‘Cause it was the first time I had bought something at JC Penney in several years, best as I can recall.

I like not having to deal with feeling I’m getting gipped just because I don’t have a coupon. Lord knows I won’t go into Bed Bath & Beyond without my mailer for $5 off. They give me the feeling that if I don’t have a coupon I’m paying too much.

The way things were priced at JC Penney made me feel warm and fuzzy.

The categories – everyday, monthlong values & best prices – felt like a promise that tomorrow I wouldn’t regret the deal I got.

The store I was at felt perkier. Livelier. It made the product seem better.

The shoe sales folk were available and nice in both the women’s and men’s department. Miracle.

I found something I really wanted to buy. So did my wife. She hadn’t bought anything at JC Penney for much longer than me. Maybe a decade.

I was reading in Ad Age today about how JC Penny sales are not reacting positively to the change in tactics brought by new CEO Ron Johnson. Comparable store sales down by 18% this last quarter. Feels a bit disastrous, although, I’m not sure that should be a surprise. JC Penny is in the beginning of a major shift in retailing strategy.  They are moving away from tactics that their customers have been trained to antiticipate and react to — coupons and sales and $.99 pricing. All things I tend to hate.

I’m glad to see the retailer taking steps to move into the next generation of retail.  Their current positioning seemed untenable. Stuck between Target and Macy’s, my guess is the path ahead looked rocky at best.

So they’ve taken an interesting gamble on a strategic shift that will be difficult for others to replicate if they are successful.

The question is, can they teach customers to be delighted by the simpler shopping experience?  Or are there enough people like my lovely wife and I to make up for the customers who disappear?

“I don’t believe social justice is a formula, I believe it is a process.”

Passionate and positive, he shared his ideas on how socially responsible business practice and respect for quality of life can help change the world.

Sustainable business is all the rage, but efforts at many companies seem to get holed up in the marketing department or as purely charitable exercises. I asked Dean if he thought large organizations could change over to the sustainable thinking his company emulates:

“For a pre-existing large scale organization it’s hard because people are already in there looking for profit. […] However, when a corporation starts out and says these are our values: ‘We’re a triple bottom line corporation. Yes, we’re going to try and maximize profit but not at the expense of the third world sourcing ecology, or the health of the communities we buy from. We’re not going to do profit on the backs of people to the point it damages their air, water, or food, or their communities. Were going to balance that. Were going to give up a little of this to get that.’

So if you start like that there is a sufficient investment community out right now who’s willing to say, ‘I’ll vote my dollars there.’ “

Interesting take. Old business models are often replaced by new thinking.  Some organizations transform, but more often they decline and are replaced. A core difference between old and new thinking is the idea of profit maximization and value maximization for shareholders. The difficulty has been and continues to be a question of measurement and recognition. The ability to recognize the value of social responsibility for shareholders is key to the idea’s growth.

Efforts to elevate sustainability and Corporate Responsibility are being highlighted publicly by companies in annual reports (See Inditex’s annual report here pg 57), special reports (Apple recently released this supplier responsibility report) and in the media. Right now much of this work is justified to protect corporate reputations (avoiding negative customer reaction), as well as to improve operations (social problems impact supply chains).  This transparency helps, but the efforts show differences from Dean’s.

Dean says his company takes a three tier approach to meet the corporate responsibilities they have set for themselves. Environmental, Economic, and Social.  I had not realized the extent of pesticide use in the coffee industry, second only to cotton, and including multiple chemicals that have been banned for use in the United States. Dean’s Beans helps the co-ops they buy from go through the process of becoming Organically Certified (as he says, ‘organic by design.’) This is more than just ending pesticide use (something he calls ‘organic by neglect’).

Dean’s Beans also internally funds what Dean calls People Centered Development. I found the approach interesting: they work with the community itself, they listen and observe, and then help facilitate something the community is going to run. The variety of projects highlights the community specific approach. For example a revolving well fund in Ethiopia called Miriam’s Well, a tree planting project (over 100 thousand trees planted) in Peru, and a prosthetic program in Nicaragua.  The goal was to start projects that would self fund over time and last.  This approach appears to rely heavily on a very personal relationship between company and community and a belief that the programs must outlast the start-up efforts of Dean’s Beans.

When asked what makes a community development program sustainable:

“Buy in, community buy in.  The community must feel that it owns the program, that it’s not being forced on them and its not going to be taken away from them. But rather its their program, they own and operate it then and will invest their energy in it even in rough times.”

So, a great evening even if I was drinking the wrong brand of joe. In the next few days I hope to be enjoying a cup of Uprising!

So it was with some interest I noticed Business Horizons’ recent issue on entrepreneurship included a paper that strongly argues scenario planning not only prepares a corporation for external disruptive events, but it can improve an organization’s overall entrepreneurial capacity.

Scenario planning has long been used to prepare for emergency events. Since the 9/11 terror attacks corporate use of scenario and contingency planning increased from 38% to over 70% of executives surveyed, again primarily as a means of preparing for external disruptive (exogenous) shocks. In the article, Beyond risk mitigation: Enhancing corporate innovation with scenario planning, William J. Worthington, Jamie D. Collins and Michael A. Hitt, show that “advanced use of scenario planning can help firms go beyond innovative responses to more complex repositioning of their strategy.”

In one example they explain how Goodyear Tire & Rubber Company uncovered synergies and competitive advantages that could be built into their supply chain while developing emergency responses to potential regional conflicts. They improved their everyday business by being prepared for a crises.

“The process used to create the scenarios aids firms in exploring the environment while exploiting their resources and capabilities (March, 1991). This may require companies to shift their perspective of scenario planning from risk mitigation to opportunity recognition. Recognizing that uncertainty in the firm’s environment is an indicator of potential opportunities is an essential insight for executives (McMullen & Shepherd, 2006). In particular, we believe that firms can use scenario planning for exogenous shocks to identify unique opportunities.” Worthington, Collins & Hitt, Beyond risk mitigation: Enhancing corporate innovation with scenario planning.

The authors call this “an opportunity to innovate.”

On occasion I’ve run into the question of whether entrepreneurs and innovators ‘discover’ or ‘create’ opportunities. In the paper Discovery and Creation: alternative theories of entrepreneurial action, Sharan A. Alvarez and Jay B. Barney argue that different strategies are necessary depending on whether opportunities are ‘discovered’ or ‘created’. For example, leadership might be based more on expertise than charisma when opportunity is discovered. Decision making may be more iterative and incremental when opportunities are created versus a risk assessment philosophy for discovered.  In their view, management strategies to leverage ‘discovery’ vs ‘creation’ appear to differ, possibly to the point of contradiction.

To a certain extent this is language play, but from a practical standpoint for a firm trying to jump-start innovative processes it indicates a need to travel multiple strategic pathways. Come to the rescue scenario planning.

It leverages existing organizational learning.

It stretches the collective imagination in ways that spreads knowledge and learning.

It creates an environment where decision making and opportunity observation can be spread throughout an organization.

What kind of scenarios are you thinking about?

Scenario Planning is a great tool for working through the Uncertainty Paradox. Identify possible scenarios. Work through solutions. Discover commonalities. Pre-position for the future.

This is a different way of stroking innovative fires within a company from more individualized efforts like Google’s 80/20 rule. It encourages teamwork, a philosophy of opportunity detection, a working structure for dealing with both opportunities and disruptions, and quite possibly a better management attitude towards learning from failure.

In today’s environment it’s easy to focus on financial disruptions, working on plans to simply get through the current crises. Scenario planning can go much further than that. Technological and pricing attacks from competitors. Changes in consumer tastes. Political disruptions. Employee defections.

All pieces in your own personal company war game.

You can either view the coming disruptions as opportunities or tidal waves. Welcome to the Uncertainty-Paradox, it’s not just about big companies. It’s about you. Innovation is a personal enterprise, part of life-long learning that builds value in all different sorts of ways.

For example, folks generating creative output are under some of the most visible pressure to change business models. This is true whether you are a large studio/publisher or one person art studio. It’s very uncomfortable, but not unexpected. Changes in distribution since before the printing press have been altering how fortunes are made and who makes them.

A new business from iStockPhoto ramps this problem up for designers in the same way they hit photographers. iStockPhoto.com will start making custom, single buyer, stock logos available on a sister site for under $700. In reality, this builds a safe marketplace for inexpensive logos, one that had been developing for a number of years. It is a logical and probably necessary jump in service. However, the business model seems to put the majority of risk on designers, changing how they do business. Just as unlimited use stock photography and digital cameras has caused serious disruption in the photography market, this will undoubtedly continue downward pressure on creative shops. Of course it also provides an introduction to selling your services halfway around the globe. Opportunity? Disaster? Race for the bottom?

One issue that stands out for folks in the US (and other countries long in the developed tooth, well actually everywhere) is that job migration appears to be primarily one way – away from home base. Which feels disturbing and unfair, even if there is mutual benefit overall.

In a recent Carnegie Mellon University publication: “Renewing Globalization and Economic Growth in a Post-Crises World – The Future of the G-20 Agenda” I found a few tidbits that deserve watching over the next decade. Government approaches to international trade and policy directly effect the profitability equations on where things get made and done. Mistakes can cause trade wars and disruptions in all markets, not just import/export. Changes can effect the jobs of everyone from CEO to parking attendant.

In the report, Robert Atkinson, President of the Information Technology and Innovation Foundation, makes a compelling argument that today’s ‘mercantilist, export-led’ globalization structure is not sustainable. He defines this approach as focusiing on building prosperity by encouraging exports while discouraging domestic consumption/imports. He feels that we must move core economic policies of nations to innovation-based domestic growth strategies. This is not a call for the re-domstication of manufacturing jobs or a protectionist spew but an assessment that markets in the United States and Europe are simply not big enough to absorb output from export heavy nations like Brazil, China, India, Russia, and Japan. He calls for innovation across industries in every country rather than industry focused groupings. Creating more universal, level growth in prosperity/productivity domestically world wide. Worldwide increases in domestic prosperity will create opportunities worldwide.

A seemingly slight change of focus, but there is a big difference when the argument about imports is what is allowed in vs what can possibly be consumed.

Can you think of any local job that can’t feel the impact of global competition and change? What are you doing to get ready for winds of change?

Sounds of the sea. Columbus stands on deck, referring to parchment, sextant and sky.

First Mate: “Columbus, what’s that solid blue piece of paper?”

Columbus: “That’s my map!”

And The Crew Sings: “We are lost, we are lost, we are lost…”

The Columbus in this sketch from my days in college radio goes on to say that none should worry, “for we’ll draw the land bits in as we find them.”

When you live in the Uncertainty Paradox you are a Business Uncertainty Explorer.

Much of what we do to manage business uncertainty involves collecting and sifting data about consumers, competitors, trends, politics, technology – the list goes on and on. You can look at each bit of data as incremental detail that needs placing on your planning Map. Each ‘sighting’ (LAND HO!) adds to our understanding of the economic and marketplace landscape. Comments in the introductory Uncertainty Paradox post from several, including Brad, J.D. and LaVonn, reminded me of how difficult it can be, not only to collect data, but also to meaningfully interpret it.

Are you ready to sail when your Map is solid Blue? (Blue Skies smilin’ at me, nothin’ but Blue Skies do I see… come on everybody, hum.)

The concept of ‘No Regrets Moves’ Bill Welter introduced in his first Paradox post might help us set sail. It forces an analysis of the decision process as much as the decision. Can you make the wrong ‘No Regrets Move’? Yup. But I think ‘no regrets’ is defined by making the best move you can with the current information at hand while including a set of internal features that permits course correction as you learn more. Therefore, wrong moves are corrected rapidly and seen as learning events, not regrettable mistakes. Freeing, yes? Ready to set sail?

‘No Regrets Moves’ leverages nicely Kay Plantes push for building strategic flexibility to allow your business model to adapt to changing conditions. If you can’t predict exactly what the economic environment will bring then you have to be ready to react to the winds, storms and beautiful days as they come. Brings to mind how tossed so many of us are by the impact of Free on business models. Hang on, rough seas ahead.

The brass ring is to formulate models that can predict behavior. As more data is available these models become more and more complex. No matter how you manage information you are using a filtering system on the data in front of you, even if it is as simply-complex as gut feel. One could argue that Gödel’s Incompleteness Theorem is as true for any predictive model as it is of mathematics in general. (Ouch, I can hear the mathematicians’ cringe, give me a second to explain and then fire away.) The connection here is models are built on assumptions that make the model work, but the assumptions may not be provable or disprovable through operation of the model.

In other words: Your model doesn’t know what it doesn’t know, and you better remember that. (A blue map is perfectly happy being blue and feels no discomfort when your ship flounders on an unseen sandbank.)

How could we be misinterpreting incoming data?

• Arbitron ratings are shifting from a diary approach to an electronic tracking method. Radio stations had learned programing tactics to boost diary numbers that don’t work very well with the new method. Given the strain on the industry, was the way to get good diary numbers (maximizing advertising revenue) the best strategy to get real listeners?
• Mathematical modeling has it’s limits. The Gaussian copula function by David X.Li which claimed to model complex risk was adopted by most of the financial industry. It delivered a magic number that defined all the convoluted relationships and mysterious correlations involved in the complex transactions being created. It allowed for deals so complex that million dollar decisions were made based on faith in that formula. Miss-placed faith evidently.
• Psychographic data can help you brainstorm and target and it can also can turn your idea of customers into such a stereotype that opportunities are missed. I’ve seen products designed for the young go gangbusters with seniors, causing much confusion among the hipsters who thought they knew better. Well done research is very powerful, but understanding its weaknesses is critical to avoiding hubris.

I love this description of difficulties measuring risk in financial markets from a January 2009 Joe Nocera article in the New York Times:

“[Risk consultant Mark] Groz has his own way of illustrating the problem: he showed me a slide he made of a [risk] curve with the letters “T.B.D.” at the extreme ends of the curve. I thought the letters stood for “To Be Determined,” but that wasn’t what Groz meant. “T.B.D. stands for ‘There Be Dragons,’ ” he told me.”

The Feedback Loop — A Tool For Setting Sail, Avoiding Sea Dragons, and Correcting Course

What can stand as the business equivalent of sextant, star and compass? One of my primary tools is the Feedback Loop, which provides a consistent process of propose, implement, evaluate, and refine/revise/retire. It’s terribly simple, but that is usually for the better.

• Propose - Set direction and evaluation methodology. I wish to sail here, it should take me six weeks. I will find Land. What makes this promising six months from now, for what reasons would it be killed? I think Bill would say, “Sit Down And Think.”
• Implement – Rapid prototyping, inexpensive testing, no CYA research. Buy Supplies, load the boat, set sail. Find affordable tools to monitor and test assumptions. Implementation steps need to provide as much ‘real world’ evaluation power as possible. (Avoid Focus Group Confirmations.)
• Evaluate – Depending on the risk of further investment this step takes on various forms. Where are we on the map. Any green bits yet? Giant squid port side. The larger the investment the more serious the effort to disprove the momentum viewpoint must be. A hypothesis that is only tested in ways to prove it is right leaves you in the dark about ways it is wrong. Again from Bill – CHALLENGE.
• Refine/Revise/Retire- Every cycle should provide learning that is incorporated into the next Loop. Have someone involved who is a contrarian, devils advocate. Captain, we must change course. This step forces you to add the flexibility Kay wants to see in your business model and strategy.

This pretty much applies the scientific method to business planning (and personal life, if your so disposed – the tool scales well from the individual to the largest of projects) and is a critical element to be included in any knowledge based organization. It’s common sense, but honestly, can you remember the last time you applied something like this systematically and consistently? By establishing a Feedback Loop you reinforce the ability to make ‘No Regrets Moves’ because flexibility and course correction is built into the process. This doesn’t reduce the necessity to get decisions right, but it amplifies the ability to make decisions more timely.

The Feedback Loop also helps empower reaction to new marketing data at the lowest levels. If you are reacting at ground level, by the time a trend is a trend you already have created a solution that has gone through trial and error and can be rolled out fast. So even if it feels like your map is nothing but blue, the Feedback Loop puts in place the system you need to identify shoals, call out landmarks, track and change direction and most importantly, identify dragons.

In previous comments Terry said: “I guess the real paradox is being prepared and having a plan, but remaining open to inspiration.” So, I’m hoping the Feedback Loop can help keep your plan open to inspiration.

Are you using any tools that seem to work in a black-box sort of way to predict what the future holds?

Does the Feedback Loop sound useful to you? Have you used similar processes?

I wanted to thank everyone for your comments on the introduction to this series.  My thinking is always being spurred forward with your challenges, additions, and corrections and is very much appreciated.

• Bill Welter’s Adaptive Strategies blog
• Kay Plantes Business Model Innovations Blog
• Fred Schlegel  (You’re already here!)

Join the continuing conversation at each of our blogs as we explore the implications of the uncertainty paradox.

• Tropicana went for a radical new package design dropping their familiar ‘straw in an orange’ image for what I consider a rather generic box.
• Gatorade traded the logo and their name for a large letter G and reduced lightning bolt.
• Pepsi traded their single circle for a series of happy faces and fat birds and stylized type.

I’ve reported disasterous Tropicana numbers earlier (down 20%) and that they have abandoned the logo change.

Evidently the Gatorade numbers are just as terrible down more than 13% in the first quarter (with Powerade picking up 6 points of marketshare). My guess is they won’t backtrack here. (Two admissions of extreme error in a six month period. Nope.) (UPDATE BELOW)

I haven’t seen anything about Pepsi results, but for the most part you could still tell a Pepsi bottle was a Pepsi bottle so there isn’t much to expect. I doubt consumers pay much attention to Fat Pepsi logo vs Thin Pepsi logo, but if it makes corporate happy…  This is a different strategy from the cloak of invisibility delivered by the Tropicana and Gatorade redesigns.

Here are a few things I am assuming about the decision to bring such radical change to Tropicana and Gatorade.

• Each brand is facing serious challenges to their dominance and therefore alarm bells were ringing.
• Folks within each organization were tired of the old ‘been there for years’ logos.
• They hired a ‘branding’ agency. (Heavy sigh. I’ll save the rant for later.)

Humans get tired of things. I get it.

Change is good. Fabulous.

Old packaging design gets dated. You might become a nostalgia brand, or heaven forbid, a drink for old people.

Was there panic? I don’t know. Certainly somebody, somewhere wanted to put their imprint on some classic American brands.

Three lessons from this very public experiment.

• First – While logo design is critical, most of a logo’s (and package’s) power comes from FAMILIARITY. Both Gatorade and Tropicana became invisible overnight. Customers had to look for them and therefore had an extra second to make a different choice.
• Second – Changes to familiar brands need to be made with care. Huge advertising budgets don’t necessarily equate to awareness at the shelf. (Anybody remember when Arco changed to Amoco, or visa versa? The cardboard cutout of the gas pump attendent changing the sign was up for several months in the midwest.)
• Third – Watch out for what research is really telling you.  This was too big of a change to not been researched the heck out of. Most of the time failure here revolves around experiment design (examine logos in a focus group room rather than on the shelf of a real store) or the results are ignored cause ‘change is good.’

The landscape is littered with name, logo and packaging changes gone bad, so you would really think folks would know better by now.

UPDATE/CLARIFICATION 07/28/09: The misfire becomes more obvious when I compare apples to apples. The 13% decline was in sales. Gatorade lost about 6 percent in market share which was almost entirely picked up by Powerade. This makes the following quote from PepsiCo CEO Indra Nooyi all that more amazing (July 23 Wall Street Journal Subscription probably needed) “Clearly some of those [former] users switched to cheaper alternatives” and in some cases soft drinks, she said in an earnings conference call. “They didn’t have a right to exist in the Gatorade world,” they just liked the taste.

I can’t even begin to address how wrong that sounds.

Uncertainty can also drive you mad and destroy your company.

Bummer.

Bill Welter (Adaptive Strategies), Kay Plantes (Plantes Company) and I have been discussing how the uncertainty caused by stronger, less predictable and more frequent disruptions can be as large a source of opportunity as it is a threat. We’ve been considering why such uncertainty tends to freeze some and free others. And we’ve been thinking about where companies and individuals can find solid traction for progress even when they feel trapped by uncertainty.

The three of us have worked with a wide range of organizations from the very large Fortune 500 to the very small entrepreneurial start-up and we tend to agree that standing still is about the only option NOT open to you today.

You are either planning your moves or circumstance will do the moving.

Sound scary? It should, but maybe in more of a roller coaster sort of way. Think about it, the economy has its ups and downs, technology drives you through loops and leaps and your customers are constantly throwing in wild curves. Not to mention the twists from world politics, commodity prices and competition. But we think there are ways to prepare for the wild ride, ensure the track is safe and train well built. Ways that head you towards fun and profitability rather than derailment.

The Uncertainty Paradox

Uncertainty is a funny thing. At the same time it destabilizes your organization’s ability to generate profits it opens up opportunities for the future. (One can also argue that too little uncertainty leaves you open to severe risk from an ‘unlikely’ event, such as the financial firestorm in late 2009 – but we’ll leave that for later.)

In research literature the Uncertainty Paradox is referred to from several different perspectives. For instance in terms of government regulatory policy it faces the question of making decisions based on risk that can not be assessed with certainty. In research literature it is a question how managers can still make decisions with incomplete or in-exact information (qualitative vs quantitative). (Subscription only link to Roger Palmer article)

We’ll be defining it further as we go along, but for now lets call it the belief that organizations and individuals need insights and strategies to move forward with certainty even under conditions of increasing uncertainty if they are to take advantage opportunities as they are uncovered.

The three of us are tackling the Uncertainty Paradox from our different perspectives. The nice thing about working together is that we each focus on different aspects of preparing a company to innovate and react to maximize profitability.

First an introduction to our ‘circles of influence.’

Preparing (for Leadership) — Differentiating (the Enterprise) —- Connecting (to Customers/Partners/Competitors)

Preparing – Uncertainty demands leadership that is prepared at all levels of an organization to act decisively and timely. In Bill’s book “The Prepared Mind Of A Leader” he describes a key variable:

“Some of us are ordained leaders in our organizations. We have the appropriate title and the appropriate box on the company organization chart. Others of us are left with the unofficial title of “follower.” However, the reality of the need for speed and intelligence on the spot makes this distinction moot. We simply can’t wait for the official chain of command to comprehend the changing world around us: we don’t have the time, and the situation demands a response! Therefore, everyone has the responsibility (but often not the cultural permission) to work outside their job description to take advantage of opportunity that leads to strategic advantage. Leadership is seen in acting with foresight in the best interest of the organization’s value chain, in line with personal and societal values. Prepared Minds enter the action anchored in purpose and unafraid to think and act differently than the status quo.” — Bill Welter – The Prepared Mind of a Leader: Eight Skills Leaders Use to Innovate, Make Decisions, and Solve Problems

Differentiating – Strategically differentiating your enterprise – product, structure, revenue streams, the whole ball of wax – becomes more critical as outside disruptions and outright copying intensifies. In Kay’s book “Beyond Price, Differentiate Your Company in Ways That Really Matter” she talks about shifting from Customer Driven to Market Driven:

“They [Strategically Differentiated Organizations] have broadened their external focus so they can understand the forces at work in the market as a whole, and they make deliberate decisions about both where to compete and how they will stand out from the competition.” — Kay Plantes – Beyond Price: Differentiate Your Company in Ways That Really Matter

Connecting - To many, marketing has become about communications. If you’ve been around me for a while you know that’s not the way I preach the discipline here. Marketing, as I look at it, involves creating and nurturing an organization’s internal and external connections with customers, partners, competitors and marketplace to drive feedback for decisions, productivity gains, and innovation. Disruption tests those connections so they must be secure:

“Driving the marketing discipline through your organization creates entanglements with customers deep down in the soul. It affects creativity in ways that are profound. Just think what would happen if your customer and prospects became an intimate part of your org chart.” Fred Schlegel, Frogblog

Whether you want to call it marketing or something else, we’ll be looking at strategies and ideas that can drive those relationships in the face of uncertainty.

A Group Project

Each of us will be looking at real world tools and strategies that can drive a company, idea or you forward in the face of a world seemingly gone mad. I’m going to leave it to you to visit Bill and Kay’s websites to seek their take on the Uncertainty Paradox and get a better feel for their background. The perspectives overlap and interconnect in ways that even we haven’t fully imagined yet. However, in the spirit of ‘open’ and ‘moving forward with certainty in the face of uncertainty’ we’ve decided to flesh out our ideas in blogger style. We’re hoping that the community of commenter’s at each of our blogs will join the conversation, challenge the ideas put forward and strengthen the concepts so they’ll be of more use.

The three of us are posting introductions to the Uncertainty Paradox today. Add your voice to the discussion here and at their blogs.

(Update 10:00 am : I jumped the gun on publishing by a bit, so Bill and Kay will be posting in a bit.  I’ll update links as they are available.) (UPDATE 7/24/2009: Links have been updated to Bill and Kay’s introductory posts.)

Do you have any examples of opportunity born out of uncertainty?

My thanks to Brad Shorr, business blog consultant extraordinaire, for introducing the three of us and instigating this little thought experiment.

• Bill Welter’s Adaptive Strategies blog and his introductory post: “Leadership In Times Of Uncertainty”
• Kay Plantes Business Model Innovations Blog and her introductory post: “Does Business Model Strategy Matter In An Age Of Uncertainty?”
• Fred Schlegel “Tackling The Uncertainty Paradox-An Introduction” (You’re already here!)

Join the continuing conversation at each of our blogs as we explore the implications of the uncertainty paradox.

Oh, and there’s not a dime to spare.

This is the challenge faced by many rural health centers utilizing a system of community health workers who travel from clinics to reach patients in very isolated regions. They usually travel by foot or bike. They often cover such large areas that they may not return to the base clinic more than once a month.

In wealthier regions solutions would probably involve large scale databases, interactive web pages, medical equipment hooked up to doctors in centralized locations and maybe even a car or two.

Sometimes a lack of resources and a will to succeed is more than ample to create a real world changing difference.

Frontline SMS:Medic was one of the business plans presented as part of the NU Venture Challenge at the Northwestern University Farley Center for Innovation Entrepreneurship Summit last month. What an aggressive group. They have already deployed several systems, received the NU Venture Challenge ‘Best Social Entrepreneurship’ award  and recently won the N2Y4 Moble Challenge.

The solution? Text messaging.

Through open source software (FrontlineSMS), inexpensive (yet rugged) cell phones, a basic PC at the health center and a GSM modem they are able to set up a robust communication network for health workers and the community health center. Information is of higher quality and instantaneously updated and available.

Sometimes it’s the budget and infrastructure limits that actually drive the most robust and useful solution. When you know what money can’t buy you figure out ways to make due while making great – cardboard creativity in action. The young company even operates in an unusual, low cost way. While the idea was hatched in the summer of 2008 and the company launched this past February – the first face-to-face meeting of most the team didn’t occur until March.

They’ve been working as a virtual organization all along.

The innovative solution they have developed takes into account the limited infrastructure available and can be implemented for just a few thousand dollars. But even this low cost solution stretches budgets.

Next innovation – a charity that accepts your old cell phones to raise the capital needed to implement FrontlineSMS:Medic – www.hopephones.org.

As I said in my previous post – it’s nice to see young entrepreneurs face challenges.  They bring a can-do spirit that is invigorating. FrontlineSMS:Medic is operating in a niche that other organizations could not serve.

If you happen to have a spare cellphone hanging around, check out www.hopephones.org. Donating your phone could help spur a revolution in medical records technology.

Photo Credit: © 2009 Adrian Sparrow via www.istockphoto.com.

When you’re moving at the speed of light it’s easy to think those who don’t keep up just don’t get ‘it.’

• Word processing software is so productive, why do they even make pencils anymore? (We still use about 100 million a year.)
• Email is fabulous, why phone? (Oops, showing my age. Substitute Twitter)
• Online listings are always up to date. Why do 19 billion paper catalogs keep showing up in my mailbox? (At least it feels like my mailbox.)

Innovation Reality Check.

If you are in a dynamic product development environment your eyes might be so focused on the future that you miss opportunities in maturing markets simply because it seems passe’. (Buggy whips anyone?)

I was involved in a project that expected a significant number of senior participants. It was a bit high-tech but seemed well thought through. Usage was dismal.

“They don’t get technology.”
“They’re afraid of computers.”
“They’re set in their ways.”

Excuses, excuses, excuses. Did a bit of research. Asked folks in the target market what they thought. It wasn’t the technology. It was the concept. We were meeting a need they did not yet have.

Ah-ha!

What do your sales-folk think?

Pull you top salespeople in. Ask them for their best sales document. Want to bet it’s a home brew? Great sales-folks have always adapted their pitch. This drives marketing departments nuts. It’s off message. It’s ‘unprofessional.’ It’s cardboard creativity at its best helping meet sales objectives better than the original material. Large organizations have begun to install systems that try to capture this kind of end-user innovation, but most of the time it remains fragmented.

Salespeople usually have to live with what their customers actually want and understand. That often forces them to cut through ‘high concept language’ that was used to sell an idea internally and focus on the things that will actually sell the product. Sometimes cutting edge and sales talk align, sometimes they don’t.

Innovation Matters. But sometimes it would be better to call it Optimization.

Providing a customer something they don’t want is wasteful. Having it ready when they catch-up is brilliant.

• Microsoft Word is a beast of a word-processing program. I no longer use it until final draft. Too cumbersome. To0 heavy.
• Salesforce.com is a beast of a CRM tool. BUT, it can be just as simple or complicated as you want it to be without a lot of up-front planning or investment. Simple to get in, simple to ramp up, simple to get hooked.

Think about where you are in your business. Has innovation caused confusion, or irritation, or simply bloat?   Can you simplify or backtrack and pick up lost sales in a way that doesn’t compromise what you are about?

Do you see potential customers in your rearview mirror?

It comes from places you expect, don’t expect, and come to expect. 

You have to be open to it. Defend it. And, on occasion, abandon it.

Physics has been my muse for thinking about ways creative ideas might be better shepherded through an organization as we try to:

Avoid concept death by committee.

Avoid killing creativity through argument.

Avoid ignoring the game changing idea.

As I explored folks came to my rescue – building on concepts, offering encouragement, arguing kindly (and on occasion providing the needed fix). Very similar to the way discussions surrounding physics were described in Gilder’s Book. The discussion has spurred my thinking – and so this seemed like a good time to review where we are at.

Strategies for Probing and Testing Ideas without Killing Them

Thought experiments were a favorite of Einstein and Bohr in part because they help you to think through the implications of a theory. I started with the idea that formalized thought experiments could form a foundation of ideas to draw from.

Brad Shorr provided a good spin by suggesting we choose the most ridiculous idea possible and working backwards from that. “You might find something that seems impossible at first blush is not impossible at all.” 

LaVonn commented on how the idea could help organizations break out of their ‘linear chain of command.’ “A great organization has many paths for an idea to take for examination and consideration.”

Kay Plantes warned of how playing this game poorly can lead you “over a waterfall where only the lowest cost companies end up floating.”

So thought experiments could be used to break down boundaries between divisions, transfer information, explore the ridiculous as well as the likely – all to form a library of stress tested ideas that can be referenced as conditions on the ground change. 

As Andrew said, “Ideas are powerful but only so if they are acted on.”

Nurturing and Defending Ideas Against the Brick Wall

Ideas seldom come packaged ready to implement. They can be messy, humorous, illogical and unlikely. From my list of strategies for breaking through brick walls discussion quickly turned to how hard it is for a creative spirit to survive within the corporate confines.  

“Once you are “inside,” you are absorbed and then defined by their lack of imagination,” Diana commented 

Creativity itself may be easier to outsource in our technological world, Brad predicts. “Too much pressure on employees to toe the line. Within organizations the pull of conformity is as irresistible as the pull of gravity.” 

No matter if the work is internal or outsourced, a driving need for ‘fresh perspectives’ is essential to improved creativity. As Andrew brought up, “It is too easy for employees of an organization to become accustomed to the ways and systems of the organization, and this may limit their ability to see the potential for new and better ways of accomplishing certain tasks.”

Entanglement As A Tool Rather Than A Theory

I mentioned that I love the word entanglement. It seems ripe with possibility when applied to the idea of relationships. It is what drew me to Louisa Gilder’s book The Age of Entanglement: When Quantum Physics Was Reborn in the first place.

The effect of entanglement is (using the more correct definition courtesy of Salvador), when you measure one entangled particle that simultaneously determines the state of the other.  Applied to marketing I imagine this to mean: Mutual Long Term Influence Even at Long Distance.

While Bill Welter thought the idea was interesting, he did bring up concerns about how ‘noise in the system may overcome the real communication.’ So entanglement must be something more than social media. “Just because we can use social media doesn’t mean we should use it all the time for meaningless broadcasts.” I think of the explosion of corporate sales chatter on Twitter is a pretty clear description of where this can go wrong.

Salvador is the true scientist in this great group and took a shot at further defining what ‘entanglement’ might look like as apposed to a standard network:

“‘Entanglement” was Schroedinger’s word, and he just casually tossed it off, I think he didn’t take it seriously, and it is a fine word for the phenomenon. ….However, the word IS conceivable, it can have meaning. And the ‘force’ at issue, is essentially inconceivable, which is why they say no one can ‘understand’ the quantum physics.

So in your context here, I’d suggest entanglement be “undefinable” as part of its definition. But then it could be described for example by how it is unlike a network, or what things are possible under entanglement, which are not possible in a network, or are there improvements to be applied to a network? Redundant nodes…”

I’ve been really energized by the ideas-from-strange-places that have come about from this series and readers’ comments. 

The power of blogging to explore and record ideas should not be surprising, but it is a relatively underused tool at the corporate level. The community interaction has helped me get my head around concepts that may have some long-term merit. It would be interesting to see companies get past their security concerns, adopt an open attitude and see how their crazy ideas were reacted to, even if it was just with the corporate audience.  

Thanks to all who comment and read. I appreciate your thoughts and encouragement. Now I just need to decide if frogman should be my moniker as Salvador suggests.