Cristian Mitreanu's Blog

Create a Compelling and Comprehensive Story

This is a re-post of my guest column at Edtech Handbook.

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Success is an important part of the human condition. It is important because it shows us where the limits are and what can be achieved. Witnessing success helps us craft our goals and dreams. Success permeates all aspects of our lives. And when it comes to business, the idea of success is even more critical. There, simply staying in business means being successful. Business as usual in an ever-evolving environment means running to stand still. So, there is no wonder that we are always looking for what might cause success in business. And it’s one thing that most often comes up -- the visionary leader. The vision. 

But vision is just a story.

Visionary leaders use stories to mobilize and energize people, bringing internal stakeholders and customers alike behind their companies and products. These are stories of a better world, in which the listener sees himself or herself better off. Their potential for mass appeal is directly determined by their easiness of being integrated into the listener’s overarching personal story. Some stories are simple, focusing on one easy-to-describe need and a new, better way of addressing it. Others are more complex, providing an explanation that includes the past, the present, and the future. And these are the most powerful ones, as they provide a far-reaching rationale for the company.

Now, the efforts of tying together the past, the present, and the future by explaining how things evolve over time more often than not leads to the development of an explanatory model. And there is a reason for that -- models provide deeper insights. As Henry Mintzberg, a renowned management thinker, explains in his article “Developing Theory about the Development of Theory:”

“I am interested in explanation, and don’t much care what it’s called, theory or otherwise. When I think about it, however, I see explanation along a continuum, from lists (categories), to typologies (comprehensive lists), to impressions of relationships among factors (not necessarily ‘variables’: that sounds too reified for many of the factors I work with), to causations between and patterns among these relationships, to fully explanatory models (which interweave all the factors in question).”

It is typically through models, then, that we create powerful stories that exhibit two essential characteristics. They are compelling, having a tendency to pull people in without much of a push effort. And they are comprehensive, offering clear and long-term guidance. While the first characteristic refers to the perceived value of which the story talks about (in this respect, venture capitalists have a favorite saying: “painkiller, not vitamin”), the second one is more important and it refers to the level of clarity with regard to how the idea will be turned into reality and, subsequently, make the customer and the business successful. In fact, there is a causal relationship between the two attributes that becomes more apparent as the complexity of the offering increases -- you cannot make something compelling, if you cannot articulate what it is and where it sits.

Some industries or business spaces tend to have more comprehensive models than others, and in most cases the difference stems from the way we set the boundaries for the space itself. Ed-tech or educational technology provides an interesting case here. Its very name reveals the fact that the space is generally seen as separate from, but at the same time supporting of, the education space. And that has long kept ed-tech captive to models and principles that have been generally underlying the education space since the Industrial Revolution. As a result, the space has been teeming with point solutions that address one or a small number of needs -- solutions that won’t bring about any major revolutions. Moreover, this state of affairs has also been encouraged by the short-term interests of those who typically back technological innovation. But things have begun to change.

In the recent years, the very foundation of the conventional education system and its value to the society has been increasingly coming into question. So, if you are building a business in this space, start to think broadly -- think learning, not education. Then, while keeping in mind that technology is inseparably intertwined within the process of learning/teaching, begin crafting a compelling and comprehensive story. Build a new or use an existent explanatory model that brings clarity at each of the three basic levels of the story -- worldview (How does the world work, without your product?), product (What is and where does your product sit?), and strategy (How is your business going to capture value?).

For inspiration, you could read the great story of Vittra, the Swedish school that has eliminated the classrooms altogether, creating an environment that stimulates the children's curiosity and creativity, as Principal Jannie Jeppesen explains on the school’s website. And, as I wrote in the summary of the presentation “Unlocking Innovation in Education through Meaningful Technology (A General Model for Ed-Tech)” (a framework that you might find useful), always remember:

“Innovation in education is hard. It is hard because the what must stay relevant in an ever-changing world. It is hard because the how and the when directly affect the value of the what. And it is hard because education instances range widely from informal day-to-day interactions with the environment to complex activities, conventionally associated with what we call ‘formal education’.”

What Have You Learned from a Mistake?

This essay was part of my application to the Harvard Business School MBA program, submitted on March 6, 2009. Answering the question "What have you learned from a mistake?" in 400 words or less was one of the required essays.

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In general, identifying a mistake is not as easy as it may appear. One reason is the fact that the difficulty of such a task tends to increase with the impact of the action taken – the more life-changing the action’s impact, the longer the timeframe necessary to clearly categorize that action. What may initially seem to be a mistake can turn out to be an action with an overall positive impact. And these are the kind of actions that provide the most valuable lessons.

The less obvious reason for the general difficulty of categorizing an action stems from the fact that everything is governed by a principle of cause and effect. In short, the past determines the present, which further determines the future. So, even if an action’s outcome may have seemingly played out, the analysis should not be bounded by the action’s immediate context. Whether a past action was a mistake, or not, should be determined in relationship to one’s desired future, which is a rather fuzzy system of reference.

One example of an important and hard-to-categorize action relates to my approach to learning English in the years preceding my permanent relocation to the United States. Specifically, it is the decision to assign this task a relatively low priority. Although the decision has the makings of a mistake, its outcome is still playing out, so I would rather refer to it as something that I would have done differently. Nonetheless, the lessons are valuable and plentiful.

Moving to America was one of my major goals since early on. For me, this was the place where the future happens, and where I could attempt to “change the world.” Yet, in spite of the “advance notice,” the opportunity caught me unprepared. Not only that I had no realistic idea of what it takes to become fluent in English, but I had never been to the United States before, let alone lived there. Consequently, the assumption underlying my relocation – experience and education matter most, language will catch up – was flawed.

What followed was a nine-year journey peppered with valuable lessons, ranging from general (i.e., “take nothing for granted”) to specific (i.e., local culture). Nonetheless, the most important gain is a deeper knowledge of self, which might have never been possible without that “mistake.” Furthermore, it is an insight that confirms and strengthens my long-held values and career objectives.

Build a Foundation for Your (Education) Revolution

This is a re-post of my guest column at EdTech Digest.

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Paradigm shift. ... Fifty years ago, last month, a short book with less than 200 pages was published to eventually become one of the most influential of the twentieth century. Aside from introducing the concept of paradigm shift, which is now widely used and probably abused, Thomas Kuhn’s The Structure of Scientific Revolutions has significantly changed the way we look at how science is being developed. And then some.

Kuhn introduced the idea that scientific discoveries are not cumulative and they do not get us closer to an absolute, universal truth. What is rather happening, according to him, is that scientists, as a collective, go through periods of time, defined by distinct underlying perspectives — paradigms. A paradigm constitutes the foundation for all scientific activity during such period of time, and it typically competes with the previous and the subsequent ones. In an insightful article in the Guardian, John Naughton explains:

“By the standards of present-day physics, Aristotle looks like an idiot. And yet we know he wasn’t. Kuhn’s blinding insight came from the sudden realization that if one is to understand Aristotelian science, one must know about the intellectual tradition within which Aristotle worked. One must understand, for example, that for him the term ‘motion’ meant change in general — not just the change in position of a physical body, which is how we think of it. Or, to put it in more general terms, to understand scientific development one must understand the intellectual frameworks within which scientists work. That insight is the engine that drives Kuhn’s great book.”

And that is the insight that is essential here. While the way paradigm shifts occur remains a subject of debate among the philosophers of science, what is really important to all of us in the education and ed-tech space is the notion of paradigm and the implicit idea that our actions are always guided by an underlying worldview — whether shared by others or not.

The revolutionary movement in education has been getting significant traction over the past few years. While the value and return of investment of the formal education comes increasingly into question, the number of startups and initiatives has skyrocketed. The news are certainly flooding the Internet. And the “ed-” discussion, in general, is on. However, what we are really short on are the discussions about worldviews and underlying philosophies. Mesmerized by the success stories, we have relegated this topic to the “Hm, that’s interesting” category.

At the society level, that might be okay. It is difficult to say to what extent worldviews and the visions built on them really matter. The naturally-increasing affordability of technology, in general, has led to a “see what sticks” culture. Esteemed companies like Google have taken advantage and, as a result, promoted a tidal wave of “rapid-prototyping.” Many venture capitalists have grown comfortable funding engineers with little to no business idea, the rationale being that high-quality people can successfully change the direction of the company on a dime (action known as “pivot”). And that is fine. At the society level, numbers rule. The larger the pool of ideas and attempts to implement them, the higher the quality of the successful ones. We call that technological progress.

At the individual level, however, a coherent worldview and a clear vision based on it can significantly increase one’s odds of building something great, revolutionary. The success of Apple in an environment dominated by increasingly shorter turnarounds and product life cycles is to be attributed in large part to Steve Jobs’s worldview and vision. Thirty years ago, when most people were struggling to understand what a computer is, he saw a future of interconnected portable devices with human-centered interfaces — all pretty consistent with where things are today. But his vision didn’t stop there.

In a recently-released 1983 talk at the International Design Conference, he describes a future dominated by artificial intelligence — a vision that, incidentally, reinforces the idea and importance of a worldview, while predicting a return to the student-centric, Socratic education:

“The problem was-- You can’t ask Aristotle questions. And I think as we look toward the next 50 to 100 years, if we really can come up with these machines that can capture an underlying spirit, or an underlying set of principles, or an underlying way of looking at the world so that then when the next Aristotle comes around… Maybe if he carries around one these machines with him his or her whole life and types in all this stuff, then maybe someday after the person’s dead and gone we can ask this machine, ‘Hey, what would Aristotle have said- What about this?’ And maybe we won’t get the right answer. But maybe we will. And that’s really exciting to me.”

Sure, you can build a simple product, a “one-trick pony,” without a coherent worldview or a clear vision. Just focus on one customer need and build a product that addresses it. The investor hype and the financial markets might even help you build a lasting company. But even in those cases, you have to be able to tell a compelling story, internally as well as externally.

So, what is the worldview that will support your (education) revolution? Is it a wish list, a manifesto? Or, is it a model? As we get this discussion going, the presentation below might provide some ideas.

A Manifesto: Hey Teacher, You Are a School!

The following essay has been originally published as "Why Teachers -- Not Schools -- Are the Real Institutions" at TeachThought. This is the original manuscript.

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HEY TEACHER, YOU ARE A SCHOOL!

"I am a teacher, therefore I teach," is a phrase that seems to describe your job pretty well. Teaching is, nevertheless, what you are getting paid for. But times are changing and such narrow perspective could become dangerous. At the very least, you are probably leaving parts of your professional career in the hands of others, failing to fully materialize the value that you could generate. In the worst case scenario, though, you could simply be rendered irrelevant.

If we look beyond all the labels and terms conventionally associated with the teacher profession, if we ignore all the semantics and the constraining "baggage" that comes with them, it is easy to see that you are an institution. Not necessarily a legal institution, but rather a value-generating institution. Simply put, you are directly responsible for a student’s partial accumulation of knowledge and skills.

Although realizing that you are an institution is a first step in the right direction, that is not enough. In the 1960 Harvard Business Review article "Marketing Myopia," Theodore Levitt explains how companies fall victim to their own narrow perspective on what they actually do:

"The railroads did not stop growing because the need for passenger and freight transportation declined. That grew. The railroads are in trouble today not because the need was filled by others (cars, trucks, airplanes, even telephones), but because it was not filled by the railroads themselves. They let others take customers away from them because they assumed themselves to be in the railroad business rather than in the transportation business. The reason they defined their industry wrong was because they were railroad-oriented instead of transportation-oriented; they were product-oriented instead of customer-oriented."

In your case, the customer is the student. And you are in the education business, rather than the teaching business, which tends to be heavily shaped by the general technological level and the way the society and, thus, the education system is presently organized. It is a distinction that suggests that, as an educational institution, the jobs that you do (yes, already do!) go beyond teaching.

In my recent presentation "Unlocking Innovation in Education through Meaningful Technology (A General Model for Ed-Tech)," which was also mentioned in this very blog [TeachThought], I identified the basic jobs that an educational institution (or simply, school) must perform. It all begins with the identification of the steps that the student is taking during the education process, whether that refers to a single course or a four-year program: 1) CONSIDER skills, programs, schools; 2) ACQUIRE knowledge, skills, certifications; and 3) ACTUALIZE new (intellectual, professional) identity.

Now, as with any service-providing institution or organization, the school must match the student’s behavior in order for a mutual engagement to take place. Consequently, the basic jobs that a school must perform are: PROMOTE, DELIVER, FACILITATE, and OPERATE. And, since we have already established that you are an educational institution, these are your basic jobs too.

The PROMOTE Job

This is the job corresponding to the student's CONSIDER. Depending on the characteristics of your student population, your organizational affiliation, and your level of involvement, the job could take various forms. The most passive form is your reputation, whether you are actively managing it or not. At the other end of the spectrum, you could be already involved in a dialogue with the prospective students. You might have already developed a following or, even better, a community.

The DELIVER Job

This is the job corresponding to the student's ACQUIRE and is what we conventionally think of as teaching. And this job too takes various forms. At the minimum, it is your classroom teaching activity. In other circumstances, though, this job could go well beyond teaching in that it establishes a platform for the student's learning process. In other words, this is the job where you enable the student to learn in an integrated, unifying manner -- whether the knowledge and skill comes from the interaction with you, from the interaction with other students, from individual study, from family and friends, or from some or all of these sources.

The FACILITATE Job

Corresponding to the student’s ACTUALIZE, this is the job where you are supposed to help the student close the loop of development (whether that is intellectual, career, or professional development). Having just acquired new knowledge, skills, and potentially a certification, the student is in the process of re-inserting himself or herself into the environment, in a position that is perceived as an advancement. In some circumstances, such as public K-12 education, this job is embedded in the system to some extent. Nonetheless, in other instances, you might have already developed strong relationships with the entities with which your students will engage next, facilitating a smoother actualization process.

The OPERATE Job

As an institution, you have to create a lasting environment, in which your activities can be performed repeatedly over an extended period of time. In short, and from the institutional point of view, you have to ensure that you are a lasting entity. This job too might be embedded in the system, where the public school you teach at provides a physical classroom, offers you a computer to use, and performs all the other supporting tasks. In some cases, though, you might be already handling these jobs yourself. Using the latest technologies available, you could be performing underlying tasks such as student information management, accounting, and information technology management. 

This holistic view of what you fundamentally do provides valuable guidance in an education space that quickly evolves toward a student-centric environment. Whether you remain affiliated to an existing organization or try to start your own, this framework of your basic jobs could help you maximize the value that you bring to the table. In conclusion, I would say, make this your manifesto and always remember: "Hey teacher, you are a school. So, start thinking and acting like one."

Theories Are Like Maps

Kevin A. Clarke and David M. Primo, both professors at the University of Rochester and authors of the new book "A Model Discipline: Political Science and the Logic of Representations," recently wrote an interesting NYT piece on the need to overcome "physics envy" in social sciences. Here are some good excerpts:

 

"Many social scientists contend that science has a method, and if you want to be scientific, you should adopt it. The method requires you to devise a theoretical model, deduce a testable hypothesis from the model and then test the hypothesis against the world. If the hypothesis is confirmed, the theoretical model holds; if the hypothesis is not confirmed, the theoretical model does not hold. If your discipline does not operate by this method — known as hypothetico-deductivism — then in the minds of many, it’s not scientific. [...]

But we believe that this way of thinking is badly mistaken and detrimental to social research. For the sake of everyone who stands to gain from a better knowledge of politics, economics and society, the social sciences need to overcome their inferiority complex, reject hypothetico-deductivism and embrace the fact that they are mature disciplines with no need to emulate other sciences.

The ideal of hypothetico-deductivism is flawed for many reasons. For one thing, it’s not even a good description of how the “hard” sciences work. It’s a high school textbook version of science, with everything messy and chaotic about scientific inquiry safely ignored."

 

"To borrow a metaphor from the philosopher of science Ronald Giere, theories are like maps: the test of a map lies not in arbitrarily checking random points but in whether people find it useful to get somewhere."

What Is Interesting?

Ever wondered what makes an idea interesting? In his 1971 article "That's Interesting!: Towards a Phenomenology of Sociology and a Sociology of Phenomenology," published in the Philosophy of the Social Sciences, Murray S. Davis provides some timeless insight. Here are three interesting (no pun intended) excerpts:

"It has long been thought that a theorist is considered great because his theories are true, but this is false. A theorist is considered great, not because his theories are true, but because they are interesting. Those who carefully and exhaustively verify trivial theories are soon forgotten; whereas those who cursorily and expediently verify interesting theories are long remembered. In fact,the truth of a theory has very little to do with its impact, for a theory can continue to be found interesting even though its truth is disputed -- even refuted!"

"We have seen that an audience finds a proposition 'interesting' not because it tells them some truth they did not already know, but instead because it tells them some truth they thought they already knew was wrong. In other words, an interesting proposition is one which denies some aspect of the assumption-ground of its audience, and in The Index of the Interesting we have categorized the various aspects of this assumption-ground which can be denied. Since this is the defining characteristic of an 'interesting proposition', it can also be used as a criterion to determine whether or not a particular proposition is interesting."

"But even the 'Stars' of social science sometimes assert propositions found to be non-interesting. Why should this ever be the case? Besides the occasional fall of the Stars themselves into mediocrity, the fault may lie not in the Stars, but in their audience. Propositions are interesting or uninteresting only in relation to the assumption-ground of some audience. If an audience finds a proposition asserted by a reputable social scientist to be obvious or irrelevant or absurd, it may be because the proposition has come to the attention of an audience other than the one to whom it was originally intended. A proposition which merely affirms a particular assumption, is irrelevant to any assumption, or annihilates the whole assumption-ground, of one audience may have been formulated to deny a particular assumption, be relevant to some assumption, or harmonize with the whole assumption-ground, of another audience." 

You can download the entire article here.

Powerful Quick-Fix for the MBA

Criticism of the conventional MBA program is nothing new. For years, Professor Henry Mintzberg of McGill University has arguably been the champion of this movement. In the 1992 Harvard Business Review debate “MBA: Is the Traditional Model Doomed?,” he describes the product of such programs as “people [who] are committed to no company and no industry but only to personal success, which they pursue based on academic credentials that are almost exclusively analytic, devoid of in-depth experience, tacit knowledge, or intuition.” Later, in his 2005 book “Managers, Not MBAs,” he writes, “Using the classroom to help develop people already practicing management is a fine idea, but pretending to create managers out of people who have never managed is a sham.”

Some may disagree with this stance. And considering that the demand for MBA degrees continues to remain high (as illustrated by the New York Times article “Bank Crisis Shifts Demand for M.B.A.'s” and the Graduate Management Admission Council’s own records “Total GMAT Tests Taken by Testing Year”), it does appear that employers do value these graduates. So, could it be that the conventional MBA program has become more of a recruiting tool that supplies employers with strong employees rather than future managers? Hard to tell.

On Harvard Business Review’s blog, in early 2009, several thinkers discussed problems and potential solutions on the forum “How to Fix Business Schools,” followed later by more posts on the same theme. Things are moving, nonetheless. Most schools seem to be hard at work refining their MBA programs by either tweaking their respective curriculums or their approaches to teaching, or both. A group of Harvard Business School faculty has even documented some of these developments in their 2010 book “Rethinking the MBA: Business Education at a Crossroads."

Unfortunately, the biggest problem, as it was articulated by Prof. Mintzberg (you can’t create managers in the classroom), is inherent to the conventional MBA program. In general, a lower graduating age means more time available to advance up the corporate ladder, which further means an increased probability of a successful business career. In addition, an increased number of success stories means a larger applicant pool (which also tends to push the average age lower, where managerial experience is low). And so, as long as schools can show some sort of causality between the MBA degree and a successful career, this cycle becomes self-reinforcing.

The advent of the Internet has made this causal relationship increasingly elusive. Not only that the knowledge taught in school has a lower value due to its widespread availability, but the limitations of our general understanding of how businesses work is becoming more apparent. And this, as one of the main drivers behind the value proposition of the conventional MBA program, will prevent the current revamping efforts undertaken by many schools from having any meaningful impact. A true overhaul will only occur when the business management body of knowledge successfully makes a significant leap forward.

However, as we wait for a new theory that would allow us to integrate currently disparate concepts and generate a more realistic business big picture, there is one easy and powerful solution for the MBA program: introduce a mandatory class of history of business and economic thought.

In spite of the underlying implication of the word “history,” this class should be more about thought and historical circumstances, than about the completeness of the record. If developed and implemented in harmony with the rest of the program, the “history” class could have a significant impact on three dimensions. First, it would help students acquire not only a dynamic perspective of the business world, but also a better understanding of how various concepts are related or fit together. Second, the class would provide a platform that would “nudge” students into thinking critically about existing concepts, and further into creating their own. Lastly, the new capability of providing students with the more advanced skill of understanding the big picture could be a significant source of competitive advantage for any MBA program.

UPDATE 3/15/2011: This idea was also submitted as a "hack" at the Management Innovation eXchange (http://www.managementexchange.com/hack-67).

Enabling Individual Freedom and the Pursuit of Happiness

Formatted as a "YouTube video," here's an introduction to the new economic worldview that stems from the theory detailed in my article "A Business-Relevant View of Human Nature" (this should be your next stop). Some interesting conclusions can be drawn from it, including a potential explanation for the current economic crisis...

UPDATE 1/23/2009: A transcript is now available here.

My Human Nature Article Gets "Must Read"

My article "A Business-Relevant View of Human Nature" has been recently recommended by Stephan Zimmermann, professor and former department chair for economics, whose blog "No Widgets Here" is part of the online economics magazine Amateur Economists. In the comments section of his post "Dominant Economic Views in Western Society, Part II," Professor Zimmermann says (bold type is mine):

"Cristian - your article should be a "must read" for all of our "Amateur Economists" readers. Obviously I agree with your concept of "successful existence," which really cannot (or should not) be reduced to a pat formula, economic or otherwise. This might even, as you suggest, include maximizing, as long as the inherent dangers of such maximization are considered."

In his article "Turning Bright Lights on the Dismal Science," Prof. Zimmermann explains one of the reasons a deep insight into human nature is important:

"Economics is just another method of trying to solve the age-old question of what, how and to whom to distribute finite resources. [...]

Ever since Adam Smith, the foundations of economics have been presented as scientific fact. The facts presented as economics are really two: an assumption regarding the nature of man as well as a strict belief and usage of logic. Unless someone can show an alternative to thousands of years of developed logic based on fact, we should be able to live with that assumption. More difficult, of course, and subject to endless debate is the assumption regarding the nature of mankind. [...]

Too many would-be economists in graduate school or beyond may never really have had asked themselves about the fundamental nature of man.

Once we understand and accept the essentials of mankind, bolstered with valid facts, we should be able to look at the "dismal science" with a much brighter perspective."

A New Take on the Business Cycle

The concept of the Business Cycle, or Economic Cycle, is one of the most important topics in economics.   It represents the quest to understand why an economy tends to alternate between periods of growth and periods of decline, or recession (a subject all too common these days!).   Expectedly, this is a fiercely debated subject, and thus there are several related theories out there -- check Wikipedia's "Business Cycle" for a good introduction to the concept.   As I mentioned in the past, the business theory that I developed recently has the potential to provide novel explanations for broader economic phenomena; including the Business Cycle.   Since I just published the article "A Business-Relevant View of Human Nature," which details (as opposed to the more abstract explanations from BizBigPic or my book "Spointra") the basis of my fundamental theory of business, it is now possible and timely to elaborate a little on the new perspective on the Business Cycle.   Despite my efforts to keep this simple, though, you should read the article.

... Done? ... Let's move on, then.

As you know now, all business transactions can be represented on the continuum of problem-solving behaviors.  At any given time, a transaction occupies a particular position on the continuum.  Furthermore, over time, that position tends to move lower under the effect of commoditization.  Now, if we think of a national economy as the totality of business transactions that take place within that particular country, the economy can be seen as a collection of positions, or dots, that are moving lower on the continuum of problem-solving behavior. In addition, dots are continuously added (i.e., new offerings) or discarded (i.e., irrelevant offerings).  (For some help with visualizing these dynamics, you can check the second part of my video "Strategic Vision a la Spointra," with the note that: (1) it is a two-dimensional representation; (2) it refers to a firm; and (3) the continuum is placed horizontally, as opposed to the vertical orientation from the article.  So, instead of a top-down movement, you will see a right-left movement.)

We know that each of these dots has an associated stream of revenue that grows larger as the dot moves lower (a.k.a. commoditizes).  We also know that during its continuous evolution, the collection of dots tend to form a cluster, where a majority of the revenue is generated.   I will refer to this cluster as the Center of the economy.   Due to the continuous downward movement of all transactions in an economy, the Center will typically emerge at the lower end of the continuum of problem-solving behaviors.  Now, there are three general areas on the continuum, each associated with a particular business environment.  At the lower end, the environment is characterized by commoditized offerings, high levels of standardization, high levels of competition, low margins, etc.  All this implies that practices like consolidation through mergers & acquisitions, business-process outsourcing, and personnel reduction due to process automation are very common.

 

I will conclude for now with some thoughts.   It is clear that the Center's formation or migration to the bottom of the continuum is natural, being driven by human nature.   The way down is characterized by increasing revenues, and thus economic growth.   But once there, the conditions tend to worsen for most participants.  Moving up or dispersing the Center can be caused by technological revolutions (which would create a multitude of new high-level offerings).   However, it can also be caused by widespread divestures of irrelevant offerings, and profound social and political change (which would cause many transactions to be repositioned on the continuum), among others.   That is why it is often that we see recession, or economic contraction, being associated with these sort of events.

So, there you have it -- another view of the Business Cycle, or a general pattern for economic fluctuations.   I will come back with more thoughts in the future, but in the meantime let me know what you think.

Referenced in Upcoming Book "Strategy and the Fat Smoker"

My MIT Sloan Management Review article "Is Strategy a Bad Word?" will be referenced in David Maister's upcoming book "Strategy and the Fat Smoker." To be released in January 2008, the book brings together articles that David, a renowned consultant and former Harvard Business School professor, wrote over the past few years. Nevertheless, the bound galley shows that the articles have been slightly reworked and formatted to serve the main purpose of the book -- to offer practical advice on how to overcome short-term temptations and go after enduring corporate health. Simply put, the book shows you how to "get the fat smoker on the diet."

David previously referenced "Is Strategy a Bad Word?" in his article "What's Our Deal?" (also a chapter in the book), and in his blog entry "What IF There's No Final Whistle?" Although its release was fittingly timed to coincide with the New-Year-resolutions season, the book can be pre-ordered now at Amazon.com.

Puzzled by Diagrams?

Here's what Prof. Henry Mintzberg writes in his paper "Developing Theory about the Development of Theory:"

"My work is loaded with diagrams, seeking to express every which way how the ideas I am trying to make come together. Aristotle said 'The soul...never thinks without a picture.' I try to help my soul think. [...]

These diagrams really help me a great deal: I can see it all at a glance, even if outside my head. But not always into other heads. I have been puzzled to find that some people are puzzled by these diagrams. They don't think in such terms, nor are they even able to see it in the work of others. Even many of my own doctoral students, sometimes including the best, when urged by me to express their ideas in diagrammatic form, have not gotten past a 2x2 matrix or two. Maybe this has to do with my education as a mechanical engineer -- probably the only thing left of that -- or at least my predisposition to do that kind of education, because I like to see things altogether, at a single glance, to quote a famous composer."

My book "Spointra and the Secret of Business Success," as well as the related initiative BizBigPic, is quite heavy on the graphic side. However, this blog and BizBigPic, which uses a blog technological platform, are perfectly suited for discussions. So, if you have any questions, please don't hesitate to start a discussion.

How to Innovate Your Online Venture

Earlier today, MarketingProfs.com published my new article, "How to Innovate Your Online Venture," based on an earlier post on this blog. The publication is timely. Recent announcements from Google and Amazon.com, highlighting new improvements (read "innovations") of their services, support the model presented in the article.

Google: Universal Search
http://www.google.com/intl/en/press/pressrel/universalsearch_20070516.html

Amazon.com: Digital Music Store
http://phx.corporate-ir.net/phoenix.zhtml?c=176060&p=irol-newsArticle&ID=1003003&highlight=

Spatial Thinking in Strategy

Tiha von Ghyczy (Darden School of Business, University of Virginia) wrote an interesting article, "Constructing Strategic Spaces," as a precursor to a future book about spatial thinking in strategy. Here is one of the closing ideas:

"Strategy is a particular form of social coordination across scales of space and time that can be bridged only by articulated and shared thought. Strategic spaces are superb catalysts and vehicles for the thinking itself and for the articulation and the sharing. They are also -- unlike narratives in the form of vision and mission statements -- open-ended and highly plastic."

Remember, the concept of ofmos, introduced with my fundamental theory of business at BizBigPic.com and later presented in the book “Spointra and the Secret of Business Success,” is actually a strategic space.