Category Archives: Learning

  • 0

From Shareholder to Stakeholder Market Economies

Category:Collaboration,Community,Connections,Context,Institutional Innovation,Learning,Opportunity,Passion,Potential,Trust

What better day than Labor Day in the U.S. to address the growing discussion about shareholders and stakeholders in market economies?

In recent years, there’s been more and more discussion about the need to expand corporate horizons beyond just serving shareholders to serving a broader range of “stakeholders.” While at one level this is long overdue, I fear the need is being expressed too narrowly.

It’s often framed as a choice – do we serve shareholders or serve other stakeholders, like employees, customers, business partners and community members? I’d like to suggest that it’s not an either/or choice but a both/and. Given the way the world is changing, the best way to generate expanding returns for shareholders is to find more creative ways of serving the evolving needs of all stakeholders. Those who continue to focus narrowly on shareholder interests will be increasingly marginalized and prove to be a deep disappointment to their shareholders.

Why is this true? Let’s look at how the world is changing, building on some of the perspectives that I outlined in my book The Power of Pull.

Diminishing returns from current approaches

For over a century, we’ve lived in a global industrial economy where the key to economic success was achieving economies of scale in asset intensive businesses. Those asset intensive businesses required massive investment and shareholders were increasingly demanding short-term returns on their investments.

This led to the emergence and growth of the scalable efficiency institutional model that has ruled the business world. The key to economic success was to become more and more efficient at scale, with a relentless focus on cost reduction and delivering short-term quarterly returns to shareholders.

But here’s the problem. The world is changing. What was efficient and successful in the past is becoming less and less successful over time. Need some evidence for this assertion? Check out the work I have done on return on asset trends for all public companies in the US. It turns out that from 1965 until today, return on assets for all public companies has declined by 75%, it has been a long and sustained erosion. (I know the link I provided only showed results up to 2015 but we have recently updated this to 2019 – the trend continues, and I will be writing more about this soon.)

Now, I will point out that return on assets is not the same as return to shareholders. It turns out that over this time, return to shareholders has also declined, but the decline has been cushioned by a series of financial engineering measures designed to serve the needs of shareholders – adding debt to the balance sheet, and increasing dividends and stock buybacks. Companies are remaining focused on serving the shareholder, but this is not a sustainable approach in a world of decreasing return on assets. There’s only so much debt that can be added to the balance sheet and less cash available to increase dividends and stock buybacks.

The scalable efficiency model

This erosion in return on assets is particularly ironic because we increasingly live in a global economy where much more value can be created with far less resources and far more quickly than was ever imaginable a few decades ago. What’s preventing us from harnessing this opportunity? It’s the scalable efficiency model.

Scalable efficiency encourages us to squeeze all other stakeholders in our never-ending quest to become more efficient. Employees? Keep their salaries as low as possible while increasing their production quotas. Business partners? Seek to get as much from them while paying them as little as possible. Customers? Raise your prices wherever possible and find ways to lower the production costs, even if quality may suffer. Community members? They’re a distraction – stay focused on the means of production.

But here’s the problem. Scalable efficiency is a diminishing returns proposition. The more efficient we become, the longer and harder we have to work to get the next increment of efficiency. The paradox is that, the more we focus on delivering short-term returns to shareholders through scalable efficiency, the lower those returns will be over time.

This approach diverts our attention from the opportunity to create more value – all our attention is focused on cutting costs. In a world of exponentially expanding opportunity, that’s a big loss. Here’s another paradox: the more we focus on delivering exponentially expanding value to shareholders, the more we will need to commit to address the needs of all stakeholders. Why is that?

Addressing the context of all stakeholders

Value depends on a deep understanding of context – the context of all stakeholders. It’s a key reason that I’ve suggested we’re moving from the Industrial Age to the Contextual Age.

It starts with the customer. Customers are becoming more and more powerful and increasingly insisting on products and services that are tailored to their specific and rapidly evolving needs. Understanding and anticipating those needs requires a rich understanding of the context of our customers. The most successful companies will be those who don’t just wait for customers to tell them what they need, but who instead invest the time and effort to anticipate those needs – and who understand the needs that are most fundamental and rapidly expanding.

But, that’s just the beginning. The companies that will be most successful will harness the potential for expanding leverage – creating more much more value with far less resources of their own. They will deliver much greater returns to shareholders. But the focus on leverage requires a deep understanding of the context of an expanding array of potential business partners. Understanding the context of business partners helps to identify their needs and what would motivate them to devote more time and effort to delivering more value to you and your customers. You will be much more successful in harnessing the power of pull and expanding your ecosystem of business partners if you understand and serve their needs.

And, of course, there are your employees. In a rapidly changing world, it has become a truism that employees are going to have to commit to lifelong learning. The learning that is most valuable is learning in the form of creating new knowledge through action together with others. The institutions that succeed in the future will be those who make the journey from scalable efficiency to scalable learning.

But few people are asking what’s the motivation to learn. The unstated assumption is that it’s fear – if you don’t learn faster, you’ll lose your job. While fear can motivate some learning, it’s a very limited motivator, especially when the learning involves risk-taking and working closely with others. As I’ve discussed elsewhere, the passion of the explorer is a much more powerful motivator for learning.

The challenge is that very few workers today have that kind of passion for their work, as some of my recent research demonstrated. If we are really committed to cultivating that passion in our workforce, we need to develop a much deeper understanding of the personal context of our employees and what kind of impact has the most value and meaning for them. If we’re not addressing this value and meaning for our employees, we will not be successful in motivating them to learn faster and find ways to deliver more and more value to their colleagues, business partners and customers. We will not pull out of them more and more of their potential.

And, if we’re serious about serving the needs and delivering more and more value to our customers, business partners and employees, that inevitably leads to addressing another set of stakeholders – members of the communities we live and operate in. Our communities are a key element of the context for all of our stakeholders. If our communities are not thriving, then our other stakeholders will find it much more challenging to achieve the potential and impact that is most meaningful to them. The companies that understand the needs of their communities and actively contribute to their flourishing will be much more successful in creating value for their other stakeholders.

Bottom line

To harness the exponentially expanding opportunities that are emerging in our Big Shift world, we need to become much more aggressive in creating and delivering value for all our stakeholders. Shareholders will receive far more value from companies that find ways to expand leverage and accelerate learning. Those are the companies that will create much more value with far less resources and far more quickly than other companies. But leverage and learning require a deep commitment to all stakeholders – understanding their context and the value that is most meaningful to them and committing to deliver value to them. By addressing the needs of all stakeholders, companies will unleash the network effects that can create exponentially expanding value for shareholders, and for all stakeholders.


  • 5

Loss Can Be Growth

Category:Crisis,Emotions,Learning,Loss,Opportunity

Flowers blossoming in Death Valley

This is a period of loss

For many of us.

Loss is hard to take.

Something or someone

Meaningful to us

Is gone,

Perhaps forever.

It fills us

With sadness and regret.

There’s an emptiness

That seeks to be filled.

Let’s view loss as an opportunity.

Take the time to reflect –

What was it that was so meaningful,

That is no longer there?

What we lost was unique,

But the meaning

May be found elsewhere.

We just need to know

What to look for.

A deeper understanding of meaning

And why our loss was so meaningful

Could help us in our journey ahead.

We would be more aware

Of the meaning that matters

And be more focused

In seeking it out.

Growth is about

Finding more meaning.

Loss can give us much more insight

Into the meaning

That will help us to

Grow and flourish

Far beyond

Where we are today.

If we prepare fertile ground,

Flowers will blossom,

And our lives will be a lot richer

And, it’s even possible that

What we have lost

May return,

But with much more richness.


  • 1

A Deep Dive Into the Passion of the Explorer

Category:Collaboration,Crisis,Emotions,Exploration,Learning,Passion,Potential

During the current pandemic, I’m struck by the number of people who have told me that this crisis has been a catalyst for them to reflect on what’s really important to them. Through reflection, they’ve come to realize that most of their time has been spent on activities that have little, if any, meaning for them.

As an optimist, I’d like to believe that is one positive outcome of the pandemic – it will be a catalyst for us to reflect on what really matters to us – what are we really passionate about? The challenge is that most of us have not yet found the passion that can provide us with a living. In fact, a survey that I recently completed of the US workforce indicates that, at most, only about 14% of US workers are passionate about the work they are doing.

There are many reasons for this. In part, we live in a society that tells us from an early age to focus on a career that will pay us well and that passion is something to be pursued after hours, as a hobby. We also work in institutions that are deeply suspicious of passion – passionate people tend to take risks and often deviate from their assigned tasks.

But the paradox is that we live in a world of mounting performance pressure where passion becomes the key to turning pressure into opportunity. To be clear, I’m talking about a very specific form of passion – the passion of the explorer – that emerged from my research into arenas where participants deliver sustained extreme performance improvement. This form of passion has three components:

  • A long-term commitment to achieving increasing impact in a specific domain
  • A questing disposition that seeks out new challenges
  • A connecting disposition that seeks to connect with others when addressing new challenges to achieve greater impact

People with this form of passion are motivated to learn faster and will be the most successful in a rapidly changing world. If you’re not passionate about the work you’re doing, you’ll fall further and further behind as you compete with people who are passionate. And, of course, you won’t find much meaning in your work to give you a sense of fulfillment.

I’m hopeful that this pandemic will drive more and more of us to embark on a quest to find and nurture our passion, and to find a way to make a living by pursuing our passion. In the new book that I’m writing, I focus on the lessons that I’ve learned on my journey to uncover my passion and integrate it with my profession.

On the side, I’ve been collaborating with Tracey Grose, who is putting together a program where I can share some of these lessons with others who are on a similar journey. Those who participate in this program will get a preview, and a deeper dive, into some of the approaches that I will be covering in this new book.

In this program, Catalyzing Impact, we’ll start by explaining why the passion of the explorer is becoming more and more central to success. It will help to reinforce the growing awareness that passion is not just a “nice to have,” but a “must have” if we are going to thrive in an increasingly challenging world.

But the bulk of the program will focus on the approaches that can help us to find and cultivate our passion of the explorer and then integrate it with our work. I will challenge everyone to find this passion within themselves, driven by a belief that we all, as human beings, have a capacity for, and hunger for, the passion of the explorer.

Part of this involves reflection on our past, but it also requires us to look ahead and reflect on what our view of the future is and how it shapes our actions today. It also will involve looking around and looking for patterns in people who inspire us and who give us energy.

We will also look at the work that consumes much of our lives and focus on the activities, if any, that generate excitement within us. While many of us will not find ways to cultivate passion in the work that we are currently pursuing, there are sometimes opportunities to evolve our current work in ways that are more aligned with the passion of the explorer that we are uncovering.

More likely than not, we’ll find many elements that could be indicators of the passion that resides within us. Part of our effort will be to weave these elements together as we begin to see underlying patterns that connect what at first appear to be diverse elements. While some will be struck with a sudden revelation of the passion within themselves, for many this will be the beginning of a longer journey of exploration.

Part of the program will be designed to help participants pursue their exploration beyond the program. In this context, I will highlight the role that impact groups can play in our journey. My experience is that journeys become a lot more enriching and enlightening when made together with others.

I’ve become a strong proponent of participation in small impact groups – they typically involve 3-15 people. The participants in these impact groups share a commitment to a quest – in this case, it is the effort to find and cultivate a passion of the explorer. They meet on a regular basis – usually weekly, if not more frequently – and they build deep, trust-based relationships with each other as they pursue their journey together. They challenge each other to make more progress, but they also encourage and support each other when they run into unexpected obstacles or challenges.

This program will help participants to understand the value of these impact groups. It will provide guidance on how to bring these impact groups together and how to manage these impact groups so that participants can get the most value from their interactions.

The intent is for the program to be a catalyst for discovery and to motivate people to pursue a journey that is designed to help them discover and cultivate their passion of the explorer and to find ways to integrate that passion with their work so that they can increase their impact in a meaningful way in all dimensions of their lives. I hope you will be able to join Tracey and me in this program – please sign up here.


  • 23

Beyond Our Edge

Category:Collaboration,Creation Spaces,Edges,Emotions,Exploration,Institutional Innovation,Learning,Movements,Narratives,Opportunity,Passion,Potential,Trust

I’ve got some exciting news. I’ve opened up a new company – Beyond Our Edge, LLC.  Its goal is to motivate more and more people to come together and move beyond our edge so that we can achieve more of our potential together. Many of us are already drawn to our edge, but we’ll be much more likely to move beyond our edge if we come together on the journey. I’ve always been inspired by the African proverb: “If you want to go fast, go alone; but if you want to go far, go together.”

This move has been made possible by my retirement from Deloitte, even though I have no intention of “retiring.” I’m now free to venture beyond my edge and I’ll want to connect with others who share my passion for exploration and driving meaningful change.

My next book

In that context, my first priority is to finish writing my next book – its working title is “From Pressure to Passion.” Two triggers motivated me to write this book. First, even though my business career has been largely focused on business strategy, I’ve come to believe that achieving impact depends less on strategy and more on psychology – if we don’t see and understand the emotions that are driving our choices and actions, we’ll never achieve what we really need and want. Second, as I’ve traveled around the world over the past several years (well before the current pandemic), the dominant emotion that I encountered everywhere is fear – at the highest levels of organizations, on the front lines and out in the community.

While that fear is understandable – there are many reasons to be afraid – it’s also potentially very dysfunctional. We need to acknowledge the fear but, equally importantly, we need to find ways to cultivate hope and excitement that will motivate us to move forward in spite of our fear. My new book is partly about my personal journey from fear to hope and excitement, but it draws on that experience to outline approaches that we all can use to make that journey.

While my book focuses on helping people to make this personal journey, it also highlights the need to drive fundamental change in the environments that we live in. We’re in a world that’s rapidly evolving. It’s a paradoxical world – it provides exponentially expanding opportunity as well as mounting performance pressure.

Bringing movements together

Right now, most of us are experiencing mounting performance pressure, in part because all our institutions were designed for an earlier, more stable world. The institutions that provided stability in the past are increasingly proving ill-equipped for the rapidly changing world around us. We all see this. It’s a key reason that trust in all our institutions is eroding around the world. It’s also feeding our fear – the institutions that we thought we could rely on are increasingly failing us.

Our institutions have become significant barriers to our efforts to harness the exponentially expanding opportunity that’s now becoming available to us. So, even if we find ways to overcome our fear and take more bold moves to pursue opportunities, we’ll find our existing institutions standing in our way and limiting our potential for impact.

That’s why we need to drive change on two fronts – individual change and institutional change. For decades, we’ve had two movements proceeding in parallel – the human potential movement and social change movements. The challenge is that there’s very little interaction between these two movements – it’s either all about helping individuals to overcome their internal obstacles or driving change in the broader society or economy. Unless we can drive change on both fronts, we’ll never create the conditions that will enable all of us to achieve much more of our potential by harnessing exponentially expanding opportunity. We need to find ways to bring these two movements together.

Impact groups inspired by narratives

It will come as no surprise to those who’ve been following me to hear that I believe the key to bringing these two movements together is to focus on organizing small impact groups that can then connect and scale their efforts through broader networks and platforms.

Let me be clear – to harness exponentially expanding opportunities, we need to come together. If we act alone, we’ll only achieve a small fraction of the potential available to us. By coming together, we’ll be much more likely to overcome our fear and find the courage to move beyond our edges and achieve much more of our potential.

What will it take to bring us together? I’ve become a strong proponent of opportunity-based narratives that frame really big, inspiring opportunities in the future and that represent a call to action to all of us today, emphasizing that those opportunities will not be achieved unless we act together. Imagine what amazing things we could accomplish if we all came together?

Understanding edges

As we come together, we need to find ways to help each other move beyond our edge. In this context, edges have many meanings. At one level, edges are defined by areas of expertise – for example, marketing, economics or equipment maintenance. At another level, edges are defined by our comfort zones – where do we start to become uncomfortable when confronted with new experiences?

For many of us, edges create the image of a cliff where we need to be very careful or we’ll slip and slide into oblivion. I prefer to view edges as walls – they’re the boundaries that limit our ability to explore and discover more of our potential. And we can’t just look beyond the walls, we need to climb over the walls and explore the territory that’s been hidden from us.

Sure, venturing beyond these walls can be scary and make us very uncomfortable because we’re venturing into unknown territory, but we’re much more likely to make the journey if we’re joined by others whom we trust and who will provide us with support and encouragement. We’re also likely to learn more if we go together, rather than heading out alone. No matter how smart any of us are, we’ll learn a lot faster if we’re sharing experiences with others and learning through action together.

Bottom line

I’m hoping that my new book will become a catalyst to motivate more of us to venture beyond our edge together. Over the next several months, I’ll be looking to connect with others who share my conviction that there’s exponentially expanding opportunity available to all of us if we choose to address the root causes that are holding us back – the emotion of fear within all of us and the institutions that are increasingly serving as barriers to progress. It’s an unprecedented opportunity, but we need to act now, together, and venture beyond our edge.


  • 1

Direction, Not Destination

Category:Learning,Opportunity,Poem,Potential

We’re all on a journey.

Or we should be.

Many of us have stopped,

And remain stuck,

Afraid of what

Might lie ahead.

Some of us are on a journey

Dictated by others,

In an effort to please.

As we embrace our own journey

Avoid the advice

To pick a destination.

Our journey is without end.

There is no destination.

But let’s not wander aimlessly.

We need to find a direction

So that we can make progress

And keep looking ahead.

That direction

Needs to be our own direction,

Not someone else’s.

It’s the direction

That fills us with excitement

And drives us

To keep moving forward.

When we find that direction,

We’ll be unstoppable

And make great progress.

Our journey will be without end

Because there’s so much to explore

And experience.

We’ll savor what we see,

But we’ll always be drawn

Beyond the horizon.


  • 10

From the Gig Economy to the Guild Economy

Category:Collaboration,Community,Connections,Creation Spaces,Flow,Institutional Innovation,Learning,Opportunity,Trust,Workgroups

More and more people are talking about the future of work. In those conversations, something that’s getting quite a bit of attention is the “gig economy,” where more and more work is being done by independent contractors and not by full-time employees. While that’s certainly an interesting trend, I prefer to look ahead and anticipate what’s next. In that context, I’d suggest that we’re going to evolve from a “gig economy” to a “guild economy.”

Forces at work

The growth of the gig economy is a result of many forces coming together. A core driver of the gig economy is the evolution of the scalable efficiency model that drives most of our large institutions. As I’ve written about elsewhere, the scalable efficiency model has shaped our large institutions around the world for at least the past century.

This model is driven by the belief that the key to success is to do things faster and cheaper at scale. Enormous wealth and institutional success have been the result, which is why institutional leaders are so wedded to this model.

But there’s a problem – actually, many problems. Efficiency is a diminishing returns proposition. The more efficient we become, the longer and harder we need to work to get the next increment of efficiency. Diminishing returns is a problem on its own, but it’s compounded by the fact that we live in a Big Shift world of mounting performance pressure – competition is intensifying, change is accelerating, and extreme disruptive events occur with increasing frequency.

The early growth of the gig economy

Rather than questioning the continuing value of scalable efficiency models, institutional leaders have a natural tendency to want to squeeze harder. One approach to cost-cutting that has gained increasing traction in the past several decades is the shift from full-time employees to contract labor. If the work to be done is variable, rather than constant, why pay a full-time employee when we could turn a fixed labor cost into a variable labor cost and simply hire a contract worker when a task needs to be done?

Even better, there’s an opportunity to save on labor costs because the employer doesn’t have to pay all those expensive employee benefits like health care insurance. When the work can be done remotely, the company can save even more money by finding contract workers in parts of the world where lower wages are the norm.

These are some of the reasons why gig work has grown rapidly over the past several decades. There’s also another reason which should be a bit of a red flag. I haven’t seen any statistics on this, but anecdotally I am seeing a growing number of workers leaving large institutions and striking out on their own because they are frustrated with the worker experience in large institutions. They’re driven by a desire to learn faster. They report to me that they’re developing their capabilities much more rapidly as an independent contractor than they ever could when they were stuck within one institution.

But, while there are some exceptions, most of the “gig work” being done today is done by individuals working on a transactional, project basis. They’re on their own. That’s what’s going to change.

The Big Shift and the imperative to learn faster

As I’ve already mentioned, the Big Shift is creating mounting performance pressure on all individuals and institutions. But, at the same time, the paradox is that the Big Shift is also creating exponentially expanding opportunity – we can create far more value with far less resource and far more quickly than would have been possible a few decades ago.

As we confront the paradox of the Big Shift, the imperative is to learn faster – that’s the most effective way to respond to mounting performance pressure, while at the same time addressing exponentially expanding opportunity. By learning faster, I mean creating new knowledge through action and reflection on impact achieved. Those who master the ability to learn faster will achieve much higher impact in a rapidly changing world.

But, here’s the challenge, the scalable efficiency model of our institutions is fundamentally hostile to this form of learning. It requires taking risk and improvising when the scalable efficiency model insists on tightly specifying and highly standardizing all tasks to be performed. It also insists that everyone deliver their results predictably and reliably without failure.

The impact on the gig economy

The gig economy, as it’s currently structured, also limits the potential to learn faster. Gig workers typically work as individuals and they are very transactionally driven. While gig workers can certainly learn by engaging as individuals in project work, that’s not the optimal way to learn. If we’re serious about accelerating learning and performance improvement, we need to come together in small groups (what I call “impact groups”) of 3-15 people who develop deep, trust-based relationships with each other based on a shared commitment to increasing impact.

We’re already starting to see some of that start to happen in the gig economy. Individual workers are discovering that there are others who share their passion and coming together so that they can work on projects as a group, rather than individuals.

I anticipate this is just the beginning. As gig workers begin to realize the need to accelerate their learning and performance improvement, they’re going to be driven to come together into small groups and offer their services as a group, rather than as individuals.

On the other side, institutions are going to begin to see that the real value of contract workers is the diversity of experience and expertise that they bring to the work. These contract workers can help the institution’s employees to learn faster by exposing them to different perspectives and approaches to addressing work. These institutions will begin to expand their focus beyond just cost savings and see gig workers as an opportunity to learn faster. While some of that may be accomplished in a “one-off” project with individual contractors, there will be even greater potential for learning if enduring, trust-based relationships are developed with specific gig groups over time.

The role of guilds

That sets the stage for a new way of organizing the gig economy. We’re going to begin to see impact groups forming and coming together into broader networks that will help them to learn even faster.

That’s where guilds come in. In Medieval times, guilds were a prominent way of organizing in urban areas to bring people together who were seeking to earn a living from a particular craft or trade. These guilds had many different roles, but a key one was to help their participants become better at their craft or trade. They were powerful learning organizations where participants learned through practice, rather than sitting in classrooms.

As independent workers become more aware of the imperative for accelerating learning, they will tend to affiliate into guilds that will help to connect them with others who might become part of their impact group and, more broadly, with other impact groups that share their passion for increasing impact in a particular set of activities. These guilds can help to knit together larger and larger networks of impact groups, generating something that I call “creation spaces,” to help scale and accelerate learning. For example, think of a guild that will help graphic designers to come together and learn from each other.

These guilds can play many different roles over time. One major role would be to provide the participants in their guilds with access to a variety of benefit programs like health care and life insurance that would be much more difficult to obtain as individuals. These guilds can also help to define and manage reputation systems that will help their participants to build a broader range of trust-based relationships. They can become rich environments for mutual aid among participants.

Beyond the gig economy, there’s another area that will see the re-emergence of guilds. That’s in product and service businesses that will increasingly fragment as customers demand more and more tailored products and services to serve their specific needs (see more about fragmentation trends in the economy here). The participants in these small, but very profitable, product and service businesses will see value in connecting with others in their particular domains so that they can all learn faster and create even more value with less resource. For example, think of a guild for craft chocolate companies that are serving very specific customer niches.

The potential limitations of guilds

In Medieval times, guilds had a mixed role. In part, they helped their members to learn faster together but, in another part, they often served as barriers to entry for others who wanted to practice the craft or trade. Often acting in collaboration with city governments, they would impose severe restrictions on those who could participate in a certain craft or trade. They often became very protectionist, limiting competition. (As you can see from the picture above, many of them excluded women)

The next generation of guilds needs to avoid the temptation to erect barriers. Rather than focusing on protecting existing stocks of knowledge, they need to be committed to enhancing and scaling flows of knowledge so that everyone can learn faster.

To address the opportunity to help participants to learn faster, these guilds need to find a way to move beyond fear of competition and foster the excitement that can come from addressing the exponentially expanding opportunities created by the Big Shift. Rather than embracing a scarcity mindset, these guilds need to cultivate an abundance mindset. They need to recognize that, the more people that come together, driven by a commitment to learn faster, the more opportunity there will be for value creation. It’s a very different heartset and mindset from the ones generated by the fear that is engulfing more and more of the world’s population.

The bottom line

The imperative to learn faster is going to motivate individuals to come together in very different ways. In at least one dimension, our future may represent a return to the past, when we see the re-emergence of guilds. Rather than isolated individuals driven by fear as they confront mounting performance pressures, we are likely to see people coming together, excited about the opportunity to learn faster and embrace exponentially expanding opportunity.


  • 0

Data Is the New Solar

Category:Creation Spaces,Data,Flow,Institutional Innovation,Learning,Trust

In our digital economy, we’ve become increasingly captivated by data. The new meme that many in the tech world hear is that “data is the new oil.” I cringe every time I hear that, because it uses a metaphor that significantly under-estimates the value of data on so many dimensions. I prefer to say that “data is the new solar” – let me explain.

I completely understand why many are using the phrase that “data is the new oil” – it’s been used for over a decade and has captured the imagination of many people.  The intentions of those using this phrase are good. They want to communicate the growing role of data as a source of energy as we move from an industrial economy to a digital economy. We needed energy sources like oil to power our factories and all the logistics required to move physical products to where they will ultimately be consumed. But our digital economy is fueled by data

So, what’s wrong with this metaphor? Why do I prefer the metaphor of “data is the new solar”? Where do I begin?

Scarcity versus renewable

Let’s start at the source. Oil is a natural resource that is inherently limited in supply and can be rapidly depleted. Once extracted from the ground, the remaining supply shrinks (of course, new oil can form, but that takes thousands of years).

Solar energy has limits, of course – there’s only one sun and it’s only capable of producing so much energy. But we are so far from encountering those limits that we might as well view it as an unlimited energy source. More importantly, solar energy is constantly renewing, the sun is at work every minute of the day, generating more energy.

So, if we look at data as an energy source, is it more like oil or solar? Data is constantly renewing and has the potential for infinite expansion – the supply of data is unlimited. We significantly under-estimate the power of data if we view it as a depleting energy source.

Production costs

But, there’s more. Because it is a scarce and depleting resource, the production cost of each barrel of oil that we pull out of the ground tends to go up – we have to drill deeper and go to more remote areas to keep our global economy going. In sharp contrast, the production cost of each unit of electricity produced from solar energy is declining (at an accelerating pace, as my friend Ramez Naam continually reminds us). When we look at the production cost of data, guess what? It’s declining at an accelerating pace, driven by the exponential price/performance improvement of digital technology.

Metaphors matter

Why does this matter? The metaphors we use play a big role in shaping our actions regarding the objects being described. If we view a source of value as a depleting resource with increasing costs of production, we’ll work hard to capture it and hold it for ourselves, but there are limits to the effort we’ll put into it because it’s a limited resource, after all. We tend to adopt a scarcity mindset.

If we view a source of value as essentially without limits and with rapidly diminishing costs of production, we’re much more likely to be energized to invest a lot more effort in harnessing that source of value. With an abundance mindset, we see that the rewards are unlimited and that’s very exciting.

From abundance to expanding abundance

So, if it comes to a choice between oil and solar as a metaphor to describe the role of data in the digital economy, I definitely favor viewing data as the new solar.

But even that metaphor can be limiting. Data has so much more potential than solar. Used in the right way, data has the potential to fuel ever-expanding value creation. The key is to shift our mindset from data as the fuel for existing activities and impact to data as a catalyst for learning to help us find ways to generate more and more impact with less and less effort.

Yes, that requires a profound shift in how we approach data. As I’ve written elsewhere, we’re on the cusp of a big shift in institutional models from scalable efficiency to scalable learning. In the scalable efficiency model, the role of data is to help us do what we’ve always done faster and cheaper. The focus is on efficiency.

In the scalable learning model, the focus shifts to harnessing the potential to create more and more value for stakeholders, starting with customers, and accelerating our ability to expand the value that we provide. I hasten to add here that, when I’m talking about value, I’m not narrowly talking about economic value. I’m talking about a much broader form of value in terms of addressing the needs and aspirations of the people we’re addressing – starting with customers, but also including employees, business partners, community members and, yes, shareholders as well. I remain convinced that those who adopt this broader view of value will be the ones to create rapidly expanding economic value.

Data is a key fuel for learning and therefore for expanding value creation. That’s something that not even solar can do.

Implications of expanding abundance

Here’s the thing. To unleash this expanding abundance, we’ll need to find more effective ways to come together to share the data we have. If we adopt the scarcity mindset, we’ll hoard the data we have and prevent anyone else from gaining access to it. But that limits our ability to learn from the data.

We’ll learn a lot faster if we invite a more diverse group of participants to come together to generate new insights and ideas from the data. So, the ability to generate expanding value from data hinges on our willingness and ability to come together, driven by a desire to learn how to create more value. That requires an abundance mindset.

An abundance mindset helps to build trust. If I believe that we have more than enough resources to create value for everyone, I’m much more likely to trust others. If I believe that we have scarce resources, my trust rapidly erodes – you may seem like a nice person but, at the end of the day, I want to be sure that I’m the one who can get those resources.

As I’ve written elsewhere, trust is a prerequisite for learning, especially learning in the form of creating new knowledge which requires taking risk and working with others. The more willing we are to trust each other, the faster we’re going to learn. And, if we come together in expanding learning networks (something I call creation spaces), we have the potential to unleash an exponential growth in learning by harnessing network effects.

But, is data all there is?

In focusing on data, we need to be careful about not limiting our vision. Sure, data is valuable, but it’s just the beginning. It provides us with a window to better understand the context that we all live in. But let’s not stop there.

We need go beyond the data and the context to understand the emotions and the motivations that drive us. That’s where the value ultimately lies. If we don’t understand the emotional and spiritual needs and aspirations of those we are trying to serve, we’re never going to provide the most meaningful value. As I’ve written elsewhere, we need to focus on heartset and spiritset, not just mindset.

The challenges ahead

If we’re going to unleash the full potential of data as a fuel, we need to recognize there are significant challenges ahead. Our institutions will need to be fundamentally re-designed to shift them from scalable efficiency models to scalable learning models. That will require very different approaches to leadership.

It will also require us to go to the most basic question of all: what is the value that matters? We will need to broaden our horizons from short-term shareholder returns to longer-term stakeholder value that in turn will generate unprecedented longer-term economic value. There will be a lot of resistance to this change on multiple levels, but those who address and overcome these roadblocks will find that data is a more powerful fuel than anything we have ever seen before.

Bottom line

So, data is an extraordinarily powerful fuel, far more powerful than oil and even more powerful than solar. Used in the right way, it can help unleash exponentially expanding value creation. What’s the right metaphor to capture the unprecedented potential of data as a fuel for our economy and society? For the moment, let’s at least view data as the new solar.


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Learning Communities – The Journey Ahead

Category:Collaboration,Community,Connections,Creation Spaces,Learning,Narratives,Opportunity,Passion

Now, more than ever, we need to learn faster. In a rapidly changing world, learning becomes a key driver of survival, not to mention success. But it’s a very different form of learning from the one we experienced in school or in our training programs – that learning is about sharing existing knowledge. That can be helpful but, in a rapidly changing world, keep in mind that existing knowledge becomes obsolete at an accelerating rate.

In this kind of world, the most valuable form of learning is creating new knowledge through action and by working together. How do we do that? We need to find ways to come together and participate in communities – but they’re a very different form of community than the ones that most of us know today.

Communities of interest

Many of us participate in communities of interest. They take many different forms. They could be a book club that meets monthly to discuss an interesting book. They could be an online social media group that comes together around a shared interest like gardening or blockchain. They could be a group that comes together in conferences framed around particular areas of interest – anything from certain genres of music to personal growth or business domains like marketing or digital technology.

These communities can vary significantly in size, ranging from 5-10 people in a book club to thousands of people at a large conference or in a social media group.

Participants in these groups share an interest and enjoy connecting with others to discuss this interest. Sure, there’s some learning that occurs in these groups but it’s fairly random and mainly about sharing existing knowledge.

Most of these communities are not driven to learn faster together. They’re just an opportunity to enjoy time together around shared interests. I wrote about the virtual version of these communities of interest more than 20 years ago in my book, Net Gain.

What’s missing in most of these communities of interest is an experienced and motivated moderator who can help the group to learn faster together. Moderators can be powerful catalysts for conversation and can help to focus the conversation on powerful questions that can inspire participants to come up with new ideas and insights as they embark on a shared quest to venture into areas they have not explored yet.

These groups also generally don’t create opportunities to step back and reflect. Do the participants carve out time on a regular basis to step back and reflect on what they’ve learned and on what new questions are emerging from their conversations? That’s very rare, but can be hugely valuable in focusing new learning.

Communities of impact

These are very different forms of communities. Participants in these communities are driven by a desire to act together in ways that can achieve increasing impact in a particular domain. It’s not just about action for the sake of action, it’s about achieving specific forms of impact. They are relentless in measuring that impact and seeking ways to increase their impact over time. That’s what motivates them to learn – they are seeking to discover new approaches that will help them to achieve more impact with less effort and fewer resources.

The core unit in these communities of impact is a small group of people – typically 5-15 people. In some of my other writing, I have referred to these units as “cells” or “teams.” These impact groups remain small because their success hinges on forming deep, trust-based relationships with each other. The participants in these impact groups get to know each other extremely well, both in terms of their strengths and their weaknesses, as well as their motivations. As I’ll discuss in another blog post, deep trust is a key to accelerating learning when it involves creating new knowledge. If the impact group gets much beyond 15 people, those deep, trust-based relationships become more challenging to build and maintain among all the participants.

These impact groups meet on a frequent basis – usually at least weekly and potentially even daily. As they form deep, trust-based relationships with each other, they become more willing to express their vulnerabilities and ask for help from others in their group. Participants in these impact groups connect on an emotional level and not just an intellectual level. They challenge each other if they sense that participants are becoming too passive or losing the excitement that motivates them to move beyond their comfort zone and they support each other when they sense that participants are becoming frustrated or overwhelmed by the roadblocks or obstacles they are encountering.

Participants in these impact groups are often driven by a very specific form of passion. I call it the “passion of the explorer” and I’ve written widely about it, including here and here. These impact groups can be found in areas that display sustained extreme performance improvement, including extreme sports and online war games.

Communities of impact scale by finding ways to connect the small impact groups into broader networks, that I have called “creation spaces.” In these creation spaces, impact groups can interact with the broader community and learn from the initiatives and experiences of the other impact groups in the community. These impact groups can pose questions to the broader network to see if anyone has any ideas or suggestions on how to come up with high impact answers. They can observe the approaches and impact achieved by other groups and develop new insights on how to achieve even more impact. There’s an interesting balance that emerges within these communities of impact – at one level, the impact groups are competing with each other to see who can achieve even greater impact but, at another level, they are collaborating with each other because they are driven by a shared commitment to increase impact.

Unfortunately, these communities of impact are very rare in our business and personal life. If we’re really committed to creating new knowledge through action together, we need to find ways to cultivate more of these communities of impact. This usually begins by finding an area that we are passionate about and then seeking to connect with others that share this passion and a desire to achieve increasing impact in that domain.

Often participating in these communities of impact can deepen our passion.  It can be very invigorating to connect with others who share our passion and to act together in ways that deliver increasing impact. That can help us to overcome our fear and deepen our excitement about the opportunity to make a real difference in areas that are meaningful to us.

These communities of impact can emerge from local initiatives, but they can also be catalyzed by organizers who see the potential for scaling learning. One powerful organizing tool to help cultivate communities of impact is something that I call opportunity-based narratives, that I have written about here and here. These narratives are very different from stories. They frame an inspiring opportunity out in the future, but they make it clear that addressing this opportunity requires many people to come together and take action. They are a call to action and a call to learn since they make it clear that the opportunity itself, and the approaches to addressing the opportunity, are not yet fully defined.

These opportunity-based narratives can help to focus the initiatives and learning of the participants in the communities of impact. They leave a lot of room for local improvisation, but they help to cultivate a shared commitment to the kind of impact that will make a real difference in helping this opportunity to materialize.

Physical communities

So, what does this have to do with the physical communities that we all live in? Most of these communities have a long history and they have basically become communities of convenience. We live there because we were raised there or because we were drawn by an opportunity for work or because of an attraction to a particular climate, setting or lifestyle. We likely have friends there but, unless it’s a very small town or neighborhood, we certainly don’t know everyone there.

Unfortunately, for an increasing number of physical communities, we’ve lost a deep sense of connection with the community and commitment to the success of the overall community. We have become increasingly passive and/or polarized.

Here’s an idea. What if we framed an opportunity-based narrative for our physical community – what amazing things could we accomplish if we all came together and committed to increasing our impact in addressing a shared opportunity? We could transform physical communities into communities of impact, starting with small impact groups, but rapidly scaling into networks that draw together more and more members of the community.

It can be done. Forty years ago, I was drawn to a physical community – Silicon Valley. There were many factors that attracted me, but one of the most powerful ones was the sense that this was a community driven by an opportunity-based narrative. More and more people were coming to Silicon Valley from all over the world because they were drawn by the opportunity to change the world by harnessing the growing potential of digital technology. It provided a sense of connection and shared commitment to increasing impact that I’ve found deeply inspiring for a number of decades.

Bottom line

We live in a world that is rapidly changing, bringing both exponentially expanding opportunity and mounting performance pressures. Harnessing the opportunity and overcoming the pressure will require all of us to learn faster, together. We can do that through communities of impact. If we can find ways to evolve our existing communities of interest and physical communities into communities of impact, we will find ways to come together to achieve far more of our potential. Let’s get started.


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Re-Imagining the Potential of Achieving Your Potential

Category:Connections,Context,Institutional Innovation,Learning,Passion,Potential

Many of us were living in fear, even before the current pandemic hit. But it’s interesting to me that, even in times of great fear, we have a hunger for hope. That’s been brought home to me by the number of people I’ve encountered (virtually) over the past several months who have observed that this crisis is prompting them to reflect on what really matters to them. And. most interestingly, they are actively seeking to accomplish more of what really matters to them, not just hold on to what they have today.

Let’s explore where this drive to achieve more of our potential might lead us.

What potential?

As humans, we all have infinite potential – we can cultivate a vast array of potential talents and accomplish amazing things. But, as motivated and talented as we might be, we’ll never be able to cultivate all those talents. We have to focus. Which of the infinite dimensions of potential will we choose to cultivate?

Passion can help us to focus. I’ve written extensively about passion, including here and here. To be clear, I’m focused on a very specific form of passion, something that I call the “passion of the explorer.” I encountered this form of passion in my research into arenas where there is sustained extreme performance improvement – I found that participants in these arenas had this specific form of passion.

People with this form of passion have three attributes: a long-term commitment to making an increasing impact in a chosen domain, a questing disposition and a connecting disposition. People with this form of passion have chosen a domain that deeply excites them – it could be anything from manufacturing or healthcare to knitting or big wave surfing.

This commitment to a domain, and to making an increasing impact in that domain, focuses us on the potential talents and abilities that we must develop in order to make an increasing impact in that domain. In my view, it is the most powerful motivation to learn and achieve more of our potential. If we find and cultivate this passion of the explorer, we will be driven to achieve the potential required to make a continually increasing impact in the domain. We will never let up – people who have this passion often talk about being in a marathon rather than a sprint because they recognize this is a long-term effort.

It’s the subject of another post, but I believe we all have this passion within us, waiting to be discovered. Some of us see it at a very early age but, for many, we still have not found it. In part, that’s because many of us have been told to forget about passion and simply acquire the skills necessary to earn a good living. In part, it’s because most of the institutions we work for are deeply suspicious of passion – people with this form of passion are not good at following orders and they are prone to take big risks in pursuit of the impact that matters to them. We’ve simply given up looking for the passion because our institutions and society discourage it.

That’s a tragedy, because that passion is there, waiting to be discovered and unleashed. And finding that passion will help us to achieve far more of our potential than any extrinsic motivations or simply grit or determination could make possible. By finding and focusing on our passion, we’ll achieve far more of our potential than randomly trying to cultivate as many of our talents as possible.

Achieving potential through impact on others

One interesting thing about passion is that it focuses us on increasing impact. That takes most of us outside of ourselves, because the impact is in the world around us, not inside us. That’s important because, many people, when they talk about achieving more of their potential, seem to be talking about going inward and just focusing on themselves as individuals. I’ve come to believe that the best way to achieve more of our potential as individuals is to connect more effectively with others in the world around us. And passion helps us to do this.

This happens in at least two ways. First, the way we measure increasing impact in a domain usually focuses on impact on others. Let’s say we’re passionate about designing tools and equipment that can help construction workers build better buildings. That requires a deep understanding of the context confronted by construction workers and the challenges they face as they go about their work. To develop that understanding, we would need to connect deeply with a broad range of construction workers. And, it would not be a one-time connection – we would need to stay connected so that we could explore how to have increasing impact on their work over time.

This doesn’t just apply to passion about designing products or interacting directly with customers in a marketing or sales context. Think about those who are passionate about fulfillment center operations (yes, there are those who are deeply passionate about this). Those people are driven to connect with both suppliers and logistics operators to understand how they can make more of a difference in their operations.

Now, I can hear the skeptics come up with examples of passion that are very much solo activities that don’t seem to involve impact on others. Think about people who are passionate about gardening – and it’s about cultivating their own garden, not the gardens of others. Or people who are passionate about woodworking and who don’t sell or share their extraordinary wood art with others.

There are certainly some extreme examples of people who are totally inwardly focused, but I would be cautious about whether those people are really passionate or driven by an obsession. There is a difference, something that I have explored here. One key difference is that passion helps build relationships and obsession inhibits them.

In this context, passionate people who are pursuing solo activities are still seeking to make an increasing impact, but the impact they are seeking is to inspire others and enrich the lives of others. Truly passionate gardeners show their gardens to others, not because they are showing off, but because they are driven to see what really has impact on others and to learn more about how to have even greater impact over time.

So, one way that the passion of the explorer helps to connect us with others is by inspiring us to achieve increasing impact on others. This passion motivates us to connect with others to understand the impact we are having and the potential for even more impact by addressing unmet needs or aspirations.

Achieving potential through collaborating with others

But the passion of the explorer motivates us to connect on another dimension as well. As I mentioned earlier, one of the attributes of the passion of the explorer is a connecting disposition. When confronted with new challenges and opportunities, people with this passion are driven to connect with others who might be able to help them come up with even better approaches to addressing those challenges and opportunities. They realize that, no matter how smart and talented they are, they will learn a lot faster and achieve more impact if they connect with others who share their passion or simply have expertise and insight that might help them come up with new ideas. People with the passion of the explorer are connected into much broader and more diverse networks than people who have not yet found their passion of the explorer.

So, passion motivates us to achieve more of our potential and drives us to connect with others on two levels. Rather than narrowing our horizons and isolating us, the drive to achieve more of our potential provides a powerful fuel to broaden and deepen our connection with others.

The power of diverse networks

That fuel becomes even more powerful when we begin to realize the network effects that it can unleash. As we’ve all come to realize, the value of participating in networks increases exponentially as the number of participants grows. In this context, we’ll begin to see that we can accelerate our ability to achieve more of our potential as we connect with more people, especially if they are motivated by a similar passion to achieve increasing impact in a given domain.

We can achieve even more of our potential if these expanding networks have greater diversity in terms of the backgrounds, skills and perspectives of the participants. If we’re just connecting with people who are similar to us, we’ll never learn as fast as when we connect with a more diverse set of people.

Of course, diversity can lead to fragmentation and loss of focus, but what makes this diversity so powerful is when everyone shares a commitment to achieving increasing impact in a specific domain and agrees on ways to measure that impact. Then we unleash the productive friction that can be a powerful driver of learning.

The need for institutional change

As we begin to realize the power of connection in helping us to achieve far more of our potential, we’ll begin to see how our institutional environment today limits our ability to connect, rather than expanding our ability to connect. As I’ve written about in the Big Shift perspective, our institutions today are driven by scalable efficiency models that focus on protecting existing stocks of knowledge, rather than helping us to participate in a broader range of flows of knowledge.

That’s why people with the passion of the explorer are often deeply frustrated within our existing institutions. They are often pounding the table, upset about the barriers that are preventing them from connecting in ways that will help them to increase their impact. That’s also why people with the passion of the explorer are often deeply suspect within our existing institutions – they’re the discontents and the troublemakers.

The growing realization that achieving more of our potential requires broader and richer ways of connecting with others will lead those with passion to see that our existing institutions are limiting our ability to achieve more of that potential. We need to shift from institutions that are driven by scalable efficiency models to institutions that are driven by scalable learning models, as I’ve written about here. This is a key reason why those who have been drawn into the human potential movement will eventually join forces with those who are drawn into social change movements. While largely separate today, these movements will need to come together to achieve their full potential, as I’ve written about here.

Bottom line

Achieving more of our potential is not an inward looking and isolating aspiration. If we truly understand that our potential is to make more of a meaningful difference in the domains that matter to us, we will begin to see that achieving more of our potential will require us to connect much more deeply and broadly with others. If we get this right, we will unleash powerful network effects that will enable us to learn at a much faster rate than we would have ever imagined possible and that will finally enable us to achieve exponential potential.


  • 3

Leaders Learn

Category:Collaboration,Leadership,Learning

If you’re not learning,

You’re not a leader.

If you’re learning alone,

You’re not a leader.

Leaders mobilize many

To learn together.

They inspire others with awesome opportunities,

Inviting people to come together

And venture out to the edge,

Beyond their comfort zone.

Leaders pose powerful questions

And ask for help from others

To find the answers.

These questions focus,

Inspire

And challenge,

While building trust.

They urge us all to explore

Uncharted land

And expand our horizons

While driven by a shared quest.

Leaders inspire others

To lead others

In their quest for answers

That matter

Which, of course,

Will only lead to more questions

To be pursued

In a never-ending quest

For expanding opportunity

For everyone.

Don’t measure leaders

By the number of followers.

Instead measure leaders

By the number of leaders

They unleash.

Dare I say?

Leaders inspire us

To pursue our exponential potential.


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