Friends,
I hope that all is well with you and yours, and that this e-mail finds you on a boat with shoddy connection, in the tropics, three months after I sent it.
Now accepting keynotes for 23Q3-24Q1
Every year, I create three main presentations. For 2023, they are:
Delusions of determinism: Why planning for success leads to failure
Regression toward the meme: Why modern leadership continues to fall into old traps
Under pressure: Retail in a new financial era
If you want to book me for your event, workshop, or corporate speaking slot, just send me an email. To make sure I am available, however, please do so at your earliest convenience; my schedule is filling up fast. More information can be found here.
A couple of updates before we go-go
The book is progressing embarrassingly well at the moment. The pieces are falling into place, the narrative is becoming abundantly clear, and it is starting to look very good indeed.
Steve recently presented some of our concepts at a risk management conference - with the feedback that they were “visionary”. We will do our best to live up to that billing, though I suspect that Steve’s immense capacity as a speaker helped more than a little. If you are hosting an event on strategy, management, innovation, or risk, you really do need to book him; he is insanely good.
Now onto the newsletter.
Item Declaration of the week
Not so much anything worth reading this week, I am afraid, as a personal heads up.
Ever since Musk was forced to purchase Twitter, the platform has become increasingly worthless as a business tool. Substack links, for example, are now considered spam, which means that traffic from the site to this newsletter (which used to be substantial) today is nonexistent. To be blunt, this has hurt me financially.
Consequently, when I recently read that Space Karen was encouraging Tucker Carlson to run his new show there, beginning with an interview with Donald Trump during the (proper) presidential debate, I felt my patience reaching new lows. If that is the direction that X is heading, I will be heading for the exit.
In the meantime, expect more content on LinkedIn.
Moving on.
When was the last time you were surprised by something you knew would happen?
On change, surprise, and adaptability
About a year and a half ago, I wrote about strategic movement; how firms might navigate their surroundings and act in the face of uncertainty. My point was that, contrary to popular wisdom, companies should not strive to “be prepared for anything”. What “anything” might be, you see, constantly changes and expands.
The explanation can be found in a familiar concept: the theory of the adjacent possible. For those who may not remember, or anyone new to this newsletter (welcome - how very nice to see you), it can be defined as “what can come to be” in any given context.
To reuse an analogy from my Techsylvania keynote, you may think of it as (within the context of strategy) an indefinite row of doors; it is not endless, but without an identifiable end. If you were to open a door and step inside, two things would immediately happen: the door would shut behind you, and another indefinite row of doors would appear before you.
It follows that one can only ever use one door at a time and that, in turn, the space of the possible (the rows of doors that we may choose) forever will be dramatically larger than the space of the actual (the doors that we chose). In other words, if one truly were to “prepare for anything” (an impossible task a priori, but for the sake of the argument), it would be wasteful to the extreme.
Having said that, we also cannot assume that the space of the actual is so small that we can control it. Change is not a contrast, but a constant. New doors come into existence all the time, and many are opened entirely by chance. Not preparing for anything would therefore be neglectful to the extreme.
The question, then, is how we can prepare for a future that we cannot predict.
Long-time readers will already know the answer. Instead of going to the traditional extremes (single mastery in strategic planning, perpetual reinvention in agile), we should improve our adaptive abilities. We need to learn when to reconfigure and how.
An excellent starting point is to attempt to identify whether we the sudden change we are facing constitutes a situational surprise or a fundamental surprise. To once more explain by analogy, building upon David Woods’ Noah story, consider a man named Alan. He can be summed up as a stickler for routine; every working day is deliberately designed to be identical to the previous. Without exception, he gets up at 7am, arrives at work at 9am, leaves at 6pm, and goes to bed at 10.30pm.
One day, after hearing his colleague Linda rhapsodize about the wonders of a new play at the local theater, Alan decides to break his pattern and go home early so that he can make the evening performance, only to find his wife in bed with one of his coworkers. She has had a situational surprise. Alan has had a fundamental surprise.
A situational surprise is a small thing, a detail, to which one can fine tune one’s behavior - cheat a little earlier in the day, if you like. It is typically not defined by its frequency (or lack thereof), though it can be, but rather that it somehow fails to fit one’s model of the world. As long as we update it, however, we will be fine.
A fundamental surprise, on the other hand, completely changes one’s entire world view. It forces radical rethought, reconsideration and reconceptualization.
Mistaking one for the other can have dramatic consequences. A firm that believes a surprise to be fundamental when it is situational may, for example, pivot into a space in which it is at a competitive disadvantage. One that dismisses a fundamental surprise as a situational surprise may find that it accelerated potentially lethal strategic drift.
The easiest way to discern the nature of the change we are facing (within the present context) is through the company strategy. Surprises will always occur outside of our boundaries. A situational surprise will emerge close to them; a fundamental surprise far from them. The larger the distance, the more we have to stretch - and the likelier that something will break.
Unfortunately, as we have discussed previously, few strategic frameworks are explicit about boundaries (ABCDE being a noteworthy exception). But as far as rules of thumb go, the narrower the strategy (e.g., if it takes the form of a highly detailed plan), the closer our boundaries will be to one another, and the higher the risk that the surprise we face forces us to begin anew. Well, unless we suppress or ignore it, which admittedly is common practice.
Either way, a complete lack of strategy (having close to no boundaries, which would mean that almost no surprise would be fundamental), as sometimes argued for, is not a realistic solution. Resources are finite. We will always have to make compromises, sacrifices, and trade-offs.
And so, regardless of the strategic approach that you choose, consider your adaptive capacity and the ease with which you may change.
Think of it not as preparing for a surprise, but preparing to be surprised.
Until next time, have the greatest of weekends.
Onwards and upwards,
JP
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