Organism Omnivore

5429335563_ebe9be20dcCompanies are like living organisms.

They learn, evolve and eventually die in 13 years, plus or minus 5.

They consume sales, and excrete costs.

They are omnivores.  The more sales a company consumes than costs it excretes, the more it grows.

Yet most companies operate like machines that walk at right angles, with one foot stuck in the tar pit of analog.  In the industrial era, a business was like a clock with a long and short hand, devised by engineers and pencil-pushed by accountants for maximum productivity; every worker was an undifferentiated cog and wheel, interchangeable, disposable.

This machine-view of business operations prevailed because smokestack industries were stable, predictable; the most valuable assets were hard and fixed; electrical plants, factories, work-in-progress inventory, and finance capital. Deprioritizing humanity for the sake of optimizing profit was considered good business judgment, because human bonds were too fragile.  Ayn Rand’s Fountainhead popularized the notion of companies being the birthright of clever individuals atop a pyramid of workers who did their bidding.  Thus, management people were the brains and relationships were secondary.

But in this new digital ecosystem, the business world is a vast, murky and clandestine rainforest, where machines constantly bump into things, spin uncontrollably, rust and malfunction.  Henry Ford, a pioneer of the mass-market automobile industry, once said  “Any customer can have a car painted any color that he wants so long as it is black.”  As a monopoly car manufacturer, such arrogance by Ford was pardonable, but today’s customers want personalized experiences and different products and services every day.

In order for a business to survive threat of extinction, companies have to create a new nervous system, and high performance infrastructure.  It must be responsive to environmental changes as a living thing would; and protect crucial nerve endings from getting damaged and paralyzed.  For example, if you are in a cold environment and you don’t know; you are dead.  This is an advantage living organisms have over machines.  Machines don’t know they are dead.  In my experience, the business’ nervous system can be destroyed by miscommunication and conflict, if there is no understanding of self and management.

Thus, a knowledge system that is distributed throughout all the employees must be restored, where continuous p2p learning about one’s environment is the aim.  This process is not mechanical; learning is creative, fluid, soft, messy and magical.  And the power of digital is that it automates the mundane and frees up bandwidth to do more learning.  Employees can be then redeployed to think,  strategize, learn and see into the future.

As a result, companies need to invest in connectedness both internally and externally.   And move away from centralizing digital like it is another cog and wheel.  Evolutionary biology defines an organism as a body composed of different pieces that coordinate well for a common purpose.  Organisms have self-control and derive power from within.  In his book, “Living Company”, Arie De Geus argued that as a living organism organization’s first loyalty is not to any individual or crowned figurehead, but to its existence, growth and factors that extend its longevity.

A living company is a connected company.

A connected company operates as a band of self-directed pods that are supported by platforms and connected by common purpose, not by fear of a supervisor. Amazon and Google are great examples of the open, living, connected company.  They disperse digital staff across key departments, with change agents that lead key initiatives, set up processes, and synthesize the dots while empowering others to lead.  They see companies as a complex ecosystem of connections and potential connections.  Here is the survival kit for a living company:

  • Living companies have to encourage creative binging.  E.g. Google used to give its workers 20% of time to do side projects which produced Adsense and Gmail.
  • Living companies have to have a strong, unified culture.  See sustained superior performance of Proctor & Gamble, Zappos, Netflix, because of the importance of culture.
  • Living companies have to be self-aware and in touch with the world around them constantly on the prowl for new opportunities.  E.g. Google investing in self-driving cars and home automation(Nest).  Facebook investing in virtual reality (Oculus)…

As we move towards the next wave of digital disruption, customers will be more and more connected with each other on mobile, social and the cloud.  A successful company must adapt, reinvent its product and services and connect with customers. The best way to do that is as a living company not a dead machine.

Black Swan Surprise

Black swans are outliers.

At least that is what everyone thought in Europe, when all swans were assumed to be “snow white.”

By the 18th century, Dutch explorer Willem de Vlamingh landed in Australia, discovered black swans and altered the science of zoology. After the fact it seemed obvious to armchair scientists that black swans had to exist. Making the impossible, possible.  But even the other furry genetic mutations (boxing kangaroos, duck billed platypus and teddy-bear koalas) that were discovered had to roll their eyes at such ludic fallacy.

black swan 2According to Wall Street derivatives legend, Nassim Taleb, “black swans” are wildly unpredictable human events that occur when we least expect them. Like 9/11 and the rise of the PC, internet and Google, they cannot be predicted based on what we know no matter how much we rewrite our ignorance in the past to suit a predictable future.

For example, in the “hood”, black swans are quite common.  Ask the homeless.

They are the albino pigeons that leave exploding surprises on windshields and pedestrian heads.  They fight for bread scraps outside restaurants and pose with statues for picture-taking tourists.

They are also the iPads and cellphones the homeless use as vital links to friends, employment opportunities and housing to build a light-tunnel out of isolation and despair.  Who would have thought the new wave of digital technologies – cloud, Big Data, social, mobile, 3D printing, the Internet Of Things – intended for commercial enterprises and paying consumers, could launch a flock of black swans to help the poor?

As bizarre a juxtaposition as it seems, access to digital technology from smart watches to Wifi is like drinking water for the disenfranchised in poor communities.  Technology allows them to defy the physics and social stigma of an address or zip code. Less status symbol and more survival apparatus, these cheap communication technologies are like feet kicking down the fourth wall to the theater of their lives; where they can fully engage and contribute to the conversation on Facebook and Snapchat.

When technology is used to solve real world problems, a cyclone of black swans circle to raise the roofs of our assumptions. For example, Leo Grand, a homeless man in New York City, was given the Matrix-like choice ( blue pill/red pill) to take a one time $100 gift or coding lessons for an hour a day with mentor tech programmer Patrick McConlogue. Leo chose the red pill and learned to write javascript. After three months, he developed a mobile carpooling app,called Trees for Cars (http://bit.ly/1wK0y0z), that connects drivers and riders in an effort to reduce CO2 emissions from cars.

Other attempts have been made to tackle the challenges of education, computer literacy and speedy Internet access, unleashing potential black swan surprises.  Bill Gates issued the Reinvent the Toilet challenge to bring sanitation solutions to 2.5 billion people in the world.  The contest engendered ideas like solar-powered electronic toilets to a prototype that helps recharge mobile phones from urine.

Google launched Google Fiber to cover the last mile into the “hood” and stimulate more high speed broadband adoption and innovation across the digital divide.  Additionally, they devised Project Loon, bringing internet access to rural and remote geographies with floating balloons in the sky (inspiring the imaginations of UFO conspiracy theorists, http://bit.ly/1GFIa8U).

1b7e670In all these use-cases, when we concentrate on things we already know and fail to take into consideration what we don’t know, a black swan surprise hits us with its wing, beak or tail.   We tend to put on rose-tinted blinders to the impact of randomness and fail to appreciate the imperfection in our perception of events. Yet reality is not linear math; it is a complex bending mosaic of ones and zeroes swiped with the pads of our fingers, whose rising and falling patterns find comfort in the cumulative effect of a handful of shocks.

Count the game-changing events, the technological advances and inventions that you have witnessed in your lifetime; and compare them to what was there before. How many of them came on the schedule of a toaster?

The mother of invention is need and there is greatest need in poor U.S. inner city communities.  Although we like to simplify, narrate, and categorize, and remain cynical about rewarding those who can imagine the “impossible, I predict the next black swan technology will come from these communities.  It is already there, waiting to be discovered.

Fix Dem Broken Windows

It has been a decade since I have read the New York Times best-seller by Malcolm Gladwell, The Tipping Point, where he talks about how little changes can have big impacts.

Amongst many ideas in the book, he brings up the broken window theory, “a criminological theory of the norm-setting and signaling effect of urban disorder and vandalism on additional crime and anti-social behavior” (sourced from Wikipedia). Gladwell draws out the example of how Mayor Rudolph Giuliani sparked a branding revolution of New York City. In the 70s, 80s and early 90s New York City’s 42nd Street was a notorious crime capital synonymous with broken drug needles, petty theft and prostitution, reflected in low fare B-flicks like Taking the Pelham 1,23 and Warriors. But in a relatively short period under Giuliani’s watch, it became a commercial epicenter attracting Disney and Virgin Records. The way Giuliani performed this magical turnaround was not through the brute calculation of adding more police, but focusing on the small stuff: petty crime, spray-can vandalism and college kids jumping subway turnstiles.

The idea is that if you permit a broken window or a piece of graffiti to go unchecked, it will become viral. Crime will proliferate. Accordingly then by preempting the low hanging cost-centers and eye sores of New York’s self-image, a positive tipping in social behavior can spread. Citizens would have more pride, invest to keep the culture clean, and do better work. Predators and felons would scurry like rodents, because they stick out too much in positively-lit environments.

As a turnaround change agent, we want to parachute into corporations and bulldoze the largest rocks and challenges. We overlook the tiny pebbles that can avalanche into a boulder of trouble. We let sewage that starts out harmlessly as a banana peel accumulate around us, on the shop floor, or on the sidewalk. But it is the quick surgical strikes that give us the wins and momentum to rise to the greater tasks in life, politics, science and the arts.

And that goes for emotional sewage—bad decisions, heartaches, and pain we carry daily. We can accumulate so much of it that it clutters our thinking and defeats our drive. We have no place to put it and are ashamed to show it. So it sits and stays and becomes a rotten landfill collecting flies of negativity and apathy.

If I tell myself, that part of me is broken and cannot be fixed until I do something major, I am susceptible to behaviors that can lead to further harm. I am so relaxed in my standards that I accept more broken windows.

Brand is perception and perception is reality. If your mirror is broken, you will perceive yourself and brand as broken. So set the standard in youself. Choreograph today’s self-image for tomorrow’s history. Fix those broken windows first and the community will follow.

Why Should You Lead?

Its fascinating how often we imagine ourselves as CEOs, reclined like Captain Kirk of Star Trek issuing orders, with the company around us running like minions as instruments of our grand vision. But at no point have we negotiated or made the case to ourselves for why we should be given that respect. We feel entitled because of connections, our fancy degrees or our bloated sense of self and existence, but when directly asked, “Why should you lead?” we fumble for answers. At times no answer at all. I have seen many a people project the confident shell of a leader, bequeathed the ceremony of the title. Yet they cannot pinpoint with clarity and concision why them. You hear phrases like, “I am unique…because I deliver results…”, but these responses get lost in a wash of responses that are exactly like everyone else.

This is what divides great leaders from ok leaders. Great leaders have a conviction that is unflappable. There is something in their gut that rings truth. There is something in their eyes that widens that you want to follow, and they do not have to convince themselves. Its their purpose already written and we are turning the pages.

Put a page with the question, “Why should you lead?” on your refrigerator. And don’t turn it, until you have a good answer.

Big Idea

We were broken into teams. We had 15 minutes to make a recommendation to the hypothetical client.

Here was the situation:

“Club Luxe is a luxury health club that has its stalls stocked with expensive salon shampoo. The customers love the shampoo and its sold at the front. However, the shampoo routinely disappears from the showers; and there is 33% theft rate. The club has already tried reminders, penalties and incentives to reduce theft, but nothing has worked thus far.”

Here was the parameters:

1) one bottle of current brand per stall must remain
2) 100% elimination of theft
3) zero cost to the club to implement solution
4) no burden imposed on club members

This felt to me like a classic riddle. We only had 15 minutes. My instinct was that underneath this problem lay an elegant solution, because “zero cost” to me meant that they could not dip into monetary resources, time or people. So an elaborate scheme like having a shampoo dispenser or using smaller amounts in the shampoo containers felt clumsy. After knocking around a few ideas with the group, I had an Aha-moment (The one where the clouds split and a ray of light beams onto your forehead.) Why not take the bottle caps off of the containers? This solution would absolutely discourage club luxe members from stealing the shampoo because it would spill in their purse or bag and the most beautiful part, it cost the client nothing.

When all the groups reconvened to share their solutions, as predicted ours was the most simple and elegant and right (McKinsey & Co was hired to do this case and they chose to “take off the bottle caps”.) However, the point of the exercise was less about getting the right solution and having a framework and process to generate a list of quality options. When I was asked by the class what were my assumptions and facts I didn’t really have any? Again, I focused in on the constraints(“zero cost”) and from that developed a solution. But what came to bear, as I explained myself was that my argument was weak, even although I had the right solution. It did not rest on sound evidence or an uncovering of assumptions and counter-arguments; it was born from intuition.

Here’s the rub: I can tell you that in the real world, in most instances, we don’t have time to break things down systematically. Much decision making is rooted in experience and extemporaneous gut-calls. However, that’s not what companies are paying you for. They are paying for your methodology and reasoning. Yes the big idea counts. But in a room of skeptics that are not seduced by risk, how do you get them to divorce themselves from their better judgment? One does this by having better judgment than them. A solution, therefore, is only as good as the evidence it stands on. Welcome to the world of business.

Ropes: Its not about you

Photobucket

I climbed a 30 ft pole and jumped to catch a trapeze at a ropes challenge course.

If you have never done it. Think: The pole is a metaphor for “You’re the cause you’re looking for.”

So many of us need a track or one more peg to indicate what we should do next. We are good at coloring our lives inside the lines of others. We are good at climbing so long as the course is outlined. But for real dramatic growth, at some point you have to realize you are the end point. There are no more steps to climb, no more grooves or pegs to hold your foot in place. You have to believe that you can will yourself to a standing position on top of the pole and leap for your goals. The first time I got to the top I wobbled off the pole and failed miserably. The second time, I was successful. I scaled up like a monkey and got to a standing position easily. It was the trapeze that gave me trouble. No matter how determined, after three more tries, I was unable to leap out, catch and sustain my grip.

While I would have liked to have accomplished my goal of leaping and holding on the trapeze bar, in life you have to recognize that its not about you all the time. One of my classmates had gone first in that exercise. He climbed the pole, reached the top, jumped but missed the trapeze. He was terrified, and discouraged. He did not think twice about trying the challenge again. But after he saw my dogged persistence — jumping four times— he tried again. He climbed up the pole, got to the top, jumped and caught the trapeze! He even did a upside down monkey flip to dismount.

I did not accomplish my goal but I released my classmate to accomplish his goal. My persistence enabled and ennobled him to go after the pole again. And he became a success for both of us.

Leadership the Burt Way

The look of love is in my eyes when I hear a Burt Bacharach track — especially when he lends the limitations of his own untrained voice to a track like on “The Look of Love.” His voice scratches like a needle on vinyl, full of goodness and sweetness with all the whimsy of a camel’s tail. It is a softening agent that works on the hardest of hearts.

At first listen, you cannot hear him. The orchestra behind him is a big wave consuming him, riding him into a sandpit. And it is because he does not shout. He dials down the longing breaching his loins to a whisper. But that’s the genius of Burt. Instead of being something he’s not, which is a great singer of heft and volume, he’s just himself, a hip dude with an ear for nuance. His quiet forces the listener to listen and journey into his world of compassion, love, and humanity.

As I have noticed with singing, leadership is too often characterized by boom and force and meanness. It is not a coincidence that a disproportionate number of CEOs of Fortune 500 companies are tall and have a deep voice. For some reason, we instinctively fall in line when figures of tremendous height with a James Earl Jones voice stand before us. Force yields fear, obedience and effective delegation. But Burt teaches us a different path. Love and good nature and the abnegation of self are the more sustainable enterprise. If only all CEOs listened to some Burt Bacharach.

What the world needs now is love, sweet love. Hit it, Burt.

Leading is Doing

Have you ever done a team building exercise? It usually involves a random assortment of stuff like a blindfold, a hula hoop, 5 tennis balls, Lego blocks, a stomach for inebriation, a pinch of humor and an abundance of trust. Corporations do it to foster team identity and community amongst employees outside the grind of work. MBA programs do it for similar reasons but more so to develop instances for students to practice their leadership skills within a team setting.

I have engaged in a few team building exercises but there was one that stayed with me from an MBA prospective weekend, where I was blindfolded with seven other people. Our task: to build a tent. Here was the punchline. Even if I was not blindfolded and had a book of instructions, I still would not have been able to build a tent. But here we were like Gilligan Island castaways with no eyesight, no prior relations to one another, and an impossible task ahead that would make McGyver blush. We did have a little help. There was a person in our group who was a mute….meaning he could see everything but was restricted from talking. So communication was dialed down to prehistoric claps and grunts with the one person who could see visually how to build a tent.

At the outset of the task, I did the leadership thing. I spoke first with a vision. I stated that if there were any tent building experts in the group they should be the project lead. Two men admitted to having experience and so they took up the charge. I felt good. I was first-to-market with this epiphany. My second epiphany was that I know that I don’t know. And instead of adding another cook to the kitchen I decided to surrender my executive right to lead and shrunk to the background in perpetual silence so the “real leaders” could get to work. I have worked in flat organizations, small start ups, where there was no clear leaders or established hierarchy and it was a hot mess, because everyone talked over one another. Noise pollution is hazardous to progress and the best alternative I have learned is elimination of waste i.e. those who cannot add value or offer expertise. Hence, throughout the whole process I was in the corner listening to work get done, shielding myself from any tent poles that might spring by accident and hit me.

We finished the task in record time all because I pointed out that those with a tent background should lead and more importantly I got out of the way, right? No. Not exactly. After the glow of my triumph died down and I had a moment to reflect, I was disappointed in myself. While my plan for not being a liability was great i.e. getting out the way, shielding myself from getting randomly hurt, I was not an effective asset, at least not one that inspired leadership. My instincts were good but I used them to protect myself from embarrassment, not lead the team to victory.

Now some might argue I am being too hard on myself, but the truth is I used leadership and delegation to isolate myself from the process and productivity. That’s not a good thing because every member of the team should and can contribute in meaningful ways. What held me back? Was it fear of failing the process? Was it laziness? Am I just a talker, not a doer? Not so sure. But I do know even if you don’t have all the answers you do what you know how to do. For instance, my skill might be communicating the process not doing it. Therefore I should have been the talker. Here’s how it should have gone:

“Who knows how to build a tent? I don’t know how. But I do know there is a process. Those who know the process tell us. Then we should delegate. What I will do is section out the pieces,etc” . ..Standing out as leader but recognizing other talents is where the moral of other people wanting to work for you comes from. Lack of expertise is no excuse not to get involved. Don’t think that its a tent but more a process that needs to be completed. Something needs to be constructed and there’s a process around it. Leading is Doing.