Those of us who have been building digital communities know that we were simply trying to re-interpret and re-create the rules of real, living, communities. Wendell Berry had something say about this many years ago which applies to the “ecosystem builders” of today.
These “rules” or steps are not optional – you can’t pick or chose. All or nothing. Our survival as a species may depend on understanding this.
These are also the rules for sustainable development. Gandhian all the way.
Supposing that the members of a local community wanted their community to cohere, to flourish, and to last, they would:
1. Ask of any proposed change or innovation: What will this do to our community? How will this affect our common wealth?
2. Include local nature — the land, the water, the air, the native creatures — within the membership of the community.
3. Ask how local needs might be supplied from local sources, including the mutual help of neighbors.
4. Supply local needs first (and only then think of exporting their products, first to nearby cities, and then to others).
5. Understand the ultimate unsoundness of the industrial doctrine of ‘labor saving’ if that implies poor work, unemployment, or any kind of pollution or contamination.
6. Develop properly scaled value-adding industries for local products in order not to become merely a colony of the national or the global economy.
7. Develop small-scale industries and businesses to support the local farm or forest economy.
8. Strive to produce as much of their own energy as possible.
9. Strive to increase earnings (in whatever form) within the community, and decrease expenditures outside the community.
10. Circulate money within the local economy for as long as possible before paying it out.
11. Invest in the community to maintain its properties, keep it clean (without dirtying some other place), care for its old people, and teach its children.
12. Arrange for the old and the young to take care of one another, eliminating institutionalized ‘child care’ and ‘homes for the aged.’ The young must learn from the old, not necessarily and not always in school; the community knows and remembers itself by the association of old and young.
13. Account for costs that are now conventionally hidden or ‘externalized.’ Whenever possible they must be debited against monetary income.
14. Look into the possible uses of local currency, community-funded loan programs, systems of barter, and the like.
15. Be aware of the economic value of neighborliness — as help, insurance, and so on. They must realize that in our time the costs of living are greatly increased by the loss of neighborhood, leaving people to face their calamities alone.
16. Be acquainted with, and complexly connected with, community-minded people in nearby towns and cities.
17. Cultivate urban consumers loyal to local products to build a sustainable rural economy, which will always be more cooperative than competitive.
From a speech delivered November 11, 1994 at the 23rd annual meeting of the Northern Plains Resource Council.
Each morning I get up and check to see if we’re still living in a Democracy.
I’m only half joking. In the US, Trump was just a symptom of the larger rot. It is not an accident that all around the world countries are falling into the trap of authoritarianism.
What can be done to stop the backsliding?
Maybe Bill Gates could start a PAC to get money out of politics. Maybe we could take to the streets to stop voter suppression.
Or maybe we could just keep being distracted by Harry and Megan.
Staying silent will kill us all. Nerds, unite.
This letter spells out the duopoly which is now in full force in US politics. The last remaining chance for Democracy to survive in the US is for us to heed this warning >>
A Letter to the Democratic Convention from Franklin D. Roosevelt
July 18, 1940
Members of the Convention:
In the century in which we live, the Democratic Party has received the support of the electorate only when the party, with absolute clarity, has been the champion of progressive and liberal policies and principles of government.
The party has failed consistently when through political trading and chicanery it has fallen into the control of those interests, personal and financial, which think in terms of dollars instead of in terms of human values.
The Republican Party has made its nominations this year at the dictation of those who, we all know, always place money ahead of human progress.
The Democratic Convention, as appears clear from the events of today, is divided on this fundamental issue. Until the Democratic Party through this convention makes overwhelmingly clear its stand in favor of social progress and liberalism, and shakes off all the shackles of control fastened upon it by the forces of conservatism, reaction, and appeasement, it will not continue its march of victory.
It is without question that certain political influences pledged to reaction in domestic affairs and to appeasement in foreign affairs have been busily engaged behind the scenes in the promotion of discord since this Convention convened.
Under these circumstances, I cannot, in all honor, and will not, merely for political expediency, go along with the cheap bargaining and political maneuvering which have brought about party dissension in this convention.
It is best not to straddle ideals.
In these days of danger when democracy must be more than vigilant, there can be no connivance with the kind of politics which has internally weakened nations abroad before the enemy has struck from without.
It is best for America to have the fight out here and now.
I wish to give the Democratic Party the opportunity to make its historic decision clearly and without equivocation. The party must go wholly one way or wholly the other. It cannot face in both directions at the same time.
By declining the honor of the nomination for the presidency, I can restore that opportunity to the convention. I so do.
The new normal is the old normal. How much has really changed since the days of the East India Company? We are accelerating backwards, back to a world run by a few, for the few.
The question we should ask now is: what does it mean to decolonize the corporation?
It means understanding that everything we do in business is built on the foundation of the brutal business model handed down to us by Robert Clive and friends.
P.S. – did you know the East India Company came back to life in 2004?
What’s wrong with Elon Musk? And why do we—as a society— allow billionaires to play games with our future?
Maybe it’s because we think Elon Musk, Jeff Bezos, Mark Zuckerberg and/or Bill Gates will save us with their genius. Don’t count on it, children. The revenge of the nerds is nigh.
Here’s what Musk had to say: “You can’t see where the implant is and he’s a happy monkey. We have the nicest monkey facilities in the world. We want them to play mind-Pong with each other.”
The line between Trump and Musk is a fine line indeed.
Now check out Zuckerberg and his “monkey experiment” —
We are all “happy” monkeys now.
How high do we have to jump for that banana?
UPDATE: see also — the #happypig
Phil Kotler and I write about new approaches non-profits should consider as they plan their futures. Here are seven recommendations we think can make a real difference:
- Revisit your Mission.
- Organize as an Ecosystem.
- Look for Entrepreneurial Opportunities.
- Design for Justice.
- Embrace Brand Activism.
- Build/Join a Purpose Platform.
- Start/Join a Movement.
Read the article at The Marketing Journal >>
Where can we find light, y’all?
The Hill We Climb
by Amanda Gorman
When day comes, we ask ourselves, where can we find light in this never-ending shade?
The loss we carry. A sea we must wade.
We braved the belly of the beast.
We’ve learned that quiet isn’t always peace, and the norms and notions of what “just” is isn’t always justice.
And yet the dawn is ours before we knew it.
Somehow we do it.
Somehow we weathered and witnessed a nation that isn’t broken, but simply unfinished.
We, the successors of a country and a time where a skinny Black girl descended from slaves and raised by a single mother can dream of becoming president, only to find herself reciting for one.
And, yes, we are far from polished, far from pristine, but that doesn’t mean we are striving to form a union that is perfect.
We are striving to forge our union with purpose.
To compose a country committed to all cultures, colors, characters and conditions of man.
And so we lift our gaze, not to what stands between us, but what stands before us.
We close the divide because we know to put our future first, we must first put our differences aside.
We lay down our arms so we can reach out our arms to one another.
We seek harm to none and harmony for all.
Let the globe, if nothing else, say this is true.
That even as we grieved, we grew.
That even as we hurt, we hoped.
That even as we tired, we tried.
That we’ll forever be tied together, victorious.
Not because we will never again know defeat, but because we will never again sow division.
Scripture tells us to envision that everyone shall sit under their own vine and fig tree, and no one shall make them afraid.
If we’re to live up to our own time, then victory won’t lie in the blade, but in all the bridges we’ve made.
That is the promise to glade, the hill we climb, if only we dare.
It’s because being American is more than a pride we inherit.
It’s the past we step into and how we repair it.
We’ve seen a force that would shatter our nation, rather than share it.
Would destroy our country if it meant delaying democracy.
And this effort very nearly succeeded.
But while democracy can be periodically delayed, it can never be permanently defeated.
In this truth, in this faith we trust, for while we have our eyes on the future, history has its eyes on us.
This is the era of just redemption.
We feared at its inception.
We did not feel prepared to be the heirs of such a terrifying hour.
But within it we found the power to author a new chapter, to offer hope and laughter to ourselves.
So, while once we asked, how could we possibly prevail over catastrophe, now we assert, how could catastrophe possibly prevail over us?
We will not march back to what was, but move to what shall be: a country that is bruised but whole, benevolent but bold, fierce and free.
We will not be turned around or interrupted by intimidation because we know our inaction and inertia will be the inheritance of the next generation, become the future.
Our blunders become their burdens.
But one thing is certain.
If we merge mercy with might, and might with right, then love becomes our legacy and change our children’s birthright.
So let us leave behind a country better than the one we were left.
Every breath from my bronze-pounded chest, we will raise this wounded world into a wondrous one.
We will rise from the golden hills of the West.
We will rise from the windswept Northeast where our forefathers first realized revolution.
We will rise from the lake-rimmed cities of the Midwestern states.
We will rise from the sun-baked South.
We will rebuild, reconcile, and recover.
And every known nook of our nation and every corner called our country, our people diverse and beautiful, will emerge battered and beautiful.
When day comes, we step out of the shade of flame and unafraid.
The new dawn balloons as we free it.
For there is always light, if only we’re brave enough to see it.
If only we’re brave enough to be it.
Change is coming.
Clark Fox, Solomon Kane and I decided to do this >>
submit your work!
Why are leading brands turning to progressive Brand Activism?
How do brands align their values with the values of their customers, their employees, and society at large?
We offer the workshop in two locations:
(1) in Sarasota, Florida (workshop led by Professor Philip Kotler and Christian Sarkar)
(2) on your company’s premises (workshop led by Christian Sarkar)
WHO SHOULD ATTEND
Senior executives responsible for company/brand strategy and direction
The workshop introduces executives to the strategic power of Brand Activism done right.
- What is Brand Activism?
- How are leading companies stepping up? (NIKE, PUMA, Microsoft, Google, Unilever, Patagonia, The Body Shop, Kenneth Cole, and more)
- The role of Trust: local, national, and global
- What are the existing models for Brand Activism?
- An introduction to the Sarkar-Kotler Brand Activism Framework
- Understanding Brand Activism strategy
- The CEO as Brand Activist
- How do you find your authentic Brand Activism story?
- What could possibly go wrong?
- Aligning values and building movements
- Measuring the impact of Brand Activism (Return on Trust)
- Brand Activism Mapping
- The Brand Activism Canvas
Ever wondered what makes a video go viral?
There are several societal norms challenged in the video. The ad celebrates the second marriage of a woman and includes her daughter. And secondly, the woman is dark-skinned. In a society obsessed with fair complexion, the ad breaks an unwritten rule of Indian advertising. The emotional impact of the ad made it a viral hit, with politicians, citizens, and film stars talking it up on their social media accounts.
Arun Iyer, the creative director, says: “This is the thinking that most progressive people have. They may not be going through the same thing in their life, but the ad makes a bold, progressive, statement and people like to be associated with brands that make such statements.”
The company behind the ad is Tanishq, the largest retail jewelry brand (part of the forward-thinking TATA Group) in India with over 156 stores in 86 cities.
In the US, and specifically in Texas, we have slightly different reasons for emotional contagion: toilet humor.
I met Larry Keeley through a mutual friend several years ago. He’s the thought leader behind Doblin, the innovation consulting company that’s now part of Deloitte. At the time, Larry had come up with an innovation scanning methodology which looked across industries to identify innovations up and down the value chain. Larry was also kind enough to join the $300 House project as an adviser, and I’ve learned a lot from him – more than he can imagine!
Now, and this is a good read for the holidays, he’s written a book called Ten Types of Innovation: The Discipline of Building Breakthroughs.
You see, most companies focus on just one type of innovation – product innovation. Sure, some of us are looking at service innovation and business model innovation (thanks to Clayton Christensen and Alex Osterwalder), but we still suffer from tunnel vision. Time to wake up and look across the entire scope of our business activities. Where can and should we innovate?
How will your company build it’s business innovation portfolio?
Bezos raises the stakes in retail warfare: drone delivery… Are you worried Fedex?
What’s wrong with this picture?
According to the Global Innovation Index (GII) – co-published by Cornell University, INSEAD and the World Intellectual Property Organization (WIPO) – the most innovative countries in the world are:
3. United Kingdom
5. United States of America
7. Hong Kong (China)
Other than chocolate, watches, and secret bank accounts, I’ve never viewed Swiss innovation as leading the world. The same goes for Sweden (IKEA, Abba?) and the Netherlands (Shell).
Why are these countries being hyped as the most innovative countries in the world?
Let’s dig a little deeper. Firstly, the index tracks the wrong measures of innovation:
Swiss “innovation” looks like this:
The USA looks like this:
So, let’s look at three other “not-so innovative” countries: Brazil, China, and India – yes, they are “emerging markets”…
See the problem? Innovation cannot be measured by number of entries to Wikipedia, or number of papers, or patents, or YouTube uploads.
Rather, it should be measured in terms of innovation (and disruption) – by industry.
Brazil, is the first country where renewable energy accounts for more than 85.4% of the domestically produced electricity used. If that’s not innovative, I’ll go re-read Heidi.
China? Well, they’re China. Every product the Swiss used to make is now made cheaper and of comparable quality in China. Red capitalism rules the business world right now, so that’s something of a disruptive innovation, don’t you agree?
And India? They’ve got more scientists and engineers who are hungry to make something happen. India’s also the hot-bed for reverse innovation (which does not seem to be on the radar at the WIPO). And they just sent a mission to Mars…
So what’s wrong with this innovation survey?
Simply put, it’s not based on reality. And it’s not an accident that Switzerland is “so innovative,” according to this survey – which happens to be sponsored by INSEAD (in Lausanne) and the WIPO (Geneva). The innovation for Switzerland is its opaque banking system (ask China about that: Chinese government officials hold about 5,000 personal Swiss bank accounts with the Swiss global financial services company UBS. Two thirds of those accounts belong to high level central government officials.)
… Wait. There is one true innovation from Switzerland that does deserve a mention: the cap on CEO pay. Let’s see if it flies.
Companies and countries that are serious about innovation would do well to not pay attention to this survey, and focus instead on their schools, quality of science education, business transparency, social mobility, gini coefficients, and of course, governance itself (the Corruption Index). See also the Big Shift and A New Culture of Learning.
And if you want to measure creativity, that’s going to be something else entirely.
Elvis Presley and Bob Marley as they would look today (h/t these folks):
What can we learn from these lads? These, the young lions, who conquered the world like Alexander, but then had it all taken from them by Thanatos.
One thing you have they don’t. And if you escape the sword of Thanatos for a while, you still have to deal daily with his post-modern cousins: Boredom and Anxiety.
He realized now that to be afraid of this death he was staring at with animal terror meant to be afraid of life. Fear of dying justified a limitless attachment to what is alive in man. And all those who had not made the gestures necessary to live their lives, all those who feared and exalted impotence– they were afraid of death because of the sanction it gave to a life in which they had not been involved. They had not lived enough, never having lived at all.
― Albert Camus, A Happy Death
The man also said, “to have time was at once the most magnificent and the most dangerous of experiments.”
Every minute counts. Each year is 525949 minutes. How do you make every minute mean something? How do you escape everydayness?
When Apple announced its plans to bring a 100% renewable energy powered manufacturing plant to Arizona, we would do well to ask why?
The answer is partly to be found in the map below:
1) Proximity to Mexico
There’s a Foxconn manufacturing base in Juarez – just over the Mexican border – and it seems like the output from the Arizona plant will end up there.
2) Tax Structure
Over the past 15 years Arizona has demonstrated a “pro-business” mentality combined with a minimalist regulatory approach by reducing taxes and decreasing regulations:
- No corporate franchise of business inventory tax
- Low workman’s comp and unemployment insurance rates
- No income tax on dividends from out-of-state subsidiaries
- 80% sales factor on corporate income tax scaling to 100% option
- No worldwide unitary tax
- Aggressive depreciation schedule
- 90 day or less permitting
- Virtually all services exempt from sales tax
- No inventory tax
- No Sales tax on manufacturing equipment
- Ability to carry forward 100% of net operating income for twenty consecutive years
- Small businesses with less than $10 million in assets will not be required to pay capital gains taxes beginning in July 2015
- Right to Work State
Arizona also has aggressive tax credits to reduce state corporate income tax liability. This includes phasing in a corporate income tax rate from 6.9% in 2012 to 4.9% in 2017.
So what does this mean for neighboring states?
It’s too early to call this is a new wave of innovation, but it’s worth thinking about. How can states like California, Texas, and New Mexico join this solar-shift? Do they even want to?
C’mon, New Mexico!
Apple is to be applauded for bringing manufacturing back to the US. More importantly, they can still think different.
One of the primary reasons for the failure of development projects is that they cannot be sustained. Traditional approaches don’t always work; as soon as the development institutions (NGOs, agencies) leave, things fall apart. Soon the project is either abandoned or simply turned off. This happens all the time with water and energy projects.
One way to work around this and “make it stick” is to involve women in the project. This has been the secret behind the success of organizations like Grameen and the Solar Electric Light Fund. When women lead and control their own destinies, stuff happens. This is a lesson learned in the field, but overall the “development-through-empowering-women” movement is fizzling.
Is there anything else we can think of to make development changes stick?
How about the profit motive?
In his recent book The Solution Revolution: How Business, Government, and Social Enterprises Are Teaming Up to Solve Society’s Toughest Problems Deloitte’s William Eggers asks us to consider erasing public-private sector boundaries. According to Eggers:
In the book, Eggers presents four specific, scalable business models that are changing the world:
These business models are all very important because they bring the profits into the equation thus allowing them to scale.
But none of these business models solve the problem of scaling the $300 House or for that matter any of the public services the world is crying out for – sanitation, healthcare, water, energy, etc.
As I asked in a previous post on integrated development, why is it too much too ask that governments, NGOs and development institutions, and businesses work together with the communities involved to build integrated solutions?
Here’s how an impact innovation project might work:
Impact Innovation solves multiple problems simultaneously via integrated development
Because of the interrelated nature of the problems that drive the cycle of poverty, the only way to solve these problems is to employ an integrated development model which attacks several challenges at once: clean water, food, health, education, employment, and housing. Housing is delivery mechanism for a better life. This can be achieved using “whole village development” an approach proven by the Solar Electric Light Fund in sub-Saharan Africa. Thus a house is of little value without supporting infrastructure– clean water, sanitation, electricity, waste collection and disposal, basic health, education, and jobs!
Impact Innovation demands collaboration between communities, government, NGOs, and businesses
The key ingredient is trust and solidarity. For example, Partner In Health (PIH), one of the world’s most famous NGOs, believes it is essential to partner with the community. They hire and train local staff. They work with governments to reinforce national health services so more people receive services. They collaborate with other health workers such as traditional birth attendants and government health workers because together they can have a stronger impact. PIH has established a community-based model of care that is now viewed as a leading health-care delivery model in the developed world.
Impact Innovation requires total inclusivity
In the integrated development model, the NGO understands local community problems intimately, the government is responsive to the needs of the community through sound policy, land use arrangements and transparency, and businesses work with both to serve the poor as a customer, partner, employee and supplier. Activities and plans are coordinated, even synchronized. Inclusive growth is driven by inclusive business practices.
When we look at the state of current development
projects, we find a curious gap in execution. Because NGOs and
government institutions and agencies don’t think of business as a part
of the solution, they simply don’t include profit as part of the
So here’s what takes care of this gap:
Impact Innovation uses a hybrid or collaborative business model.
Can governments, businesses and NGOs work together to provide basic services for the poor at an affordable cost? To adopt an analogy from the world of cloud computing, we can think of this integrated model as a “lifestyle-as-a- service.”
Who pays for all of this? Instead of choosing 100% charity or 100% market-based solutions, I’m hopeful in a third alternative: the use of a collaborative or hybrid business model. I started thinking about this thanks to Ashoka’s Bill Drayton and Valeria Budinich (see their Hybrid Value Chain Framework).
So now let’s look at how a hybrid or collaborative business model might be designed to deliver “housing-as-a-service.” We start with a template which shows all the participants and the major process milestones in the service delivery process and adapt it to housing:
Different phases can be managed by different players. For example, a hybrid business model might include a configuration as follows:
In the Design phase, the community works with an NGO and businesses to develop a solution that works for them (this is the hybrid value chain approach from Ashoka!)
In the Build phase, the community works with the business to build the houses they designed in the previous phase. The government may subsidize or donate the land and cost of construction.
In the Finance phase, community members finance their houses with a lending bank that is now a for-profit scheme (under the watchful eye of a government panel).
The Maintain phase may include jobs for the community and training services from an NGO.
And finally, when the time comes to Upgrade, all players come to the table to develop the next solution.
Since infrastructure projects are implemented in phases, they can also be managed in phases. Governments, businesses and NGOs can collaborate to provide basic services for the community at an affordable cost. Imagine if this were to happen across all 638,000 villages in India.
And why should we stop at housing? All public services could be designed, built, financed, maintained, and upgraded using this hybrid business model concept:
I’m doing some research into finding out who is actually doing this already.
Impact Innovation has an employment effect leading to inclusive growth
The hybrid/collaborative-business model allows the community to be involved in each service as a consumer and as an employee or owner. A common enough idea is that building low-cost housing can help create an ecosystem of house builders and suppliers – often members of the community being served. The idea is to transfer that thinking across all the integrated services provided. The hybrid business model can pay for the ongoing employment of community workers for sanitation, energy, education, health, housing, of course, but even something like entertainment, where a member of the community becomes the entertainment entrepreneur, charging a micro-fee for movies or soccer games shown in the village community center, for example.
The Kodak story so far has been rather colorful, but as Kodak emerges from Chapter 11 bankruptcy, it looks like another company altogether. Will it ever shine again?
Gone is the document imaging business (spun off as Kodak Alaris; new owners = Kodak’s UK Pension Plan). Instead, the focus is on a new set of markets:
In short, the new Kodak ain’t the old Kodak. The key to survival is going to be professional services (watch out Xerox!) >>
Can they do it? How are they going to win? Do they have the capabilities they need?
The search for a new CEO is on. She‘s going to have to be a consultant’s consultant – a professional services expert. Good night, Kodak. Good night, moon. Good luck.
The disruptors are getting disrupted.
In Consulting on the Cusp of Disruption (Harvard Business Review),
Clayton Christensen, Dina Wang & Derek van Bever point out the coming disruptive changes in the world of management consulting.
And the big boys are getting ready. McKinsey Solutions, for example, is essentially a business model innovation that could reshape the way the global consulting firm engages with clients. It’s about “embedding software and technology-based analytics and
tools providing ongoing engagement
outside the traditional project-based model.” According to Christensen and friends, “McKinsey Solutions is intended to provide a strong hedge against potential disruption.“
So, will software robots replace the consultants?
No just yet, but the authors warn that the threat from smaller, more nimble competitors is real:
At traditional strategy-consulting firms, the
share of work that is classic strategy has been steadily decreasing and
is now about 20%, down from 60% to 70% some 30 years ago.
Wow. That’s some serious disruption, don’t you think? Clients are focusing on value-based pricing instead of per-diem billing. (And not a moment too soon!) If you’re engaged in any kind of consulting work, or even services, you would do well to buy the article. (As a bonus, you get to learn how the legal market got disrupted!)
Here’s a sample of their thinking: the three consulting business models observed and cataloged:
New upstarts like IDEO bring a collection of skills and capabilities not found in traditional firms. They bridge “the disciplines of
industrial design and innovation consulting… Its unique mix of talent
and strength in solving interdependent problems makes it hard to
Christensen, Wang and van Bever point to the model of IT services as a threat as well. Emerging market competitors like Tata Consultancy Services and Infosys. (I’m not so sure.)
IMHO, the big boys have been asking for trouble. By focusing on harvesting and/or fleecing clients, they left the doors open for nimbler and more insightful competitors. I think there’s one more business model that may have been overlooked: the individual, branded consultant.
Now, more than ever before, companies want to connect to the originator, the source of an idea – instead of going with organizational middlemen. Thought-leadership translates to market leadership. Some of the big firms are hiring these gurus to harness their I.P. but the list of independent, disruptive gurus is growing fast.
- Peter Drucker – The Original D-I-Y management consultant (R.I.P. Peter!)
- John Hagel III* – Big Shift + edge strategy (now with Deloitte’s Center for the Edge)
- John Seely Brown* – Education and Learning (he works part time for Deloitte’s Center for the Edge)
- Tom Davenport* – Competing on Analytics
- Stuart Hart* – Sustainability and B.O.P.
- Vijay Govindarajan* – Reverse Innovation
- Tammy Erickson* – Talent Management
- Marshall Goldsmith* – Leadership
- Dean McMann* – Customer Intimacy
- Mo Kasti* – Physician Leadership (see, it’s getting hyper-specialized!)
[* disclosure: these are clients or former clients of mine]
The list just goes on and on:
- Larry Keeley – Innovation (with Doblin, acquired by Monitor, then Deloitte)
- William Eggers – Government Solutions (with Deloitte)
- Jakob Nielsen – Usability
- Roger Martin – Strategy
- Alan Weiss – Pricing
- Seth Godin – Marketing
- Dan Kennedy – Entrepreneurship
- Perry Marshall – Internet Advertising
What’s interesting is that so many firms were founded or driven by thought-leaders: Monitor (Michael Porter), Innosight (Clayton Christensen), Ogilvy and Mather (David Ogilvy), so that the industry is well aware of the value of big-thinkers. Where they have failed is in nurturing them and allowing them to shine (e.g. where is Oliver Wyman hiding Adrian Slywotzky?). Deloitte seems to get it – they acquired Monitor, hired John Hagel and JSB, and encourage the building of the individual brands like William Eggers.
P.S. – here’s an interview with Clayton Christensen done over 10 years ago. We talk about disrupting the consulting industry in passing!
Discovered in an attic in Norway:
I showed my support by building Jim’s website.
The incumbent is a Republican guy who doesn’t believe in public health. He’s against child immunization, apparently.
After getting a few emails about this article in the Guardian, I went back to Professor Clayton Christensen‘s op-ed in the New York Times (h/t Derek Van Bever) and asked myself this question: What kind of innovation is the $300 House really?
I went through the “types” of innovation as described by Christensen:
Empowering Innovation: transforms complicated and costly products available to a few into simpler, cheaper products available to the many, thus creating jobs, because they require more and more people who can build, distribute, sell and service these products. Empowering investments also use capital — to expand capacity and to finance receivables and inventory.
Sustaining Innovation: replaces old products with new models, but creates few new jobs; such innovation has a neutral effect on economic activity and
Efficiency Innovation: reduces the cost of making and distributing existing products and services. Such innovations almost always reduce the net number of jobs, because they streamline processes, reduce capital investments, and eliminate waste.
So what about the Base of the Pyramid? What about the non-customer, the folks (generally poor) that are always under-served?
The result? Let’s define a new term: Impact Innovation – which like Impact Investing – seeks to make a difference.
Impact Innovations are innovations which:
1) solve a major problem (or several major problems simultaneously)
2) are sustainable
3) are affordable (may include hybrid business models)
4) serve the non-customer (new markets that did not exist before).
5) build an ecosystem of products, services, and experiences around the innovation
None of this is especially new, but the language we need to describe the problems we are facing is.
My point is simple: this is going to be the future of development. Governments, non-profits, and business will have to work together. Either that, or we’re in serious trouble.
On January 19, 2012, Kodak, the once iconic US company which had democratized photography, filed for chapter 11 in the U.S. Bankruptcy Court in the Southern District of New York.
To the millions of lives and memories touched by Kodak over the years, the news may have come as a huge surprise. But to those who make a living following companies’ growth or demise, there was zero surprise. Kodak’s ties with its customers had been weakening over the years – when Kodak was synonymous with amateur photography. Now, customers, both new and experienced, were choosing to bypass Kodak altogether. Simply put, Kodak had nothing to offer them; nothing valuable enough anyway, for them to stay.
So, what happened? How did a company that once owned the hill tumble down and lose its crown? Let’s see if we can understand what happened.
When George Eastman decided “to make the camera as convenient as the pencil” which is how he explained Kodak’s value proposition, he literally transformed our lives by introducing us to our personal “Kodak moments” – the memories that the individual captures as a way to celebrate, share, and communicate our most precious memories with our friends and families.
Kodak was the Apple and Facebook of its day because Eastman understood what customers valued. He realized that technology could change markets – overnight. And of course, that is precisely how he started Kodak – by creating the dry-plate technology which made photography accessible to all.
But Eastman could have easily failed to see the significance of the new. He could have stuck to his profitable business model, hypnotized by the massive profits his dry-plates produced for Kodak. He could have failed, but he did not. In fact, he bet the company not once, but twice, and both times he won because he kept stuck with his imagination – he clearly had the capability to envision how the right technology could transform the customer experience for the better.
The first time Eastman bet the company was when dry-plates were threatened by a new technology. Eastman gave up on his dry-plate business to pursue a promising new technology developed by Kodak – film. Eastman’s first simple camera in 1888 was a wooden, light-tight box with a simple lens and shutter that was factory-filled with film. Priced at $22.00, the world was forever changed.
Later, Eastman faced another existential Kodak moment when he again bet the company’s future on color film, which at the time was not as high in quality as the established black and white.
Eastman built the Kodak empire on a deceptively simple “razor and blades strategy,” selling inexpensive cameras and making money on the back end on film and printing.
So what happened?
The inexpensive business historian known as Wikipedia tells us that the problem with Kodak was that its “unassailable competitive position would foster an unimaginative and complacent corporate culture.”
In 1975, a Kodak engineer – Steve Sasson – invented the digital camera. But this time Kodak was no longer the Kodak of George Eastman. As Sasson desperately wandered around the company trying to convince senior executives of the potential of his discovery, he was met with the mindset of a company in love with the present. Sadly, there were no George Eastmans left at Kodak.
His presentations “met with a lot of curiosity, some annoyance.” According to Sasson, “Many times people talked about all the reasons why it would never happen. But there were many people that quietly looked at it and said, ‘Boy, it’s a long time, but I don’t see that it won’t happen.'”
As Kodak “fumbled the future,” Japanese firms like Sony leapfrogged Kodak, establishing a lasting reputation for inexpensive digital cameras.
At the time of its bankruptcy filing, Kodak gave several reasons for taking such drastic action: “to bolster liquidity in the U.S. and abroad, monetize non-strategic intellectual property, fairly resolve legacy liabilities, and enable the Company to focus on its most valuable business lines.” In the same release, Kodak also stated that they had “made pioneering investments in digital and materials deposition technologies in recent years, generating approximately 75% of its revenue from digital businesses in 2011.”
So while Kodak eventually got serious, and become the world’s leading seller of digital cameras, it had lost its profit engine. The “razor and blades” business model had evaporated. Without profits driven by the sales of film, Kodak was in a black hole of its own making.
Two other fatal flaws can be observed in hindsight.
The first was Kodak’s hubris in terms of marketing. As Adrian Woolridge wrote in his Schumpeter column, Kodak made the fatal mistake of “competing through one’s marketing rather than taking the harder route of developing new products and new businesses.” As we’ll see, its competitor Fuji Films – facing exactly the same predicament as Kodak – has managed to survive and thrive in the same business climate that drove Kodak to ruin.
The second fatal flaw was, in my view, the mindset of the executive team. In 1989, the board placed the wrong bet when they chose Kay Whitmore as CEO over Phil Samper. Whitmore was a hardliner – a veteran of the traditional film business. Samper (the digital “hope”) left to join Sun Microsystems. Three years later, the board fired Whitmore, and then went on to institute a revolving door policy which saw a line of CEOs fail one after the other.
To this very day, Kodak has an identity crisis: it does not understand who its customer is, and in its dithering, it no longer knows what Kodak is. The current Chairman and Chief Executive Antonio Perez is an HP printer executive, and has predictably steered Kodak toward consumer and commercial printers.
He says that the bankruptcy will help Kodak maximize the value of patents related to digital imaging. The final strategy? Litigation. According to Reuters, Kodak is trying to create new revenue streams using extensive litigation with rivals such as Apple Inc, BlackBerry maker Research in Motion Ltd, South Korea’s Samsung Electronics Co and Taiwan’s HTC Corp.
The failure of Kodak is a failure of management imagination. It is the failure of the executive mindset that no longer is connected to the customer.
The sad truth is when you take a photo today, Kodak is not part of the picture.
Kodak’s story is neither peculiar, nor unique. To attribute its crumbling relationship with customers to a single disruptive technology or market trend – example, digital transformation, would be overly simplistic. What happened to Kodak is a failing that repeatedly expresses itself in countless companies across the globe. They lost touch with their customers.
Cynthia Freeland‘s book – But is it art? – came out before Arthur C. Danto‘s – what art is – in fact he endorses it on the front cover (sort of) – but then he tries to one up her with a sincere form of flattery = his own take on the subject.
As a fan of Danto, I have to say his book is “pretty good and all,” but I’m embarrassed at what the publisher did to him (or perhaps he did it to himself) by copying the “look and feel,” to use the language of design, of Freeland’s remarkable book.
Maybe Danto/Danto’s publisher was reading this at the time:
Still, I think both books have their place.
Freeland’s book is more accessible (which is ironic since she’s a philosopher) and Danto’s book is pretty Hegelian and over-philosophical (but then he’s a philosopher too and an art critic).
Freeland sees art with the glasses of an aesthetic – she examines the various theories of art in an entertaining, non-academic, journey through time and space. What can we learn from how art is exhibited? How much it costs? Who or what is an artist? How do we assign meaning to art? etc. etc.
Danto insists that art is a trinity – meaning, embodiment, and interpretation. This is straight out of Charles Sanders Pierce, and while he hints at it, Danto doesn’t acknowledge it. Maybe he didn’t read Walker Percy‘s “Toward a Triadic Theory of Meaning” in The Message in a Bottle. Or maybe he did, but I doubt it.
What I find interesting that both books don’t mention the grave danger facing art – the mechanization/digitization of the process of production of art. In my view the danger is the same one Hundertwasser saw when he said that straight lines and photography are the end of art.
Everyone must be creative, said Hundertwasser.
Otherwise, I add, you will become a living, programmable machine. Most of us already are without knowing it. Our modern rituals – shopping, moviegoing, television, gaming, rob us of our creativity and make us passive consumers of machine optimized reality. Art and Big Data collide. Art loses. Profits win. Design destroys art.
Art is the fight to not be a machine. To not have to follow reason. To not have to be a consumer. To say no. The “artistic suspension of reason” lets call it. Or even: “the artistic rejection of profit.”
Art is what keeps us human. Irrational, yet human. Art is love. There, I said it.
The predictable, strategic failure of Nook is now on the front pages of dead-tree media. Despite Nook’s problems, Barnes & Noble Chief
Executive William Lynch said the company “remains committed” to the
Nook devices. He’s on his way out.
What Barnes & Noble needs to do is think.
Barnes & Noble has to remember what it is.
Here’s what it is not:
- a Christian book store
- a video-gaming parlor
- a coffee house
- a stationery store
- a toy store
Who will save Barnes & Noble for us? Watch your customers, B&N!
How’s it going J. C. Penney?
The Productization of Bob Marley is one of the saddest moments in his career. Bob Marley has become Babylon. I guess even revolutionaries get consumerized… See my 2009 post on the monetization of Bob Marley. The reality is worse than I feared.
R.I.P. Bob! Even though your family seems to have sold you out, your music will do the heavy lifting – dreader than dread.
Once again, I make a fool of myself… Can you be a 33% Sanyasi?
How do you build an ecosystem of resources and assets around a physical community?
That’s the question I’ve been struggling with for the past few months. During my recent trip to India, I found there were varied answers to the question, ranging from “it’s the government’s job” to “the community will have to do everything for itself.” I finally heard the answer I wanted to hear from the dynamic leaders of an emerging Indian giant. Over breakfast they told me that they were trying to build the right ecosystem around a rural village, and they were serious about building employment opportunities into the village itself.
Back in the USA, retired research biologist Marlene Warner gave me a book yesterday which made me sit up. It was John McKnight’s The Careless Society: Community and Its Counterfeits. In it, McKnight talks about diagnostic and anti-diagnostic ideologies.
This diagram is diagnostic; it points out needs and deficiencies, and turns citizens into consumers of medical social and service systems:
The second diagram is anti-diagnostic; it creates a map of capacities and assets, and empowers citizens, associations, and enterprises. The author says it can be a resource magnet.
A synthesis of these two maps is needed, says McKnight. These diagrams have to be integrated to build an integrated development model, and the community must be involved in the creation or co-creation of its future.
Stupidity is not learning from the mistakes of the past.
Now we see Hyatt Hotels destroying themselves in much the same way that Circuit City did before them.
What is it with these management decisions?
Paul Michelman describes the two-step process:
1. Make the decision to fire a very important yet modestly paid sector of your workforce. Fire the entire lot of them.
2. Outsource their positions to a third-party vendor who will bring in contractors to do their jobs at a lower cost. But — and this is critical — before you fire them, trick your workers into training the people who will replace them. How to pull this neat trick off? Tell them they are training vacation replacements. (Best to leave out the fact that the vacation is permanent).
How can a company compete when they turn their employees into disengaged zombies? This is an old management problem. Peter “The Great” Drucker believed that employees are assets and not liabilities. Too bad there are so many businesses that haven’t yet learned the cost of treating employees as costs.
And once again, I’m sure these executives are paid “well above the market-based salary range for their role.”
Here’s Naomi Klein >>
If this was the Republicans, the theme would be fear and more fear… Time to Vote Barack Obama!
Growing up in India, we’d occasionally see signs of “communal violence” in the streets. Sometimes, school would be canceled, and we’d stay at home playing cricket or soccer.
Curiously, these acts of violence between Muslims and Hindus, or Hindus and Sikhs, or Hindus and Christians, or Hindus and Dalits, would appear precisely at the same time as the elections.
Politicians have a simple formula. Divide people and win. This worked for the British, and unfortunately, it’s still being tried in India today.
Another shameful political tactic to join a long list of tactics used to gain or maintain power. And the voice of sanity is, as usual, drowned out.
Now we have John McCain doing his best to raise fear and divide us here in the US. The sad truth is that we’re not as civilized as we think, and the Republican party continues to exploit these poor racists – taking them for a ride – like their parents before them.
What’s it going to be, America? Hope or Hate?
The nerds at the World Future Society have been burning the candle at both ends to come up with these insightful predictions:
Forecast # 1: Everything you say and do will be recorded by 2030.
Forecast #2: Bioviolence will become a greater threat as the technology becomes more accessible.
Forecast #3: The car’s days as king of the road will soon be over.
Forecast #4: Careers, and the college majors for preparing for them, are becoming more specialized.
Forecast #5: There may not be world law in the foreseeable future, but the world’s legal systems will be networked.
Forecast #6: The race for biomedical and genetic enhancement will — in the twenty-first century — be what the space race was in the previous century.
Forecast #7: Professional knowledge will become obsolete almost as quickly as it’s acquired.
Forecast #8: Urbanization will hit 60% by 2030.
Forecast #9: The Middle East will become more secular while religious influence in China will grow.
Forecast #10: Access to electricity will reach 83% of the world by 2030.
Now let me add a few of my own.
If McCain wins this election, here are five additional predictions for the US of A:
Prediction #1: We will be a third-world country – with 95% of the wealth concentrated in the hands of 5% of the population.
Prediction #2: We will be standing in lines to buy gas at outrageous prices.
Prediction #3: We’re going to be spied on by our own government which won’t give a hoot about privacy rights or the Constitution.
Prediction #4: The media will be bought off by the corporations and feed us nothing but propaganda. Show us how, Tom Brokaw.
Prediction #5: We will never trust our government again. In fact we will learn to believe exactly the opposite of what they say.
Wait-a-minute! Those aren’t predictions, they’re reality — under the current Republican regime!
So, get out there and vote >>