Week 29, 2023—Issue #265
Innovation Cycles, Leverage at Work, and Slime Molds
Successful organizations do three things: they create value for customers, they empower their people, and they deliver positive long-term results.
Here are three ideas to help you do the same:
#customervalue
Innovation Cycles
The long-view of disruptive innovation
The theory of “creative destruction”, introduced by Joseph Schumpeter in 1942, suggests that economic growth is propelled by long waves of innovation. These waves, spanning from the Industrial Revolution’s water power and textiles, through railways, steel, and electricity, to the digital era, have been becoming progressively shorter, marking an accelerating pace of change. Each cycle disrupts prevailing markets, leading to influential monopolies, as was evident with 19th-century rail companies and now with the AI revolution. As we navigate the 6th and current cycle, it’s a pertinent reminder to always think long-term, ensuring we’re not just reacting to immediate changes but preparing for the future.
#personalfulfillment
Leverage at Work
Redefining the value of time
In The Almanack of Naval Ravikant, Naval offers insights into the role of leverage in the real estate sector. Paraphrased, the book describes laborers as the base, performing hands-on repairs with limited leverage. Above them are general contractors managing projects and wielding the laborers as leverage. Higher-up, real estate developers invest in and renovate properties, leveraging capital for the chance to make hefty profits. At the summit are those leveraging both media and code, like innovators in real estate tech companies, combining deep industry knowledge and tech prowess, aiming for astronomical returns. Capping it all off, Naval reminds us that: “You’re never going to get rich renting out your time.”
#longtermprofitability
Slime Molds
How to avoid coordination headwinds
As organizations grow, they face increasing “coordination headwinds” which can stifle progress and innovation. Alex Komoroske, Head of Corporate Strategy at Stripe, suggests using the Dialectic Method to harness opposing ideas for better solutions. It’s essential to actively seek diverse viewpoints, avoiding echo chambers. Drawing an analogy, which is vividly illustrated in his accompanying slide deck, he advises organizations to emulate slime molds: disparate units collaborating seamlessly. By genuinely engaging with varied opinions and emphasizing common objectives, organizations can transform these challenges into avenues for growth and innovation.
That’s all for this week.
Until next time: Make it matter.
/Andreas
How can we build better organizations? That’s the question I’ve been trying to answer for the past 10 years. Each week, I share some of what I’ve learned in a weekly newsletter called WorkMatters. Back-issues are published to Medium after three months. Subscription is free. This article was originally published on Friday, July 21, 2023.
