New Power

Gah! It has been 15 years since The Clue Train Manifesto went live (April 1999 for those wanting precision), and it would appear that a good chunk of the corporate world still needs it explained to them. Witness the Harvard Business Review‘s “Understanding “New Power””, which somehow manages to fuse, really confuse, in their own words “increasing political protest, a crisis in representation and governance, and upstart businesses upending traditional industries.” Okay, so one should be generous with HBR: it doesn’t really serve them to think about things like income inequality. (More seriously, HBR can often be a lot smarter than its home in the Harvard Business School, which begot the world the MBA, and thus probably deserves a special place in the annals of Ideas That Destroyed Civilization As We Know It (And Just When Things Were Looking Up).)

HBR’s definitions of old and new power are reasonable, however:

Power, as British philosopher Bertrand Russell defined it, is simply “the ability to produce intended effects.” Old power and new power produce these effects differently. New power models are enabled by peer coordination and the agency of the crowd—without participation, they are just empty vessels. Old power is enabled by what people or organizations own, know, or control that nobody else does—once old power models lose that, they lose their advantage.

And we can only hope that someone, somewhere is making notes on where there is excitement and innovation in the world and where there is not.

People, People, People

The world’s most successful organizations value great people. Some call them “A Players.” Others call them “stunning colleagues.” In all cases, high talent density is everything. What’s in flux today is what makes someone great. Legacy HR models tend to value “managers” – people with graduate degrees from prestigious business schools with years of experience leading initiatives in their chosen field. As a result, a typical day in corporate America is peppered with meetings and PowerPoint presentations. Planning has become the work. Intuitively, we know that’s not right. To win in the marketplace, someone has to create and deliver exceptional products, services, and experiences, and planning won’t get us there. In a Digital OS, the emphasis on People is all about making. “Makers” are people who have skills (as opposed to credentials). They think by doing: experimenting, testing, and learning. Within these high performance cultures management has evolved into something more akin to mentorship. The thinking goes, if workers are capable of making decisions about their priorities and workflow, what’s left for the manager is skills development, knowledge sharing, and helping with roadblocks – the Montessori method gone corporate.

From “The Operating Model That Is Eating The World” by Aaron Dignan.

Why Apple Is Special and Amazon Is Not So Special in One Paragraph

You have to admire the grandness of claims sometimes made by pundits. Derek Thompson’s assessment comes down to this:

Apple’s core business is something that practically everybody wants to do (and can do): making phones and tablets. Amazon’s core business is something that practically nobody wants to do (or can do): build a massive online database and offline infrastructure to transport boxes from warehouses to hundreds of millions of doorsteps.

A later update comes in the form of a telephone call from Peter Misek, managing director at Jefferies & Company, who responded:

Apple is an ecosystem. I’m an iPhone user. The chances I leave are minimal because I have all my music and photos and such on the phone. The inertia or friction of moving is fairly high.

Clearly, Amazon knows that my loyalty as a consumer is price-dependent. Unless they can move into a similar market space as Apple occupies, which is less so, they are going to have to watch always for competitors looking to play the one-downsmanship game that is so often retail. This is not impossible, but it is difficult, as department stores across America can attest. This is clearly why they are pushing so hard to develop their own ecosystem.

As always, the world is more complex than pundits make it out to be.

Intel Inside

Back in 2007 a member of the press asked Steve Jobs about Apple’s participation, or lack thereof, in the Intel Inside program. Both Jobs and Phil Schiller make it clear that they want the customer’s experience to be focused on what the product delivers, not who the makers of its components are.

That’s important for a couple of reasons. First of all, it keeps producers focused on their audience’s experience and not on satisfying supplier or partner compliance requirements in order to save money. So, deliver a great product to your real audience and make money in the old-fashioned way. Second, it makes your product yours and not someone else’s. If you change suppliers, you don’t need to change anything else. Third, and most importantly, it forces you as a producer to take responsibility for your product. Its strengths, and its weaknesses, are yours and yours alone to account for.

Listen for yourself.

Saving the Independent Bookstore

The Washington Post has a three-part series chronicling a recent workshop in Menlo Park, California focused on finding ways to save independent bookstores. Day 3 is here, with links to the previous two days. The threat? Amazon.

Oh, Amazon, I don’t know how to feel about you anymore. Life on the South Coast would be, first, intellectually poorer, and, second, more expensive with you.

That is, we have no local bookstores except for Barnes and Noble and Books-a-Million — okay, I’m not counting our one goofy used bookstore and the handful of Christian bookstores. Our local public library is strictly a browsing library and our university library hasn’t bought much in the way of new books since 2005. Amazon has been our one conduit for maintaining any kind of relationship with intellectual currency.

But Amazon’s business practices — their pricing practices, their treatment of employees (especially those in their distribution centers) — seem only to reveal a cut-throat approach to the world.

Netflix’s Lost Year

CNet has a fantastic history of “Netflix’s lost year” in which they pair all the external happenings that all of us could observe with internal events. If the article seems too long to read: the conclusion is Netflix over-reached in its transition. Streaming video is the future, but there was no reason to cannibalize the company by spinning off the DVDs when that end of the business could simply have slowly been sunsetted. Why did Netflix over-reach? CEO Reed Hastings let success go to his head.

It never ceases to amaze me how executives and managers of successful companies begin to believe their own hype. The fact is few organizations, if any, succeed because of one individual alone. One person may give the driving vision, but there’s a whole lot more to be done on the execution end of things.

And then there’s luck. Few successful people realize how much luck, just the raw randomness of the universe, made their success possible. A large percentage see their own hard work, and no doubt hard work is important, but they don’t see all the other folks working equally hard, perhaps even harder, who did not succeed.

The result of this weird blindness, perhaps a function of our own American tendency to tell “rags to riches” stories that tend to focus on the individual and not the organization, is that smart folks too often think they are the only ones who know better.