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.
Your company could be here.
I am, for the first time, opening up to newsletter sponsorships. For more information about how to put your brand in front of thousands of highly skilled, highly engaged professionals, send me an email. First come, first served.
Now accepting keynotes for 24Q2-24Q3
Every year, I create three main presentation decks. For 2024, they are:
What to Do When You Don’t Know What to Do: How to turn uncertainty into a competitive advantage. (Based on my new book by the same name.)
Regression Toward the Meme: Why modern leadership falls into old traps - and how to avoid them.
The Efficiency Illusion: How to uncover the hidden costs of digital commerce and create profitable growth.
If you want to book me for your event, corporate speaking slot, or workshop, merely send me an email. To make sure I am available, however, please do so at your earliest convenience; my availability is limited and the schedule is filling up fast. More information may be found here.
A couple of updates points before we go-go
I was recently asked, for the third time this week and about the thousandth time overall, why I “give a shit”. None of the questions was ill-intended in any way, but each person had surmised that the corporate game is rigged; might as well go to work, play along, and enjoy your salary.
The obvious answer is that I cannot afford complacency. As a consultant, my job is to help organizations improve. I have to care - even if they do not. And yes, I am (painfully) aware of the issue that lies therein.
The problem is further exacerbated by the fact that my well-known competitors are selling what already is in demand: familiar promises of deterministic control based on outdated beliefs about how organizations function (not an opinion but a scientific fact). That their “solutions” rarely actually work is neither here nor there. As we have established, people prefer a predictable failure to an unpredictable success.
What few appear to consider, however, is that the plan (for it is always a plan) that follows from the expensive advice is precisely what creates the feeling of despondency in the first place. Employee engagement is typically an issue because there is a lack of creative oxygen, and what suffocates participation more than anything is being told to “stick to the plan”.
Now, while I would be entirely open to working with or for someone else, I have absolutely no desire to hand over client work to a bunch of twenty-something underlings who go on to merely fill in the blanks “like they did the last time” in a consultancy equivalent of a conveyor belt manufacturing line. This hardline makes me persona non grata in big advisory firms to which the approach is fundamental.
My curse, in other words, is that I genuinely care. Thus, I have no choice but to give my all to identifying better ways of working, of doing strategy, of leading companies. Whether I have been successful doing so is entirely up for debate, but at least I am fucking trying.
Oh, and yes, I am changing the title formatting (at long last) to the Seinfeld “the” approach. Although the original reasoning (X & Y) was similar, it seems overdue.
Moving on.
2024.2.c
Resilience - Of Paramount Importance
Part III: The Law of Stretched Systems
In last week’s premium-subscriber newsletter, we discussed the danger of dismissing fat tail events as they often cascade throughout systems and have immense effects on businesses. To reuse but one of our examples, the fate of the Chinese real estate sector could end up having a dramatic impact on tech firms of all sizes the world over.
Our conclusion was not that one should prepare for every contingency, but that one should be prepared to be surprised and understand the tradeoffs in strategic choices made. We also discussed how one might do that.
What we did not discuss beyond a short reference, however, was how change leads to more change.
Most conversations about the evolving nature of the corporate existence revolve around perceived plateaus. We have all heard the line “this will change everything”, not least in respect to AI, but rarely ponder the premise of the promise: the transition will one day be completed. Once we have implemented the new system, upgraded our software, solved the problem, we will be done. Money will be saved and time will be freed.
Similar conclusions have been reached repeatedly throughout history. Perhaps most famously, John Maynard Keynes predicted in Economic Possibilities for our Grandchildren (1930) that we would work 15 hour weeks due to the pace of technological progress. As if it needs to be written, we are not.
Granted, economists are quick to point out that working hours for the average worker indeed have dropped significantly in the last 150 years. But they conveniently forget to mention that practically the entire decline came within the first 70 years of that span. In the 1880s, the typical worker labored ten hours a day, six days a week. In 1920, their counterpart was down to an eight-hour day, six days a week. By 1940 the typical work schedule was eights hours a day, five days a week. Today, despite immense increases in labor force and ground-breaking innovation, that is still the rule.
The hypotheses for why are manifold, ranging from imagined aspiration to David Graeber’s notion of bullshit jobs, but almost all focus on individual drivers and therefore, I would argue, provide partial explanations at best. If we instead observe the system, a pattern emerges. As soon as there is some improvement, for example in the form of new technology, it is exploited to achieve a new intensity and tempo of activity. The form that the exploitation takes naturally varies, but the principle remains the same. To illustrate, it is perfectly possible to predict what patterns will emerge once a new patent has been filed, but it is impossible to know beforehand precisely what the patented invention will be.
In complexity science and resilience engineering, the phenomenon is known as the law of stretched systems and has been proven to hold time and again: every system is stretched to operate at its capacity. The more RAM computers have, the more RAM browsers will require for tabs. The faster networks get, the bigger web pages will be. The larger memory gaming consoles have, the larger games will be. The more data processing capabilities we secure, the more data we will collect. What is available will be used.
Bringing the law to a context that is perhaps more immediately relevant, it means that time freed up by, say, automation in operations will immediately be filled by something else, typically justified by the same desire for efficiency that drove the innovation in the first place. In theory (and sales argument), we can do more, faster, better, and cheaper. In reality, what we imagined would relax workload conversely increases workload; we work the same hours, but are asked to do more in them. And the more productivity apps we purchase, the more time people will spend on them instead of being productive.
For strategy, the law of stretched systems means (among other things) that the more successful we are, the more change we will bring about, as other adaptive units will do their utmost to take advantage. Behind every successful company, there forms a long line of hopeful competitors looking to do the same but slightly better. The market creator does not compete merely against individual firms, but the trial and error of the market itself in a constantly changing environment.
Believing that we may render change or challenge irrelevant through mastery as conventionally posited, therefore, is not only false but evidently self-defeating. Although we may achieve success through a fortuitous bet, our ability to maintain it relies entirely on our capacity to adapt to change. Complacency kills.
Put differently, the proverbial game is not about controlling change, but making the most of it - an endeavor overflowing with challenges. The wrong response implemented too quickly can be disastrous, but the right response implemented too slowly may become the wrong response as a result.
Next week, we are therefore going to continue this exceptionally important conversation on precisely that.
Until then, have the loveliest of weekends.
Onwards and ever upwards,
JP
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