Category Archives: Fear

  • 19
    Mar 23
  • 0

Escalating Return on Attention

Category:Connections,Emotions,Fear,Future,Learning,Opportunity,Paradox,Potential,Workgroups

Last week, I gave a talk at the South By Southwest conference in Austin where I focused on the increasing importance of return on attention. I believe this is becoming more and more central to success, but that business people are viewing this much too narrowly. There’s a significant untapped opportunity waiting to be addressed.

Paying attention to return on attention

Let me begin by saying that most business people are primarily focused on a very different metric to measure progress – return on sales. While I don’t want to dismiss this, I suggest that it’s too limiting for two reasons.

First, it’s inward looking – it focuses on the financial performance of the company. While that’s certainly important, the financial performance of the company is shaped by events and needs outside the company.

Second, by focusing on financial performance, it draws the attention of management to lagging indicators. It tells them how they have been doing. In a rapidly changing world, we need to be looking ahead, focusing on indicators that will help us to anticipate emerging opportunities.

We need to pay more attention to return on attention. In an increasingly competitive world, customers are gaining more power. Where customers choose to allocate their attention among a growing number of options competing for their attention, will determine who succeeds and who becomes increasingly marginalized.

We need to find ways to measure and monitor return on attention. But the challenge is that return on attention can be viewed at many different levels.

Level 1 of return on attention

When I talk with executives about return on attention, I find that they quickly narrow their focus to their own company. For them, return on attention is how much they have had to spend per unit of attention from their customers and promising prospects.

Once again, they understandably fall back to financial metrics and what they have had to “pay” for the attention of their customers. This is still very focused on the company and lagging indicators – how much have they had to pay in the past.

Level 2 of return on attention

We need to expand our horizons. Rather than focusing on the company, let’s shift our attention to the customers and their return on attention – what value are the customers receiving for the attention they are providing to the company? What’s their return on attention?

And, let’s stay focused on value received, rather than the amount of time and effort that customers have to invest in order to receive the value. The temptation here is to narrowly define value as delivering what the customers want and need today.

The challenge is that what customers want and need today may not be what is ultimately most valuable to them. As I’ve written about in The Journey Beyond Fear, people around the world are increasingly driven by the emotion of fear. In this kind of world, the most effective way to draw attention is to address the fears that are consuming customers – feeding the fear, providing them with defenses against perceived threats and helping them to escape from the fearful world around us (dare I mention metaverse?).

Addressing current needs can help to attract attention with less effort but, if the needs are not sustainable, is this the most promising way to increase return on attention for customers over time? Even more importantly, if the needs that customers perceive today are limiting their potential to create value that is more meaningful to them, are businesses serving the true needs of the customers?

Level 3 of return on attention

This takes us to an even more promising level of return on attention. Rather than just focusing on the current needs of the customers, maybe businesses should look ahead and anticipate emerging needs of customers that can create much more value.

Businesses need to expand their horizons even further. They need to not just focus on the return on attention to the customer today, but the return on attention to the customer over time. They need to ask what can help customers to achieve much more impact and value that is meaningful to them than what they are achieving today. What are the unmet needs of customers that customers themselves might not even be able to articulate today, but that could help them overcome their fear and motivate them to provide more and more attention?

While this requires businesses to look ahead, business executives should realize that the timing could not be better. One of the challenges for businesses today is the significant erosion of trust from their customers. While most customers could probably not articulate what is eroding their trust, a key driver is the growing recognition that companies are focused on serving their own short-term needs, rather than understanding and addressing the evolving needs of their customers to achieve more impact that is meaningful  in a more and more challenging world.

Businesses that understand what is driving the erosion of trust and actively seek to increase the return on attention of their customers will find that they will draw and retain the attention of those customers  much more effectively than they have in the past.

Level 4 of return on attention

But that’s not all. There’s an even bigger opportunity that remains to be addressed by both customers and the businesses serving them. In a rapidly changing world with mounting performance pressure, all customers have a need to find ways to continue to increase impact that is meaningful to them.

This creates a need for all customers to learn faster about how they can increase impact in areas that matter to them. In this rapidly changing world, this is not about learning in the form of training programs that share existing knowledge, but instead it’s about creating environments and conditions that can help customers to create entirely new knowledge at an accelerating rate – finding ways to create more and more value with less effort.

This kind of learning doesn’t occur in a training room. It occurs out in the real world as customers take action, assess the impact they are achieving, and reflect on what new actions they can take that will yield even more impact. As customers begin to see the need for this and the value it can provide, they will also begin to see that they can learn much faster and more effectively if they come together in small groups where they share a passion about increasing impact (I call them impact groups and have written about them here).

Customers will significantly increase their return on attention if they can participate in these learning environments because they will create much more value for themselves and for others. Businesses that see this emerging need and act aggressively to provide these learning environments will ultimately draw more and more of the attention of more and more customers and create much more value for themselves as well.

We need to see an intriguing paradox. The same long-term forces that are creating mounting performance pressure and a growing need for impact that is meaningful are also creating exponentially expanding opportunity – we can create far more value far more quickly and with far less resources than would have been imaginable a couple of decades ago. Those customers and businesses who see this exponentially expanding opportunity and actively seek to address it will dramatically increase their return on attention.

There’s an untapped business opportunity that I describe as “the trusted advisor” where businesses focus relentlessly on increasing the impact that their customers can achieve. This business opportunity has exponential potential.

Bottom line

In a more and more challenging world, where fear is becoming the dominant emotion, it is understandable why businesses are pursuing more and more short-term financial metrics for impact. But those metrics are increasingly limiting our ability to create value.

If we are going to unleash the exponentially expanding opportunity that is emerging around us, we need to find metrics that will excite and inspire us, and help us to overcome our fear. We need a deep and nuanced understanding of “return on attention” that is focused on the growing impact that our customers can achieve. This will help both our customers and our businesses to move beyond their fear and succeed in ways that will help all of us to flourish.

  • 26
    Feb 23
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Evolving Boards Into Springboards

Category:Collaboration,Connections,Emotions,Fear,Future,Leadership,Opportunity,Transformation

In a rapidly changing world, Boards of Directors (or Trustees) can play a significant role in becoming a catalyst for change within large, traditional companies and other institutions. Unfortunately, this role is still an untapped opportunity in most institutions.

What’s the need?

As I’ve written about extensively, we are in the early stages of a Big Shift that will transform our global economy and society. The paradox of the Big Shift is that it creates mounting performance pressure and exponentially expanding opportunities at the same time.

Mounting performance pressure takes many different forms – intensifying competition, accelerating pace of change and extreme, disruptive events. That pressure creates an imperative for change – if we continue to do what we’ve always done, we’ll become increasingly marginalized and ultimately be wiped out.

But the good news is that the same long-term forces are creating exponentially expanding opportunities – we can create far more value with far less resources and far more quickly than ever before. These are not just opportunities – they are imperatives. In the Big Shift world, only those who see and address these exponentially expanding opportunities will navigate successfully through the mounting performance pressure.

Re-imagining the role of boards

Boards today are generally viewed as fiduciaries for shareholders in the institution. Unfortunately, this role is generally defined too narrowly in today’s world. Board members are expected to represent the interests of shareholders as they currently express those interests. The problem is that shareholders are increasingly focused on maximizing short-term returns. “Short-termism” reigns supreme.

If the shareholders truly understood the exponentially expanding opportunities being created by the Big Shift, their interests would shift from maximizing short-term returns to unleashing the exponential returns that can be generated in the Big Shift. So, the challenge for Board members is whether they should continue to pursue the current short-term interests of shareholders or become catalysts to help shareholders (and management) see the much bigger opportunities that could generate far greater returns over time.

Catalysts for change

Boards are uniquely positioned to become catalysts for change in large, traditional institutions. While boards typically include some leaders from within the organization, they also bring together a group of individuals from outside the organization who represent diverse backgrounds. These individuals are uniquely positioned to provide an “outside-in” perspective for the management of the institutions who tend to become consumed by “inside-out” perspectives as they embrace scalable efficiency institutional models.

But to harness the potential of this “outside-in” perspective, board members must be willing and able to become provocateurs, challenging the implicit assumptions held by the internal management of the organization. They must invest time in exploring how the world outside the organization is changing and they are uniquely positioned to do this, given their backgrounds and experience outside the organization. They can not only rely on their own experience – they can also be proactive in inviting more outsiders to engage with them and the leadership of the organization regarding the trends that are re-shaping the environment of the organization.

These perspectives can help to build greater awareness of the large, emerging unmet needs of customers and other stakeholders of the organization (e.g., business partners and suppliers). They can also increase understanding of the potential to mobilize a broader set of resources to address those unmet needs and create much more value, with far less resources, and far more quickly than ever before.

These emerging perspectives can be catalysts for change at two levels. They can engage the internal management of the organization. At the same time, they can engage the external investors who are likely still pursuing narrow, short-term returns.

From provocation to excitement

Board members should never under-estimate the challenge of shifting the perspectives of the internal management or the external investors. To shift these perspectives, board members need to move beyond provocation. They need to frame exciting opportunities for creating much more value and focus on identifying the trends that are making these opportunities more and more feasible. Where possible, they should provide explicit examples of organizations that are already starting to address these opportunities and the impact that they have achieved. If those examples are not yet available, they should focus on identifying some short-term initiatives that the organization can pursue in addressing these opportunities and demonstrate tangible progress with relatively modest effort.

Those who have followed my writing will recognize that I am suggesting that board members should embrace a version of the “zoom out/zoom in” approach that can help to drive change by helping to overcome the fear and skepticism that often makes people resistant to change.

While the primary focus should always be on the exciting opportunities that can overcome fear and skepticism, board members can also be helpful in broadening the perception of risk among management and investors. Most risk management discussions focus on the risks associated with new initiatives. Very rarely is there any discussion of the risks associated with continuing on the current course. In the Big Shift world, continuing on the current course is often the highest risk option of all, yet few leaders or investors understand those risks.

The key is to understand that just focusing on the risk of the current path will only strengthen the fear that will increase resistance to change. If Board members want to become catalysts for change, they need to focus on framing exciting opportunities that can motivate management and investors to abandon their current beliefs and embrace new approaches that can deliver much greater rewards.

Bottom line

Board members are uniquely positioned to become catalysts for change, creating a springboard for the delivery of much greater impact and value in a rapidly changing world. To harness this potential, board members need to leverage their position as outsiders and help both management and investors to see exciting opportunities that are not yet on their radar screen. The key is to help both management and investors move beyond fear and cultivate intense excitement about exponentially expanding opportunities.

By playing this role, board members will become true fiduciaries for investors, helping them to significantly increase the return on their investment, while at the same time helping management to achieve much greater impact.

  • 18
    Jan 23
  • 0

The Untapped Opportunity of Institutional Narratives

Category:Emotions,Fear,Growth,Leadership,Narratives,Opportunity,Strategy

Everything I do is connected, even when the connections aren’t immediately apparent, even to me. Almost 15 years ago, I started writing about shaping strategies as a powerful way to unleash enormous value for companies – including here and here. Much more recently, I published The Journey Beyond Fear, a book that explored the role that narratives can play in helping to motivate people to achieve much greater impact that is meaningful to them. In that book, I discussed how institutional narratives can help organizations connect more deeply with their customers and third parties to create more value. Unfortunately, I have not yet made the connection between institutional narratives and shaping strategies explicit, even though they are deeply connected.

Institutional narratives

For those who haven’t read my writing, let me start by explaining what these two approaches are. Institutional narratives are not stories, even though most people view them as synonymous. For me, stories are self-contained – they have a beginning, a middle and an end. Stories are also about the story teller or some other people, real or imagined, but they’re not about you.

In contrast, narratives are open-ended. There’s some kind of big threat or opportunity out in the future and it’s not clear how the narrative will be resolved. The resolution of the narrative hinges on the listeners in the audience – it’s a call to action to them to determine how the narrative will be resolved.

In this context, institutional narratives are not about the institution. They are about some big, inspiring opportunity for the customers and stakeholders and the action they will need to take to address the opportunity. There are very few examples of this kind of institutional narrative, but a classic one was the narrative by Apple Computer in the 1990s that was condensed to the slogan “Think Different.”

Shaping strategies

Shaping strategies focus on opportunities to restructure entire markets or arenas in ways that create significant value for the shapers. Shaping strategies mobilize a large number of third parties to pursue the restructuring of the market or arena.

Shaping strategies rely on three elements. First, there’s a shaping view that focuses on what the new market or arena structure could look like and the benefits it could provide to the participants. Second, there’s a shaping platform that helps participants to come together and achieve greater impact with less effort. Third, there are shaping acts and assets which the shaper can use to demonstrate its commitment to pursuing the shaping opportunity.

Most organizations take the existing market or arena structure as a given and focus on how to thrive in the existing structure. In a world of accelerating change, the challenge is that existing structures are rapidly becoming obsolete. The missed opportunity is to imagine and pursue a new structure that could create far more value. Some of the most successful shapers in the business world have been Dee Hock (Visa), Malcolm McLean (containerized shipping), Victor Fung (Li & Fung), Bill Gates (Microsoft), and Marc Benioff (Salesforce.com).

Connecting 

So, what’s the connection between institutional narratives and shaping strategies? The connection is through the shaping view. When I originally developed the perspective on shaping strategies, I saw shaping views as very business-like, focusing on risks and rewards. As I’ve shared before, Dee Hock, the founder of Visa opened up my eyes. In one of our conversations, he cautioned me that it was not about risk and reward, it was about fear and hope, because that was ultimately what motivated people to act. It was an “a-ha” moment for me that helped me shift my attention to the world of emotions, which became the focus of The Journey Beyond Fear.

Institutional narratives emerged in my thinking as a way for organizations to create much deeper emotional connections with their customers and stakeholders. By framing really inspiring opportunities for those outside the organization, institutional narratives communicate a much deeper understanding of what really motivates these participants and help move people from fear to excitement as they look into the future.

For this reason, institutional narratives can become the foundation for a powerful shaping view. Once leaders have framed the really inspiring opportunity that can excite and motivate participants to take action, they can take the institutional narrative to another level by focusing on defining a market or arena structure that can help participants to address the exciting opportunity out in the future. This could attract a growing number of participants to join in the effort to evolve this new market or arena structure.

Exploring an example

So, what would this look like in practice? Let’s look at the wellness arena.  More and more people are becoming focused on strengthening their wellness and not just waiting until they get sick to get help and support. Today, the wellness business is highly fragmented with wellness coaches and a growing array of wellness service providers, ranging from gyms to nutrition experts.

I believe there’s a significant opportunity for wellness coaches to evolve into trusted advisors that orchestrate growing networks of specialized service providers to serve the needs of their clients. This could be a platform for significant growth by mobilizing more and more diverse expertise based on larger and larger networks of participants.

To address this opportunity, a small wellness coaching business today could begin by framing an institutional narrative that focuses on the growing ability of people to improve their wellness, driven by new technology and deeper understanding of what our bodies need to function at better and better levels. The narrative would emphasize that this opportunity requires action from people inspired by the opportunity to improve wellness to adopt new practices – it won’t just happen on its own.

This opportunity for improved wellness can then provide the context for framing an opportunity for a growing number of third parties to come together into a broader network that will be orchestrated by the wellness coaching business. Because these third parties will bring a very diverse set of skills and capabilities, the network will be a lot more effective in improving the wellness of its clients. These third parties can become excited by the potential to improve the wellness of clients much more than if they were just operating as isolated service providers.

This institutional narrative can thus become the foundation for a powerful shaping view. The institutional narrative focuses on cultivating emotions of excitement and passion among both clients and third parties that can help the clients. This will motivate them to act boldly to pursue the opportunity. A more detailed shaping view can then help to provide the third parties with a road map to guide them in the actions they can take to come together and address the opportunity. It will  also help them to see how they can collaborate in ways that will create more value for clients as well as for themselves.

Bottom line

Institutional narratives can play many different roles in helping organizations to connect more deeply with their customers and stakeholders so that they all can achieve greater impact. One key role of institutional narratives is to motivate third parties to come together and act more boldly in ways that will restructure an entire market or arena. Based on my research, there are very few examples of organizations that have made the effort to develop a powerful institutional narrative, but there are even fewer examples of organizations that have pursued the potential of institutional narratives to support shaping strategies. This is an untapped potential that needs to be addressed.

  • 20
    Nov 22
  • 1

The Metapsychology of the Metaverse

Category:Collaboration,Community,Connections,Context,Emotions,Exploration,Fear,Future,Learning,Narratives,Opportunity,Passion,Potential,Uncategorized

The metaverse is consuming conversations about technology these days. But, what is it? And, is it something we should welcome?

What is the metaverse?

I can’t pretend to offer a definitive definition of the metaverse – I certainly haven’t been able to find one. It’s one of my concerns in all this talk about the metaverse – many different definitions seem to be floating around so it’s not clear what we are talking about.

My best guess about what most people mean when they talk about the metaverse is that it is an immersive and persistent three-dimensional virtual realm, shared with many users, that brings together virtually enhanced physical and digital reality. It integrates many different technologies, including augmented reality, the Internet of things, virtual reality, and blockchain. Blockchain provides an opportunity to use cryptocurrencies and NFT’s to create a fully functional virtual economy in the metaverse where you can buy and sell any virtual asset.

The metaverse can have a significant game component, where participants compete to achieve certain goals and win prizes for their efforts. In fact, I would suggest that the video game world is rapidly evolving into the metaverse and may lead the way for other metaverse initiatives. However, the metaverse can be much more than a game.

The term “Metaverse” was first coined by the great science fiction author, Neal Stephenson in his book, Snow Crash, published 30 years ago. If you haven’t read it, I highly recommend it. In this book, Stephenson basically presents the metaverse as a virtual reality-based Internet populated by user-controlled avatars.

So, if this is what the metaverse is, is it good or evil? Well, the answer is – it depends. Like most technology, it’s not good or evil in itself. It all depends on how we use it.

The evil side of the metaverse

In a world that’s increasingly dominated by fear (see my book, The Journey Beyond Fear), there’s a significant risk that the metaverse will evolve in ways that limit our potential as humans, rather than expand it. What do I mean by that?

The metaverse is an artificial world that can provide an escape for those who are finding the real world very scary or limiting. If we’re driven by fear, it can draw us out of the real world and offer us a place to hide. If we’re consumed by boredom, it can provide us with an irresistible opportunity for excitement.

Temporary relief may be OK, but the metaverse can be designed to be addictive. Participants will find themselves spending more and more time in the metaverse, leaving the real world behind. Of course, for many metaverse designers, that’s what they’re seeking – make the metaverse an all-consuming experience.

The good side of the metaverse

While understandable, that misses the real opportunity of the metaverse. The metaverse can become a launchpad for all of us to achieve much more of our potential in the real world, but that will require a very different design of the virtual worlds we’re creating.

It requires a fundamental shift in focus in how to measure success. If the metaverse is designed to be an escape, the measure of success is how much time participants spend in the metaverse. If it’s a launchpad for impact in the real world, the measure of success is how participants are increasing their impact in the real world as a result of participating in the metaverse.

How could the metaverse help participants to increase their impact in the real world? It could begin by embodying the core elements of what I describe as opportunity-based narratives – a really big and inspiring opportunity out in the future and a call to action to address the opportunity. While the metaverse can present the opportunity in the virtual world, it would need to be clear that the opportunity exists in the real world as well, and help to motivate participants to pursue that opportunity there. Similarly, while the metaverse could provide an environment for action to pursue the opportunity in the virtual world, participants would need to understand that the real potential for impact is in the real world.

To help people address these opportunities, the metaverse could provide ways for people who are inspired by these opportunities to come together and discuss approaches that would have the greatest potential for impact in addressing these opportunities. These groups might even become what I call “impact groups.”

But it wouldn’t be just about discussion. In the metaverse, participants would be encouraged to take action. Initially, that action might be in the virtual world of the metaverse where it could be pursued perhaps more quickly and with less risk and more rapid feedback than in the real world. But, once again, participants would need to understand that this is simply a vehicle for learning how to have more impact in pursuing the opportunity in the real world. Designed appropriately, the metaverse could become a powerful learning platform that helps participants to learn faster through action together.

In short, the metaverse could become a vehicle for helping participants to overcome fear and boredom that they may be experiencing in the real world. It could do this by providing participants with the tools and connections that can help them address some very large and inspiring opportunities in the real world. Rather than providing an escape from the real world, the metaverse could motivate participants to return to the real world, excited about the potential to have much greater impact that is meaningful to them. Of course, they would regularly return to the metaverse to connect with more people and find ways to have even greater impact.

Metapsychology

So, why did I include metapsychology in the title of this blog? Of course, one reason was that it blended so well with metaverse. I may be using the term inappropriately, but it struck me that there’s an opportunity to explore the relationship between psychology and the metaverse.

In particular, it highlights the importance of understanding much more deeply how different design approaches to the metaverse could shape or influence the psychology of its participants. It’s also important to explore the relationship between the psychology of participants in the real world and in virtual worlds.

My view of the untapped opportunity is how the metaverse can help more and more people on the journey beyond fear and boredom. It can help to draw out hope and excitement in the real world that will motivate all of us to achieve much more of our potential.

Of course, we need to be careful about manipulation of emotions. From my perspective, manipulation occurs when we create environments or contexts that draw out certain emotions that are not in the best interest of the participants, but serve the interests of those who are creating the environments. In contrast, I am focusing on creating environments that will draw out emotions that we all as human beings have a hunger for – hope and excitement about an opportunity to have more impact in the real world that is meaningful to us and to others.

That’s ultimately where the money is. Many organizations seek to manipulate the emotions of others in order to serve their own interests. That may work in the short-term, but the key to generating long-term revenue and benefit comes from cultivating emotions that help us to achieve more of our potential.

Bottom line.

Like all technology, the metaverse can be used for good or evil. It’s up to us. As an optimist, I see the opportunity for enormous positive impact from the metaverse, but I’m concerned that there are strong incentives for metaverse designers to provide escape vehicles for participants and reduce the potential for positive growth in the real world. Once again, it’s up to us. How can we create more incentives for metaverse designers to provide us with launchpads in addressing very large opportunities in the real world?

  • 05
    Sep 22
  • 0

Shaping Serendipity with Narratives

Category:Collaboration,Community,Connections,Emotions,Fear,Future,Learning,Narratives,Opportunity,Passion,Potential,Serendipity,Trust

I have long challenged our conventional view of serendipity. I believe that those who master the art of serendipity will ultimately achieve much more of their potential and create value that is meaningful to them and others. But it won’t be easy. It will require us to move beyond our comfort zone and embrace new approaches.

Shaping serendipity

Most of us believe that serendipity is something that just happens and that all we can do is be prepared for it when it does happen. I devoted an entire chapter in my book on The Power of Pull to the opportunity that we have to shape serendipity – we can, through our actions, significantly increase the probability of it happening.

What are some examples? If you live in a small village, the likelihood of serendipity is much lower than if you move to a large city. If you’re booked from early morning to late in the evening with meetings with people that you already know, you’re much less likely to run into someone that you didn’t know and who could provide real insight into an issue you are addressing. The choices we make on a daily basis can significantly alter the probability of those unexpected encounters.

I can’t resist tying this to my new book – The Journey Beyond Fear. In that book, I discuss how fear is becoming the dominant emotion among people around the world. If we’re driven by fear, we tend to isolate or hang out with people we already know – we’re very reluctant to meet people we don’t know.

Serendipity matters

So why does this matter? Well, it turns out that serendipity is becoming more and more essential for success. As I’ve discussed in my research on the Big Shift, we live in a world of accelerating change and intensifying competition.

In this Big Shift world, we need to accelerate our learning, especially learning in the form of creating new knowledge, as we confront situations that have never been encountered before. One of the best ways to pursue this form of learning is to seek serendipity – encountering people who can provide unexpected insight into some of the challenges we are confronting.

Narratives as a catalyst for serendipity 

So, how do we do that? There are many ways, as I discussed in my book on The Power of Pull. In this post, I’m going to focus on an approach that I have come to believe is particularly powerful and yet rarely used. It involves the use of narratives which I discuss in more detail in my new book, The Journey Beyond Fear.

Most people view stories and narratives as meaning the same thing. I make an important distinction. For me, stories are self-contained. They have a beginning, a middle and an end – the end, the story is over. And stories are about the story-teller or some people, real or imagined. They’re not about you.

In contrast, for me, narratives are open-ended – there is no resolution yet. There is some kind of big threat or opportunity out in the future. It’s not clear whether it will materialize or not. And the resolution of the narrative hinges on you – it’s a call to action to those who are hearing the narrative. Their choice and actions will help to determine how the narrative plays out.

Opportunity-based narratives can be powerful catalysts for serendipity on two levels. First, they focus on a really, big inspiring opportunity that can help people more beyond fear and cultivate the passion that will take them beyond their comfort zone as they seek to address the opportunity. Second, these narratives have a call to action that motivates people to take action, including seeking out and connecting with others who share their excitement about the opportunity to be addressed. These are often people they have never met before.

Personal narratives

In The Journey Beyond Fear, I explore how narratives can be crafted at multiple levels – personal, institutional, geographical and movements. Let’s start with personal narratives. We all have a personal narrative that is shaping our choices and actions. Unfortunately, more and more of us are consumed by threat-based narratives, viewing the future as very threatening and feeding the emotion of fear. As a result, we often do not have a call to action to others – with fear, we tend to lose trust in others and isolate ourselves.

Imagine what we could accomplish if we found a way to craft an opportunity-based personal narrative – a narrative is shaped by some really big and inspiring opportunity in the future that could help us to achieve much greater impact that is meaningful to us. That opportunity could help us overcome our fear and realize that the opportunity is not just for us – it’s an opportunity that many could share. It would motivate us to spread the word about the opportunity and seek help from others in addressing the opportunity. As word spreads, the likelihood of serendipity increases. People we never knew will seek us out, excited about the ability to come together and pursue a shared opportunity.

Geographical narratives

(I’ll leave institutional narratives and movement narratives for another time.) I believe that geographies – cities, regions and countries – can craft inspiring opportunity-based narratives that will increase serendipity. What’s the evidence for that? Well, cities like Athens, Florence and Vienna have harnessed that potential (see more in The Journey Beyond Fear). For now, let me focus on where I live.

I’ve been in Silicon Valley for many decades and people often ask me how to explain the continued success of Silicon Valley. Others would focus on things like the universities and venture capital firms. I believe the success of Silicon Valley has ultimately been driven by a powerful opportunity-based narrative. At a high level, it focuses on the opportunity to change the world by harnessing the exponential potential of digital technology, but the call to action is that you need to come to Silicon Valley to help address this opportunity. It’s the reason why the majority of successful entrepreneurs in Silicon Valley were not even born in the US, much less Silicon Valley. They were drawn from all over the world by the inspiring opportunity-based narrative.

Once they came here, serendipity was unleashed. These people were continually running into other people at gatherings and on the street that they never knew before. And because they were so passionate about the opportunity that drew them here, they would quickly begin discussing a challenge that they did not yet know how to address and asking for help and advice. Serendipity sizzles in Silicon Valley. And it can sizzle in any geography that inspires people to come together to address a really big opportunity.

Unleashing the power of narratives

Narratives have enormous potential but we only unleash that potential if we craft our narratives in certain ways. As I’ve already indicated, we need to shift from threat-based to opportunity-based narratives that can help all of us to overcome our fears and our tendency to isolate as we lose trust in others. The opportunities need to be really big opportunities that will take some time to achieve and that will require the effort of many people who can share in the opportunity (ideally, the opportunity will become even bigger as more people come together).

We also need to make an effort to spread the word about the opportunity and encourage people to come together to address the opportunity. We need to find ways to reach people that we don’t know. Word of mouth can help, but writing and speaking about the opportunity to large groups of people can be even more helpful in attracting people we don’t know (dare I mention social media as one important avenue?).

Bottom line

In a rapidly changing world, serendipity becomes more and more central to success, given its power to generate new insight that we would have never had on our own. We have the ability to significantly improve the likelihood of serendipity. One powerful (and largely untapped) approach that can help in this quest for serendipity is the crafting of inspiring opportunity-based narratives with a call to action to a broad audience.

If we get this right, we can turn the mounting performance pressure of the Big Shift into exponentially expanding opportunity. We are now able to create far more value with far less resources and far more quickly than ever before. Let’s get started!

  • 11
    Aug 22
  • 0

Shaping Markets and Shaping Psychology

Category:Collaboration,Emotions,Fear,Future,Leadership,Opportunity,Paradox,Passion,Strategy,Transformation,Trust

Dee Hock, the founder of Visa, recently passed away. It’s been a catalyst for me to reflect on the role he played in expanding my horizon beyond strategy to explore the role of psychology in shaping our impact. This post will take one of my approaches to strategy – shaping strategy – and focus on its ability to shape our psychology.

Shaping strategies

I’ve written extensively about the untapped potential of shaping strategies, including here and here. In a world of accelerating change, business leaders have been embracing approaches like agility that focus on rapidly and flexibly responding to the events of the moment. The goal is to react to whatever is happening at the moment.

As a contrarian, I have challenged that view. In times of accelerating change and increasing uncertainty, we have more degrees of freedom to shape the markets and environments around us to create more value for ourselves and for other participants. But we have to see that opportunity and pursue it. And, to do that, we need to escape the reactive mindset that shrinks our time horizons.

Three elements of shaping strategies

Shaping strategies focus on addressing this opportunity. They rely on three elements: a shaping view, a shaping platform, and shaping actions and assets. The shaping view is the foundation of these strategies – it looks ahead and describes how a future market or industry might be structured in a very different way to create and capture much more value for its participants. Shaping platforms then provide a way for more and more participants to join in the effort – they help to reduce the effort and cost of participation while bringing quicker and larger returns. Finally, shaping actions and assets are ways that the shaper can overcome skepticism of potential participants that the shaping opportunity is achievable.

Even though we are in a world where shaping strategies are becoming more and more viable, very few companies or other institutions have pursued these strategies. Some of the most successful shapers have been Dee Hock (Visa), Malcolm McLean (containerized shipping), Victor Fung (Li & Fung), Bill Gates (Microsoft), and Marc Benioff (Salesforce.com). I discuss their approaches and the lessons that can be learned in my book, The Power of Pull.

Shaping psychology

So, how does this shaping strategy approach connect with shaping psychology? All three elements of a shaping strategy can be very effective in shaping the emotions of the participants.

Let’s start with the shaping view. When I developed this approach to strategy, I focused on the role of shaping views in framing an opportunity that would increase our perception of rewards and reduce our perception of risk.  When I was talking with Dee Hock about this, he interrupted me and said “you’ve got it all wrong. It’s not about risk and reward, it’s about fear and hope. That’s ultimately what motivates people to act.”

That was a wake-up call to me. I had been thinking in narrow business terms, when the real need was to focus on the emotions that shape our actions. I began to realize that the most effective shaping views seek to overcome the fear holding back many participants and cultivate hope and excitement about an opportunity that could be achieved if they all came together. After all, it’s fear that is holding us back from seeing big opportunities in the future and focusing us on simply reacting to whatever is going on at the moment.

Shaping platforms also help to shape the emotions of participants. By reducing the effort required to participate and creating more rewards for participation, these platforms make it easier to participate, even if participants still have some fear. They also help participants to overcome fear and build hope when they see more rapid rewards and connect with others who are enjoying similar rewards. These platforms would be even more effective if they were explicitly designed to address these emotions and help participants to make the journey beyond fear.

Shaping actions and assets provide a way for the shapers to demonstrate their commitment to the shaping opportunity. This can be a powerful way to overcome the lack of trust that comes with fear. For example, the shaper could make a large investment that would be viewed as a “bet the company” investment to demonstrate its commitment. If it is a smaller, entrepreneurial company, the shaper could also develop some early partnerships with larger and more influential companies that would increase the perception that the shaping strategy will succeed. These actions and assets help to strengthen hope and excitement that the shaping opportunity is real and will be accomplished.

Bottom line

I have written before about the paradox that we confront in the Big Shift that is transforming our global economy and society. On the one side, the Big Shift is creating mounting performance pressure – global competition is intensifying, the pace of change is accelerating and extreme, disruptive events come in out of nowhere. At the same time, the Big Shift is creating exponentially expanding opportunity – we can create far more value, far more quickly with far less resource than would have been imaginable a couple of decades ago. Shaping strategies are a powerful approach to help many of us to move from giving in to the mounting performance pressure and instead seeing and addressing the exponentially expanding opportunities.

  • 09
    May 22
  • 0

From Adaptation to Anticipation

Category:Collaboration,Connections,Emotions,Exploration,Fear,Future,Learning,Strategy

Adapt or die. We’ve all heard this imperative. While there’s some wisdom buried in this imperative, it needs to be drawn out. Most people interpret this imperative in a way that can become deeply dysfunctional and ultimately leads to death. Adapt is not sufficient – we need to first anticipate, then adapt.

Adapting in the Big Shift

What do I mean? Let me start by setting some context. As I’ve written about extensively, we’re in the early stages of a Big Shift that is transforming our global economy and society. The Big Shift has many dimensions to it, but one key dimension is the accelerating pace of change in all aspects of our lives.

When confronted with this accelerating change, we as humans have some natural reactions. The first reaction is to go into denial – we tend to diminish or even dismiss our perception of the changes that are going on around us. We want to believe the world is actually much more stable and that we’ll return to the world we knew and relied on.

As the change accelerates, we begin to flip the switch and go to the other end of the spectrum. Now, we’re consumed by the change we see around us and we begin to see that we need to change ourselves. How do we change? We embrace the need to adapt, but the adaptation we pursue is highly reactive. We react to whatever is happening in the moment and finding ways to change to meet the new needs surfacing around us.

Here’s the problem. As the pace of change accelerates and expands, falling into a purely reactive approach can become overwhelming. There’s so much that’s changing that we end up spreading ourselves way too thinly across so many different fronts that we fail to keep up with the changes consuming us.

The need to anticipate

So, what’s the alternative? Before we adapt, we need to invest the time and effort to anticipate. We need to look ahead and try to determine how the changes around us are likely to evolve. We need to anticipate which changes will lead to new opportunities that are the most meaningful to address.

This certainly won’t be easy, but that’s why it’s important to invest the time and effort to anticipate. I’ve written about the power of a zoom out/zoom in approach to strategy for institutions and I’ve explored the techniques that can help institutions to zoom out on a 10-20 year horizon and anticipate very big emerging opportunities. Over time, I’ve come to realize that this approach to strategy also has significant value for all of us as individuals.

We need to make the effort to look ahead 10-20 years and anticipate what the world might look like then and what really big opportunities are likely to emerge to address unmet needs of others. Consistent with a zoom out/zoom in approach, we need to then focus on the next 6-12 months to identify 2-3 initiatives that we could pursue in the short-term and that could have the greatest impact in accelerating our progress to addressing the really big opportunities that are emerging.

This is where adaptation can now play a much more useful role. Once we have some focus on the changes that really matter, we can avoid being distracted by changes that are temporary or marginal. As we pursue the short-term initiatives, we’ll quickly discover what new approaches can yield the greatest impact in helping us to evolve so that we can address the opportunities that really matter. We’ll adapt much more quickly because we’re committing more time and effort to the changes that really matter, rather than getting consumed by reacting to all the changes erupting around us.

There’s another important advantage to anticipation. In a world that’s rapidly changing and creating mounting performance pressure, we have a natural human tendency to be consumed by fear. While understandable, fear is also a very limiting emotion, as I’ve discussed in my new book, The Journey Beyond Fear. If we’re afraid, we tend to shrink our time horizons, we become much more risk averse, and our trust in others erodes. Fear diminishes our ability to adapt. We just focus on very short-term changes, we become less willing to go outside our comfort zone and we are more reluctant to seek help from others.

In contrast, if we make the effort to anticipate some really meaningful opportunities what will emerge from the changes around us, we’ll begin to draw out the passion of the explorer that will help us to adapt much more effectively and rapidly. Rather than being reluctant to adapt, we’ll be excited about adaptation because it will help us to achieve the impact that is meaningful to us. As a result, we’ll also be driven to ask for help from others so that we can accelerate our progress even more.

The untapped potential of leverage

That leads to another advantage of anticipation – it can help us to leverage our efforts and to learn much more rapidly. If we look ahead and identify a really big opportunity that’s meaningful to us, it’s much more likely to be meaningful to others as well. If we share our excitement about that really big opportunity and ask for help from others, we’re much more likely to draw others who also become excited about the opportunity. We’ll begin to achieve much greater impact as we unleash the network effects that come from joining together to achieve shared objectives.

But the benefit of this kind of leverage is even bigger. If others share our excitement about the really big opportunities ahead, they will also become motivated to adapt. They will be driven to come together with us so that they can learn faster together through action and reflection on the results achieved from their actions. They will be much more motivated to collaborate and take risks that are inevitably encountered when we seek to develop new approaches in a rapidly changing environment. And, no matter how smart and talented any of us are, we’ll learn a lot faster and adapt a lot faster if we come together in small groups with deep trust-based relationships where we are all motivated to learn faster together. I call these groups “impact groups” and I’ve come to believe that they will play a key role in accelerating our adaptation – I explore this in much greater detail in The Journey Beyond Fear.

Adaptation and evolution

But, wait a minute. I can hear some real push back around this notion of anticipation as a foundation for adaptation. Many people are likely to point to the evolution of species on Earth and say that they have evolved and survived based purely on adaptation, without anticipation.

Agreed. But the evolution of species has been driven by the law of large numbers. Each being may seek to adapt, but very few are successful. The good news is that there are generally a lot of beings in a species and most of them will die off to make room for the few lucky beings that pursue the right kind of adaptation. Those lucky beings will proliferate and eventually dominate the species until the next set of changes require further adaptation and then the cycle starts over again.

What I’m seeking is a way for all of us to not just survive, but thrive. I believe that’s a realistic objective if we all move beyond adaptation and focus on anticipation. Of course, this will take some time and we’ll need to cultivate the capability of anticipation. It won’t be easy, but it can be done if we come together and make the effort.

Bottom line

Don’t get consumed by the imperative to adapt. Begin by seeking to anticipate how the world is likely to evolve and the really big opportunities that will emerge in that world, providing us with the ability to have impact that’s much more meaningful to us. Once we begin to see those opportunities, we’ll be able to focus on adaptation that really matters. We’ll also be able to come together with others who excited about these opportunities and find ways to adapt much more rapidly and effectively than if we attempt to adapt in isolation. If we get this right, we won’t just survive, we’ll thrive in ways that are difficult to imagine in a world that is rapidly changing.

  • 28
    Mar 22
  • 1

Our Future Shapes Our Present

Category:Emotions,Fear,Future,Narratives,Opportunity,Paradox

It’s obvious – what we do today shapes our future. The actions we choose to take today will determine what our future will look like.

What’s not so obvious? Our future shapes what we do today. How could that be? The future hasn’t yet happened, so how could it determine our actions today? How could this be true if we embrace the opposite view that our actions today shape our future?

As many of you know, I love paradox because it can expand our horizons and drive us to see things that have remained hidden from view. That’s what this paradox can do.

Our view of the future

We all have a view of the future, even though few of us make the effort to articulate that view, even to ourselves, much less to others.

At the risk of generalizing, I would suggest that we generally fall into two camps when it comes to our view of the future. On one side, we tend to view the future as threatening – it’s full of danger and will be much more challenging that the present. On the other side, we tend to view the future as full of opportunity – we will be able to achieve much more impact that is meaningful to us.

Of course, our view of the future can be very complex, involving a mixture of threat and opportunity but, for most of us, one or the other will tend to dominate and will shape our view of what is ahead.

That view of the future will shape our emotions today. If we look ahead and see primarily threat, we will be consumed by fear. On the other hand, if we look ahead and see primarily opportunity, we will tend to be motivated by hope and excitement.

So, our view of the future is shaping the present, in terms of the emotions that we feel today. But it does even more than that. Our emotions today shape our actions today.

If we’re driven by fear, our time horizons shrink, we become more risk averse and our trust in others erodes. As a result, we tend to become very reactive, simply responding to whatever is happening today, and we become more and more isolated, since we can’t trust others. What happens then? We enter a vicious cycle, where our reluctance to act and collaborate with others feeds our fear and our greater fear makes it even more challenging to make progress in the present.

On the other hand, if we’re driven by hope and excitement, we tend to look ahead and act boldly in the pursuit of the opportunities that we see in the future. We also are more willing to ask for help from others. This tends to create a virtuous cycle. The more motivated we are to pursue opportunities with others, the more likely those opportunities will manifest and that in turn will generate even more hope and excitement.

So, the future is shaping our present in profound ways. It’s shaping our emotions and our actions today. Of course, these emotions and actions today will shape our future as well, but let’s not ignore how our view of the future is having a profound impact on what we do today.

The role of narratives

Here’s the challenge. More and more of us in the world today are becoming consumed by fear. Why is that happening? At one level, it’s understandable because we live in a world that is in the early stages of a Big Shift, driven by long-term forces that are creating mounting performance pressure – competition is intensifying, the pace of change is accelerating, and extreme disruptive events are leaving us scrambling to figure out what to do next.

But this fear is also being fed and intensified by threat-based narratives. Those who follow me know that I have a very different definition of narratives than most. Most people view narratives and stories as the same thing. I believe an important distinction can and should be made.

For me, stories are self-contained – there’s a beginning, a middle and an end to the story. Stories are also about the story-teller or some other people, real or imagined, but they’re not about you.

In contrast, narratives the way I view them are open-ended. There is no end yet, but there’s some significant threat or opportunity out in the future and not clear how the narrative will be resolved. And the resolution of the narrative hinges on you – your choices and your actions will help to determine how this narrative resolves. Narratives have an explicit call to action.

Perhaps not surprisingly, we live in a world where threat-based narratives are increasingly prevalent. Just look at our news media and listen to our politicians – it’s all about the profound threats that are coming to consume us. Once again, there’s a vicious cycle at play. The more prevalent threat-based narratives become, the more consumed by fear we become and that in turn makes us even more receptive to threat-based narratives.

So, how do we escape this vicious cycle? We need to start by recognizing how limiting the emotion of fear is and the role that threat-based narratives are playing in feeding that fear. Then we need to make an effort to shift our view of the future and craft an opportunity-based narrative.

That requires us to reflect on what has excited us the most in our lives to date. We then need to look ahead and frame an opportunity that has the potential to draw out that excitement and keep us focused on achieving something that is really meaningful to us. As that opportunity-based narrative begins to take shape, we will start to feel the excitement that will help us to move beyond fear.

We need a view of the future to focus our actions today – a positive view of the future will lead to much greater impact today as long as we understand the obstacles and challenges that confront us. Opportunity-based narratives do not ignore obstacles and challenges – they are very clear that the opportunity will require effort and action to achieve. They motivate us to seek help from others – we need to connect with others who are also excited about the opportunity out in the future.

The future matters for business and society

This is not just about us as individuals. Our view of the future is shaping how our businesses perform and how our society evolves. We need to craft institutional, geographical and movement narratives that will help all participants to move beyond fear and take action that will help achieve much greater positive impact. If we get this right, we’ll move together into a much brighter future.

Bottom line

Let’s not be blind to how our view of the future shapes our present. The Big Shift is creating mounting performance pressure that is leading more and more of us to adopt a threat-based based view of the future. The paradox is that the same forces that a generating mounting performance pressure are also creating exponentially expanding opportunity. We can create far more value, far more quickly and with far less resources than would have been imaginable a few decades ago. The challenge is that, if we’re driven by fear today, we’ll never even see those opportunities, much less find the motivation to pursue them. How we act in the present is deeply shaped by our view of the future. Let’s come together to evolve a very different view of the future.

  • 31
    Jan 22
  • 0

Increase the Power of Your Narratives

Category:Collaboration,Community,Connections,Emotions,Fear,Movements,Narratives,Opportunity,Passion,Small moves

I’ve written a lot about the untapped power of narratives, including in my new book, The Journey Beyond Fear. But, what are the specific elements that contribute to that power? I’ve been participating in the development of quite a few narratives, and it’s led me to focus on four elements that will make or break a narrative.

Stories and narratives

Let me start, though, by reminding everyone what I mean by narrative. Those who have been following me will remember that I make an important distinction between stories and narratives, even though most people view them as the same thing.

For me, stories are self-contained – they have a beginning, a middle and an end. Stories are also about the storyteller or about some other people, real or imagined, but they’re not about the people in the audience.

In contrast, for me, narratives are open-ended. They focus on a big threat or opportunity out in the future, but the threat or opportunity has not yet been achieved. The resolution of the narrative hinges on the people in the audience – it provides a call to action that will ultimately determine the outcome of the narrative.

As I discuss in greater detail in my book, narratives can play a powerful role at multiple levels, starting with us as individuals – we all have a personal narrative. But narratives can also have significant impact at the level of institutions, geographies (cities, regions and countries) and movements. The elements that I’m going to explore below apply to narratives at all these levels.

The four elements of a powerful narrative

As I indicated, narratives can focus on either a significant threat or opportunity in the future. Since I believe we are in great need of more opportunity-based narratives, I’m going to focus here on opportunity- based narratives. Based on my experience and research, the four elements that will determine the power of an opportunity-based narrative are:

  • Framing the opportunity
  • Identifying trends enabling the opportunity
  • Identifying obstacles and challenges that stand in the way of achieving the opportunity
  • Framing the call to action

Framing the opportunity

The foundation of an opportunity-based narrative is of course the opportunity itself. This is ultimately what will motivate people to come together and act for impact. For this reason, it is important to find an opportunity that really inspires and excites the people we are trying to reach – it should not just be something that is “rational” or supported by data. Finding this kind of opportunity requires a deep understanding of the people we are trying to reach so that we find an opportunity that is aligned with their aspirations. Of course, they may not yet be aware of the opportunity, but we should explore whether this opportunity would excite them, once they become aware of it.

Effective narratives focus on a very big opportunity that will require long-term effort by many to achieve. If the opportunity can be quickly achieved by a few people, it will not become the catalyst for large-scale action by a growing number of participants. What we need are narratives that can sustain us and excite us over a long period of time. Of course, that also implies that we should be able to make progress in addressing the opportunity relatively quickly so that we will be encouraged to continue on the journey together.

The opportunity framed by a narrative also needs to be a positive-sum opportunity. This means that the opportunity will expand as the number of participants expands. If an opportunity is fixed in its size and rewards, it will discourage more people from joining and collaborating with each other.

Identifying trends enabling the opportunity

One of the big risks with framing large, long-term opportunities is that it can generate a lot of skepticism, especially from those consumed by fear. For this reason, it’s important to be able to identify some long-term trends that suggest this opportunity is achievable, and not just a fantasy.

But there’s a balance that needs to be maintained. While these trends should reinforce our belief that the opportunity is achievable, they should not be viewed as making the opportunity inevitable. If the opportunity is inevitable, we will tend to become passive. Why would we need to act and take risks if the opportunity is going to emerge anyway?

Identifying obstacles and challenges

That leads to the third element of powerful narratives. Somewhat paradoxically, the strongest narratives are those that identify and assess significant obstacles and challenges that will make the opportunity difficult to achieve. This will underscore that significant effort will be required to address the opportunity identified by the narrative. We can’t just sit back and assume that the opportunity will emerge on its own.

This will also help to prevent early participants from becoming discouraged too quickly. If they’re expecting obstacles and challenges, they’ll be motivated to forge ahead and find ways to overcome the obstacles and challenges.

Framing the call to action

A call to action is a critical pillar of powerful narratives. The people addressed by the narrative need to be clear that the outcome depends on the action they take.

For this to be effective, another balance needs to be struck. The call to action needs to be high level enough that participants can improvise and adapt the action to their specific context, especially as unexpected situations emerge. On the other hand, the call to action needs to be specific enough that it can provide tangible direction to people regarding the kind of action that will be needed to achieve the opportunity.

The call to action also needs to be framed in a way that people can initially make small moves and begin to see progress in addressing the broader opportunity. If people believe that their action will not yield any positive results for decades, they’re much less likely to maintain their excitement on continuing the journey.

This increases the importance of focusing on impact, not just action. Effective narratives have a call to action where the progress can be measured and monitored. The call to action needs to be specific enough that it can help to define metrics that matter. This will help all participants to assess how much progress is being made and to reflect on how to achieve even greater impact. It will also give them encouragement when they can see the progress that is already being made.

Bottom line

Properly framed, opportunity-based narratives can be very powerful. At their most basic level, they excite people about coming together and acting to achieve a really inspiring and meaningful opportunity. It’s ultimately about moving people beyond fear to hope and excitement.

As with most things in life, it’s ultimately about balance. We must believe that the opportunity is achievable, but also that it will not materialize without concerted action because of roadblocks and challenges that stand in the way. We need to be able to take small steps, especially at the outset, but we also need to see how those small moves can set big things in motion.

  • 06
    Dec 21
  • 0

Is Digital Transformation Missing the Real Opportunity?

Category:Emotions,Fear,Institutional Innovation,Learning,Opportunity,Passion,Strategy

Everyone is talking about digital transformation these days, but I have to confess that I am a bit of a contrarian on this topic. I’ve spoken a lot about this in recent years, but the catalyst for writing this post was a session on digital transformation at a conference that I just attended.

I work with a lot of large companies around the world and I can guarantee that virtually every large company now has a “digital transformation” program. When I press executives for details about the program, I invariably find out that the focus of the program is to apply digital technology to do what the company has always done faster and cheaper, but the business and the company remain largely the same.

Is that really “transformation”? Definitions differ, but I use the metaphor of the caterpillar and the butterfly in assessing whether transformation is really occurring. If we’re just applying digital technology to help the caterpillar to walk faster, that may be helpful to the caterpillar, but please don’t call it “transformation” unless the result is a butterfly that would be unrecognizable relative to the caterpillar. In my experience, digital transformation programs are just helping caterpillars to walk faster.

Why does this matter? It matters, because in a rapidly changing world going through a “Big Shift,” there are exponentially expanding opportunities that can only be effectively addressed if companies and other institutions are prepared to undertake true transformation, asking the most basic questions of all: What business should we really be in? How can we expand our ability to deliver more and more value to our stakeholders? How can we motivate ourselves to take more risk?

Let’s look at three levels of transformation:

  • Pursuing fundamentally different business opportunities
  • Crafting fundamentally different institutional models
  • Cultivating fundamentally different emotional drivers

Pursuing fundamentally different business opportunities

In a rapidly changing world, there’s a strong temptation to shrink time horizons and just focus on the business we have. The paradox is that this Big Shift world is creating exponentially expanding opportunities – we can create far more value with far less resources and far more quickly than ever before.

To see these opportunities, we need to be able to look ahead, far ahead, and anticipate significant  emerging unmet needs that we could address. This requires a very different approach to strategy – a zoom out/zoom in approach to strategy, something that I have written about extensively, including here and here.

Zooming out requires us to look ahead 10 – 20 years and focus on trends that are reasonably predictable and that will give rise to opportunities far larger than anything we have addressed in the past. If we look ahead 10 – 20 years and believe we are still going to be in the same business that we are today, we don’t understand exponential change. It forces us out of our comfort zone to imagine becoming a fundamentally different business from the one we are today. We begin to see the butterfly.

As just one example of how different our businesses will become, I urge you to consider Unbundling the Corporation, a perspective that I first wrote about a couple of decades ago. We need to challenge ourselves to see how fundamentally businesses are changing and the opportunities that these changes create.

As a side note (worthy of an additional blog post), the best way to pursue this form of business transformation is by scaling the edge.

Crafting fundamentally different institutional models

As we look ahead and begin to see the magnitude of the opportunities that are emerging, we will begin to realize that our current institutional models are ill-equipped to help us on the journey to addressing those opportunities – in fact, they are becoming significant barriers.

What do I mean? I’m going to generalize, but over the past century, all large institutions around the world have embraced an institutional model that I describe as “scalable efficiency.” In that institutional model, the key to success is to become more and more efficient at scale, and the way to become more efficient is to tightly specify and highly standardize all activities in the institution so that they are done in the same efficient way everywhere.

Large and very successful institutions have emerged around the world using this institutional model. The challenge is that in a rapidly changing world this approach to efficiency is becoming less and less efficient. It also misses the key requirement for success in the future: scaling and accelerating learning.

To address the opportunities in the future, we will need to embrace a very different institutional model: scalable learning. I have written about this need for institutional innovation here.

And, let me be clear – when I talk about scalable learning, I’m not talking about learning in the form of training programs that focus on sharing existing knowledge. In a rapidly changing world, the most powerful and necessary form of learning is learning in the form of creating new knowledge. That doesn’t occur in training rooms, but requires all workers to learn through action in the workplace. It also requires coming together into impact groups and orchestrating larger and larger ecosystems of participants from many different backgrounds to learn faster together.

Scalable learning can help expand our focus beyond efficiency – doing the same things faster and cheaper – to see the potential to learn how to deliver far more value as well. When we unleash scalable learning, we have the potential to deliver exponentially expanding value to our customers and other stakeholders. We are constantly finding new ways to deliver more value in a rapidly changing world. Scalable learning can also accelerate our progress towards addressing the fundamentally different business opportunity that we see in the future.

Pursuing this kind of scalable learning requires us to re-think and redesign all aspects of how we organize and operate in our institutions. It requires us to explore what is needed to become a butterfly.

Rather than trying to transform the core of our existing institution, we will be much more likely to succeed if we scale the edge, viewing the edge as the cocoon that will give birth to the butterfly.

Cultivating fundamentally different emotional drivers

Transforming into a butterfly can be very scary. As I discuss in my new book, The Journey Beyond Fear, more and more people around the world are consumed by fear, given the mounting performance pressure that is being generated by the Big Shift in our global economy. While understandable, the emotion of fear can also be very limiting.

In this context, fear can increase our resistance to change. We simply want to hold on to what we have and continue to do what has made us successful in the past.

If we’re going to make the transformation journey, we need to add another level of transformation – emotional transformation. We need to find ways to cultivate emotions that will help us to move beyond our fear and achieve impact that is far more meaningful to us.

In this context, I believe the emotion that can help all of us to pursue the transformation we need is the passion of the explorer. It’s a very specific form of passion that I discovered when researching environments where sustained extreme performance improvement had been achieved. I have written about it extensively, including here and here. The passion of the explorer is a fundamentally different emotion from fear.

I believe we all have the potential to draw out the passion of the explorer within us – it’s not just something that is limited to the gifted few. The challenge is that we live and work in environments that are deeply suspicious of this form of passion and actively seek to suppress it. The good news is that the two other levels of transformation – business opportunities and institutional models – will help to foster environments that will help to draw out the passion of the explorer.

But if we’re serious about pursuing transformation, we need to find ways to draw out this emotion, even in environments that are still seeking to suppress it. External transformation will not succeed without internal transformation. We need to move on both fronts.

Bottom line

Pursuing genuine transformation requires evolving from the caterpillar into the butterfly. It can be hugely rewarding because it positions us to address the exponentially expanding opportunities that are created by the Big Shift. Of course, digital technology can play a significant role in helping us to address those opportunities, but the key is to focus the application of digital technology on true transformation.

But genuine transformation isn’t just an opportunity – it’s an imperative. In the Big Shift world, those who hold on to what made them successful in the past – or who simply focus on doing the same things faster and cheaper – will be increasingly marginalized. Transformation is an imperative.

Three levels of transformation need to be pursued in parallel, but we need to understand that emotional transformation is ultimately the foundation that will enable us to successfully pursue the other two levels of transformation. If we can find ways to move beyond our fear, we will soon discover the butterfly that is waiting to emerge from the cocoon and venture out to amazing new areas that have never been explored. And we will see that digital transformation is designed to limit us to the lives of caterpillars.

NEW BOOK

(if you've read the book, click here)

My new book, The Journey Beyond Fear, starts with the observation that fear is becoming the dominant emotion for people around the world. While understandable, fear is also very limiting.

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The book explores a variety of approaches we can pursue to cultivate emotions of hope and excitement that will help us to move forward despite fear and achieve more of our potential. You can order the book at Amazon.

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