HEXAGRAM 34: ORIGINAL, INTERPRETATION AND CASES

HEXAGRAM 34 - Ta Chuang - The Power of the Great

Above CHEN THE AROUSING, THUNDER

Below CH'IEN THE CREATIVE, HEAVEN

The great lines, that is, the light, strong lines, are powerful.

Four light lines

· have entered the hexagram from below and

· are about to ascend higher.

· The upper trigram is Chen, the Arousing;

· the lower is Ch'ien, the Creative.

· Ch'ien is strong,

· Chen produces movement.

The union of movement and strength gives the meaning of THE POWER OF THE GREAT.

The hexagram is linked with the second month (March April).

THE JUDGMENT

THE POWER OF THE GREAT.

Perseverance furthers.

The hexagram points to a time when inner worth

· mounts with great force and

· comes to power.

But its strength has already passed beyond the median line,

hence there is danger that one

· may rely entirely on one's own power and

· forget to ask what is right.

There is danger too that, being intent on movement,

we may not wait for the right time.

Therefore the added statement that perseverance furthers.

For that is truly great power

· which does not degenerate into mere force

· but remains inwardly united with the fundamental principles of right and of justice.

When we understand this point –

namely, that greatness and justice must be indissoluble united –

we understand the true meaning of all that happens in heaven and on earth.

THE IMAGE

Thunder in heaven above: The image of THE POWER OF THE GREAT.

Thus the superior man

does not tread upon paths

That do not accord with established order.

Thunder - electrical energy - mounts upward in the spring.

The direction of this movement is in harmony with that of the movement of heaven.

It is therefore a movement in accord with heaven,

producing great power.

However,

true greatness depends on being in harmony with what is right.

Therefore in times of great power

the superior man avoids doing anything

that is not in harmony with the established order.

THE LINES

Nine at the beginning means:

Power in the toes.

Continuing brings misfortune.

This is certainly true.

The toes

· are in the lowest place and

· are ready to advance.

So likewise

great power in lowly station is inclined to effect advance by force.

This, if carried further,

· would certainly lead to misfortune, and

· therefore by way of advice a warning is added.

Nine in the second place means:

Perseverance brings good fortune.

The premise here is that the gates to success are beginning to open.

· Resistance gives way and

· we forge ahead.

This is the point at which, only too easily,

we become the prey of exuberant self-confidence.

This is why the oracle says that perseverance

(i.e., perseverance in inner equilibrium, without excessive use of power)

brings good fortune.

Nine in the third place means:

The inferior man works through power.

The superior man does not act thus.

To continue, is dangerous.

A goat

· butts against a hedge And

· gets its horns entangled.

· Making a boast of power leads to entanglements,

just as

· a goat entangles its horns when it butts against a hedge.

Whereas

· an inferior man revels in power when he comes into possession of it,

· the superior man never makes this mistake.

· is conscious at all times of the danger of pushing ahead

regardless of circumstances, and therefore

· renounces in good time the empty display of force.

0 Nine in the fourth place means:

Perseverance brings good fortune.

Remorse disappears.

The hedge opens; there is no entanglement.

Power depends upon the axle of a big cart.

If a man goes on quietly and perseveringly working at the removal of resistances,

success comes in the end.

o The obstructions give way and

o all occasion for remorse arising from excessive use of power disappears.

Such a man's power does not show externally,

yet it can move heavy loads,

like a big cart whose real strength lies in its axle.

· The less that power is applied outwardly,

· the greater its effect.

Six in the fifth place means:

Loses the goat with ease.

No remorse.

The goat is noted for

· hardness outwardly and

· weakness within.

Now the situation is such that

· everything is easy;

· there is no more resistance.

One

· can give up a belligerent, stubborn way of acting and

· will not have to regret it.

Six at the top means:

A goat butts against a hedge.

· It cannot go backward,

· it cannot go forward.

Nothing serves to further.

If one notes the difficulty, this brings good fortune.

If we venture too far

· we come to a deadlock, unable either to advance or to retreat, and

· whatever we do merely serves to complicate things further.

Such obstinacy leads to insuperable difficulties.

But if, realizing the situation, we

· compose ourselves and

· decide not to continue,

everything will right itself in time.

34 THE POWER OF THE GREAT

MANAGERIAL ISSUE:

The great CEO – managing the Power of The Great (his corporation’s as well as his own) which comes from moving correctly and timely.

THE POWER OF THE GREAT Time-Space gives us an image of a CEO who runs a great corporation so successfully that he now has to face his own worst enemy – himself, for he now risks losing his sense of justice. This CEO is so talented that his mere presence gives confidence to the employees and to the shareholders. In this particular case, this CEO is taking over at a time when he is superseded by his fame. His reputation; however, is based on real merits because he already has proven to be successful in other corporations. However, THE POWER OF THE GREAT is also a time when the corporation’s strength is beginning to reach its zenith and therefore it risks relying on its own fame for selling its products rather than in true creativity and innovation.

MANAGERIAL LESSON:

The Superior CEO knows that when his fame is so great, he must face the typical temptations successful CEOs must face - the temptation to:

1) Hear his own voice only. Many successful CEOs really believe they can do it all because they believe they know it all and, therefore they do not require of council or experts’ advice.

2) Get into an ego trip. This is manifested by wanting to take over other corporations for the sake of fame rather than for the sake of the well-being of his own corporation. This last risk is perhaps one of the greatest risks the CEO must face – his impatience in becoming famous. Sometimes the CEOs get so involved in their projects, such as a takeover or the launching of a new product, that they don’t realize that patience and timing are crucial.

A question all CEOs should ask is, can I patiently wait a few years for the results of my policies to take effect, as in the case of Ralph Larsen (the famous ex CEO of Johnson & Johnson whose philosophy was based on ethical behavior rather than immediate results), or must I see the results right away like must CEOs do and get a quick credit for them? This is a great lesson for the CEO. Most CEOs tend to lose their focus the minute the corporation is number one in the industry. It is like an itch, a malicious desire to get into trouble after having worked so hard to get to be number one. Warren Buffett is very much on the lookout for this kind of behavior to dump such stock. The CEO’s greatest danger is when he is on top, when the Board of Directors, the employees, Fortune Magazine and even the Street, recognize him as the best there is. This is the case of Jack Welch. He stuck to his business by keeping those businesses where GE was number 1 or 2 only, and refused to be lured by tempting offers in different products and markets. By holding on to the Power of the Great, he kept GE on top. Even his attempt to take over Honeywell was part of keeping within the technology industry. The opposite was the case of Tyco’s CEO.

3) Do what they know to be morally wrong and try to get away with it. For the CEO to be sure his position is one of strength, he must first make sure that what he is doing is right. Indeed, only right makes might.

INVESTMENT ADVICE:

For the investor, the Power of the Great Time-Space is a favorable Time-Space to invest.

By itself (no lines), it points to the possibility of a relative success provided the CEO keeps in mind it is no longer the best of times and reminds himself to do what is right rather than to rely on brute force.

THE POWER OF THE GREAT.

Perseverance furthers.

The hexagram points to a time when inner worth mounts with great force and comes to power. But its strength has already passed beyond the median line, hence there is danger that one may rely entirely on one's own power and forget to ask what is right. There is danger too that, being intent on movement, we may not wait for the right time. Therefore the added statement that perseverance furthers. For that is truly great power which does not degenerate into mere force but remains inwardly united with the fundamental principles of right and of justice. When we understand this point - namely, that greatness and justice must be indissoluble united - we understand the true meaning of all that happens in heaven and on earth.

There are 2 good fortune events and two reasonable possibilities to invest.

The following cases are those of corporations under the Power of the Great Time-Space:

· ConocoPhillips COP under CEO J. J. Mulva

· FLIR Systems, Inc. FLIR under CEO Earl R. Lewis

(Read at end of the Hexagram)

THE LINES

The Power of The Great comes from moving correctly and timely. The lines point to a progression of movements which range from:

· Not requiring any movement,

· To moving the wrong way and making no correction,

· To moving wrongfully, recognizing the error and reversing the course.

NINE IN THE FIRST PLACE

Managerial Issue: The great CEO – managing the Power of The Great (his corporation’s as well as his own) which comes from moving correctly and timely - abusing the power by moving forcefully rather than correctly.

Managerial Lesson: Be aware.

Managerial Warning: At the first stage of the Power of the Great Time-Space, the CEO finds himself in an inferior position which he feels forces him to move.

Managerial Advice: The Superior CEO knows it is not about how high is the corporation but how high is the moral ground. He always does what is right and therefore does nothing forcefully. The Superior CEO moves onto a project with the council of his advisors and experts and never forces his opinion upon others.

Investment Advice: Do not invest.

NINE IN THE SECOND PLACE

Managerial Issue: The great CEO – managing the Power of The Great (his corporation’s as well as his own) which comes from moving correctly and timely - abusing the power as successes lead to insatiability.

Managerial Lesson: Be moderate.

Managerial Warning: At the second stage of the Power of the Great Time-Space, the CEO risks overreaching due to his previous successes.

Managerial Advice: The Superior CEO fully digest his latest project and waits a while (that is to persevere), before even attempting to launch another project.

Investment Advice: Invest.

NINE IN THE THIRD PLACE

Managerial Issue: The great CEO – managing the Power of The Great (his corporation’s as well as his own) which comes from moving correctly and timely – abusing the power with his super ego – ignoring the limitations – his own as well as the corporation’s.

Managerial Lesson: Be prudent.

Managerial Warning: At the third stage of the Power of the Great Time-Space, the CEO risks pushing ahead regardless of circumstances.

Managerial Advice: The Superior CEO weighs carefully any new project, especially those which could be very costly to his company. He knows history and meditates on all those foolish corporate takeovers and how much damage their CEOs have done to their own corporations. He does not let it become an ego play.

Investment Advice: Do not invest.

NINE IN THE FOURTH PLACE

Managerial Issue: The great CEO – managing the Power of The Great (his corporation’s as well as his own) which comes from moving correctly and timely – moving successfully, with the proper attitude at a time of opposition

Managerial Lesson: Be analytical.

Managerial Warning: At the fourth stage of the Power of the Great Time-Space, the CEO finds the way open – he can overcome the obstruction.

Managerial Advice: The Superior CEO quietly looks inward for the real cause behind the opposition to his efforts to improve his corporation. He knows he must work quietly and constantly to remove all resistance to his project. To him, this is more important than looking outward for new conquests.

Investment Advice: Invest.

SIX IN THE FIFTH PLACE

Managerial Issue: The great CEO – managing the Power of The Great (his corporation’s as well as his own) which comes from moving correctly and timely – not abusing the power at a time when there is no opposition.

Managerial Lesson: Be proportionate.

Managerial Warning: At the fifth stage of the Power of the Great Time-Space, the CEO finds things easy with no resistance at all.

Managerial Advice: The Superior CEO knows when to move the power of the corporation forcefully and when not to. He knows the strength of the movement must be proportionate to the resistance it encounters. Here, there is no resistance therefore no force is needed for his move.

Investment Advice: Invest

SIX IN THE SIXTH PLACE

Managerial Issue: The great CEO – managing the Power of The Great (his corporation’s as well as his own) which comes from moving correctly and timely – correcting his move after abusing the power by advancing too far.

Managerial Lesson: Be repentant.

Managerial Warning: At the sixth stage of the Power of the Great Time-Space, the CEO risks complicating things by going too far in his project.

Managerial Advice: The Superior CEO admits his mistakes and ceases from his wrongful pursuit. He knows that to continue on the wrong pursuit will only lead to a deadlock where he can neither advance nor retreat.

Investment Advice: Invest.

MANAGERIAL CASES

ConocoPhillips COP under CEO J. J. Mulva

J. J. Mulva’s Performance: ROI= 122.47% Annualized Return= 8.64%

SPY’s Performance: ROI= 2.75% Annualized Return= 0.28%

J. J. Mulva became CEO ConocoPhillips in January of 2002. Since then, his performance has been superior to the SPY’s.

Because he has been CEO for almost a decade, we asked the Oracle once more about his future Time – Space. It is the Power of the Great.

Points the investor should consider:

1) THE HEXAGRAM

HEXAGRAM 34 - Ta Chuang - The Power of the Great

The great lines, that is, the light, strong lines, are powerful. Four light lines have entered the hexagram from below and are about to ascend higher. The upper trigram is Chen, the Arousing; the lower is Ch'ien, the Creative. Ch'ien is strong, Chen produces movement. The union of movement and strength gives the meaning of THE POWER OF THE GREAT. The hexagram is linked with the second month (March April).

THE JUDGMENT

THE POWER OF THE GREAT.

Perseverance furthers.

2) THE ADVICE

Thunder in heaven above: The image of THE POWER OF THE GREAT.

Thus the superior man does not tread upon paths

That do not accord with established order.

Thunder - electrical energy - mounts upward in the spring. The direction of this movement is in harmony with that of the movement of heaven. It is therefore a movement in accord with heaven, producing great power. However, true greatness depends on being in harmony with what is right. Therefore in times of great power the superior man avoids doing anything that is not in harmony with the established order.

3) THE LINES:

Nine in the third place means:

The inferior man works through power.

The superior man does not act thus.

To continue, is dangerous.

A goat butts against a hedge

And gets its horns entangled.

Making a boast of power leads to entanglements, just as a goat entangles its horns when it butts against a hedge. Whereas an inferior man revels in power when he comes into possession of it, the superior man never makes this mistake. He is conscious at all times of the danger of pushing ahead regardless of circumstances, and therefore renounces in good time the empty display of force.

4) THE MOVING HEXAGRAM

HEXAGRAM 54 – Kuei Mei - The Marrying Maiden

Above we have Chen, the eldest son, and below, Tui, the youngest daughter. The man leads and the girl follows him in gladness. The picture is that of the entrance of the girl into her husband's house. In all, there are four hexagrams depicting the relationship between husband and wife. Hsien, INFLUENCE (31), describes the attraction that a young couple has for each other; Heng, DURATION (32), portrays the permanent relationships of marriage; Chien, DEVELOPMENT (53), reflects the protracted, ceremonious procedures attending the arrangement of a proper marriage; finally, Kuei Mei, THE MARRYING MAIDEN, shows a young girl under the guidance of an older man who marries her. (1)

THE JUDGMENT

THE MARRYING MAIDEN.

Undertakings bring misfortune.

Nothing that would further.

A girl who is taken into the family, but not as the chief wife, must behave with special caution and reserve. She must not take it upon herself to supplant the mistress of the house, for that would mean disorder and lead to untenable relationships.

The same is true of all voluntary relationships between human beings. While legally regulated relationships evince a fixed connection between duties and rights, relationships based on personal inclination depend in the long run entirely on tactful reserve.

Affection as the essential principle of relatedness is of the greatest importance in all relationships in the world. For the union of heaven and earth is the origin of the whole of nature. Among human beings likewise, spontaneous affection is the all-inclusive principle of union.

THE IMAGE

Thunder over the lake: The image of THE MARRYING MAIDEN.

Thus the superior man

Understands the transitory

In the light of the eternity of the end.

Thunder stirs the water of the lake, which follows it in shimmering waves. This symbolizes the girl who follows the man of her choice. But every relationship between individuals bears within it the danger that wrong turns may be taken, leading to endless misunderstandings and disagreements. Therefore it is necessary constantly to remain mindful of the end. If we permit ourselves to drift along, we come together and are parted again as the day may determine. If on the other hand a man fixes his mind on an end that endures, he will succeed in avoiding the reefs that confront the closer relationships of people.

FLIR Systems, Inc. FLIR under CEO Earl R. Lewis

Earl R. Lewis’ Performance: ROI= 5,144.88% Annualized Return= 44.21%

SPY’s Performance: ROI= (12.06%) Annualized Return= (1.18%)

Earl R. Lewis became CEO of FLIR Systems in November of 2000. Since then, his performance has been that of a Superior CEO outperforming the SPY many times over.

Because he has been CEO for almost a decade, we asked the Oracle once more about his future Time – Space. It is the Power of the Great.

Points the investor should consider:

1) THE HEXAGRAM

(Same as Above).

2) THE ADVICE

(Same as Above).

3) THE LINES:

Six in the fifth place means:

Loses the goat with ease.

No remorse.

The goat is noted for hardness outwardly and weakness within. Now the situation is such that everything is easy; there is no more resistance. One can give up a belligerent, stubborn way of acting and will not have to regret it.

4) THE MOVING HEXAGRAM

HEXAGRAM 43 – Kuai - Break-through (Resoluteness)

This hexagram signifies on the one hand a break-through after a long accumulation of tension, as a swollen river breaks through its dikes, or in the manner of a cloudburst. On the other hand, applied to human conditions, it refers to the time when inferior people gradually begin to disappear. Their influence is on the wane; as a result of resolute action, a change in conditions occurs, a break-through. The hexagram is linked with the third month [April-May].

THE JUDGMENT

BREAK-THROUGH.

One must resolutely make the matter known

At the court of the king.

It must be announced truthfully.

Danger.

It is necessary to notify one's own city.

It does not further to resort to arms.

It furthers one to undertake something.

Even if only one inferior man is occupying a ruling position in a city, he is able to oppress superior men. Even a single passion still lurking in the heart has power to obscure reason. Passion and reason cannot exist side by side - therefore fight without quarter is necessary if the good is to prevail.

In a resolute struggle of the good against evil, there are, however, definite rules that must not be disregarded, if it is to succeed. First, resolution must be based on a union of strength and friendliness. Second, a compromise with evil is not possible; evil must under all circumstances be openly discredited. Nor must our own passions and shortcomings be glossed over. Third, the struggle must not be carried on directly by force. If evil is branded, it thinks of weapons, and if we do it the favor of fighting against it blow for blow, we lose in the end because thus we ourselves get entangled in hatred and passion.

Therefore it is important to begin at home, to be on guard in our own persons against the faults we have branded. In this way, finding no opponent, the sharp edges of the weapons of evil become dulled. For the same reasons we should not combat our own faults directly. As long as we wrestle with them, they continue victorious. Finally, the best way to fight evil is to make energetic progress in the good.

THE IMAGE

The lake has risen up to heaven: The image of BREAK-THROUGH.

Thus the superior man

Dispenses riches downward

And refrains from resting on his virtue.

When the water of a lake has risen up to heaven, there is reason to fear a cloudburst. Taking this as a warning, the superior man forestalls a violent collapse. If a man were to pile up riches for himself alone, without considering others, he would certainly experience a collapse. For all gathering is followed by dispersion. Therefore the superior man begins to distribute while he is accumulating. In the same way, in developing his character he takes care not to become hardened in obstinacy but to remain receptive to impressions by help of strict and continuous self-examination.