The Medici Effect Applied to Blockchain

In 2004, Frans Johansson coined the term Medici Effect to highlight fifteenth-century Italy as a place where an archetypal burst in creativity happened, one those effects still can be felt today[i]. Ironically, in his book by the same name, not a single example is drawn from that period. We argue that the term perfectly fits to blockchain and want to back this up with authentic Renaissance analogies.

In a previous article, we looked at the dome of Florence as a metaphor for blockchain projects. Today, we go further back in time, at the inception of the dome design, to dig into data models for blockchains and what it takes to put new ideas into action.

Ponte Vecchio, Florence’s oldest bridge, was built in 1345. Its medieval predecessors lasted a few decades at most. Even an old Roman bridge, standing on concrete foundations, had been swept away by floods and time[ii].

In contrast, Ponte Vecchio survived many events, including the German retreat of 1944 and the flood of 1966. This natural calamity was caused by an unplanned discharge of a dam upstream and flooded the city to unprecedented levels, but the Ponte Vecchio stood strong. What is special about Ponte Vecchio that helped it sustain so much for so long?

Look at designs that create better fluidity

Typical Roman and medieval bridges have round vaults and a height/width ratio of around 1 to 2. This means that numerous pillars are required to cross large rivers. Such a design obstructs water beds and, consequently, retains floods, and amplifies damages. Eventually, it can even lead to the destruction of bridges.

Before Ponte Vecchio in Europe, the only alternative to numerous arches was steep slopes. That helped, but had a drawback. Carriages were slowed down by the slopes. Merchandises often had to be discharged to avoid accidents.

Pont Vecchio’s design relies on arches with a height/width ratio of 1 to 6. It spans over three large passes while keeping the road at street level. This fluidifies the traffic of carriages over the arches and of water below them while reducing the risk of damages. Although such design had been known for long in China, Ponte Vecchio was a first occurrence in Europe. Its engineer, Neri di Fioravante, might have been influenced by Marco Polo’s description of the Lugou Bridge[iii].

What does this tell us about blockchain? Typically, bridges are at the intersections of water flows and human roads. Blockchain too is about connecting, sharing, and fluidifying exchanges. Any blockchain project materializes in a data model. The design of the old bridge illustrates that such models shall optimize for what matters most and next. The low-arch design optimized fluidity above (benefits) and below arches (risks). You can look similarly at your industry and its processes. Where are data and physical flows currently bottlenecked? What is slowing down processes for all stakeholders? Look for a design that will accelerate business flows (above arches) without creating new adoption, privacy or societal risks (obstructing the river bed). Like Fioravante, redesign the data flows and models for fluidity, making them both lighter and safer.

Innovation emerges at the intersection

As it became obvious that the dome of Florence could not be built with conventional technics, the citizens of Florence remembered that Fioravante had served them well in the past. Again, they turned to him for a solution. The old engineer mixed, sketched, and stretched existing knowledge anew. The dome of Florence would be a two-shell dome: the external cupola shall give greater height while protecting the inner one of weather influence and horizontal thrust.

The entire structure would have to be much lighter. Like Chinese bridges, double-shell domes had been out for long. They had spread with Roman-Byzantine architecture and had become typical for mosques[iv]. In the eleventh century, crusaders brought the design back to Europe. The oldest dome of Florence, that of the cathedral’s baptistery, had been built this way. However, none of these old and new versions had ever been out of stone, at such heights, with such widths.

Innovation originates at what Johansson calls the intersection. For Ponte Vecchio, the inspiration probably came from China. For the dome, it returned from the Middle-East. But none of these ideas emerged from inviting a Chinese bridge builder or a Muslim architect to solve a given issue upfront. Florence was the place where such ideas could meet at the time of the Medicis. The lesson here is about curiosity, openness and diversity. Innovation, as glamorous it is, can be a bit of a dirty process. For businesses, it means creating space for thoughts, ideas and experiences to meet and amalgamate around topics that at first seem unrelated.

Square your industry

In 1374, Fioravante died before the construction of the dome had started. We saw in the story of the dome that Brunelleschi raised up to the architectural challenge and received support from wealthy Florentine families along the path. Looking closer at how it happened, an interesting pattern unveils.

Consciously or unconsciously, the patrons of Brunelleschi literally squared the dome with own projects. The Ridolfi ordered a chapel for San Jacopo Borgo on the south-west bank of the Arno. The Barbadori did the same in the east at Santa Felicità, and Giovanni de Medici in the north-west at San Lorenzo. Finally, the hospital of the innocents got commissioned by the guild of silk in the north-east[v]. Only then, a tipping point occurred, and the Opera del Duomo took the decision to go ahead and start the dome construction.

Nowadays, forward-thinking merchants, guilds, Opera del Duomo and city councils translate to early adopters, industry associations, governments, and legislators. Private chapels and hospitals translate to proofs of concepts and multi-player implementations. In any given industry, there are challenges that are shared by all stakeholders and can only be solved by the team play of fierce competitors. We are not hinting at price agreements here, but at topics such as food safety, child labor, hunger, corruption, and even VAT tax fraud e.g. among EU member states. Have the stamina of Florence merchants and look at the bigger picture in your industry. Find like-minded in your industry. Patiently square it. Create and sustain momentum through all stages until a critical mass is reached.

Fortunately, many examples show that this is possible and happening already. The financial industry is going live with new models for handling securities[vi]. The pharma industry does the same in its fight against fake medication[vii]. More recently, growers, manufacturers and retailers are squaring the food safety issue with proofs of concept and first multiplayer implementations. Nataïs, Naturipe and Bumble Bee use blockchain and QR codes to track products from sea, fields, and farms to stores. Using smartphones, their end customers can get reliable details on the origins of corn, blueberries, and yellowfin tuna. GS1 is holding working groups on blockchain for traceability. Walmart and Carrefour are implementing blockchain with suppliers and inhouse brands. In a few years (or food scandals) from now, will anyone understand why reliable traceability is not mandated?

The examples of the bridge, the dome and the merchants show how industry-wide challenges can be approached:

Are you participating in industry forums?

Have you identified your industry challenges and your Fioravantes designers?

Have you spotted your Brunellescis and ordered private chapels? Or are you already building a hospital with some peers?

Wherever you are, here and now is the best place and time to start bringing your industry to the next level.

[i] Frans Johansson, The Medici Effect: Breakthrough Insights at the Intersection of Ideas, Concepts, and Cultures, Harvard Business School Publishing, 2004. In the paperback edition of 2006, Johansson mentions on page 2 that “Thanks to [the Medici] family and a few others like them, sculptors, scientists, poets, philosophers, financiers, painters, and architects converged upon the city of Florence. There they found each other, learned from each other, and broke down barriers between disciplines and cultures.” Besides that, Renaissance is not mentioned. The recurring analogy of the book is Peter’s café sport in Horta, Azores, as a meeting point for sailors at the intersection of America and Europe. To the discharge of Johansson, the book builds on research results and first-hand interviews that would not have been possible with Renaissance masters. For the avoidance of doubt, we highly recommend the book to all interested in innovation and the fundaments of design thinking.

[ii] Roman concrete was widespread from about 150 BC. The knowledge got lost with the collapse of the Roman empire in the fifth century AD.

[iii] The Zhaozhou Bridge was constructed in China around 600 AD and still stands. Marco Polo returned from China to Venice in 1295 and recounted of the Lugou Bridge.

[iv] Even the world’s oldest mosque, the Dome of the Rock in Jerusalem, had a wooden double shell dome from its inception in 691.

[v] Ross King, Brunelleschi’s Dome, The Story of the Great Cathedral in Florence, page 46, first published by Chatto & Windus, 2000.

[vi] For example, Deutsche Börse and HQLAx.

[vii] For example, SAP in co-innovation with AmerisourceBergen, Boehringer Ingelheim, GlaxoSmithKline and Merck Sharp & Dohme, and others.

For input and feedback in preparing this article, I want to thank Divya Chandrika Mohan and Sridhar Sundaram.