Malcom Gladwell and changing the foreseeable future

Image credit: http://kriskrug.com/

An article on venture beat explores how much data can help determine what the future of your product is. There are several important concepts at work here. Firstly, the generational / developmental concepts which ask: is the behaviour happening in these users because this is the generation in which it starts (e.g. the first generation that bought online; the first generation that used the fax in place of the post) or is it developmental (e.g. this is the point in your life that you use night clubs; this is the point in your life that you use a nursery).

Technologies that are both innovative and complicated, like Facebook, take even longer to really emerge.

He then projects further, pointing out that this is part of our understanding of where Facebook, Snapchat and many others will be in 10, 15 or more years time. The article ends by pointing out the importance of finding truth in the data. The example in the article, which asks why trust is at an all time low while use of apps in the sharing economy grows raises the important question: do the concepts you’re dealing with make sense today given everything that’s emerging and maturing?

As technologies emerge, they are described in terms of the old technology. Uber is thought of as competing with existing taxi firms because it happens to compete with it, and so the old language and concepts are carried over. While this makes some sense from a market point of view — total addresssable market, projections for the future — it can miss the point. Uber has stated:

Uber’s simple mission: Transportation as reliable as running water, everywhere, for everyone.

Far too nebulous, complex and wishy-washy

That is not the kind of thing a taxi company would every bother thinking about. It’s far too nebulous, complex and wishy-washy. It appears to have nothing to do with today’s tasks or this quarter’s revenue. It’s someone else’s problem.

My point — or, one of my points here — (and part of Malcom Gladwell’s point, I think) is that making transportation as reliable as running water is never going to be something that will show up in the data. At no point would a taxi firm or delivery company ask how reliable and simple their service should be and then express it in such a fundamentally different way.

When a company tries to innovate, they aren’t as brave or fundamental in their thinking because they allow too much to carry over from their old way of thinking. This is part of the Innovator’s Dilemma but was also nicely describe in some comments on the article on Facebook. One comment gave the familiar example:

This is, in fact, a genuine problem — or challenge, at least — in business today. For example, I know of innovation sections of big, healthy(ish) companies that can’t actually innovate because on day 1 of a project is the idea, and then from day 2 and onwards the CFO or Accounts Department, or HR, or Advertizing, or any of the company’s other departments, demands data that show how, and how soon, spending money on said project will provide an acceptable return on investment.

The focus in incumbents is, as this commenter puts it “from dat 2… [they] demand data that show how, and how soon, spending money on said project will provide an acceptable return on investment.” There are a few responses to make here [1]:

First. You don’t have to be able to state what your ROI will be to want to have an ROI at some point. You just need enough cash and control (Not my phrase — more on that in future), so see the project through. (It is my gut feeling that projects which state their ROI up-front are inherently less innovative because they aren’t exploring. Exploring means looking that unknown. More on this another day.)

Second. ROI is used as shorthand for “something we should be doing” and from this it follows that things associated with revenue in the foreseeable future, are “things we should be doing”. Sometimes that’s true, sometimes it isn’t. This becomes a crutch on which people, departments and companies lean when they have lost a fundamental understanding of what they do. Simultaneously, it has a crippling effect by limiting what they “should be doing”.

Third. This, in turn begs the question about the foreseeable future. We do things because they make sense in xx What are you doing to try to see the future of your industry? If you are a taxi firm, what time and resources do you put into spotting how emerging and maturing technology could change your world? The foreseeable future is a function of your present knowledge and understanding.

Seeing beyond the data

How can a company — and the individuals within it — have the ability to see beyond the ROI on the current projects and the data on what they are already doing?

Using the Uber example, what would it take for a local taxi firm to team up with an app developer and build Uber before Uber builds it and begins the undoing or transforming of their industry?

I believe the first two stages of this are:

Identifying a better description of what you do. If you see yourself as simply delivering the technology that you have for the past 5, 10 or 100 years then maybe there is a better articulation of what you do. The first step is to identifying the reason for your industry beyond your current technology.

If you drive a taxi, what is it that makes people take taxis? Why are they bothering to?

If you are a supermarket, why do people feel the need to stock up all in one place?

I’m convinced that even industries like software development which are relatively new, suffer from the same problem. In a matter of decades we’ve gone from nothing to an entire industry based on largely unquestioned metaphors (files, directories, operating systems etc). These metaphors might be constricting what we think of as possible because we have confused what we happen to create at the moment (packages, files, configuration) with the point of what we do (putting stuff in front of people’s eyes, ears ….).

Once you find a description which seems to encapsulate what you really do, it’s time to…

Involve data again…

With a better description, you ask the question: what is the best articulation of this give today’s technology. This question gives you license to throw away anything you might previously have built, and build what makes sense for today. However, the usual blocker in doing this is that you render much of what you’ve learnt over the years (potentially) obsolete. It might be that knowledge of cars, or how to ship CDs is no longer what matters. That’s not easy to stomach.

Increasingly, what matters is different forms of communication since so much is shifting to digital. But even at that stage — like the software example above0 — it’s very tricky to see past how we happen to build today.

Where from here…?

This post hasn’t come to a nice conclusion.

But what I think carries over from the Gladwell quotes is that data about how things are today is not enough. You need a deeper understanding coupled with excellent data skills if you’re going to change the foreseeable future… by seeing a different future. To have that, you need to go through the painful process of questioning what you’re up to in the first place.

[1] The commenter on Facebook reflects many such comments made. I’m using it as inspiration, not a target of attack.


Originally published at danfrost.co.uk on August 3, 2015.

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