HEXAGRAM 42: ORIGINAL, INTERPRETATION AND CASES

HEXAGRAM 42 – I - Increase

Above SUN THE GENTLE, WIND

Below CHEN THE AROUSING, THUNDER

The idea of increase is expressed in the fact

that

the strong lowest line of the upper trigram

· has sunk down

and

· taken its place under the lower trigram.

This conception also expresses

the fundamental idea on which the Book of Changes is based.

To rule truly is to serve.

A sacrifice of the higher element

that

produces an increase of the lower

is called an out-and-out increase:

indicates the spirit that alone has power to help the world.

THE JUDGMENT

INCREASE.

· It furthers one To undertake something.

· It furthers one to cross the great water.

Sacrifice on the part of those above for the increase of those below

· fills the people with a sense of joy and gratitude

that

· is extremely valuable for the flowering of the commonwealth.

When people are thus devoted to their leaders,

· undertakings are possible,

and

· even difficult and dangerous enterprises will succeed.

Therefore in such times of progress and successful development

it is necessary to

· work

and

· make the best use of the time.

This time resembles that of the marriage of heaven and earth,

when the earth

· partakes of the creative power of heaven,

· forming and bringing forth living beings.

The time of INCREASE does not endure,

therefore

must be utilized while it lasts.

THE IMAGE

Wind and thunder: the image Of INCREASE.

Thus the superior man:

· he sees good,

o he imitates it;

· he has faults,

o he rids himself of them.

While observing how thunder and wind increase and strengthen each other,

a man can note the way to

· self-increase

and

· self-improvement.

When he discovers good in others,

he should

· imitate it

and thus

· make everything on earth his own.

· he perceives something bad in himself,

o let him rid himself of it.

In this way

· he becomes free of evil.

This ethical change represents the most important increase of personality.

THE LINES

Nine at the beginning means:

It furthers one to accomplish great deeds.

Supreme good fortune.

No blame.

great help comes to a man from on high,

this increased strength must be used to achieve something great for which

he might otherwise never have found energy, or readiness to take

by selflessness, responsibility.

· Great good fortune is produced

and

in bringing about great good fortune,

· he remains free of reproach.

Six in the second place means:

Someone does indeed increase him

Ten pairs of tortoises cannot oppose it.

Constant perseverance brings good fortune.

The king presents him before God.

Good fortune.

A man brings about real increase

by producing in himself the conditions for it.

That is,

through receptivity to and love of the good.

Thus

the thing for which he strives comes of itself,

with the inevitability of natural law.

Where

increase is thus in harmony with the highest laws of the universe,

it can not be prevented by any constellation of accidents.

But everything depends on

his not letting unexpected good fortune make him heedless;

he must make it his own through

· inner strength

and

· steadfastness.

Then

· acquires meaning before God and man,

and

· can accomplish something for the good of the world.

Six in the third place means:

One is enriched through unfortunate events.

No blame, if you

· are sincere

And

· walk in the middle,

And

· report with a seal to the prince.

A time of blessing and enrichment has such powerful effects

that even

events ordinarily unfortunate

must turn out to the advantage of those affected by them.

These persons become

· free of error, and by acting in harmony with truth

· they

o gain such inner authority

that

o they exert influence as if sanctioned by letter and seal

Six in the fourth place means:

If you

· walk in the middle

And

· report to the prince,

He will follow.

It furthers one to be used In the removal of the capital.

It is important that there should be men who mediate between

· leaders

and

· followers.

These should be disinterested people,

especially in times of increase,

since

the benefit is to spread from the leader to the people.

· Nothing of this benefit

o should be held back in a selfish way;

· it

o should really reach those for whom it is intended.

This sort of intermediary,

who also exercises a good influence on the leader,

is especially important in times

when

it is a matter of great undertakings,

· decisive for the future

and

· requiring the inner assent of all concerned.

Nine in the fifth place means:

If in truth you have a kind heart, ask not.

Supreme good fortune.

Truly, kindness will be recognized as your virtue.

True kindness

· does not count upon nor ask about merit and gratitude

but

· acts from inner necessity.

And

such a truly kind heart

· finds itself rewarded in being recognized,

and thus

· the beneficent influence will spread unhindered.

Nine at the top means:

· He brings increase to no one. Indeed, someone even strikes him.

· He does not keep his heart constantly steady.

Misfortune.

The meaning here is that through renunciation

those in high place should bring increase to those below.

· neglecting this duty

and

· helping no one,

they in turn

· lose the furthering influence of others

and soon

· find themselves alone.

In this way

· they invite attacks.

An attitude

not permanently in harmony with the demands of the time

will necessarily bring misfortune with it.

Confucius says about this line:

· The superior man sets his person at rest before he moves;

· he composes his mind before he speaks;

· he makes his relations firm before he asks for something.

By attending to these three matters,

· the superior man gains complete security.

But

· if a man is brusque in his movements,

o others will not cooperate.

· If he is agitated in his words,

o they awaken no echo in others.

· If he asks for something without having first established relations,

o it will not be given to him.

· If no one is with him,

o those who would harm him draw near.

42 INCREASE

MANAGERIAL ISSUE:

The CEO – managing Increase.

In the previous Hexagram (41 Decrease), the wide base weakens to strengthen the narrow top. This creates an inverted pyramid or a lack of balance in the overall corporate structure which leads to instability. The corporation becomes top-heavy/weak-based or light-at-the-bottom/heavy- at-the-top. The CEO has to manage this “poverty” adjusting the corporation by decreasing or shifting resources to rebalance the corporate assets or structure. In the case of subsidiary–parent structure, there is a decrease of the subsidiaries for the sake of the parent company, or a decrease of the employees’ resources for the sake of higher management.

In this Hexagram (42 Increase), the narrow top weakens to strengthen the wide base. This adds even more stability and wealth to the entire structure. In the case of a subsidiary–parent structure, we have a decrease of the parent company’s resources for the sake of the subsidiary or a decrease of the power or benefits of management for the sake of the employees. This rebalancing is seen as an overall gain because every time the CEO shifts resources from the parent to strengthen a subsidiary, he is strengthening the entire corporation - thus it is considered an overall increase.

Unfortunately Increase is a Time-Space of short duration and the CEO must make the most of it.

MANAGERIAL LESSON:

The Superior CEO knows that for the condition of Increase to take place, he must:

1) Copy from all successful corporations those methods which have made them successful. This lesson represents one of the most important lessons in the development of managerial skills. If the less successful CEOs were to copy the methods of the more successful CEOs, then the industry and the economy as a whole would benefit. No CEO should feel ashamed of copying the successful methods of the other CEOs. This method best describes the Japanese success story. They “study success”. This is humility at its best. To accept that others are better than oneself at certain things and to copy their particular methods is truly an act of humility. As an example, Jack Welch copied the famous “Six Sigma” quality program from Motorola and applied it to GE with a vengeance demanding that while Motorola took 10 years to implement the Six Sigma program, GE should do it in 5.

The I Ching says: “When he discovers good in others, he should imitate it and thus make everything on earth his own”.

No wonder in the 80s the Japanese seemed to be making everything on earth theirs (even though the I Ching would have warned the Japanese that the Universe will eventually level what is high and lift what is low).

2) Eliminate all weakness wherever he finds it.

The I Ching says: “If he perceives something bad in himself, let him rid himself of it. In this way he becomes free from evil.”

The Japanese corporations are true masters at copying the good of others whether it is products or systems, but they have failed on purpose at eliminating their weakness, one of which is sacrificing their shareholders for the sake of their employees. This is a social strategy difficult to criticize but perhaps better left to the government rather than to the corporations.

3) Make a thorough analysis of the corporation to look for the major weaknesses of the organization and change them quickly.

4) Keep the right attitude. Perhaps the main managerial lesson of hexagram 42 is that the CEO who wishes to manage the corporation well must always think of serving the best interest of the stockholders and of the employees.

The I Ching says: “to rule truly is to serve”.

INVESTMENT ADVICE:

For the investor, the INCREASE Time – Space is an excellent opportunity to invest.

By itself (no lines) the Increase Time-Space points to success provided the CEO makes the most of this Heaven sent opportunity.

INCREASE.

It furthers one

To undertake something.

It furthers one to cross the great water.

Sacrifice on the part of those above for the increase of those below fills the people with a sense of joy and gratitude that is extremely valuable for the flowering of the commonwealth. When people are thus devoted to their leaders, undertakings are possible, and even difficult and dangerous enterprises will succeed. Therefore in such times of progress and successful development it is necessary to work and make the best use of the time. This time resembles that of the marriage of heaven and earth, when the earth partakes of the creative power of heaven, forming and bringing forth living beings. The time of INCREASE does not endure, therefore it must be utilized while it lasts.

There are two excellent lines (Supreme Good Fortune) and one good line (Good Fortune). What makes these lines positive is that they are Heaven sent.

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

· Seagate Technology PLC STX under CEO Steve Luczo

· Autodesk, Inc. ADSK under CEO Carl Bass

(Read at the end of the Hexagram)

In general terms this Hexagram should be considered a short-term investment because it represents a short term increase. Hexagram 42 could well represent the climax or zenith of the positive corporate situation. From now on the corporation will tend to decline.

The I Ching says:” the time of increase does not endure, therefore it must be utilized while it lasts”.

THE LINES

NINE IN THE FIRST PLACE

Managerial Issue: The CEO – managing Increase - when Increase is Heaven sent.

Managerial Lesson: Be aware.

Managerial Warning: At the first stage of the Increase Time-Space, the CEO encounters a Heaven sent opportunity.

Managerial Advice: The Superior CEO recognizes when a rare and unique opportunity presents itself. He knows he must use it to carry out a truly great project. When Heaven supports the Superior CEO, he knows the returns on the investment will be of the highest order provided he focuses on the benefits he can obtain for the customers, stockholders and for his employees rather than for himself.

Investment advice: Invest fully.

SIX IN THE SECOND PLACE

Managerial Issue: The CEO – managing Increase – through his own personal development.

Managerial Lesson: Be focused.

Managerial Warning: At the second stage of the Increase Time-Space, the CEO develops the personal conditions to achieve success: by “receptivity to and love of the good”.

Managerial Advice: The Superior CEO recognizes when Heaven helps and makes his utmost effort to maintain his humility and not lose his head. In this way “he acquires meaning before God and man, and can accomplish something for the good of the world.” Heaven helps the Superior CEO when he develops himself.

Investment advice: Invest.

SIX IN THE THIRD PLACE

Managerial Issue: The CEO – managing Increase - when the Increase comes about in spite of the CEO’s errors or in spite of unlucky outcomes.

Managerial Lesson: Be humble.

Managerial Warning: At the third stage of the Increase Time-Space, the CEO finds the increase comes about because of a mandate from Heaven.

Managerial Advice: The Superior CEO is always humble but even more so when the time for increase is so strong and Heaven sent that even with the CEO’s mistakes the corporation prospers. He accepts in all humility that the corporation’s success was not his doing and corrects his mistakes.

The I Ching says: “Copy the good of others and correct your mistakes”

Investment advice: Do not invest.

SIX IN THE FOURTH PLACE

Managerial Issue: The CEO – managing Increase – making sure the Increase is for the benefit of all.

Managerial Lesson: Be fair.

Managerial Warning: At the fourth stage of the Increase Time-Space, the CEO risks the Increase might benefit only those at the top.

Managerial Advice: The Superior CEO is just and fair. He knows that only when the employees (as well as customers and shareholders) participate in the corporate increase will he get the employees’ support for future large projects. If needed, he will become a man of trust to go between the BOD/shareholders and the employees to make sure part of the profits are spread amongst the employees.

Investment advice: Do not invest.

NINE IN THE FIFTH PLACE

Managerial Issue: The CEO – managing Increase – with his own kindness and generosity.

Managerial Lesson: Be generous.

Managerial Warning: At the fifth stage of the Increase Time-Space, the CEO finds his kindness and generosity increases everyone.

Managerial Advice: The Superior CEO is kind and generous because it comes from within not because he seeks merits or gratitude. He knows that true generosity is smart because it is profitable.

Investment advice: Invest fully.

NINE IN THE SIXTH PLACE

Managerial Issue: The CEO – managing Increase – failing at it because of selfishness.

Managerial Lesson: Be selfless.

Managerial Warning: At the sixth stage of the Increase Time-Space, the CEO fails to Increase the corporation by refusing to transfer the wealth. He fails to Increase the subsidiary at the expense of the parent company’s financial condition, or to improve the employees’ conditions at the expense of management.

Managerial Advice: The Superior CEO is selfless. He would never deny the resources when his goal is to Increase the corporation. He knows that to do so, would be inviting an attack against his authority. He knows that a failure to act in accordance with the Mandate of Heaven - to assist the inferior at the expense of the superior – is an invitation for the inferiors to punish his failure to act and to question his authority.

The I Ching ends with a lesson and a warning for the CEO.

The I Ching says: “Confucius says about this line: The superior man sets his person at rest before he moves; he composes his mind before he speaks; he makes his relations firm before he asks for something. By attending to these three matters, the superior man gains complete security. But if a man is brusque in his movements, others will not cooperate. If he is agitated in his words, they awaken no echo in others. If he asks for something without having first established relations, it will not be given to him. If no one is with him, those who would harm him draw near.”

Investment advice: Do not invest.

MANAGERIAL CASES

Seagate Technology PLC STX under CEO Steve Luczo

Steve Luczos’ Performance: ROI= 110.83% Annualized Return= 32.17%

SPY’s Performance: ROI= 26.77% Annualized Return= 9.27%)

Steve Luczo became CEO of Seagate Technology in 2009. Since then, he has outperformed the SPY proving he was the proper choice for Seagate.

He has already completed the first part of the mandate It furthers one To undertake something. It furthers one to cross the great water.

However, as the Space-Time reaches the sixth Line in the next few years, he will have to face the negative line in the sixth place: He brings increase to no one. Indeed, someone even strikes him. He does not keep his heart constantly steady. Misfortune.

Points the investor should consider:

1) THE HEXAGRAM

HEXAGRAM 42 – I - Increase

The idea of increase is expressed in the fact that the strong lowest line of the upper trigram has sunk down and taken its place under the lower trigram. This conception also expresses the fundamental idea on which the Book of Changes is based. To rule truly is to serve.

A sacrifice of the higher element that produces an increase of the lower is called an out-and-out increase: it indicates the spirit that alone has power to help the world.

THE JUDGMENT

INCREASE.

It furthers one

To undertake something.

It furthers one to cross the great water.

2) THE ADVICE

Wind and thunder: the image Of INCREASE.

Thus the superior man:

If he sees good, he imitates it;

If he has faults, he rids himself of them.

While observing how thunder and wind increase and strengthen each other, a man can note the way to self-increase and self-improvement. When he discovers good in others, he should imitate it and thus make everything on earth his own. If he perceives something bad in himself, let him rid himself of it. In this way he becomes free of evil. This ethical change represents the most important increase of personality.

3) THE LINES:

Nine at the top means:

He brings increase to no one.

Indeed, someone even strikes him.

He does not keep his heart constantly steady.

Misfortune.

The meaning here is that through renunciation those in high place should bring increase to those below. By neglecting this duty and helping no one, they in turn lose the furthering influence of others and soon find themselves alone. In this way they invite attacks. An attitude not permanently in harmony with the demands of the time will necessarily bring misfortune with it.

Confucius says about this line:

The superior man sets his person at rest before he moves; he composes his mind before he speaks; he makes his relations firm before he asks for something. By attending to these three matters, the superior man gains complete security. But if a man is brusque in his movements, others will not cooperate. If he is agitated in his words, they awaken no echo in others. If he asks for something without having first established relations, it will not be given to him. If no one is with him, those who would harm him draw near.

4) THE MOVING HEXAGRAM

HEXAGRAM 03 – Chun - Difficulty at the Beginning

The name of the hexagram, Chun, really connotes a blade of grass pushing against an obstacle as it sprouts out of the earth hence the meaning, "difficulty at the beginning." The hexagram indicates the way in which heaven and earth bring forth individual beings. It is their first meeting, which is beset with difficulties. The lower trigram Chen is the Arousing; its motion is upward and its image is thunder.

The upper trigram K'an stands for the Abysmal, the dangerous. Its motion is downward and its image is rain. The situation points to teeming, chaotic profusion; thunder and rain fill the air. But the chaos clears up. While the Abysmal sinks, the upward movement eventually passes beyond the danger. A thunderstorm brings release from tension, and all things breathe freely again.

THE JUDGMENT

DIFFICULTY AT THE BEGINNING works supreme success,

Furthering through perseverance.

Nothing should be undertaken.

It furthers one to appoint helpers.

Times of growth are beset with difficulties. They resemble a first birth. But these difficulties arise from the very profusion of all that is struggling to attain form. Everything is in motion: therefore if one perseveres there is a prospect of great success, in spite of the existing danger. When it is a man's fate to undertake such new beginnings, everything is still unformed, dark.

Hence he must hold back, because any premature move might bring disaster. Likewise, it is very important not to remain alone; in order to overcome the chaos he needs helpers. This is not to say, however, that he himself should look on passively at what is happening. He must lend his hand and participate with inspiration and guidance.

THE IMAGE

Clouds and thunder: The image Of DIFFICULTY AT THE BEGINNING.

Thus the superior man

Brings order out of confusion.

Clouds and thunder are represented by definite decorative lines; this means that in the chaos of difficulty at the beginning, order is already implicit. So too the superior man has to arrange and organize the inchoate profusion of such times of beginning, just as one sorts out silk threads from a knotted tangle and binds them into skeins. In order to find one's place in the infinity of being, one must be able both to separate and to unite.

Autodesk, Inc. ADSK under CEO Carl Bass

Carl Bass’ Performance: ROI= (40.44%) Annualized Return= (8.73%)

SPY’s Performance: ROI= ( 8.25%) Annualized Return= ( 1.50%)

Carl Bass became CEO of Autodesk in 2006. Since then, his performance has been poor compared to the SPY’s.

However, his new Time-Space as of 2011 is Increase with two positive Lines (one Good Fortune and another Supreme Good Fortune). In addition, the Moving Hexagram is The Taming Power of the Great. His Hexagram, his Lines and his Moving Hexagram point to an improvement in his future performance.

Points the investor should consider:

1) THE HEXAGRAM

(Same as Above).

2) THE ADVICE

(Same as Above).

3) THE LINES:

Six in the second place means:

Someone does indeed increase him

Ten pairs of tortoises cannot oppose it.

Constant perseverance brings good fortune.

The king presents him before God.

Good fortune.

A man brings about real increase by producing in himself the conditions for it. That is, through receptivity to and love of the good. Thus the thing for which he strives comes of itself, with the inevitability of natural law. Where increase is thus in harmony with the highest laws of the universe, it cannot be prevented by any constellation of accidents. But everything depends on his not letting unexpected good fortune make him heedless; he must make it his own through inner strength and steadfastness. Then he acquires meaning before God and man, and can accomplish something for the good of the world.

Six in the third place means:

One is enriched through unfortunate events.

No blame, if you are sincere

And walk in the middle,

And report with a seal to the prince.

A time of blessing and enrichment has such powerful effects that even events ordinarily unfortunate must turn out to the advantage of those affected by them. These persons become free of error, and by acting in harmony with truth they gain such inner authority that they exert influence as if sanctioned by letter and seal

Nine in the fifth place means:

If in truth you have a kind heart, ask not.

Supreme good fortune.

Truly, kindness will be recognized as your virtue.

True kindness does not count upon nor ask about merit and gratitude but acts from inner necessity. And such a truly kind heart finds itself rewarded in being recognized, and thus the beneficent influence will spread unhindered.

4) THE MOVING HEXAGRAM

HEXAGRAM 26 - Ta Ch’u - The Taming Power of the Great

The Creative is tamed by Ken, Keeping Still. This produces great power, a situation in contrast to that of the ninth hexagram, Hsiao Ch'u, THE TAMING POWER OF THE SMALL, in which the Creative is tamed by the Gentle alone. There one weak line must tame five strong lines, but here four strong lines are restrained by two weak lines; in addition to a minister, there is a prince, and the restraining power therefore is far stronger.

The hexagram has a threefold meaning, expressing different aspects of the concept Holding firm. Heaven within the mountain gives the idea of holding firm in the sense of holding together; the trigram Ken, which holds the trigram Ch'ien still, gives the idea of holding firm in the sense of holding back; the third idea is that of holding firm in the sense of caring for and nourishing. This last is suggested by the fact that a strong line at the top, which is the ruler of the hexagram, is honored and tended as a sage. The third of these meanings also attaches specifically to this strong line at the top, which represents the sage.

THE JUDGMENT

THE TAMING POWER OF THE GREAT.

Perseverance furthers.

Not eating at home brings good fortune.

It furthers one to cross the great water.

To hold firmly to great creative powers and store them up, as set forth in this hexagram, there is need of a strong, clearheaded man who is honored by the ruler. The trigram Ch'ien points to strong creative power; Ken indicates firmness and truth. Both point to light and clarity and to the daily renewal of character. Only through such daily self-renewal can a man continue at the height of his powers. Force of habit helps to keep order in quiet times; but in periods when there is a great storing up of energy, everything depends on the power of the personality. However, since the worthy are honored, as in the case of the strong personality entrusted with leadership by the ruler, it is an advantage not to eat at home but rather to earn one's bread by entering upon public office. Such a man is in harmony with heaven; therefore even great and difficult undertakings, such as crossing the great water, succeed.

THE IMAGE

Heaven within the mountain:

The image of THE TAMING POWER OF THE GREAT.

Thus the superior man acquaints himself with many sayings of antiquity

And many deeds of the past, In order to strengthen his character thereby.

Heaven within the mountain points to hidden treasures. In the words and deeds of the past there lies hidden a treasure that men may use to strengthen and elevate their own characters. The way to study the past is not to confine oneself to mere knowledge of history but, through application of this knowledge, to give actuality to the past.