hawk's personal conflict between his love for nature and the responsibilities of corporate leadership.

Visa's Success and Hawk's Self-Critique

  • Hawk acknowledges Visa's success but focuses on the shortcomings and failures to meet his own ideals.
  • He reflects on the challenges of changing corporate culture and management practices.
  • Hawk's self-critique emphasizes the difficulty of implementing a new organizational concept and his inability to prevent the reversion to traditional structures.

"For all my unorthodox behavior, my inability to conform, my desire to do things differently or think of a new way to do things, in many cases, I reverted to what most humans do, and that's just I copied what others were doing."

This quote reveals Hawk's self-awareness of his failures to fully implement his vision for Visa and his tendency to fall back on conventional methods.

Legacy and Lessons for Future Generations

  • Hawk views Visa as an archetype to study and improve upon, rather than a perfect model.
  • He encourages learning from failure and persisting in the face of setbacks.
  • Hawk's parting message is one of hope and resilience, advocating for continuous growth and innovation.

"It is no more than an archetype to study, learn from, and improve upon."

This quote suggests that Hawk sees Visa as a starting point for future innovation, not the final achievement.

Life After Visa

  • Hawk describes his departure from Visa and the transition back to a life closer to nature.
  • He expresses both pride in Visa's accomplishments and a sense of failure for not fully realizing his vision.
  • Hawk finds solace in nature, literature, and family, weaving these elements into his post-Visa life.

"Early in 1984, the curtain came down on my performance as CEO of Visa."

This quote marks the end of Hawk's tenure at Visa, leading to a new chapter in his life focused on personal fulfillment and reflection.

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