Expanding Our Horizons – Efficiently

In our Big Shift world, we confront the imperative of institutional innovation – shifting from institutional models built on scalable efficiency to institutional models built on scalable learning. I’ve written and spoken about this a lot over the years and one of the most common pushbacks I get is – “so, are you against efficiency?” This post seeks to answer that question.

Let me lead with the answer – no, I’m not against efficiency. I’m instead suggesting two things. First, we need to broaden our horizons to look beyond efficiency. Second, while efficiency is still important, our existing ways of achieving efficiency are becoming increasingly inefficient

Broadening our horizons
I’ve written about the paradox of the Big Shift. On the one hand, it’s creating exponentially expanding opportunity. On the other hand, it’s generating mounting performance pressure. Our imperative is to find ways to harness the expanding opportunities while responding to the mounting performance pressure.

While some of the opportunities created by the Big Shift involve ways to become more efficient, those are actually a very modest segment of the overall opportunity. The opportunity that’s exponentially expanding involves the opportunity to create and deliver far more value to markets and society. As one small example, just think for a minute about the potential that biosynthesis has to extend lives and dramatically increase the quality of our lives.

We need to become much more aware of the new capabilities that are becoming available to deliver far more value and find ways to harness those capabilities so that we can have a much more positive impact on those around us and, in the process, create more value for the institutions that are delivering that impact.

If all we do is focus narrowly on efficiency, we’re going to miss most of the opportunity that’s emerging. Here’s the thing – while efficiency is important, it’s ultimately a diminishing returns proposition. The more efficient we become, the longer and harder we’re going to have to work to get that next increment of efficiency. That’s not an exciting future.

On the other hand, if we focus on addressing exponentially expanding opportunities to create more value, the sky’s the limit, especially if we find ways to pursue leveraged growth. For the first time, we have the ability to tap into an increasing returns curve where the value increases exponentially over time. Who wouldn’t want that?

But to tap into that opportunity, we need to find ways to learn faster – at scale. That’s why I put so much emphasis on the imperative to move from scalable efficiency to scalable learning institutional models. These emerging opportunities are new opportunities, never encountered before. We need to rapidly learn what these opportunities are and what approaches will be most effective in addressing the opportunities. And the opportunities will be rapidly evolving, so we can’t just learn once and be done with it – the challenge is to learn more and more rapidly at scale, forever.

And, just in case it’s not abundantly clear, the learning I’m talking about here is a very different form of learning relative to the learning that we do in most institutions today. All large institutions have learning programs, but these programs focus on transmitting existing knowledge. We go into a training room and listen to an “expert” who shares what they know.

The learning that’s going to be necessary to harness these opportunities is learning in the form of creating new knowledge. That kind of learning isn’t done in a training room – it’s done in the work environment where workers are confronting new opportunities to create value on a daily basis. As I’ve explored in a recent research report – Redefine Work – this involves redefining work for everyone – rather than executing tightly specified routine tasks, we need all workers to address unseen problems and opportunities to create more value. If we take that seriously, it involves cultivating a whole new set of practices and redesigning work environments from the ground up.

Achieving efficiency differently
So, we need to expand our horizons to target opportunities to create more value. Does that mean than efficiency no longer matters? Of course it matters. In a world of mounting performance pressure, we need to strive to become more and more efficient in everything we do.

But, how do we become more efficient? The traditional approach to scalable efficiency was very clear – we tightly specify every task and standardize it so that it’s done in the same efficient way throughout the institution. We tightly integrate those tasks, removing all the inefficient buffers between them, by crafting highly efficient end to end business processes.

This approach worked very well throughout the past century, providing a foundation for large, global institutions that generated enormous wealth. But, now the world is changing, and that traditional approach is paradoxically becoming less and less efficient.
The traditional approach to scalable efficiency worked very well in more stable environments. That’s what made it possible to specify in advance, standardize and tightly integrate. But, how well does that approach work in a world that’s more rapidly changing, with more and more uncertainty and unexpected events that no one anticipated?

Not very well at all. In fact, based on surveys we’ve done, we found that 60 – 70% of worker time in large companies is spent on “exception handling” – dealing with unexpected situations that can’t be handled by the existing processes and that require workers to scramble around and improvise to find ways to address something that’s never been seen before. And they do that very inefficiently, precisely because the organization hasn’t been designed to address these exceptions. In fact, there’s a strong tendency to try to deny that these exceptions even exist, because they call into question the scalable efficiency model.

If we want more evidence that the scalable efficiency model is fundamentally broken, perhaps our analysis of the performance of all public companies in the United States from 1965 until today provides an important indicator. We used return on assets as our measure of performance and it turns out that ROA has basically collapsed over this time period – declining by 75%. There’s no sign of it leveling off, much less turning around. So much for scalable efficiency.

So, efficiency is still very important, but the approach to become more efficient is fundamentally changing. Rather than tightly specifying and standardizing all tasks in advance, we need to create environments and practices that help workers to address unseen problems and opportunities whenever and wherever they emerge. And we need to find ways to “loosely couple” all those tasks so that workers have more room and ability to improvise and test new approaches without creating unintended ripple effects that cascade into some major disaster further down the process chain.

In fact, it turns out that the scalable learning model that I’ve advocated is far more efficient in a rapidly changing world than the scalable efficiency model. By creating environments that help workers to see, address and learn from unexpected situations, we will build much more efficient institutions. Efficiency is still essential – it’s just that we have to pursue very different approaches to achieve it.

Models don’t mix
I hope I’ve persuaded you that I am very committed to efficiency as well as learning – in fact, I see them as increasingly tightly integrated. Scalable learning will produce more and more efficient institutions.

On the other hand, I hasten to add that I'm not a proponent of trying to embed both scalable efficiency and scalable learning models within the same institution. I know there's a lot of interest in the “ambidextrous” organization, where one part of the organization executes routine tasks and another part pursues innovative and creative initiatives, but count me as a deep skeptic of this idea for two reasons.

First, as I’ve suggested, in a rapidly changing world filled with uncertainty, I question whether routine tasks are even feasible, much less helpful. To the extent that routine tasks are necessary, I've made the case that they will be quickly taken by robots and AI – they shouldn’t be done by humans. My belief is that all workers should be focused on addressing unseen problems and opportunities to create more value.

Second, my experience is that these two institutional models are fundamentally incompatible and that scalable efficiency quickly and “efficiently” crushes any attempt to foster innovation and creativity. The scalable learning model that I’ve proposed as a replacement for scalable efficiency requires a fundamentally different culture and way of organizing and operating that is viewed as deeply threatening, or at the very least as a distraction, by those who hold on to the scalable efficiency model. I have yet to find an institution where these two models co-exist at scale.

A choice needs to be made, but it’s a choice in institutional models, not a choice between efficiency and more value creation. The scalable learning model delivers both greater efficiency and more value creation.

The bottom line
We don’t need to choose between greater efficiency and more value creation, but we do need to choose between institutional models. We also need to choose to expand our horizons and move beyond a narrow focus on greater efficiency.

This is not just an opportunity – it’s an imperative. In a world of mounting performance pressure, if we just focus on efficiency, we’ll ultimately be squeezed out of existence. Those who will survive and thrive in the Big Shift world are those who aggressively pursue both value creation and efficiency. And the key to both, in a rapidly changing world, is to learn faster at scale.

Zoom In Filters for High Impact

Small moves, smartly made, can set big things in motion. That’s a key to succeeding in a world of mounting performance pressure. In a previous post, I briefly alluded to the need to “zoom out” to smartly make small moves. In today’s post, I want to focus in more detail on the need to zoom in.

Zoom out/zoom in strategies                                                                                                                                                       For those who’ve been following me, you know my passion for the “zoom out, zoom in” approach to strategy, which I’ve written about extensively, especially here. For the others, let me summarize this approach. It focuses on two time horizons in parallel. I’m going to talk about companies in the discussion below, but this approach to strategy is increasingly necessary for all institutions, not just businesses.

The first time horizon, the zoom out horizon, is 10-20 years. On that horizon, the two key questions are: What is my relevant market or industry going to look like 10-20 years from now? What are the implications for the kind of company I will need to become in order to be successful?

The second time horizon, the zoom in horizon, is very different – it’s 6-12 months. On this horizon, the key questions are: What are the two or three initiatives I can pursue in the next 6-12 months that will have the greatest impact in enhancing my ability to reach my destination? Do I have a critical mass of resources committed to those initiatives in the next 6-12 months? How will I measure success for these initiatives?

Both horizons are required for small, smart moves. If we don’t have a destination, we’re unlikely to ever reach it. Instead we’re likely to incrementalize our way into oblivion. On the other hand, if we just have a long-term view and don’t focus on near-term impact, we’re likely to over-invest in “mega-projects” that limit our ability to learn and ultimately collapse from their own weight.

So, we need to zoom in and force ourselves to pick the 2-3 most promising initiatives to pursue in the next 6-12 months. Given all the options competing for our attention and resources, that’s a tall order. Is there any more guidance that we can provide to help in picking those initiatives?

Yes, there is. I’ve developed three filters to use in assessing proposed zoom in initiatives.

Find and scale an edge                                                                                                                                                             First, one of the initiatives should focus on identifying and moving aggressively to begin to scale an edge of the current business. This refers to my perspective on “scaling edges” as the most promising way to drive transformation of large, existing companies. Rather than trying to drive transformation in the core, my advice is to find an edge to the current company – something that today is relatively modest in revenue, but which, given the exponential forces driving change, has the potential to scale quickly to the point where it becomes the new core of the business. Drive the transformation on the edge, rather than tackling the immune system and antibodies that reside in the core and that will mobilize quickly to resist any effort to drive fundamental change.

The zoom out effort can be very helpful in identifying and assessing an edge that really has the potential to become the new core. It’s admittedly a high bar – the edge must have the potential to become the new core in a relatively short period of time. But, given the exponential forces that are re-shaping our global economy, it’s more and more feasible to scale a promising edge with relatively modest resources. The key is to identify the edge, commit to it and be very aggressive in doing whatever we can in the next 6-12 months to scale that edge as rapidly as possible. That’s a small move that can set big things in motion.

Strengthen the existing core                                                                                                                                                  Second, one of the initiatives should focus on identifying the one move that can have the greatest impact in strengthening the existing core of the business. We live in a world of mounting performance pressure and the existing core is what generates our current profitability. We need to do whatever we can to prolong the life of that core, while at the same time recognizing that its life span is limited.

As I’ve indicated elsewhere, I’m a big fan of the Pareto Principle, otherwise known as the 80/20 rule – in short, 20% of the causes in virtually any domain typically generate 80% of the effects. In business, that means that 20% of the products, customers and facilities typically generate 80% of the profits. While most people are familiar with the 80/20 rule, relatively few executives systematically apply that lens to identify the 20% of the products, customers and facilities that are generating 80% of the profits.

To have the greatest impact, this second zoom in initiative needs to focus on the highest performing parts of the business today. It needs to identify missed opportunities to further strengthen the performance of these parts of the business and to address potential short-term vulnerabilities. That will help to determine what measure can be taken in the short-term with the greatest potential to strengthen and amplify the profitability of these parts on the business. That’s a small move because it focuses on a relatively small part of today’s business, but it can set big things in motion by extending the life of the most profitable part of the business.

Find something to stop doing                                                                                                                                                  There’s a third zoom in initiative that, in my experience, is typically the most challenging one. It requires us to identify what significant part of the business we are going to shut down or divest in the next 6-12 months in order to free up more resources to scale the edge and strengthen the core. Once again, the 80/20 rule can provide a very helpful lens here. What about the 80% of the products, customers or facilities that are only generating 20% of the profits of the business? Why are we still in these parts of the business?

I’m not by any means suggesting we need to shut down all these parts of the business – there may be good reasons why some of these parts are marginally profitable today, but have the potential to increase in profitability over time. Nevertheless, we need to become much more rigorous in addressing the need to be in these parts of the business. In the next 6-12 months, we should force ourselves to ask how much of these parts of the business could be shut down or divested so that we can free up more resources. That’s a relatively small move that could set big things in motion by freeing up resources to devote to the areas that have much greater potential for profitability.

So, there you have it. Three small moves that could set big things in motion, but only if smartly made.

Bottom line
We live in a world of mounting performance pressure and the small moves that we’re making today are having diminishing returns. That’s because they focus narrowly on preserving our scalable efficiency businesses, rather than addressing the more fundamental imperative to transform everything we do in order to build institutions driven by scalable learning.

Transformation suggests that we need really big moves. Resist that temptation. Instead, focus on identifying the small moves that, if smartly made, can set big things in motion. The zoom out, zoom in approach to strategy can provide a powerful lens to smartly make small moves. It requires a balance between a clear view of one’s destination while emphasizing the need to act now to accelerate learning and movement towards that destination. That’s the essence of smartly made – having a long-term destination while emphasizing the need to identify the highest impact initiatives that can be pursued in the near-term to reach that destination more rapidly.

One final note. Everything I’ve covered here can also be applied to us as individuals. We need to apply the zoom out, zoom in approach to ourselves in order to increase our own impact. If we’re smart about it, we can set really big things in motion. Now, that’s something that I need to pursue further in a future blog post!

Images Matter – Shaping Our Current Social and Political Discourse

I recently wrote about the growing fear produced by the mounting performance pressure of the Big Shift. As fear grows we have a natural human reaction to hold onto what we have. While very understandable, that reaction can also be very dangerous and lead us to miss the expanding opportunities created by the Big Shift.

The two most prominent images – walls and safety nets – dominating much of our conversation these days are manifestations of our fear and desire to hold onto what we have. I would suggest that we would benefit from shifting to two other images – bridges and launch pads – that can cultivate hope and excitement and motivate us to pursue expanding opportunity.

Walls and safety nets

One side of our political spectrum has become obsessed with walls. These walls – either physical or virtual – are designed to protect us from a range of perceived threats that may vary depending on what part of the world we are in – immigrants, foreign competition and subversive ideas. There’s an understandable desire to create barriers that will insulate us and help us hold onto what we have.

On the other side of the political spectrum, there’s growing discussion about the need for safety nets that will help people who lose their jobs or suffer some other kind of adversity to recover. It’s interesting that the discussion of safety nets often uses the term “bounce back” – the key goal is to help people to return to their previous state. Once again, the goal is help us to hold onto what we have and, if we lose anything, to recover what we’ve lost as quickly as possible.

Here’s the irony – while both sides of the spectrum are becoming increasingly polarized and hostile to the other side, at some fundamental level, they’re both driven by the same fear, and the same desire to hold on to what we already have. Their view of who the enemy is and what the threat might be clearly differs, but they share a feeling of fear and the same protective urge to help people address the threats ahead.

But, here’s the problem with both sides – they hold a very static view of the world in terms of the resources that can be deployed and the opportunities that can be created. It’s all about protecting what we have in the face of growing threats.

Fixed versus growth mindsets

In this context, I’m reminded of the wonderful writing of Carol Dweck in her pathbreaking book, Mindset: The New Psychology of Success. In that book, she made an important distinction between two mindsets that appear to shape most of our behavior – a fixed mindset and a growth mindset. As she describes it, “in a fixed mindset, people believe their basic qualities, like their intelligence or talent, are simply fixed traits.” In contrast, “in a growth mindset, people believe that their most basic abilities can be developed through dedication and hard work—brains and talent are just the starting point.”

While her focus was on the mindset of the individual and their beliefs about themselves, I suspect these beliefs in turn shape broader beliefs about society. If we hold a fixed mindset about ourselves, we’re likely to hold a fixed mindset about society and the resources that are available to it. On the other hand, if we hold a growth mindset, we’re more likely to see the opportunity to create more and more impact and value as we cultivate the resources available to us and find ways to expand them.

But, what shapes these mindsets? There are many factors at work, but this is where there’s an opportunity to refer to my earlier perspectives on mindset and heartset. I suggested there that we don’t pay enough attention to the role of emotions in shaping our beliefs and perceptions.

In this context, I would suggest that fear tends to shift us to a fixed mindset and a focus on protecting the fixed resources and capabilities that we believe we have. This is all understandable and a natural human reaction to perceived threats.

Bridges and launch pads

But, what can we do to overcome the fear and shift our focus from threat to opportunity? Here’s where images matter. Walls and safety nets focus on the threat and the need to protect what we already have. What’s the alternative? I suggested above that perhaps we should shift our attention to bridges and launch pads.

What do these images suggest? Bridges are about connecting areas that were previously separated – they’re about bringing people together. The underlying belief in building bridges is that we’ll benefit from connecting with others that we couldn’t previously reach. They focus on the opportunity created by connecting people.

If you’ve been following our work on scalable learning, you’ll know that I am a strong believer that there are powerful network effects to learning. The more of us who come together with a shared goal of learning, the faster we’ll all learn. Opportunity to develop more of our potential is unlimited but to address that opportunity more fully more of us need to come together. That’s where bridges come in. And, like walls, these bridges can take on both a physical or virtual form – the key is finding ways to connect more people more effectively at scale so that they can achieve more of their potential together.

That brings me to my other image – the launch pad. I find this image much more intriguing than the safety net image because the key is to launch people into new arenas that are very distant and full of potential to learn. Rather than bouncing people back to where they were, the goal with a launch pad is to take them to much higher terrain and to accomplish things that were never accomplished before. The goal is to move forward rather than bounce back. The mindset when confronting adversity should be how to use it as a growth opportunity to accomplish even more, rather than simply going back to where one was. Imagine what we could accomplish if our programs and initiatives to help people in trouble were designed to help them get to even higher ground rather than just returning them to where they were.

Another benefit of the launch pad image is that it doesn’t just wait for people to fall and then catch them. Launch pads could be for everyone, especially the marginalized people in our population who never had the opportunity to begin with. They haven’t fallen – they never had the opportunity to get up in the first place. What would happen if we were committed to create launchpads for everyone?

If we focus on bridges and launch pads, we begin to see the opportunity that can surface if we come together with the goal of helping each other to achieve more of our potential. There still may be fear (after all, bridges have been known to collapse and rockets have exploded on launchpads), but we’re inspired by the opportunity that awaits on the other side and more willing to overcome the fear and take some risk in order to achieve far more for ourselves and for others.

The bottom line

Images matter. We need to look beyond the images to find out why we picked them in the first place and what kinds of emotions they foster. We also need to challenge ourselves to find images that can motivate us to achieve more of our potential. The story of human progress is the quest to achieve more, not just for ourselves but those who matter to us. If we abandon that quest and give in to fear, we’ll accomplish less and less as we isolate ourselves and settle for bouncing back to what we had in the past.

Small moves, smartly made

Small moves, smartly made, can set big things in motion – that’s the sub-title of my last book, The Power of Pull. It’s been a key theme of my work for decades, but it’s coming back to bite me.

I find that a lot of people have grabbed on to this message to justify incremental actions with limited funding, while holding out the expectation that they will potentially lead to big results. I’ve long been a skeptic of massive top down programs – whether it’s companies, governments or any other institutions. But let me also say that I am deeply skeptical about incrementalism and lots of small moves.

Many people glide over the phrase “smartly made” in the sub-title, but that’s what enables small moves to set big things in motion, rather than just consuming time and effort with minimum results. Let me try to unpack what that means to me.

Unpacking smartly made
“Smartly made” isn’t easy, it’s really, really hard. It’s all about understanding context and dynamics and being relentlessly focused on how to achieve the most impact with the least investment of time and resources.

I’ve developed at much greater length the increasing importance of context in the world that is evolving around us. Understanding context has always been important but, for reasons that I discuss elsewhere, it’s becoming more and more critical for impact given the forces that are re-shaping our global economy and society.

Understanding context has always been challenging, but it’s becoming more challenging on two fronts. It used to be that we could narrowly define context and focus on a small slice of the world around us – whether it’s a specific industry, geographic market or customer segment. In a world shaped by the Big Shift, everything is becoming more and more connected, so those small slices are being deeply shaped by broader forces.

In more stable times, we were also able to take a snapshot of our context at a given point in time and focus on understanding that snapshot. No longer. Our context is rapidly evolving, shaped by the exponential changes of the Big Shift. If we just focus on the snapshot, we’re at serious risk of being blindsided. We need to “zoom out” and anticipate what the context could look like years, and even decades, down the road.

Many of us are overwhelmed by this and shrink our horizons to just focus on small moves that respond to whatever is going on at the moment. While understandable, that’s not being smart. It’s a formula for failure as we spread ourselves more and more thinly across a lot of “small moves” that never get any critical mass of resource or attention. As I’ve discussed elsewhere, rather than reducing risk, portfolios of small moves can often be the highest risk approach of all.

A key part of “smartly made” is investing the time and effort required to look ahead and understand the dynamics of the broader contexts evolving around us. Of course, we can get consumed by that exercise as well.

So, another part of smartly made, is focusing on the context and dynamics that matter. Again, that’s not easy, but a key approach is to focus on identifying “influence points” – those locations that exist in all complex adaptive systems that have a disproportionate impact on the evolution of the broader system. If one can target and occupy one or more of those influence points, one can achieve far greater impact in broader systems than all the other participants, and do it with far less resources than might otherwise be required to achieve impact

Another dimension of “smartly made” is making explicit choices based on this assessment of influence points and evolving context. Rather than just randomly or opportunistically pursuing small moves, the key is to invest the time and effort required to proactively choose the small moves that have the greatest potential for high impact. Don’t just react. Focus and anticipate, and be relentless in finding the most promising ways to achieve great impact with few resources.

Yet another aspect of “smartly made” is to move as quickly as possible to action so that one can begin to learn from the impact achieved. There’s a strong bias to action and to define early milestones that can help the participants to refine their approach to get even more impact.

Finally, and perhaps most challenging, another dimension of “smartly made” is a commitment to rapidly scale impact. The participants are relentless in challenging each other to get more and more impact – these are not just “experiments”, they’re the launch pad for something really, really big and there is a commitment to set really big things in motion and scale them rapidly. The goal is not just linear impact and improvement, but exponential impact driven by accelerating performance impact.

Those of you who have followed our work will likely recognize a close parallel between these various dimensions of “smartly made” and the business practices that we’ve identified as key to accelerating the performance of front line workgroups. Our belief is that everyone, everywhere should be trying to become more focused on the small moves that have the greatest potential to set big things in motion.

Why is this such a big opportunity?
Here’s the point. In the Big Shift world we’re entering it’s possible to create much more value than would have been imaginable a few decades earlier, and to do it with far less resources and much faster than would have been possible a few decades earlier. That’s the expanding opportunity side of the Big Shift – exponential technology development and other, related forces are driving the growth of some businesses and other kinds of institutions at a rate that would have been unimaginable in our industrial era.

But we need to be smart about it. With so much change happening so quickly, we can also get easily distracted and lost in the events that compete for our daily attention. I love paradox – small moves are both necessary and dangerous. The key is whether they’re smartly made.

And the paradox is that there’s not just expanding opportunity. There’s also mounting performance pressure. If we don’t make small moves smartly, we’re likely to face diminishing returns until we’re finally squeezed out of our comfortable seats. So, this isn’t just an opportunity; it’s an imperative.

Bottom line
Rather than focusing on the small moves, we need to focus on the really big things that can be set in motion. We need to invest the time and effort to look ahead and look around in ways that can help us to see those really big opportunities and only then work back to identify the small moves we can make today and pursue aggressively to set those big things in motion. As we find those small moves, we need to be relentless in pursuing them and scaling them. Commitment is key.

So far, I’ve been talking about small moves, smartly made in an institutional setting. But, guess what? The same principles apply in our personal lives. We have an ability to have far greater impact and to achieve far more of our potential than would have ever been possible in the past. But the same principles apply – it can’t just be with random small moves. They need to be smartly made in the context of a deep understanding of the expanding opportunity that we all can address. And (some of you knew this was coming), we’ll be much more successful in setting these big things in motion if we are truly passionate about the opportunity – motivation is ultimately the key.

Feel the Fear

I perceive that fear is becoming pervasive and increasingly intense around the world. When I share this perception with others, I often get the response: “What fear? I don’t know many people who are afraid.”

That’s part of the problem. The fear is often not visible unless we know where and how to look for it. Why is that the case?

Emotions are suspect
As I’ve written elsewhere, our institutions are organized on a scalable efficiency model that views emotions as deeply suspect. In these institutions, it’s all about mindset and heartset is ignored. Emotions are a distraction – the key is to memorize the process manual and execute flawlessly and efficiently. If you express emotions, you’re viewed as weak, especially if you express emotions like fear or anxiety. So, it shouldn’t be a surprise that most of us make a concerted effort to keep the fear we feel deeply hidden, lest anyone else find out.

Fear is often expressed through other emotions
We may not express the emotion of fear itself, but we often express it through other emotions that are less suggestive of weakness.

Anger and hatred. Have you noticed the increasing amount of anger being expressed in populations around the world? Anger is often a manifestation of fear. If you feel you’re being threatened, it’s natural and understandable that you’ll feel anger towards those you believe are threatening you. In a world where emotions in general are viewed as weakness, anger is sometimes viewed as a sign of strength. It shows you’re willing to stand up for yourself.

Rigidity. People who feel fear are often driven to find something that they can tightly hold onto and count on in a world that is perceived as increasingly threatening. That’s a major reason why we’re seeing the growth of fundamentalist religions and political extremism – a growing number of people find these to be a comforting refuge from fear.

Defensiveness. If we feel fear, we are often likely to become more defensive, viewing the slightest slight as an attack and feeling the need to defend ourselves before the situation becomes even more threatening.

Stress. Who doesn’t know people who are experiencing growing stress? Stress is often a by-product of fear, especially if we feel we’re in environments that don’t allow us to express our fear. Now we have to hide our fear as well as deal with the events that are producing the fear.

Boasting and narcissism. If we’re experiencing increasing fear, a natural human reaction is to compensate by focusing the attention of others on what we’ve accomplished. I don’t know about you, but I have a definite sense that many of us use social media to share the amazing places we’ve been and people we’re spending time with in an effort to reassure others that we’re doing really well.

Hopelessness and passivity. As fear gains force, we can often move to feelings of hopelessness and passivity, a feeling that there’s nothing we can do to change things. It’s not about us; it’s just the way the world is. We drop out or, at best, we focus on taking care of those nearest to us.

Loneliness. Loneliness is becoming pervasive in many parts of the world. While many factors can contribute to this feeling, certainly one is an underlying emotion of fear. If we’re living in fear, we’re less likely to connect with others and simply try to fend for ourselves, while feeling isolated and without support.

To be clear, I’m not saying that these emotions are exclusively a manifestation of fear, but they often are. When we encounter these emotions, we just might want to explore beneath them to see if we can find fear.

What’s driving the fear?
So, if I’m right that more and more of us are experiencing growing fear, why is that happening? There are certainly many reasons, but my research suggests that we are in the early stages of a Big Shift that is generating mounting performance pressure on all of us. No matter what our credentials and track record in the past, the pressure is mounting to get even better faster in the future. It’s totally natural that we would feel fear in that kind of world, especially if we were taught that getting the right degrees and pursuing the right jobs would ensure our success.

This mounting performance pressure isn’t just about economic pressure and the ability to earn a living. It takes many different forms, including an accelerating pace of change where things we could rely on in our lives – values, norms, practices, etc. – suddenly are no longer there.

But, it’s not just mounting performance pressure that’s driving the fear. There’s also a growing realization that our institutions are not equipped to help us respond to the mounting performance pressure. In fact, there’s a sense that our institutions are making us even more vulnerable to that growing pressure. That’s one of the key reasons that trust in all our institutions is rapidly eroding globally.

Feeding the fear
If mounting performance pressure isn’t bad enough, we have a growing set of forces that are determined to feed that fear. More and more politicians are resorting to threat-based narratives to mobilize the population: the enemy is coming to get us and we’re under attack, we need to mobilize now and resist. These threat-based narratives amplify and reinforce the fear.

And there’s more. Our mass media (and social media) are increasingly focused on the terrible things that are happening in the world. Wherever there’s an earthquake, a terrorist attack, a wave of crime, an epidemic or some other disaster, we can count on it dominating the media. We have to look long and hard to find any good news. That also feeds our fear.

The negative impact of fear
If we allow fear to dominate our emotions, we’re at risk of unleashing a vicious cycle that can lead to an increasingly dysfunctional world. Fear cultivates a set of cognitive biases. First, we tend to become more risk averse – we emphasize the risk of action and discount the rewards that can come from action. As we become more risk averse, we tend to shrink our time horizons. We only focus on what we can do in the short-term because there’s more risk out in the future. As we shrink our time horizons, we fall into what economists call a “zero-sum” view of the world. If we’re only focused on today, there’s a given set of resources and the only question is who’s going to get them – you or me? It’s a win-lose view of the world. And in that kind of world, trust erodes quickly – you may seem like a really nice person, but I know at the end of the day only one of us is going to get those resources, and I want to be sure it’s me.

And these cognitive biases can unleash a vicious cycle. The less trust we have, the more risk averse we become and the more we shrink our time horizons which further erodes trust, and on and on.

How to see the unseen
So, what can we do about all of this? First, we need to see the fear and recognize how pervasive it is becoming. If the emotion of fear is so deeply hidden, how can we learn to see it? Well, we might start with ourselves. Many of us have become so deeply embedded in scalable efficiency cultures that we’ve become adept at disconnecting from our own emotions. Perhaps some deep inner reflection might reveal that we actually have fears that have been growing over time. If we’re unwilling to see and confront that fear within ourselves, we’re very unlikely to see it in others.

Once we see it within ourselves, it helps to share that recognition with others. In scalable efficiency cultures, there’s very little trust and if you come across as someone who is unwilling to acknowledge your own fears, others are going to be very reluctant to share this emotion with you. On the other hand, expressing vulnerability and acknowledging your fears can help to build trust and open up others to share their emotions with you.

My own experience is that some of the “strongest”, most successful people that I know will, in the privacy of their offices, express great fear when in the company of someone they trust.

Overcome the fear
Seeing the fear is just the beginning. To be clear, I’m not suggesting that the fear is unjustified. Fear is a very natural response to mounting performance pressure. I’m also not suggesting that the fear can be eliminated. What we need to do is to find ways to overcome the fear and cultivate other emotions like hope and excitement that can motivate us to make the changes necessary to address the mounting performance pressure.

Here’s the paradox. The same Big Shift that is producing mounting performance pressure for all of us is also producing expanding opportunity for all of us. But to realize that expanding opportunity, we’re going to have to transform all of our institutions, moving from a scalable efficiency model to a scalable learning model. If we’re driven by fear, we’re unlikely to invest the effort required to drive that transformation.

We need to find ways to focus on that opportunity and to motivate ourselves to come together in ways that can help us overcome our fear and address the challenges that stand in the way of achieving that opportunity.

Bottom line
We live in a world where emotions are suspect, especially emotions of fear. More and more of us are experiencing fear, yet that fear often remains deeply hidden, even from ourselves. We need to acknowledge that fear and commit to finding ways to overcome it. If we remain in denial, we risk being consumed by that fear and missing the growing opportunities that can help all of us to achieve far more of our potential.

Institutional Innovation – I Have a Dream

Everyone talks about transformation these days, but the term is used so loosely that it’s begun to lose all meaning. I recently wrote a blog post suggesting that the ultimate test of transformation is whether the caterpillar became a butterfly – is it so different that it’s unrecognizable? That’s a useful metaphor, but many have asked me to make it more tangible in the world of institutions.

OK, you asked for it, so watch out! It’s Martin Luther King Day in the US and I can’t think of a better day to declare that I have a dream and to explore that dream in a blog post. My dream is that we will transform all our institutions in ways that can help all of us to achieve more and more of our potential. As I explore this dream, I’m going to refer to a lot of the work we’ve been doing at the Center for the Edge since I’ve been pursuing this dream for a quite a while.

Let me start by clarifying that the transformation I’m focused on isn’t the transformation involved in moving from one business to another (let’s say, moving from being a retailer to becoming a clothing manufacturer). Yes, the business will look very different in terms of the specific activities being performed, but the overall approach to how to be successful in business will not necessarily change. I would prefer to call this diversification rather than transformation. What I’m focused on is the more fundamental transformation that will be required to be successful regardless of what business you’re in.

Also, the transformation I am seeking is not what most companies today describe as “digital transformation.” When you look more closely at these initiatives, they tend to be applying digital technology in ways that can help the company do what it’s always done, just faster and cheaper. As I'll suggest, digital technology can help to drive a much more fundamental transformation but it will first be necessary to challenge all of our cherished assumptions about how to run an institution.

Institutional transformation
For those of you familiar with our work on the Big Shift, we’ve developed a perspective that all our institutions are going to need to go through a fundamental transformation from a scalable efficiency model to a scalable learning model. Scalable efficiency models drive success by tightly specifying every activity that needs to be done, standardizing those activities so they’re done the same efficient way everywhere in the organization and tightly integrating those activities. Scalable learning models, on the other hand, focus on how to motivate people to learn faster, how to foster practices that drive faster learning and how to create environments that amplify the potential for learning.

This institutional transformation is an imperative because the scalable efficiency model is increasingly challenged given the profound changes playing out in our global economy (see our work on return on asset trends for US companies). But it’s also essential because this new model is necessary to effectively target and reap the rewards of the expanding opportunities that the Big Shift provides.

While I'll be talking primarily about corporations in this blog post, I should clarify up front that my view is that all of our institutions – governments, schools, NGO's, etc. – will need to go through this transformation in order to achieve greater impact.

Diving deeper into learning
So, what does scalable learning imply? It implies that everything in the institution will need to change – nothing will remain the same.

Before I dive into that, let me clarify what I mean by scalable learning. I’m focused on learning in the form of creating new knowledge through action and reflection on results – it’s not about sharing existing knowledge or just coming up with new ideas. Much of this new knowledge is tacit knowledge that we have a hard time articulating to ourselves, much less to others. And a key dimension of scaling is the need to go beyond your institutional boundaries and build relationships with a growing number of external participants where everyone can learn faster together.

OK, so what are some of the key dimensions of transformation required to pursue scalable learning? Fasten your safety belts – I’m going to provide a high-level overview of what will be different. I’ll explore this transformation at three broad levels: motivation, practices and environment.

Motivation
More and more pundits are talking about the need for lifelong learning and the need to learn faster, but very few are focused on what is required to motivate people to pursue this with excitement, rather than being stressed by it. This is ultimately the foundational element to the transformation required for scalable learning.

Motivation: Shift from punishment and cash to passion. Sure, cash compensation will still matter – we’ll want to be paid for work well done. But the real motivation that will drive all workers is the passion of the explorer. We’ll move from a focus on extrinsic motivation to intrinsic motivation. Every worker in these institutions will be motivated by a deep passion that will drive them to learn faster and achieve more of their potential.

Aspiration: Shift from target to trajectory. These institutions will be driven to accelerate performance improvement – linear performance improvement will not be enough, they’ll want to accelerate that improvement – forever. People with the passion of the explorer are never satisfied with one-time, or even linear, performance improvement – they’re driven to get better faster.

Performance metrics: Shift from financial results to addressing unmet needs. Sure, financial metrics will still matter, but the metrics that will matter the most will involve the ability to address more effectively the evolving needs of key stakeholders, with a focus on customers. People with the passion of the explorer aren’t driven by financial results – they want to make a difference that’s meaningful to themselves and to others that are impacted by their actions.

Leadership practices
In institutions that are driven by scalable learning, leadership helps to inspire and focus everyone on growing impact that matters.

Strategy: Shift from static to dynamic. These institutions will pursue a zoom out/zoom in approach to strategy, focusing on very large, long-term opportunities that are emerging on a 10-20 year time horizon while also identifying the 2-3 initiatives that can be pursued in the next 6-12 months to accelerate progress towards the longer-term opportunity and amplify the opportunity to learn through action. The goal is to inspire everyone with a very significant opportunity to create much more impact, but also focus on near-term action that can start to demonstrate impact.

Leadership: Shift from answers and orders to questions and invitations. Leaders will focus on framing powerful questions that can inspire everyone in the organization (and outside). They will freely acknowledge that they don’t have the answers and that they’ll need help in finding the answers.

Worker practices
Scalable learning will require a fundamental redefinition of the work to be done and active cultivation of the practices required to accelerate performance improvement.

Work: Shift from routine tasks to addressing unseen problems and opportunities. A key driver for learning is focus work on seeing what hasn’t been seen in terms of opportunities to create more value but also with an emphasis on action – developing approaches to those opportunities and seeking to evolve those approaches to generate more and more impact.

Performance improvement: Shift from process to practice. The key to driving performance improvement in these institutions will be to focus on cultivating a set of practices that can accelerate learning both within individual workgroups and across workgroups.

Internal environment                                                                                                                                                                   For these practices to achieve greater and greater impact, it will be necessary to redesign the entire environment within our institutions to support scalable learning.

Corporate focus: Shift from bundle to one business type. To accelerate learning, companies will need to unbundle. Today they are an unnatural bundle of three very different and often conflicting business types: infrastructure management, product innovation and commercialization, and customer relationship businesses. By choosing to focus on one of these three businesses, shedding the other two and building deep relationships with world class players in the other two business types, companies will be able to focus more effectively on what will be required to accelerate learning and performance improvement.

Organization: Shift from departments and hierarchies to workgroups and networks. The core organizational unit will be small workgroups of 3-15 people who connect with others through scalable networks. These workgroups will often include participants from “outside” the organization and will connect with a growing number of workgroups outside the organization. Organizations will become “creation spaces.”

Operations: Shift from push to pull. Rather than pushing all the right people and resources into the right place at the right time to meet demand forecasts, the focus will be on participating in scalable pull platforms where the right people and resources can be drawn out as needed and where needed.

Work environments: Shift from cost and comfort to accelerating learning. Design thinking and methodologies will be systematically applied to redesign work environments with the primary goal of accelerating learning and performance improvement. The focus will be on redesigning the entire work experience – physical environment, virtual environment and management systems.

Front line management: Shift from control and enforcement to coaching and development. Front line managers will be focused on how to help individuals and workgroups to develop more of their potential and deliver more impact that matters.

Technology: Shift from tasks to learning. With the growth of service oriented architectures and more and more powerful sensor and analytic technologies, these institutions will focus on how to flexibly support workgroups in learning faster in rapidly changing contexts by giving them richer and real-time visibility into the context and richer feedback loops regarding the actions they take to address the context. To the extent that these activities become routine tasks, the technology will take these tasks over and free up the capacity of the workgroups to address unseen problems and opportunities.

External environment
Scalable learning doesn’t just stop at the four walls of the institution. Scaling learning ultimately requires a systematic effort to reach beyond the institution and develop deep, trust-based relationships with an expanding array of third parties so that everyone can learn faster together.

Growth: Shift from make or buy to mobilize. Greater institutional focus will help institutions to tap into a third and much more powerful path to growth: leveraged growth. This form of growth involves connecting with and mobilizing a growing number of third parties to add more value to the customers being served, and then taking a share of the value creation as compensation for the initiative taken.

Ecosystems: Shift from static to dynamic ecosystems. Institutions will be deeply embedded in a number of growing ecosystems, but the focus will be on building relationships with a larger and larger number of participants where everyone learns faster together, rather than simply executing short-term transactions.

Platforms: Shift from aggregation platforms to mobilization and learning platforms. These institutions will participate in a growing range of platforms, but the platforms will be explicitly designed to help mobilize a growing number of participants in sustained interactions designed to produce shared outcomes and, in the process, help all the participants to learn faster from the initiatives being pursued.

The Bottom Line
If we take scalable learning seriously, it will change everything we do in institutions. The caterpillar will indeed become a butterfly, flying off to areas that were never even seen, much less experienced in its previous life.

Why go through the traumatic effort to transform? There are many reasons, shaped by the Big Shift that is transforming the global economy. But the bottom line is that the scalable efficiency model is ultimately a diminishing returns model. The more efficient we become, the longer and harder we have to work to get that next increment of performance improvement. The scalable learning model will allow us for the first time to move from a diminishing returns outcome to an increasing returns outcome – the more participants we bring together and focus on accelerating learning, the more rapidly we will create increasing value.

This transformation will ultimately be a powerful way to achieve two objectives that tend to be in opposition in the scalable efficiency world: the opportunity to achieve more and more of our potential as individuals and the opportunity to achieve more and more of our potential as institutions.

Questions for the New Year

As we enter the New Year, it’s an opportunity to step back and reflect in an increasingly hectic world. In an earlier post, I suggested we need to find time to reflect in a world increasingly dominated by flows – it’s a healthy form of friction that can actually enhance our ability to generate more insight from flows. Embrace the New Year as an invitation to reflect.

One area for reflection is what we are doing to accelerate our learning. We need to explore and understand the implications of the need for lifelong learning, as I suggested here. We live in a world where the learning imperative continues throughout our lives and, if that weren’t enough pressure, we’ll need to learn faster with each passing year as our world changes more rapidly.

Reflect on questions
OK, how do we do that? Well, it all begins with questions. What are your questions? Isn’t this a great time to step back and reflect on what are the big questions that would help us to achieve much greater impact in all parts of our lives? We’re under so much pressure to have answers during the year that we have little time to reflect on the questions that matter.

So, step back and take this opportunity to reflect. I suspect that most of us will find this challenging at the outset. We’re not used to asking questions. And, be careful because, once we start thinking about this, we’re liable to find that there are an infinite number of questions that could be asked in all parts of our lives.

One interesting exercise is to reflect on what parts of our lives are generating the most questions. We often have a greater curiosity about some parts of our lives relative to other parts. Why is that? What is sparking that curiosity? As I’ll suggest below, the answer to this could be revealing.

But, what are the questions that really matter to you? That motivates us to think about where and how we could have impact in our own lives and the lives of those around us. Most importantly, we could reflect on what’s the impact that would be most meaningful to us, both in terms of impact on our lives and impact on the lives of others? What’s the impact that would be most exciting and fulfilling to us?

And, don’t just focus on impact. Reflect also on the approach that would be required to answer these questions and whether engaging in the effort to find an answer would be exciting in itself, independent of the impact that could be achieved. Would the effort itself excite you?

By the way, put aside the questions that you could answer just by going to a search engine and finding someone who already has an answer. Those are the easy questions and you should certainly go to a laptop and find the answers to them. Focus instead on the questions that require you to create new knowledge through action – that’s the most powerful learning in a world that’s so rapidly changing. These are the questions that will cultivate imagination, creativity and emotional and social intelligence.

Find the questions that matter                                                                                                                                                      Be careful now, because we’re approaching the two by two matrix that all consultants love. On one dimension we have the extent to which the impact is meaningful to us and on the other dimension we have the extent to which the effort to find an answer is exciting and fulfilling to us. Guess where you might want to focus? Of course, it’s on the questions that fall into the upper right-hand quadrant – the questions that offer the most meaningful impact for you and the most excitement in terms of the effort required to get to the answer. And, before you lock in on the questions that matter, be sure to reflect on whether there are other questions that haven’t yet occurred to you that might fall into this same quadrant.

And, what if you couldn’t come up with any questions that are truly meaningful or exciting for you? Don’t lose hope. As we’ll see below, it likely means that your curiosity has atrophied and needs more exercise. Carry a notepad with you (or a note app, if you must) and just take a minute to write down any questions you come up with as you go through your days. Make the effort to uncover questions and then make the time to reflect on them on a regular basis. Look for the patterns that will begin to reveal what is drawing your curiosity.

Digging deeper
So, what can this reflection on questions produce for us? It can certainly help us to focus our time and attention in the year ahead on quests that can yield more meaningful impact and a more exciting way to spend our time. (Did you ever notice that quests are stimulated by powerful and exciting questions?)

But, let’s dig deeper. Reflect on the questions that you asked at the outset. How easy was it to come up with these questions? If it was very easy, you have a strong curiosity. If it required more effort, chances are that your curiosity has been suppressed, which isn’t surprising since we work and live in institutions that find questions annoying at best, and dangerous at worst. You’re supposed to have answers, not questions. Questions are a sign of weakness.

We all have the capability for curiosity, but many of us have not had an opportunity to exercise it and, as a result, it’s atrophied. It turns out that curiosity and the related human capabilities of imagination, creativity and emotional and social intelligence are foundational capabilities to drive learning (see more on this here). We need to find opportunities to exercise and cultivate these capabilities and it starts by asking hard but rewarding questions.

Digging even deeper
But, there’s more. It turns out many of us will find it easy to come up with questions in certain areas of our life, but much more challenging in other areas. As I indicated earlier, we often have a strong curiosity in parts of our lives, but not others. That can be revealing.

Those areas of natural curiosity may be important indicators of something that I call the passion of the explorer. If we’re truly serious about lifelong learning, we need to commit to discovering and cultivating the passion of the explorer that lies within all of us, even though for many it’s dormant and still waiting to be discovered. (For more on the passion of the explorer, see here and here.)

Why is this passion of the explorer so important? It turns out it provides us with a powerful and sustaining motivation to cultivate the learning capabilities I mentioned earlier as well as the motivation to achieve increasing impact in the domain of our passion. That motivation will ensure that we will learn faster and faster throughout our lives.

If we find it easy and stimulating to frame lots of questions in some area of our lives, pay attention to that. It could help us to become more aware of the passion of the explorer that we’ve already started to pursue or reveal a passion of the explorer needing to be discovered.

Regardless of how easy it was to come up with the questions, reflect also on those questions in the upper right-hand quadrant of the questions that matter framework that I described above. If you believe those questions could lead to impact that is meaningful to you and that pursuing those questions would be exciting, you may also have uncovered your passion of the explorer. People with this kind of passion are driven to achieve higher and higher levels of impact in their chosen domain – that impact is very meaningful to them – and they are excited by the effort required to achieve that impact. Now, that’s a breakthrough insight for you to build on!

But there’s more
Don’t stop now. As you begin to lock in on the questions that are most meaningful and exciting to you, there’s another level of reflection that could open new possibilities. For each of the motivating questions you’ve identified, ask who else might also be motivated by those questions? It’s actually very rare that you would come up with a question that’s only motivating to you – there are often others who would also be excited by the same question. Who are they? Where are they? Seek them out – they could help you get to a better answer faster and provide you with support and encouragement along the way.

You don’t know anyone like that? Well, then, spread the word about the questions you’re pursuing. Share the questions with your friends and associates and ask for help in finding people who might also be pursuing similar questions. Frame the questions on a blog post or other forms of social media and see who responds with ideas or just an offer to help. Use the power of pull to shape serendipity and discover people you never even knew existed but who share your interest/passion in these questions.

Who knows? Your questions might even help you to frame a powerful personal narrative that will be an inspiring call to action for others to join you on your quest to address a significant opportunity that exists out in the future. By asking for help from others you will start to build deep trust that will further motivate them to collaborate.

So, what’s holding you back?
There are likely a lot of things – lack of time, pressure from others to deliver specified results, atrophied curiosity, the list goes on. But there’s one thing that is increasingly holding more and more of us back. That’s the growing feeling of fear. In a rapidly changing world characterized by mounting performance pressure on all of us, that’s a very understandable emotion. But it’s also a very limiting emotion. An important first step to overcoming that emotion is simply acknowledging its presence. Start with small moves – framing questions – and seek the questions that excite you and will help you to address and overcome that fear. Then find others who can help to reassure and support you as you all move forward together in seeking answers to those questions.

Here's some contrarian advice: forget about resolutions. Resolutions are about finding ways to exercise discipline in pursuit of something. Rather than discipline, find the things that really excite you and cultivate your awareness of the questions that could really make a difference in those areas. Far better and ultimately more rewarding to pursue things because you’re excited by them, rather than because you are forcing yourself to pursue those things. As you become more aware of the excitement and personal importance of these activities, no one will be able to stop you from pursuing them. It’s the questions that can generate that excitement and focus your efforts.

Bottom line
It all starts with questions. Take some time to surface those questions and to reflect on them. You might be surprised by what you discover. It may be the beginning of something truly remarkable and fulfilling. And what better time to begin the journey than our entry into a New Year?

The Pull of Books

The spine beckons
Teasing us with so little,
But pulling us
To pull it off the shelf
And explore what’s inside.
We’re drawn page by page,
Exploring new terrain,
Seeking insight and inspiration,
Drawn by the promise of something
Much bigger than the pages in our hand.
The trees that gave their lives
Are grateful for our attention
And hoping that they can
Make our lives much richer and more satisfying
Here’s hoping that your tree
On Christmas morning
Will add some more spines
To nourish your days ahead.

The Threat and Opportunity of Lifelong Learning

Our conversations and media are increasingly consumed by the topic of the “future of work.” And, within this topic, one of the buzzwords that has emerged and acquired increasing prominence is “lifelong learning.” The message is that, in a more rapidly changing world, we’re all going to have to abandon the traditional notion of going to school to learn and then going into a career to apply the learning we’ve received.

While this is certainly an important message, I’m deeply troubled by the loose way it’s communicated – it rarely questions our traditional view of learning, it rarely addresses the issue of motivation and it doesn’t systematically explore what’s required to support lifelong learning.

What is learning?
When most people talk about lifelong learning, they’re still locked into very conventional views of learning – it’s about training programs and classes. More sophisticated views may explore how snippets of training programs can be delivered on demand electronically to workers in their workplace.

But, here’s the problem – most of these discussions focus on learning in the form of transmitting existing knowledge. In a more rapidly changing world, existing knowledge becomes obsolete at an accelerating rate. The key to success in that kind of world is to focus on a very different form of learning – creating new knowledge through action by addressing unseen problems and opportunities as they emerge in whatever context is relevant (and context becomes increasingly relevant, see my post on the “contextual age”).

What’s the motivation to learn?
Very few people that talk about lifelong learning focus on a key question: what’s the motivation to learn? Learning requires enormous effort and that effort will need to be sustained over a lifetime.

Sure, we can try to motivate people through fear with the message that, if they don’t sustain their learning efforts, they’ll be increasingly marginalized. Good luck with that. They might invest some effort out of fear, but they’ll never invest the level of effort required to truly excel at learning. Lifelong learning becomes a threat and they’ll be reluctant and resentful.

We can try to provide extrinsic motivation in the form of rewards like higher compensation. That may help, but it will be no substitute for powerful intrinsic motivation. What if people engaged in lifelong learning because they were excited by the opportunity and couldn’t wait until the next challenge that would provide an opportunity to learn more? They’re the ones who will learn fastest and sustain that effort throughout their lives.

What would provide that motivation? Well, I’ve written extensively about the growing importance of the passion of the explorer (see, for example here but be aware that I have many blog posts on the topic of passion, as well as this post that provides a taxonomy of passion). Those who have drawn out and cultivated this specific form of passion, are driven to learn faster throughout their lives – and the learning that excites them the most is addressing challenges and opportunities that have never been addressed before. To be clear, this form of passion is very different from the conventional focus on worker engagement that I discuss here.

But, here’s the rub. All of our institutions are built on a model of scalable efficiency and these institutions are deeply ambivalent about, if not openly hostile to, this form of passion. People with this form of passion have a hard time sticking to the script and the process manual – they get bored easily and they’re often deeply frustrated, seeing so much opportunity to get to higher and higher levels of performance and frustrated by the obstacles in their way. That may be why, at best, our research indicates that only about 13% of the US workforce currently has this passion of the explorer. If we’re truly serious about lifelong learning, we need to change that.

What’s required to support lifelong learning?
Here’s a key observation: no matter how smart any one individual is, that person will learn a lot faster as part of small group of people who share a commitment to getting to higher levels of impact and who form deep trust-based relationships through acting together. If we remain narrowly focused on learning in the form of transmitting existing knowledge, we’ll miss that key insight because it is particularly true if we are looking to create new knowledge through action in addressing unseen problems and opportunities.

At an institutional level, this shifts the focus from individuals to tightly knit workgroups who are working together to find ways to increase impact. At an individual level, it suggests that, once you’ve found your passion, you’ll achieve much greater impact once you are able to connect with a small group of others who share your passion. In fact, people who have the passion of the explorer, naturally coalesce into these small groups committed to learning faster together.

Once these groups come together, they’ll benefit by adopting a set of practices that can help them to accelerate learning and performance improvement. Our research on this front can be accessed here.

And these groups will be much more effective at accelerating their learning and performance improvement if they're provided with environments that are explicitly and systematically designed to accelerate learning and performance improvement. We’ve done a lot of research in this area and were unable to find a single company that has attempted this systematic redesign, although we wrote up the impact achieved by companies that had redesigned slices of the work environment here.

The question is: how can we scale the efforts of these tightknit workgroups and amplify their ability to learn faster together? Well, that requires a fundamentally different culture and institutional model, shifting from our current focus on scalable efficiency to a focus on scalable learning, which we’ve written about here. As part of this, we’re going to have redefine what we mean by work. Today it's viewed as a set of tightly specified and highly standardized set of routine tasks. Instead, we need to focus everyone on work that involves addressing unseen problems and opportunities in ways that can create much more value, something that we’ve written about here. It also requires us to adopt a very different organizational model, something that we call “creation spaces” that we’ve written about here and that can ultimately scale learning well beyond the boundaries of any single institution.

In short, if we’re serious about this, it will require a fundamental transformation of all our institutions. And that’s a challenge, given the powerful immune system and antibodies that exist in all our institutions and that are relentless in mobilizing to crush any attempt at fundamental change. Never, ever under-estimate the power of the immune system In that context, we’ve become strong proponents of a particular approach to organizational transformation that we call scaling the edge.

Before I stop, let me also make an obvious point. If we’re serious about lifelong learning and re-framing learning around the creation of new knowledge through action, it will require us to re-think our educational institutions from the ground up. We’ll need to abandon the model suggesting that school addresses only a specific phase in a person’s life and, once they have their degrees or credentials, can move onto other things. Rather than pushing content to students who are viewed as passive recipients, we’ll need to embrace a pull-based model that focuses on creating environments for people to discover and pursue their passions and helps them to connect with others who share these passions. In short, schools will need to evolve to become life-long talent advisors, developing deep trust-based relationships with individuals and small groups, helping them to accelerate learning and performance improvement throughout their lives.

Bottom line
Yes, we all will need to embrace lifelong learning as a prerequisite for sustained success in a world of mounting performance pressure. But, we’re going to need to embrace it as an exciting opportunity rather than as a burden or threat. To do that, we’re going to need to commit to discover and cultivate the passion of the explorer that resides within all of us and to find ways to integrate that passion into our work.

But, we need to avoid the temptation of many who say that lifelong learning is solely the responsibility of the individual who still needs to find ways to fit into our existing institutions. If we’re truly going to harness the power and potential of lifelong learning, we’re going to have to transform all of our institutions to help people to learn faster and accelerate performance improvement.

The rewards will be enormous. If we get this right, we will create environments where we will all be able to achieve far more of our potential and have far more positive impact on the people around us. And, we’ll foster a set of institutions that for the first time are able to deliver increasing returns to their stakeholders.

Gratitude for Spiritset

In my last blog post, I explored the need to expand beyond our current focus on mindset and to appreciate the role that heartset plays in shaping our beliefs, choices and actions. In reflecting on this framing, I’ve come to realize I left out a third element that provides a foundation and context for both mindset and heartset – it’s our spiritset.

What’s that? Well, it’s a made-up word, but I’m looking for symmetry with the word that dominates most of our discussions today – mindset. I’ve already made up the word heartset, so why not keep on going and offer you spiritset as well?

So, what’s spiritset? It’s my attempt to capture the essence of who we are and what ultimately makes us human. Deep within us, we each have a unique identity that struggles for expression and growth. It’s what ultimately defines us and our deepest needs. It shapes both our mindset and heartset.

Since it’s Thanksgiving today in the US, perhaps this is an appropriate time to express our gratitude for the foundation of everything that defines our humanity.

Spiritset is defined by a cascading series of paradoxes.

Individual yet connected

Our spiritset expresses our uniqueness. There’s never been anyone who is the same as we are. We all hunger for that uniqueness to be acknowledged and celebrated by others. At the same time, our spiritset defines how we are all connected to each other. No matter what our differences, we are all united by a spirit that craves connection and can only be fulfilled through connection. And it’s not just connection with other human beings. It’s connection with all other living things and even the earth and the universe. Even the introverts among us want to be connected and a prolonged feeling of isolation can lead to profound unhappiness. This paradox is nicely captured by the Latin expression “e pluribus unum” – out of many, one.

Evolving but stable                                                                                                                                                                     Our spiritset is not a fixed entity. It’s driven to grow and evolve. It wants to become more, much more. Yet, at the same time, it provides an anchor of stability that we can always count on. It defines elements that will never change and that we can hang onto in times of great stress and uncertainty. But it will never be satisfied with stability – we have a powerful need to flourish and achieve more and more of our potential

Risk-taking but protective                                                                                                                                                              In its quest to grow and evolve, our spiritset is not only willing, but eager, to take risks that will help us to achieve more of our potential. But, our spiritset is also very protective – its goal is to thrive but, in order to do that, it must first survive – so it will do everything it can to protect us from any dangers lurking in our environment. Its survival instinct is very strong and has helped us and our ancestors to navigate through some very challenging environments. It provides us with the courage to move forward, even in the most difficult times.

Giving but seeking to receive                                                                                                                                                      Our spiritset drives us to make a difference that matters to others who matter to us. We are deeply fulfilled by a sense that we have contributed something meaningful to others. Yet, at the same time, our spiritset is in a constant quest to find ways to receive from others so that we can achieve more of our own potential. The ultimate goal is a virtuous cycle where the more we receive from others, the more we are able to develop our potential and provide meaningful contributions to others.

Energizing but relaxing                                                                                                                                                               Our spiritset is an incredible source of energy. It inspires and drives us to explore and strive to achieve more of our potential. But at the same time our spiritset provides a source of calmness that relaxes and detaches us in the most trying of times. It’s that extraordinary balancing act that enables us to not only endure but to turn some of our biggest challenges into some of our greatest opportunities. And the amazing thing is that, when our spiritset truly connects with the spiritset of others, our energy is amplified and our relaxation deepens. Our spiritsets are an infinite source of energy when properly cultivated.

Where does spiritset come from?
Many of you who’ve been reading this far, have now concluded that I'm some kind of religious evangelist. After all, isn’t spiritset just another word for soul? Well, for some it is and that may be fine. But I caution you not to be too quick to use this word for several reasons.

First, depending on your religious persuasion, soul may have very different meanings and not capture all the dimensions of spiritset that I’m exploring.

Second, the concept of soul tends to be associated with religion and a belief in God. I’m not suggesting that we need to believe in God, at least as conventionally defined, in order to embrace the reality of our spiritset.

Perhaps our spiritset emerges from energy forces that we don’t yet fully understand, but that are a very real part of our universe. There’s so much of our universe that remains to be explored – perhaps this is just one other dimension inviting our attention. There are many who would describe themselves as spiritual, but not religious, who are exploring this dimension. I definitely fall into this camp.

But perhaps we don’t even have to believe in some mysterious energy force to embrace the concept of spiritset. Perhaps we just have to acknowledge that our physical bodies are extraordinarily complex and evolving systems that we are only beginning to understand. For a long time, we’ve pursued siloed understanding of our bodies, with some focusing on neuroscience, others focused on our cardiovascular systems and yet others focusing on our digestive systems. We’re only now beginning to understand that these are not independent systems but highly connected and interacting, and shaping each other in ways that we had not even imagined. Perhaps there are other dimensions of interaction and interdependence of our physical systems that give rise to the characteristics of the spiritset that I’m describing, without requiring us to look for some mysterious energy force or soul as the source of this spiritset.

Why does this matter?
Many of my business colleagues as they read this are now beginning to wonder if I’ve gone off the deep end and wandered into woo-woo land. Why does any of this matter for business or for the successful operation of any of our institutions?

Well, I believe it not only matters, but will become increasingly central to our individual, institutional and social survival. In more stable times, perhaps we could get away with embracing a rationalist outlook focused just on mindset, especially if we were willing to acknowledge that psychology could help us to understand the role that emotions and our heartset play in driving our choices and actions.

But, as we move deeper into the Big Shift, characterized by mounting performance pressure and an accelerating pace of change, we need to look deeper into ourselves to understand who we really are and what really motivates us. In that kind of world, superficial manipulation of our thoughts and emotions won’t produce the motivation we’ll all require to succeed.

The institutions and leaders who understand the power of our spiritset and the infinite potential that it offers will be the ones to survive and flourish in increasingly challenging times. They’re the ones who will help us to navigate from mounting performance pressure to expanding opportunity by cultivating that spiritset. They will see that spiritset, properly cultivated, provides us with the motivation that leads to accelerating performance improvement, while providing us with the guardrails to flourish rather than flounder. They will see that spiritsets, properly cultivated, can generate the mindsets and heartsets we need to achieve far more of our potential, as individuals and institutions. This isn’t just about our needs as individuals. It’s increasingly about our needs as institutions.

Cultivating spiritsets
Here’s the challenge. While we all have a spiritset that can enable us to flourish, our institutions and our societies have increasingly created environments that ignore, if not deny, the existence of that spiritset. We’re all focused on instilling the right knowledge and skills that can help us to succeed. We are taught that emotions are a distraction, if not deeply harmful, to our quest to succeed. Spiritset is viewed as some kind of mystical fantasy that undermines our ability to succeed in the material world. Success is increasingly defined as the accumulation of material goods.

Spiritsets are certainly not cultivated and nourished in our world driven by scalable efficiency. That doesn’t mean they go away. They live within each of us, struggling for recognition and attention. But they live in the recesses of our being and, for most of us, can only play a limited role in helping us to achieve more of our potential.

But, imagine what we could achieve if we not only acknowledged, but actively sought to cultivate, the spiritsets that reside within all of us. That would provide us with the motivation to achieve more of our potential and to have an increasing impact that matters on others. It would also provide us with an opportunity to connect more deeply with the spiritsets of others so that we could amplify our energy and achieve even more impact together.

By focusing on spiritsets, we would finally encourage everyone to find their passion and pursue their passion in ways that benefit others while helping each of us to achieve more of our potential. I’ve written elsewhere about the imperative to shift from institutional models based on scalable efficiency to ones based on scalable learning.

But here’s the rub, we will never learn fast enough unless we’re motivated to learn faster and the most powerful form of motivation is intrinsic – it comes from what I’ve described as the passion of the explorer. That form of passion is ultimately a manifestation of our spiritset – it emerges from our quest to achieve far more of our potential.

Today, our research suggests that only about 14% of workers in the US have this form of passion in their work. That’s a natural and inevitable consequence of building institutions that fail to recognize the importance of spiritsets.

Scalable learning requires intense motivation which requires passion which requires cultivating our spiritset. It all goes back to spiritset.

The journey to nurture spiritset
So, how do we nurture our spiritset? We need to begin by acknowledging that it exists and that it has extraordinary power. That will motivate us to look within and invest the time and effort required to explore the force that ultimately defines who we are. We need to reflect on what truly drives us and what will enable us to achieve more of our potential. As we do this, we need to seek out others who have embarked on a similar journey. And then we need to work together to shape institutions and communities that actively seek to address the needs of our spiritset, helping all of us to achieve more of our potential. It won’t be easy, because so many of us have lived so long without even acknowledging our spiritset, much less learning about its needs and power, but the rewards will be enormous for us as individuals and as a society.

Bottom line
We’re complex beings, and we need to learn how to embrace that complexity. We’re also capable of achieving infinite potential, but only if we embrace the complexity that makes us human. Let’s resist the temptation to simplify, because that will only limit our potential. Let’s dive deep beneath our mindset and heartset and explore the foundation that ultimately defines who we are. As we move into an exponential world shaped by exponential technology, this will be the key to unleashing our intrinsically human ability to drive exponential performance improvement for ourselves.

I’m writing this in Athens, Greece. I’ve always had deep admiration for those brave early explorers like Aristotle and Socrates who had the curiosity and wisdom to learn more about who we really are. They’ve inspired me to write this. We have yet to discover fully who we really are.