The second one about learning
On intellectual MMA
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.
In today’s newsletter we highlight challenges in organizational learning. In the premium section, we also discuss Nvidia, Apple, artificial intelligence, and how to break the alignment paradigm through coherent action.
Now accepting keynotes for 24Q4-25Q2
Every year for the last decade or so, I have created three main presentation decks. For 2025, however, I have (for the first time) added a fourth due to popular demand. They are:
What to Do When You Don’t Know What to Do: How to turn change into a competitive advantage. (Based on the new book by the same name.)
Pushing the Envelope: How to create and nurture an innovative organization.
Resilient Retail: How to survive and thrive in the modern marketplace.
The Unknowable Unknowns of Artificial Intelligence: How to manage a risk that is inherently undefinable.
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, please do so at your earliest convenience; my availability is limited and the schedule tends to fill up fast. More information may be found here.
A couple of updates before we go-go
First, and most important, I have updated my keynote offering for 2025 and added a fourth talk about AI. See above for further information, booking details, and so forth.
Second, I HAVE MY CAR BACK. HALLELUJAH.
Oh, how I have missed thee.
Alas, on my way back - during which it suspiciously did not rain (a clearly deliberate decision by the ever-spiteful weather given how desperately the birch pollen covered Merc was in need of a shower) - the wind began to blow. It got worse. By next morning, the breeze had developed into a storm.
Two Thuja trees that I had recently planted were so immensely impressed by the display that they fainted. This meant, of course, that they also had to be put back into the soil and provided something to hold on to, lest their stems and roots would buckle once more the like knees of a 12-year old girl at a Taylor Swift concert.
Unfortunately, as I realized a few weeks ago when I planted the trees in the first place, I am highly allergic to Thujas. The only reason why we have them in the garden is because they make up what we call the Wall of Pine-a, created by the previous owner. My wife does not want to go through the hassle of replacing them all, so every now and again, one of the moody fuckers die and I have to replace them. With painful consequences, regardless of any preventive efforts, to follow.
So that is what I am enjoying right now. Happy days.
Third, on a completely different and more positive note, if there are any parents to young children out there, I highly recommend the books about Alfie Atkins (Alfons Åberg in Swedish). There are cartoons available too (on Netflix at least in the Nordics), and they are f-a-n-t-a-s-t-i-c.
Unlike other celebrated kids’ shows (e.g. Bluey), Alfie Atkins is not hectically paced, instead taking its time to tell stories about everything from bullying to how to behave at the dinner table and even philosophy - in each case in a way that is understandable to children.
Oh, and if you happen to find a subtitled version of the cartoon featuring the Swedish actor Jonas Karlsson as the narrator, boy oh boy, will you be in for a treat. It is an absolute masterclass. Perfect in every detail.
Moving on.
2024.4.b
The second one about learning
On intellectual MMA
Earlier this week, I made a couple of reflections on organizational change and learning, particularly from the viewpoint of consultancies and agencies. The analysis proved to hit the proverbial spot; many, it soon became apparent, recognized themselves in what I wrote. And so, I thought that I would elaborate a bit upon my thoughts.
Since far from all of you follow me on LinkedIn, here is the original post for reference:
A short explanation of one (of many) reason(s) why agencies and consultancies will remain a lot slower to change than they tell their clients, shareholders, and anyone else willing to listen (or to be within earshot).
Starting with the very most basic and fundamental, the way that external aides primarily make money is by selling their services. Per the most common rule, if you are employed by such a firm, you need to bring in (or work on) more business in monetary terms than your salary costs. Hence, utility rates.
If you challenge the status quo - typically embodied by the most senior employee (manager) in your team - by bringing in new ideas, you will be considered a pain to work with (for various reasons ranging from ego to plan and schedule maintenance/adherence). If you are a pain to work with, you will not be picked to be included in teams by the person responsible; they want to deliver to deadline, expectation and budget, ideally as smoothly as possible. And so, your utility rate will fall, and eventually it will make no fiscal sense to have you on board. Much as how Upton Sinclair mused upon the difficulty to make someone understand something when their salary depends on them not understanding it, it is very difficult to challenge someone when your salary is under their control.
As a result, few novel ideas will emerge; innovation is not killed by a lack of innovative sparks, but a lack of oxygen. (And this, by the way, is also why hiring to speed up organizational change is a lot more difficult than most imagine; pre-existing constraints make even the most inventive lose their ability over time.)
The utility rates also force the modus operandi in place by additionally ensuring that little time is set aside to learn. Even if you hover around 75%, which isn't a bad benchmark overall, the remaining 25% is typically spent chasing clients, doing admin, and so on. Only a fraction, if that, is spent learning new skills or upgrading existing ones in ways that go beyond what the organization offers.
In other words, the very basics of the business model, at least as currently applied, inherently make learning difficult. Without learning, there will be no new ideas. Without new ideas, there will be no change.
Ironically, the current trajectory means that the big next step for the parties involved is likely to come if (a big if, but nonetheless an if) they manage to productize their service offering, for example by using AI - which will remove utility rates from the proverbial conversation.
Along with, of course, the need to have quite as many employees.
Obviously, the lion’s share of I wrote is based on what I have learned over my long career as a consultant, but there are a few key principles also at play.
The first is the unsexy but nonetheless very real point about how the organizational perspective differs from that of its employees. Many (though admittedly far from all) employees want to learn. While a massive opportunity for their employers, it also presents a dilemma. Learning requires time. Time requires money. Money requires business. Business requires time.
Consequently, if the learning in question is not self-evidently tied to the business, firms often see it as a waste of time and money. And yes, this is despite their love for public grandstands about the importance of innovation (which is a byproduct of new ideas being introduced). What therefore tends to end up happening is that the upskilling efforts most likely to be deemed worthy of investment are those that reaffirm the status quo; employees are not introduced to novel thinking, but taught how they might do what they already are doing in better, faster, and cheaper ways. While that undoubtedly can be beneficial, it also locks existing beliefs and knowledge in place.
Second, there is a scientifically proven benefit to what one might call breadth (as opposed to depth) of learning. Specialization can be highly valuable but does not, contrary to popular belief, necessarily lead to breakthrough innovation. Rather, it tends to improve upon what already exists. We may see why if we go back a couple of years in this newsletter’s history and remind ourselves how insights are generated:
As we can see in the illustration above, there are three pathways to insight generation.
First, one might make better use of what Gary Klein calls the power of contradictions by taking advantage of the Tilt! effect. Whenever we encounter new information that fails to fit into our old model of the world, our intuitive reaction is to dismiss it as erroneous. However, such inconsistencies and discrepancies can be the origins of new insights and should consequently provoke further investigation. (One might also observe that this echoes Steven Johnson’s notion of error and Thomas Khun’s argument regarding the role of error in scientific advancement.)
The connection path, meanwhile, thrives from having a plethora of ideas “swirling around”. As Klein puts it, the more swirl and turbulence, the greater the chance for discovery; by increasing the opportunity for accidental linkages, we improve the odds of discovering insights. To Johnson’s point in Where Good Ideas Come From, this can be done precisely by learning broadly (thus exposing ourselves to novel ideas).
The third path, creative desperation, requires what Klein calls “a different stance”, as it comes out of being cornered and trapped in our own minds by an unwarranted assumption. The term sometimes invokes slight trepidation, but there are ways in which to achieve the effect without pushing one’s employees to a state of near-panic (e.g., by listing assumptions using a Wardley map (premium link), employing constraints such as a highly limited budget, or encouraging critical thinking).
Crucially, each pathway is dramatically easier to take if employees have - to paraphrase the late, great Charlie Munger - a large latticework of mental models upon which they may hang their experience. Without one, they will only ever view the world through a narrow lens. Even if said lens is the one that the company desires, a hell of a lot of critical information will be left unseen. And that is incredibly dangerous.
Introducing an organization to different concepts and ideas may appear wasteful in the short-term, but almost always proves valuable in the long-term. One might think of it, as Steve aptly put it in one of our recent conversations, as the intellectual equivalent of mixed martial arts. In any particular instance, proficiency in a specific technique or style may be beneficial, but in an uncertain, continuously changing competitive situation, the significantly larger toolbox of MMA will be very hard to beat.
And so it also is with knowledge.
Until next time, have the loveliest of weekends.
Onwards and ever upwards,
JP