The Energy-Entropy-Information Nexus
A unified framework for investment, innovation and (personal) development
I have first utilized the nexus framework in attempting to untangle the Internet, in preparation for its redesign. I revisit it to further clarify its underlying dynamics, and demonstrate how it could be used at different levels.
The discussion here invites a revisit to the concepts of money, and development. A reminder that money does not have inherent value, and that development goes beyond the economic, is needed. For the sake of brevity, this has been published as a separate post.
Having said that, it is time to take a look at the relations outlined in the nexus. These could be broken down into energy-entropy, entropy-information and energy-entropy-information relations. The innovation models discussed by Bonvillian and Singer in their book, “Advanced Manufacturing”, are introduced.
Energy-Entropy
A rock is carved by a thousand drops. We put in energy to build the systems in which we operate. Energy is expensed to roll steel into pipes, and set up factory lines. These systems then serve to make us more effective as we work within them to produce soap or manufacture cars. They extend beyond the factories, into our corporations, municipalities and governments. A corporation, after all, is meant to reduce friction in interoperations amongst its departments. The design, manufacturing, marketing and sales teams find themselves in a loving home, in which they could effectively communicate. As we advance, we might find nothing more accurate in describing our wills and designs than the tools we use. The technical requirements could no longer be expressed more explicitly than through direct modelling. Topological optimization transforms the engineering criteria to a specific design for the manufacturer to work with.
The best way to understand a system is to explore what it allows you to do.
Tools, a materialization of our work-action space, are an embodiment of our structures. The best way to understand a system is to explore what it allows you to do. This is the underlying concept of tutorials. At the same time, you should not hesitate to create your own tools, to mold systems to your intentions. In essence, while the systems you operate in dictate what you do, or as Omar puts it, you do not rise to your goals, but fall to your system, the systems that exist depend on the energy you put into building them.
We are the context.
With that in mind, when designing new tools, make to sure to design the workflows around them, if not the whole system. Taking a popular social media website as an example, we see that is has been built on superficial comparison, ushering a new age for exhibitionism and other mental heath disorders. The damage is done, but a lot might have been avoided, and lives might have been spared. Rushkoff makes a valid case in his article by stating that staying in college might have given the website’s founder the context he needs. We are the context. Our interactions are the workflow, and our social lives the system.
This shortcoming of failing to understand the existing system, as you rush to deliver an in-demand solution is not unique. To a certain extent, it is a flaw we have been happily promoting as design thinking, a methodology which Ersoy invites us to rethink. It could be attached to shallow innovation, called induced innovation or technology “pull”. Such model is based on new — entrepreneurs — or existing industry players leveraging largely existing technology to tap a market opportunity, unanswered demand.
Superficial comparisons were the subject of timeless chitchats. Social media have given them a platform, amplified them. We see then this amplification of human will by technology, as discussed in my previous article shown below, falls within putting in energy to build systems that decrease the friction for certain interactions.
There is no such thing as a neutral system or technology. The implicit design choices, the unnoticed personal motives, the prioritized objectives all paly a role in determining how the system will play out. There is only so much detail a human could pay attention to. Even then, as Fox phrases it, everyone thinks they’re the good guy. From institutionalized discrimination, to calendar debt, review and redesign your systems and tools. “Spend four hours sharpening the ax,” as Lincoln would say.
The basis to the system you wish to build might come from a burst of energy and overenthusiasm, the system itself, however, is built slowly and steadily. It is upkept and refined with use. Working with it is the best way to preserve it, improve it and promote it. This goes beyond demonstrations to case studies, and perhaps further. Ansys, founded in 1970 to become the pseudonym for simulation, does this excellently. Amongst its consultation services, it offers an embedded expert, an Ansys employee, a delegate meant to get its customer, the company, up and running with its software to meet its needs. On another level, it is a floral distributor designing bouquets, not solely supplying florists.
I frankly do not want to become Warren Buffet, binging on soft drinks and fast food because they are my cash cow.
This invites us to consider the other direction. Invest in what you regularly use and promote. I frankly do not want to become Warren Buffet, binging on soft drinks and fast food because they are my cash cow. When investing, you are funding what you believe. The cooperative path, described by Wahl, is one, and perhaps the most vivid realization of the mantra. Ghost kitchens and home couture are unknowingly promoting the model. However, when you are buying coffee from your local coffee shop, you are funding the flocks of socializers that inhabit it. When you are meeting your friend at the public park, you are promoting it, strengthening its existence.
This obviously extends beyond monetary terms. How could the different forms of support merge? This is an interesting question which invites us to rethink how we structure our enterprises. Considering new dimensions of trust and management will disrupt the sustainability of our building amenities, our neighborhood cafes, and our favorite brands. It is these features that motivate my proposal of distributed ownership when discussing seismic shifts in the economy.
Redefining businesses as purpose-driven allows them to break free from the reign of profit and shareholder value.
Apart from shortcomings of current business dynamics in describing the microscale, the macroscale is also under recent investigations. The ideas entertained above make more sense within the framework of purpose-driven business. The framework, which was previously in circulation, has been solidified by Business Roundtable in a 2019 statement. Redefining businesses as purpose-driven allows them to break free from the reign of profit and shareholder value, as the respective articles by Harvard Business Review and CNBC highlight.
In the October that followed the statement — three days before the suspected day zero for the Coronavirus — Deloitte has put together an actionable article on the matter. A year later, we see that purpose-driven businesses are not only surviving the pandemic, but thriving and outperforming their counterparts. The advantage these firms achieve seems not to be an ephemeral one.
It is not solely a web design gimmick.
Nowadays, it seems to have become all the buzz, with companies that were shortsighted to the change rushing to adapt and gasp the much needed fresh air it provides for their survivability. Before you rush to rephrase a few words on your website and claim you are purpose-driven, take the time understand what it means and develop your authentic purpose. As this section of this essay points out, it would take effort to change the structures of your organization. It is not solely a web design gimmick.
When purpose replaces greed, in the just-enough “Need” economy, the concept of market competition becomes misleading if not redundant. Players would be able to collaborate, and leverage an ecosystem to fulfill their purpose. It is for this that I have argued against breaking up Big Tech “monopolies”, and for envisioning their raison d’etre in my article on redesigning the Internet. Mergers and acquisitions would then be driven by synergies, rather than the latter being left as an afterthought, risking the success of M&A.
Such utopian markets rely on ensuring a business being driven by purpose beyond lip service. One way to start would be to give your business self-development skills. One particular item to add to your checklist, comes straight out of Barry Davret’s article. Give your customers what they need, not what they want.
Beyond your business, systems at other scales would affect whether it is capable to live up to its purpose. Placing the personal in parenthesis before development in the subtitle is a hint that all scales are to be considered, such that you are looking at a system of systems, a unified framework, at the end of the day. Apart from the people running it, a business is affected by the jurisdiction within which it exists.
“Revive the human, so that the nation thrives.”
It is by no chance that warships are crowding the Mediterranean as industrial nations are seeking to secure contracts for their stagnant Oil & Gas sectors. While purposes unify business, those of nation-states drive them to clash, for nation-states are ill-defined to serve within a limited scope rather than ideological ideals. They, too, need to be redefined. Design across scales, and, as Sultan Abdulhamid II would say, “Revive the human, so that the nation thrives.”
Diversification silences your voice.
In attempting to revive the human, yourself, it is important to give yourself agency. Investing in what you believe in is giving yourself agency. Diversification silences your voice. Diversification minimizes not only risk, but also uncertainty, the medium of change. You must understand then that investing as advertised online will not make you rich. This is not a paraphrase of “Be fearful when others are greedy,” even though it could be understood as such. The advertisers, the greedy, will get rich out of your own investments. Through impersonal investments, you are effectively handing over control to corporations who seek to roam freely.
It should be evident by now that true wealth is in the legacy you engrave into this world, your actions, the energy you put in. To avoid self-sabotage, and not to seal yourself to Sisyphus’ fate, you need to be consistent. Have a vision. Build your systems around it. Work towards your purpose. Invest your hard-earned cash, not in gamblers’ stocks, but in ecosystems consistent with your vision. This is the true panacea of diversification, supporting the businesses which amplify your goals and work. The legacy of the Albany Nail Factory stands to advocate these words.
Interest on capital, akin to paychecks for the idle, rewards laziness.
If you intend to work hard and spare no effort, you must put in your energy. Similarly, with its transactional value, you should invest your money. The government, which function is to channel the people’s best interest effectively, must support these efforts. The government must neither tax income, nor offer interest, for interest on capital, akin to paychecks for the idle, rewards laziness. This is not to be understood as an argument against welfare benefits. For that, please review the discussion on the cycle of poverty above. The $1 annual WhatsApp fee imposed to slow down growth, and give servers a much needed break, teaches us that taxation is penalization.
In that sense, development is reinvestment. If it must, the government might choose to tax the purchase of “non-essentials”, and definitely wealth accumulated and left unproductive. Interest-bearing loans are not productive; they are leeches on the backs of true businesses. Such a scheme would help keep wealth in circulation, as it is meant to be.
It is evident by now that for systems to be built, systems need to be disrupted or destroyed. To build the structures which liberate your energy and efforts, the suboptimal structures need to be swapped out. This metaphor of swapping, as though it is bracing a building while its pillars are restored, evokes the imagery of concurrent change. Quitting an addiction and developing yourself happen concurrently, for quitting an addiction is on the path of recovery. This is better understood through the decision making process underlying the replacement of legacy systems in manufacturing.
The destructive urge is creative.
We now understand why war is sometimes inevitable. It not only frees human potential from a tyrant system, but inspires otherwise untapped potential. It is not the women and children of Germany picking up rubble after the end of the World War II that I point to. Rather it is the inspiration of scientists to increase their breadth and ponder more, as G. I. Taylor had done in the previous war. It is the drive to build a new world order on the relics of states. It is the understanding that the destructive urge is creative in nature.
In life, you ought to build yourself.
If all this energy goes into building and reforming human artifact systems, don’t expect to find yourself. In life, you ought to build yourself, and you are given every chance to do so until you run out of breath. This is why following your passion is terrible advice. You do not know yourself. Attempting to find yourself, or any part thereof — your love, your passion, your career — is dangerous. It will send you on the look out, for teenage dreams and disturbing tattoos, wasting your energy instead of directing it towards setting up the systems of your life.
Put in the effort to structure your character. Your vision structures your thoughts. Your actions and interactions structure the world around you. Understand this interplay between energy and development.
Entropy-Information
Information must be structured. This is the essence of knowledge.
This section is less verbose, as the relation it tries to convey is more straightforward. Uncovering information allows you to build better systems, structures. Novel systems allow you to uncover new information. Most importantly, to be put to use, information must be structured. This is the essence of knowledge.
The relation underscores why data science has become a necessity. It also highlights why management consultants find a warm nest in emerging nations. The latter seek to develop their systems, but lack the experience to do so. If they do have the experience, they appear to be developing at a pace faster than they could learn. They need to outsource learning.
The role of a school is to structure as to allow a child to structure his thoughts and inquisitiveness.
These same needs are the education system’s purpose. A child needs structure, as Hobbs states in his parenting advice. Not the mere delivery of information, the role of a school is to structure as to allow a child to structure his thoughts and inquisitiveness. This discussion on the role of an education system should wait for a future article.
Uncertainty is a medium of change, including a change of mind. Similar to how destruction of structure spurs the release of energy, it could help reveal information. It could be quite literally with the discovery of a time capsule upon the bombing of a building. However, the intention is to encourage you to shuffle your methods, and question your systems, to pick up new insight on how things could be done.
Opposite to policy for basic research, stands manufacturing-led innovation.
As such, both, erecting and tearing down systems, aid in uncovering information. This is most vividly seen in setting up an innovation pipeline to fund basic research, typically through state grants, to introduce “radical” innovation and push out technology. At the other end, opposite to policy for basic research, stands manufacturing-led innovation. It is built upon insights informed by applied research at the level of the enterprise. It integrates strongly with the processes, the structures to tell us how to improve them.
The US seemed to understand that during its early days, when East Coast nobles would send workers to learn trade secrets in Europe, especially pertaining to manufacturing of arms, prior to the Civil War. After the second World War, however, it has heavily focused on pushing technology, with manufacturing slowly tiptoeing east. Asian star-children now take the lead in manufacturing-led innovation, having been wreaking the global manufacturing scoreboards for a while.
Remember that information and structure support one another. This is the warning hidden in the context not considered. It is only with both that you are able to act.
Energy-Entropy-Information
Increasing entropy might unlock new insights, however, as discussed above, information only becomes accessible with the structure for it. As such, entropy always stands between energy and information, between action and knowledge. Organized armies win battles. Knowledgeable armies capture resources. Being both allows you to sustain your economy on usurping oil in foreign lands. That is having the energy and information allows you to erect a system of your choice.
Information is knowledge if organized, and knowledge is power. With the nexus clarified, we are able to present the more holistic innovation models, the extended pipeline and innovation organization. As its name implies, the extended pipeline stretches beyond the innovation pipeline to support not only basic research, but every stage from the technology push to market push, crossing what is called the “Valley of Death”, between advanced research an implemented technology. DARPA is a perfect example of an institution fostering this pipeline. This type of support coming from the former has yielded major innovations including modern electronics, the Internet and the Space sector shaping up today.
Failed states might have a unique opportunity in organizing innovation on a fading canvas.
If the extended pipeline provides an interconnect between information and energy, innovation organization is about the system become self-aware of its role. The multiscale approach, advocated for in the Energy-Entropy section, is at the heart of the most successful innovation model. It goes beyond enabling this communication between the two sides of the nexus, to allowing interplay to shape development. It institutionalizes frameworks and policies to fortify innovation and break down the barriers facing it. As would be discussed in a future article, failed states might have a unique opportunity in organizing innovation on a fading canvas.
At a personal level, knowledge is as empowering as you allow it to be, and its attainment hangs on your actions, and the systems you build.
Conclusion
In brief, I propose the new framework of the energy-entropy-information nexus. The article has gone to great lengths in explaining it, at times stating the obvious. In any case, the multiscale aspect of the framework allows us to build more novel concepts on top of it. This piece remains as a reference to ensure clarity of though when writing and reading future articles. The upcoming thorough explanation of the “Need” economy, coined previously, and the subsequent proposal of a pathway to recovery for my beloved Mediterranean homeland, rely on this framework, as a start.
