Strategy from machines and people

The HBR online has published an intriguing piece about the formation of strategy from a combination of information synthesised by people and machines.  In essence, it’s saying that some parts of strategy formulation should be informed by rules (i.e. data) and others by intuition (i.e. people).  the concept is nicely encapsulated in the graphic below.

An integrated strategy machine is the collection of resources, both technological and human, that act in concert to develop and execute business strategies. It comprises a range of conceptual and analytical operations, including problem definition, signal processing, pattern recognition, abstraction and conceptualization, analysis, and prediction. One of its critical functions is reframing, which is repeatedly redefining the problem to enable deeper insights. Within this machine, people and technology must each play their particular roles in an integrated fashion.



Source: Designing the Machines That Will Design Strategy

The value of sleep – McKinsey article

With a young family and a sometimes-heavy travel schedule, I’ve always been mindful of the value of sleep.  I’m a fan of an afternoon power-nap rather than a coffee, and believe in the power of uninterrupted sleep.
McKinsey has published a great article on this that outlines some of the research behind the need for sleep.  Among other things the article highlights that:
Scientists have found that sleep deprivation impairs this ability to focus attention selectively. Research shows that after roughly 17 to 19 hours of wakefulness (let’s say at 11 PM or 1 AM for someone who got up at 6 AM), individual performance on a range of tasks is equivalent to that of a person with a blood-alcohol level of 0.05 percent. That’s the legal drinking limit in many countries. After roughly 20 hours of wakefulness (2 AM), this same person’s performance equals that of someone with a blood-alcohol level of 0.1 percent, which meets the legal definition of drunkenness in the United States
The infographic below is useful:
You can read the full article here:

The implication for macro scale innovation cycles

This is a fascinating and long read about where the world is going to in regards to the next wave of innovation.  It’s also insightful when considering where innovation will focus in the coming years:

Intrapreneurship and skunkworks are replaced by internal innovation processes which, while ineffective at producing radical innovations, allow controllable and measurable sustaining innovation. Money that would have been spent financing external innovation is redirected back to corporate development and, perhaps, even corporate controlled research labs.

These sorts of controllable and measurable innovation processes are already taking hold, both inside and outside the corporate world. It’s no coincidence that the buzzwords in innovation the last few years have been ‘lean’ and ‘customer development.’ While these both claim to be new discoveries, they are actually old practices that fell out of favor during the installation period because they aren’t suited to radical, fast-moving innovation; they only work when innovation is slower and more predictable: Steve Jobs could not have used customer development to create the Apple computer; Henry Ford’s quip that if he asked his customers what they wanted they would have said “a faster horse” are both acknowledgements of this.

The hallmark of a new technological revolution is that the innovation trajectory is unknown: lean doesn’t work on early adopters because they will use anything novel (i.e. the Altair as an MVP was pretty well useless in predicting what mainstream customers would want in a personal computer); customer development doesn’t work when you’re developing a general purpose technology. In general, you can’t iterate your way to radical innovations, almost by definition.

Source: The Deployment Age | Reaction Wheel

Cities, companies and innovation

Geoffrey West is a physicist by training, but has crossed over into theories of biology, and then to theories about cities.  More recently he has started to look at companies, and some of his research is illuminating with respect to the need for innovation in organisations.

His observation about cities is that they need diversity in order to grow, and companies need similar:

“…in what way can you make a company more like a city?” West asks. “You allow at least part of it to be a little more organic, to grow in a natural way, and let it be much more open to having mavericks, naysayers, and people with odd ideas hanging around. Allow a little bit more room for bullshit. You need some mechanism to somehow break this straitjacket that big companies take on as they grow.”

You can get further context from the full article here:  The Fortune 500 Teller

VUCA – volatile, uncertain, complex, and ambiguous

One of the themes emerging from a range of sources in the foresight arena around the world is that it’s increasingly hard to understand where the world is going.  An acronym that helps describe this is VUCA:

It’s an acronym developed by the U.S. military after the collapse of the Soviet Union to describe a multipolar world: volatile, uncertain, complex, and ambiguous. Volatility reflects the speed and turbulence of change. Uncertainty means that outcomes, even from familiar actions, are less predictable. Complexity indicates the vastness of interdependencies in globally connected economies and societies. And ambiguity conveys the multitude of options and potential outcomes resulting from them. Where once we could count on the seeming certainty and predictability of binary choices — capitalism versus communism, democracy versus autocracy, Corn Flakes versus kasha — choices and consequences are now far less clear.

Source: Leading in an Increasingly VUCA World

Economist on the relevance of the blockchain





If you are not familiar with the BlockChain, the Economist has an excellent primer on it which goes beyond the simple first-mover of BitCoin.

The graphic below is a good explanation about how the chain is built, and how it’s kept unique.

Towards the end of the article is a section that nails why it’s important beyond currency:

One of the areas where such ideas could have radical effects is in the “internet of things”—a network of billions of previously mute everyday objects such as fridges, doorstops and lawn sprinklers. A recent report from IBM entitled “Device Democracy” argues that it would be impossible to keep track of and manage these billions of devices centrally, and unwise to to try; such attempts would make them vulnerable to hacking attacks and government surveillance. Distributed registers seem a good alternative.

The sort of programmability Ethereum offers does not just allow people’s property to be tracked and registered. It allows it to be used in new sorts of ways. Thus a car-key embedded in the Ethereum blockchain could be sold or rented out in all manner of rule-based ways, enabling new peer-to-peer schemes for renting or sharing cars. Further out, some talk of using the technology to make by-then-self-driving cars self-owning, to boot. Such vehicles could stash away some of the digital money they make from renting out their keys to pay for fuel, repairs and parking spaces, all according to preprogrammed rules.


Source: The great chain of being sure about things

Why Curious People Are Destined for the C-Suite

In my mind innovation, creativity and curiosity are absolutely linked.  In an increasingly volatile world, these traits assume new value as they allow people to assemble disparate knowledge and recombine it in order to avoid ‘failures of imagination’ about possible futures.  PwC carried out a survey earlier this year of CEOs which threw out some fascinating insights:

When asked recently to name the one attribute CEOs will need most to succeed in the turbulent times ahead, Michael Dell, the chief executive of Dell, Inc., replied, “I would place my bet on curiosity.”Dell was responding to a 2015 PwC survey of more than a thousand CEOs, a number of whom cited “curiosity” and “open-mindedness” as leadership traits that are becoming increasingly critical in challenging times.

Source: Why Curious People Are Destined for the C-Suite

Bran Ferren on the Art of Innovation


There’s a plethora of good advice in this article on innovation, especially the sections on art, business and innovation.  However the one piece that will probably ring true for large organisations is this:

At most companies that care, you can set up creative, innovative environments and teach everyone to function better within them. You can hire a Picasso. Or, better yet, you can hire several Picassos: Several extraordinary people with complementary talents, who each have strengths that the others don’t have. Having picked them, you can empower them. You can put them with 15 other people as good as they are, but in different ways. You then get a type of generative activity and creativity that you don’t get otherwise. Even then you still have to take that creativity, massage it, and create an output that’s valuable for a customer. Which is hard for most companies to do.

Meanwhile, odds are that the rest of your organization, especially middle management, will strive to eliminate them. So you need to give them top cover.

Never underestimate the need for top cover.

Source: Bran Ferren on the Art of Innovation

Why A PayPal Executive Is Being Mentored By His Millennial Employees

When I give presentations at conferences, I often get asked by people one simple question: “how do I keep abreast of all this new stuff?”  My response is that people should think about getting mentoring from people younger from themselves – ‘reverse mentoring.’

Fast Company had a short piece on this recently, and it highlighted some of the benefits:

Shivananda says reverse mentoring also helps leaders connect with millennials. “Often leaders look at millennials and don’t understand them,” he says. “Reverse mentoring gives me an opportunity to do that, not just by learning in terms of technology, but by engaging and maximizing the workforce. It gives me an ability to demonstrate that this is a place to come to work and be appreciated. Somebody wants to understand and learn from them.”Reverse mentoring works best when it’s a reciprocal experience, says Shivananda, and this can help the junior employee grow in his or her own career by discussing their aspirations.

“Reverse mentoring should always be a mutual experience; I provide value by sharing my years of experience,” says Shivananda. “They give me value through sharing what’s new, what’s happening, and what’s relevant.”

Source: Why A PayPal Executive Is Being Mentored By His Millennial Employees