Jill Lepore has an excellent take-down in The New Yorker of Clay Christensen’s The Innovator’s Dilemma. Yet I am unconvinced.
I thought I was convinced when I read it. It’s a brilliantly done piece, examining Christensen’s evidence, questioning his methods, and drawing appropriate lessons, including wondering why we accepted the Innovator’s Dilemma for decades without critically examining it. (Christensen became so famous for it that his last name isn’t even flagged as a spelling error on my Mac.)
I got de-convinced by a discussion on a mailing list I’m on that points to some weaknesses in Lepore’s own argument, including her use of “cherry-picked” examples — a criticism she levels at Christensen — and her assumption that the continuity of companies, as opposed to their return on assets, is the right measure. As a person on the mailing list points out, John Hagel, John Seely Brown and Lang Davison take return on assets as a key metric in their book The Big Shift. And then someone else maintained that ROA is a poor measure of networked phenomena. That morphed into a discussion about the pragmatic value of truth: Does disruption provide a helpful framing for the New York Times as it considers its future?
The problem is that brains are truthy. They are designed to pay attention to things that seem to matter to us, bending our world around our concerns and interests. And brains are associative, so they make sense of the world — maybe even at the level of perception — by finding the relationships that seem to matter to us. In Heidegger’s terms, we are not indifferent knowing machines, but are creatures that care about what happens to us and to others. The brain is an unreliable narrator.
We now have access to an unfathomable sea of information that can contradict anything we settle on. That sea has been assembled by caring creatures and their minions, but it is so vast and global that it contains information beyond the caring and linking of any one of us. Every understanding can be subverted with a wink and a hand wave because all understanding simplifies a world that is resolutely and even necessarily complex. The universe outruns us.
Now we have machines that can look at masses of data and escape from our temptation to turn everything into a narrative. But those machines are limited by our decision about which data is worth gathering and connecting. There is hope in this direction, but it’s not clear whether we are capable of accepting the findings of machines that correlate without stories.
TL;DR: Our brains are truthy and the world is too big to make sense of. Not that that will stop us from trying.
[June 20:] Clay Christensen has cried foul in an interview.
Categories: big data
, too big to know
Tagged with: business
Date: June 18th, 2014 dw
Peter Cappelli has written an excellent post at HBR that falls simultaneously into the “Well, Duh” and “Needs to Be Said” bins: “It’s Not OK That Your Employees Can’t Afford to Eat.” Well, duh! It’s amazing that it even needs to be said. (Note that the Duh belongs not to Peter but to whomever needed to hear that.)
Let me put it differently. From my point of view, here are the two fundamental objectives for any business:
1. Enable your customers to lead lives that are a little bit better.
2. Enable your employees to lead good lives.
Profit is what you use to do both of those things.
Tagged with: business
Date: December 17th, 2013 dw
“People don’t want to buy a quarter-inch drill. They want a quarter-inch hole.”
This gets quoted a lot by marketers. Usually it gets attributed to Theodore Levitt, an economist at Harvard Business School, but he quite explicitly [pdf] attributed it to Leo McGinneva, about whom I can find out nothing other than that he was a “businessman.”
This quote has the salutary effect of focusing marketers away from what they’re selling and on what customers are buying. So, I find it useful. But also irksome.
I’m irked first of all for the small reason that people don’t actually buy quarter-inch drills to drill quarter-inch holes. The buy a quarter-inch drill bit to drill a quarter-inch hole. A quarter-inch drill is a drill that accepts drill bits with a maximum of a quarter-inch shank. And, yes I know I’m being annoying.
The more important reason this formulation bothers me becomes clear if you use something other than a tool as your example. “People don’t want to buy a towel hook. They want a _____.” How do you fill in that blank without it being simply redundant: “They want a hook to hang a towel on.” It’s not just that it loses its rhetorical punch. Rather, it becomes clear that you have to go further into the customer’s value system to make sense of it. Why do they want a towel hook? Because they like dry towels? Because they want to impress their new in-laws? Because they repainted and the old towel hook is now the wrong color? Because they want a place to hang a dress so that the shower will naturally steam it? Because their shower rod is coming loose? Because their pet ferret is getting old — poor Ratface! He can barely see! — and is soiling towels left on the floor?
So, people don’t buy holes. They buy something that helps achieve a goal that is particular to them and is part of the larger set of interests and values that make them who they are. The hole example helps but doesn’t go far enough.
We all know this. So why does the “drill/holes” example keep coming up, and keep feeling like an insight? To me, this is evidence of just how much we take for granted the misalignment of the interests of businesses and customers — the great business tragedy of the Age of Massness.
But that’s a different story.
Tagged with: business
Date: October 6th, 2013 dw
Greg Silverman [twitter:concentricabm], the CEO of Concentric, has a good post at CMS Wire about the democratization of market analysis. He makes what seems to me to be a true and important point: market researchers now have the tools to enable them to slice, dice, deconstruct, and otherly-construct data without having to rely upon centralized (and expensive) analytics firms. This, says Greg, changes not only the economics of research, but also the nature of the results:
The marketers’ relationships with their analytics providers are currently strained as a service-based, methodologically undisclosed and one-off delivery of insights. These providers and methods are pitted against a new generation of managers and executives who are “data natives” —professionals who rose to the top by having full control of their answering techniques, who like to be empowered and in charge of their own destinies, and who understand the world as a continuous, adaptive place that may have constantly changing answers. This new generation of leaders likes to identify tradeoffs and understand the “grayness” of insight rather than the clarity being marketed by the service providers.
He goes on to make an important point about the perils of optimization, which is what attracted the attention of Eric Bonabeau [twitter:bonabeau], whose tweet pointed me at the post.
The article’s first point, though, is interesting from the point of view of the networking of knowledge, because it’s not an example of the networking of knowledge. This new generation of market researchers are not relying on experts from the Central Authority, they are not looking for simple answers, and they’re comfortable with ambiguity, all of which are characteristics of networked knowledge. But, at least according to Greg’s post, they are not engaging with one another across company boundaries, sharing data, models, and insights. I’m going to guess that Greg would agree that there’s more of that going on than before. But not enough.
If the competitive interests of businesses are going to keep their researchers from sharing ideas and information in vigorous conversations with their peers and others, then businesses simply won’t be as smart as they could be. Openness optimizes knowledge system-wide, but by definition it doesn’t concentrate knowledge in the hands of a few. And this may form an inherent limit on how smart businesses can become.
Tagged with: 2b2k
Date: May 30th, 2013 dw
CNN.com has posted my op-ed about why where you work is not about the quality of your life so much as about the substance of it.
Judging from some of the reaction, I should emphasize that if the only way to save Yahoo were to require everyone to come to work every day, that would certainly be the right decision. But it seems clear to me that Marissa Mayer was sending a signal with this policy, for surely there are some people who were working productively from home. So, if the new policy is a signal and is not actually required to save Yahoo, then I think she has underestimated how disruptive a signal it is. [To late to stick in a spoiler notice? That was the essence of my op-ed.]
Also, CNN.com has stripped out the links, I’m pretty sure unintentionally. Here they are:
Tagged with: business
Date: March 2nd, 2013 dw
My latest column in KMWorld is about why your business needs scholars. In fact, though, it’s about why the idea of scholarship is more helpful than focusing your thinking on knowledge.
, too big to know
Tagged with: 2b2k
Date: October 1st, 2012 dw
I wanted to replace the smashed screen of a white MacBook, and found what seemed like a very good price from Wegener. The new screen arrived very quickly, and was exactly as described. But when I started to strip down the MacBook, I discovered I had ordered the wrong screen. It’s surprisingly easy to do.
So, I sent an email to Wegener and quickly got a reply, followed by a phone call. The support person said they are happy to send me the right screen, for which I have to pay a little more because it’s a more expensive part. They’re sending it even before I return the old one. So far, the experience has been terrific: Quick responses, friendly people, good return policy.
Then they told me that in the carton for the replacement part I’ll find a postage paid mailing label. I reminded them that the problem was entirely my fault, and thus there’s no reason for them to pay for shipping. Yikes, that’s some good customer service! (I went ahead and returned the first screen on my own dime.)
It’s amazing how powerful an experience it is to be treated like a human being by a business.
is a fantastic way to sell indie games and music. You name your own price, you can divvy it up among the creators and among charities, and today I got a message that they’ve added more songs for free for anyone who purchased the most recent bundle.
Yo, Humbles, I already bought the product. You don’t have to entice me any more. On the other hand: You’ve made me love you even more, and you’ve helped some musicians spread their music just a little wider.
I thought it had been 6 months since my last dental check up. Since I now routinely multiply any past intervals by two, I figured, correctly, that it’s really been a year. Usually, the hygienist has to put on waders and go at me with a pickaxe and a trowel. This was the first time in my life that a dental hygienist has marveled at my teeth. Gums are strong. No tartar, except for a little around a couple of teeth. Some healing of a couple of “pockets.”
There’s been one major variable that I know of: I switched from a Braun electric toothbrush to a Philips SoniCare.Why? Because the Internet told me to. I believe that the correlation is not accidental (see what I did there?), but of course it is just one data point.
Tagged with: business
Date: August 2nd, 2012 dw
Is it just me, or are we in a period when new distribution models are burgeoning? For example:
1. Kickstarter, of course, but not just for startups trying to kickstart their business. For example, Amanda Palmer joined the Louis CK club a couple of days ago by raising more than a million bucks there for her new album. (She got my $5 :) As AFP has explained, she is able to get this type of support from her fans because she treats her fans honestly, frankly, with respect, and most of all, with trust.
2. At VODO, you can get your indie movie distributed via bittorrent. If it starts taking off, VODO may feature it. VODO also works with sponsors to support you. From my point of view as a user, I torrented “E11,” a movie about rock climbing, for free, or I could have paid $5 to stream it for 10 days with the ability to share the deal with two other people. VODO may be thinking that bittorrenting is scary enough to many people that they’ll prefer to get it the easy way by paying $5. VODO tells you where your money is going (70% goes to the artist), and treats us with respect and trust.
3. I love Humble Bundle as a way of distributing indie games. Periodically the site offers a bundled set of five games for as much as you want to pay. When you check out, you’re given sliders so you can divvy up the amount as you want among the game developers, including sending some or all to two designated charities. If you pay more than the average (currently $7.82), you get a sixth game. Each Bundle is available for two weeks. They’ve sold 331,000 bundles in the past three days, which Mr. Calculator says comes to $2,588,420. All the games are all un-copy-protected and run on PCs and Macs. Buying a Humble Bundle is a great experience. You’re treated with respect. You are trusted. You have an opportunity to do some good by buying these games. And that’s very cool, since usually sites trying to sell you stuff act as if buying that stuff is the most important thing in the world.
4. I’m hardly the first to notice that Steam has what may be the best distribution system around for mass market entertainment. They’re getting users to pay for $60 games that they otherwise might have pirated by making it so easy to buy them, and by seeming to be on the customer’s side. You buy your PC game at their site, download it from them, and start it up from there. They frequently run crazy sales on popular games for a couple of days, and the game makers report that there is enough price elasticity that they make out well. If I were Valve (the owners of Steam), I’d be branching out into the delivery of mainstream movies.
There’s of course much much more going on. But that’s my point: We seem to be figuring out how to manage digital distribution in new and successful ways. The common threads seem to be: Treat your customers with respect. Trust them. Make it easy for them to do what they want to do with the content. Have a sense of perspective about what you’re doing. Let the artists and the fans communicate. Be on your customers’ side.
Put them all together and what do you have? Treat us like people who care about the works we’re buying, the artists who made them, about one another, and about the world beyond the sale.
Tagged with: business
Date: June 2nd, 2012 dw
A few days ago I pointed to Elizabeth ‘s thread at Reddit where she engaged with the public in a way that everyone who manages customer support, PR, or marketing ought to learn from.
Today, Amanda Palmer posted about her current Kickstarter project, which has raised $855,000 with eight days yet to run. Her goal was $100,000…except in her post she responds with complete frankness (she’s AFP, after all) about what her real expectations were. The post is both an explanation and a demonstration of how musicians and theandir audiences can love and support each other.
I’ve got a post at the Harvard Business Review site about what I’m calling (not too seriously) The Gettysburg Principles. The point is that you can keep your customers buying from you if your business is of your customers, by your customers, and for your customers. “Of” means that your business is made up of people like your customers. “By” means that your customers are contributing to the creation of your product. “For” your customers means you put them first. These three terms give a handy way of analyzing why customers stick with some businesses even if they have to pay a bit more or make some other adjustments.
Anyway, there’s more over at HBR…
Tagged with: business
Date: March 28th, 2012 dw
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