Niko Canner – Become a Perfect Instrument

**Patrick O'Shaughnessy** (0:04)
Hello and welcome everyone. I'm Patrick O'Shaughnessy and this is Invest Like the Best. This show is an open-ended exploration of markets, ideas, methods, stories, and of strategies that will help you better invest both your time and your money. You can learn more and stay up to date at investorfieldguide.com.

**SPEAKER_1** (0:24)
Patrick O'Shaughnessy is the CEO of O'Shaughnessy Asset Management. All opinions expressed by Patrick and podcast guests are solely their own opinions and do not reflect the opinion of O'Shaughnessy Asset Management. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions.
Clients of O'Shaughnessy Asset Management may maintain positions in the securities discussed in this podcast.

**Patrick O'Shaughnessy** (0:49)
Our guest today is Niko Canner. Niko is the founder of Incandescent where he and his team help leaders of large companies in the areas of strategy and innovation.
He was also the founder of Katzenbach Partners and a member of Bridgewater's Management Committee. Niko is a fantastic writer and I highly recommend you check out his blog On Human Enterprise which has posts on many of the most interesting aspects of business and personal purpose. This conversation was inspired by many of those posts. Please enjoy. Okay, Niko, so this is going to be a different episode. We may touch on investing. I think our conversation will check in on that topic every so often. But really it's about individual and firm action and behavior.
And to frame the entire thing, I would love for you to begin by telling the story of Dr. V.

**Niko Canner** (1:34)
So Dr. V is somebody who achieves something that any sane person would think is impossible.
In his mid-50s, he founded an organization called Aravind, which was originally an 11-bed hospital, in Madurai in the south of India, focused on addressing curable blindness from cataracts. And over the course of 30-something years, he built an organization that treats a volume of patients equivalent to about three quarters of the entire UK national health system, but at 1% of the cost. And their outcomes are as good as leading academic medical centers in the US. They're so good that it is the leading destination for Harvard Medical School residents in ophthalmology.
So a truly incredible organization that's achieved a mixture of quality, cost, and innovation that you would think couldn't be achieved. And they've done all of this without taking a dollar philanthropy into their core operations, even though the majority of patients that they serve, they serve either for free or for extremely reduced costs. And they have a cross-subsidy model where some patients pay a good deal for a slightly smoother version of the patient experience, and that floats the whole organization. So Dr. V built the organization. He passed away seven years ago. It continues in full force today, and he is, to me, a kind of personal emblem of what it means to be able to be in pursuit of the seemingly impossible.

**Patrick O'Shaughnessy** (3:24)
There's three quotes that in a piece that you wrote about Dr. V, three questions that he asked, which are kind of silly, or they seem silly at first, and as you read them again and again, they become more and more meaningful. Maybe you could describe those questions and why you're so interested in them.

**Niko Canner** (3:38)
The question that is most deeply resonant, he frames as how do I become the perfect instrument? Part of what I find so beautiful about that question is to even ask it, you must begin with a question of instrument of what, and then the inquiry can begin.

**Patrick O'Shaughnessy** (4:00)
Yeah, and let's describe why this is such a great idea and why you think it's important for people to consider that question across, we, I think, together reviewed 20 or 30 pieces that you had written in advance of this interview about all sorts of things.
And I would say one of the common themes is stepping back and thinking about frameworks, impact, values, goals, and then creating a system that allows those things to happen. I think Dr. V is a great place to start because he's doing this at individual level in a very tangible way, but talk more about why you're interested in this idea of stepping back and asking that basic question. An instrument of what?

**Niko Canner** (4:38)
So let's contrast two time horizons here. There's the only time horizon in which we are actually able to act the present moment.
And then the very long time horizon of what it means to give your life to something that is deeply important and that rewards cumulative achievement.
Dr. V sustained exponential growth that seems modest compared to a lot of today's enterprises. Something like 15% for many, many years after an initial period of scaling. When you compound that for a long time, you get to the seemingly impossible, like the achievements that I described. Part of what I find so powerful about this question of becoming the perfect instrument is that it bridges from the very long-term instrument of what and how can I progress in my own ability to be that instrument if I have a very long time to work toward changes with the present moment of what is my intention with this thing that I am doing now? How do I bring the best of what it is possible to be and do to this moment? And how do I use this moment as a vehicle to practice and improve?