Author: JP

Thinking about predictability: More musings about Push and Pull

Chichen Itza photograph courtesy JuanRojo

If you’ve been following this blog for long, then you’ll probably know that I’ve been interested in a number of themes to do with information and its implications on business structures and process. You will also know that every now and then, I use the arenas of food and music to illustrate points or issues.

Of late, much of my time has been taken up in reading (and re-reading) The Power of Pull, and I’ve written a couple of posts on the subject. Messrs Hagel, Seely Brown and Davison have really made me think about things; they’ve answered some of the questions I’ve had for a while, and raised a number of new ones.

In parallel, I’ve also been delving into collapse theory, sparked off by Clay Shirky’s excellent post on the collapse of complex business models. That led me on to digging deeper into Joseph Tainter; I ordered and read The Collapse of Complex Societies straightaway; if any of you is interested in collapse theory, I would strongly recommend you read it; it is also really worth reading a long book review that Professor Tainter did, headlined Collapse, Sustainability and the Environment: How Authors Choose to Fail or Succeed.

Clay has also been responsible for putting a third, connected, stream of thinking into my head, via Kevin Kelly, another must-read person. The Shirky Principle. [Incidentally, you can rest assured I will be reviewing Clay’s upcoming book, Cognitive Surplus. I’ve already ordered it; how nice it was to see that the book was actually being released same-day US and UK. I am so sick of artificial scarcities.]

“Institutions will try to preserve the problem to which they are the solution.” — Clay Shirky

So that’s where my head is right now. Thinking about institutions built fundamentally around “push” principles trying to survive in a “pull” world. Thinking about institutions that are designed that way through no fault of their own; these principles have been the basis of management and economics thinking for the best part of a century. Thinking about institutions that “try to preserve the problem to which they are the solution”. Thinking about institutions that grow more and more complex over time, and then collapse.
Which leads me to the main point of this post. Predictability.
In the Power of Pull (pg 37) the authors articulate a number of “instincts, assumptions and beliefs” that make up “the philosophy of push”:
  • There’s not enough to go around
  • Elites do the deciding
  • Organisations must be hierarchical
  • People must be molded
  • Bigger is better
  • Demand can be forecast
  • Resources can be allocated centrally
  • Demand can be met
I am particularly taken with the Demand can be forecast/Demand can be met statements. For some years now, I have been bemused at the things institutions do in order to make something fundamentally unpredictable into something somehow more predictable.
Through sheer serendipity I was at Burroughs Corporation when the firm, and the industry, began to realise that the money was moving from hardware to software; I was at Data General when the firm, and the industry, began to realise that the money was moving from proprietary to open; I was at Cap Gemini when the firm, and the industry, began to realise that IT services were moving from national to global scale; I was at Dresdner Kleinwort when the firm, and the industry, began to realise that financial services were moving from analog to digital.
In each case, there was a significant shift taking place in the industry, one that was going to transform the entire market radically. In each case, there was a clear institutional response. And in each case, the response was expected to provide a predictability of outcome that was required to be of unusual precision for such an emergent venture in such a changing environment.
I saw the same thing when it came to “agile” methods and practices. Everybody seemed to understand what the methods and practices were; and then, for some strange reason, everyone expected some incredible level of precision in planning and outcome which militated against any concept of agility; this is what I was referring to as the “planning horizon” problem in a recent post.
These behaviours caused a level of cognitive dissonance in me, and I’ve therefore been thinking about it for some time now. Right now I don’t want to go into why people want this predictability, suffice it to say that it appears to be a Push principle as articulated in the book. What I want to do is concentrate on the things people do in order to achieve this state of predictableness.
The easiest route to guaranteeing predictability is to control the market, have a monopoly. Many companies have tried this in the past, many continue to try this, despite legislation and regulation to prevent this. It is easier to do this in some jurisdictions rather than others; surprisingly, it would appear that some companies in “developed” countries seem to be as adept in sustaining monopolies while pretending to be otherwise, as their emerging-nation counterparts: the processes get more sophisticated and get called lobbying rather than bribing, but the outcome’s the same. Nevertheless, global monopolies are hard to sustain: artificial scarcities (eg region coding on DVDs) get met by artificial abundances (eg chipping of DVD players).
If you can’t have a monopoly, the next thing you do in your quest for predictability is to try and control your customer, make it hard for the customer to leave you. This is not surprising, since financial backers (quite possibly the ones wanting the predictability in the first place) are trained to ask “where’s your lock-in” as part of Due Diligence 101. Overt ways of controlling the customer start looking anti-competitive; as a result, the practice has begin to ease, although there are worrying signs that it will resurge in the guise of customer data import and export.
If you can’t lock in your customer, then you do the next best thing. You convince yourself you have predictability. You use a variety of financial and reporting tools to sustain this pretence, often under the guise of “risk management”. [In this context, I would strongly recommend you read Michael Power’s The Risk Management of Everything, a wonderful little tract that you can download for free here.] Sometimes when I look at everything that happened in the financial markets, I cannot help but feel that the same principles that Clay Shirky speaks of in The Collapse of Complex Business Models applies in modern financial markets. The problem with this approach is that you land up having no defence for “black swans”. In fact I would go so far as to state that the process of pretending predictability is one that systemically creates and increases black swan risk.
If you can’t convince yourself, then it all begans to unravel. Because you’re left with the temptation to convince others of the predictable nature of business while not being convinced yourself. Why? Because “push” organisations work on this basis of precision in predictability. The techniques people use to “convince” others in this respect are immoral at the very least and illegal at the extreme.
Institutions, particularly “push” institutions,  have grown up on the mother’s milk of predictability, of smoothed-out forecasts, of a level of precision that is no longer sustainable in a “Pull” world. They’ve resorted to using an extensive variety of techniques to try and hold on to that predictability; some of them are sustainable in the short term, some of them are downright illegal, none of them have any real value in the long term.
Which brings me to the question that’s keeping me awake. Can a traditional Push institution really become a Pull institution, bearing all this in mind? is that transition, that hybrid state,  really possible? how long can one institution uphold two sets of radically different principles under one style of management?
I tried to imagine a Push institution outsourcing work to a Pull institution, to try and understand what the working agreement would look like. And I didn’t like the answer.
Comments and advice welcome.

On pasta and music and copyright

I love food. I love cooking. I use the analogy of food to learn about information: in fact, I’ve nearly finished writing a book that looks in detail at information as if it were food. One of the foods I love is pasta. Glorious pasta.

[I’m attributing this to Red Giraffe, though I came across this elsewhere without any attribution.]

Nobody quite knows precisely where pasta comes from, where and when pasta began. The web is a rich resource for satisfying any curiosity you may have on the topic; suffice it to say that most of the stories involve thousands of years, a lot of dead people (usually Greeks, Romans and Chinese) and even the odd saint or two. Marco Polo doesn’t quite make the cut, but that doesn’t prevent the Chinese having a stake in the ground millenia earlier.

Some of the stories are more recent and more enjoyable (albeit slightly less credible) such as this one, harvested from the Alexandra Palace Television Service over fifty years ago:

Some of the stories may be hard to believe, but nevertheless people agree on a number of things:

  • Pasta has been around since the year dot.
  • Pasta is made by mixing ground kernels of grain, usually wheat,  with water or egg; while Italian pasta tends to be made of durum wheat and no other, other types of grain are in use elsewhere.
  • Pasta used to be made by hand (or more precisely, foot); since 1740 or so machines have also been used to make pasta.

[attributed with thanks to Donovan Govan]

Pasta comes in many shapes and sizes and forms; if you’re interested, read the wikipedia article. If you want to delve deeper, there is probably no better book than Oretta Zanini de Vita’s Encyclopaedia of Pasta.

[Attributed with thanks to FoodieSteve’s blog]

Pasta proclamations, even patents, have been around for a long time, perfidious and pusillanimous attempts to pervert people’s creativity. There have even been designers who’ve tried their hand at new forms of pasta:

Giorgio Giugiaro’s Marille pasta

Philippe Starck’s Mandala pasta

Think about pasta. Today, anyone can make pasta. Kafkaesque bureaucracies can make up rules about the nature of the grain used, the water used, the egg, whatever, but basically every human being has a right to decide what to make pasta out of. You can buy machines to make pasta. But you don’t have to. You can buy “readymade” pasta made by someone else, or even try and make similar pasta at home yourself. You can even go to the extreme, and buy not just the pasta but the love and labour that goes into making and serving a dish with pasta: you can go to a restaurant and pay a chef to do that for you, pay waiters to serve it to you.

Basically, you can do what you like with pasta, starting with the wheat and water and ending with the cooked meal. At each stage, you have the choice of whether you want to pay someone else to do something or not. Someone else can make the pasta for you. Sell you a machine to make pasta. Write a book and tell you how to make the pasta. Or the meal itself. Someone else can cook it for you, amateur or professional. There are a million ways people can participate in the design, making, cooking and eating of pasta, a million ways people can make money with pasta.

Wonderful, isn’t it? The freedom and creativity that has given us over 1300 types of pasta over centuries, shared and enjoyed by billions.

But you know something? It would take very little to screw all this up, to make a complete codswallop out of pasta. Imagine this scenario:

  • Step 1: Patented genetically modified durum wheat begins to displace “organic” wheats. Over time, all the durum wheat grown in the world is covered by patent. People continue to share recipes and cook and eat at home, and in restaurants.
  • Step 2: The GM wheat manufacturers do deals with pasta machine manufacturers (also patented, of course). You cannot use the machines except with official durum wheat. [This is called putting the DRM in durum, which then gets trademarked as DuRuM]. People continue to share recipes and cook and eat at home and in restaurants. Some people have the gall to build their own machines, some don’t even use machines; they knead the dough with their feet.
  • Step 3: The pasta and pasta machine manufacture and distribution industry does not like this, so, under the guise of public safety, lobbies and gets legislation passed that outlaws all wheat bar non-GM wheat, as happened for a while with mustard oil in India. While they’re at it, home manufacture of pasta is also banned. People continue to do what they’ve been doing for thousands of years, and the legislation isn’t taken seriously.
  • Step 4: The internet arrives, Moore’s Law continues to march, and the digitisation of the pasta world continues. 3D printing becomes reality. People don’t just share recipes with their friends and neighbours any more, they now use the internet to share recipes with people they don’t even know, people living all over the world. Even worse, people start making their own pasta machines even though this is “illegal”. RepRap pasta machine cells spring up everywhere.
  • Step 5: The pasta and pasta machine manufacture and distribution industry, which had been going so well since the middle of the 19th century, is distraught. They find all this modern technology so unfair, despite the irony that they themselves disrupted an entire industry as a result of technological advancement 150 years ago. So they lobby government for even more law, to declare sharing of recipes illegal, to declare 3D machines illegal, to declare the transport and distribution of such recipes and machines illegal. Up goes the cry, the pasta bandit must be stopped. Billions at stake, millions of jobs lost, all because of the pasta bandits.
  • Step 6: Government is so busy looking for WMD in Iraq, looking through their expense claims, looking for oil, looking for lucrative post-government book deals, speaking assignments and suchlike, that they don’t have time to worry about all this. Their noses may have been deep in the trough, but they know what to do every time they hear words like “bandit”. Bandits? We can’t have them. Thieving uncivilised louts, we need to put a stop to this forthwith.
  • Step 7: And so the pasta “bandit” is born. And over time, five thousand years of eating pasta comes to a halt.

Don’t worry, none of this could happen in a civilised country, we have nothing to fear. Especially in civilised countries like the UK, the USA and France.

Think about pasta. And think about music. Think about laws that require you to take down a home video of people singing Happy Birthday to You. Think about laws that require people’s internet connections to be cut off for alleged acts of music “piracy”, somehow seen as criminal theft while being at best, and that too only if proven sufficiently in a court of law, civil offences of copyright infringement. Think about laws that make it impossible to provide free wifi.

Think about the freedoms that are being traded. Yankee Doodle, as the song says “put a feather in his hat and called it Macaroni”.

Soon we won’t have the right to call anything Macaroni. Forget calling a feather macaroni, at the rate our freedoms are being traded we will soon not have the right to call macaroni macaroni. Not unless it was made out of GM durum wheat made using licensed machines on licensed premises, using officially endorsed recipes.

The Digital Economy Act is not about thieves or bandits. It’s about preserving 150-year-old business models that prevent human beings from enjoying 5000-year-old freedoms.

More on the Power of Pull

The world keeps changing. There was a time when all the conversation related to a blog post could be found in the area around the post, the blog itself. Nowadays things are somewhat more complex. Today, if I want to find out how my post is being received, I have to do a number of things:

  1. I have to tweet the existence of the post on twitter. I spent time not doing this, but for the past six months or so I’ve been doing this. Since I’ve only written twenty or thirty posts in that time, my followers have not complained so far.
  2. Then, having tweeted about the post, I have to watch for the RTs, twitter retweets. The number of RTs, the people doing the RTing, how people I’ve never heard of then RT the RTs, all this is part of watching localised viral action. And learning from that.
  3. In parallel with this, I have to watch for people “liking” the post on Facebook, ever since they bought FriendFeed. And the comments they make. Similarly, I have to watch for comments on LinkedIn as well as”notices” people publish on identi.ca. Why do I do all this? Because the conversation is important to me. That’s why I blog. That’s how I learn. So if the conversation is taking place in a number of places, then I have to go there.
  4. Finally, I have to watch for DMs, twitter person-to-person mail, along with trad email on the topic, as people reach out to me privately about the blog post. Some prefer it that way. It’s not for me to decide or judge. What matters is that I can get to the feedback and learn from it.

Which brings me nicely on to yesterday’s post, on Push and Pull, reviewing The Power of Pull (John Hagel III, John Seely Brown and Lang Davison).

Lots of retweets, some nested retweets, but so far not a peep on the blog. I guess people are still taking it in, I have this penchant for the longer post every now and then. But. What I have had are DMs, and a few emails. And strangely enough, all the private comments were the same. Two comments, usually in tandem, both about The Power Of Pull.

“I don’t see it”. “I don’t think that the institutions are ready as yet”.

These are important comments and deserve a response in public.

In some ways, all this reminds me of two earlier small shifts I’ve had the joy of participating in/catalysing, both while at Dresdner Kleinwort Wasserstein. The first was to do with embracing opensource, which we did in 1999. Not just using opensource, but contributing to opensource. By early 2001 we were already launched as www.openadaptor.org, thanks to my erstwhile boss and mentor, Al-Noor Ramji. How wonderful to see that it continues today.

The second was to do with regular use of IM, blogs and wikis, which started in the 90s but crystallised in 2002-03. They became the basis for a number of case studies at Harvard Business School, and then formed part of the impetus for Andrew McAfee’s excellent book on Enterprise 2.0.

In both cases, resistance from the core of the organisation was high, and the immune system did everything in its power to prevent progress. Over time, the people and personalities changed, and life moved on. So what happened? Opensource stuck and grew. Social software grew, but less well: the use of IM and wikis continued apace, but blogging dropped off, a trend I want to come back to.

There was a third small yet significant shift I sought to catalyse, one that led to my having the mail address [email protected]. At Dresdner Kleinwort, we had a real challenge with Slammer. There was this awful weekend where we were hit early Saturday morning, had a huge team working round the clock throughout the weekend (I can still remember the problems with patch 39 and patch 61), and just about managed to get our desktops ready for Tokyo trading for their Monday. That led to a management team powwow where we decided we would put forward a plan to replace all MS in the bank with Apple. Project Jobsworth was born, a pun on Steve Jobs and on the likely response of the powers-that-be. Remember, this was at a time when I was one of the powers-that-be. We were only given permission to pilot up to 650 desks; so we started learning about OSX (which was easier than it sounds, there were a bunch of Objective C enthusiasts in my department, collective relics of a NextStep initiative in an earlier life), we brought in a bunch of G4s and laptops and cinema displays, even had a co-branded online shop. But it led nowhere, we could not solve simple yet critical issues to do with Reuters and Bloomberg and Excel and that was that. No more “linux with QA and style”.

Today, looking back, I tend to colour all this with my learning at BT, particularly to do with Ribbit. How to acquire a startup in Silicon Valley, something we hadn’t quite done before. How to acquire said startup pre-revenue, something unheard-of. How to run the business for capability rather than for revenue, yet build a strong springboard for real growth, revenue and profit. How to ensure that the wheel of BT does not crush the butterfly of Ribbit.

And what I see is this:

Dresdner Kleinwort allowed us to bring in opensource pretty much according to the Power of Pull playbook. Introduced as an edge activity, spikes of talented people working to their own rules, “controlled” only by capital and operating expense annual envelopes, left to their own devices as to how to create and extend value. So it happened.

Dresdner Kleinwort couldn’t do much about IM, Bloomberg had made it an industry standard via their chat, and things like ICQ and Jabber had evolved into Parlano and everyone used it. And they still do.

But blogs were about something different, social software in general was about something different. About conversations to do with ideas, some of which actually had to do with work. This attacked the intellectual core of a company’s existence. I began to realise that watercooler and washroom conversations were tolerated because they were “not part of work”, and that social software was threatening that divide. Which made control freaks very uncomfortable. Particularly as blog posts began to deal with sensitive subjects such as the process of performance evaluation and review, sales commission plans, forecast quality, even corporate strategy. This. Would. Not. Do. So as soon as management support dwindled, so did the initiative.

The move to Apple was similarly stalled, because it attacked another “central” heart. The right to decide who to buy services from. The right to decide who made preferred supplier lists and who didn’t. I was actually told categorically that a key reason not to proceed with Apple was their financial instability in comparison with MS. That’s why I’m not a banker. Just look at the stock market behaviour of those two firms since early 2003 and you can decide for yourself.

Why bring all this up? Because I think it has everything to do with The Power of Pull and the question of whether institutions are ready for the implications.

  • I think everybody knows that from a theory-of-the-firm perspective, things are broken; that transaction costs are no longer as important as relationship costs.
  • I think everybody understands that there is a shift from hierarchies-of-businesses-with-products-in-silos to networks-of-relationships-and-capabilities.
  • I think everybody realises that partnership and open innovation is a must, despite natural monopolistic urges to have end-to-end-control.
  • I think everybody appreciates the importance of talent, of knowledge capital and of social capital, all these are understood and responded to.
  • I think everybody has bought into the need for agility in business, the importance of lean processes and quick-turnaround decisions.

The problem is not in the changes and shifts above. It is in what people don’t talk about, don’t want to talk about. What they can’t talk about.

And that is this:

How do we account for all this? How do we make all this work in our current paradigm of management and control and resource allocation and hierarchical empowerment? And the sobering answer? We don’t know.

Anyone who has worked in “agile” environments to any significant extent will be aware of the “planning horizon” problem. There is an implied “it is done when it is done, and it will cost what it will cost” principle in agile environments, and this militates against traditional financial disciplines.

Over the last two decades, this planning horizon problem has gotten a lot worse. On the one hand, the markets and analysts have colluded to get more and more short-termist in their thinking and in their expectations, and this has been reflected in the savagery of valuations and responses to quarterly earnings statements and forecasts. On the other hand, more and more organisations are finding that it’s not just product development cycles that have gotten shorter, product life cycles have collapsed and compressed as well (a point well made in multiple places in The Power of Pull). So sales, revenue and margin forecasts are harder to manage. To make matters worse, software development/integration is becoming an increasingly significant part of product development, management and operations, and we all know what software estimation has been like. [I’ve tended to believe that software estimation is like a man growing ear hair. It takes time to get good at it.]

This Scylla and Charybdis scenario is making life very difficult for management everywhere. Increasingly shorter reporting cycles, higher expectations of accuracy, in an environment where business forecasting has been made much harder as a result of software-driven products and services with compressed life cycles.

All good reason to throw The Power of Pull into the bin, isn’t it?

Yes.

But do realise that you’ll be throwing the future of the firm into the same bin when you do that.

Because what we need is a class of person whose forecasts are reliable despite supply and demand volatility, despite cost and revenue fuzziness. Agnostic to market ups and downs. What we need is a class of person who understands how to convert the swords of traditional factories into the ploughshares of the creation spaces that the Power of Pull speaks of. What we need is a class of person who not only knows how to make use of geographical spikes of talent and passion, but one who knows how to make the spikes happen in the first place.

The institutions that win tomorrow are those that get better at having access to such a class of person, at attracting such a class of person, at knowing how to relate to that class of person in order to achieve a significantly higher level of performance. Which is what the book is about.

We’re going to have to learn about measuring and valuing “flows” rather than “stocks”. We’re going to have to learn about valuing social and relationship capital, at a time when we’ve resolutely refused to allow any form of human capital to be appreciated, much less actually valued. We’re going to have to learn about trusting the talent at the edge to do the right thing, and to keep doing the right thing, because historical forms of cost and revenue control are no longer effective.

The old ways do not work. That’s what the Return On Assets motet of the Big Shift is all about.

The old ways provide us examples every day of major companies having to announce major writedowns, confess to major disasters in estimation and forecasting, even collapse as a result of not being able to bear the Scylla and Charybdis burden. If you think the last two decades were tough in this regard,  you ain’t seen nothing yet.

So, to everyone who says to me “I can’t see it” or “I don’t think the institutions are ready for it”, all I can say is “It’s too late for debate. Be there. Or be not there.”

In this context, one of the big reasons why I liked the book is that it’s written by people who really understand the world of accounts and accounting. Much of the book is empirical. Disregard it at your peril.

Of Push and Pull

My thanks to Bob Davidson (oybay on flickr) for letting me use the wonderful shot above.

Those of you who know me well will also know that I have had a soft spot for the writings of John Seely Brown and John Hagel for some time now. [I’ve found 15 mentions of the word “Seely” alone in the past five years].  The Social Life of Information is one of the most important books I’ve read in the past 20 years. Similarly, ever since I saw the two Johns present the findings that formed the material for The Only Sustainable Edge, I’ve been tracking what they’ve been doing with keen interest.

I’ve had the privilege of meeting both of them over the years; more recently, I’ve been able to spend some quality time with John Hagel, usually at conferences we were both speaking at, sometimes even on the same panel. Which is why I feel truly honoured to have been named one of the original “edgerati” by them. They define edgerati as follows:

More about the edgerati later. Not today, other than to say that it’s a mind-boggling list of people, comprising many of my heroes both dead and alive, and to remark that it feels lonely to be one of the few large-enterprise people on it. But today is not about the edgerati.

Today is about something else. It’s about The Power of Pull, written by John Hagel, John Seely Brown and Lang Davison, one of the best books I’ve read in a very long time. And I read a lot. As many of you know.

In a farsighted article over 13 years ago, James Gleick wrote this:

….the promotion of Push is the silliest piece of puffery to waft along in several seasons. In fact, Push is nothing more than a thinly disguised return to ideas of information delivery that the Internet has made obsolete. The failure of Push is preordained.

Gleick was talking about the push and pull of information. The Power of Pull is about much more than that. It’s majestic, momentous, almost a grand unified theory of a number of themes you will be familiar with.

The theory of the firm and the future of work

There’s an underlying theme throughout the book that touches on the theory of the firm, its raison d’etre, its structure, format and workflow. N. “Venkat” Venkatraman, a Boston professor I have a lot of time for, told me many years ago that business used to be about hierarchies of products and customers, and is now about networks of relationships and capabilities. John Roberts sought to extend that theme in The Modern Firm. Tom Malone did a splendid job of exposing us to how work would change in The Future of Work, and continues to look at this very carefully at the Center for Collective Intelligence, where I am privileged to be able to join him and support him every now and then. People interested in this subject should read the books listed above. [Disclosure: Both Tom and Venkat are good friends and regular dinner companions.]

What this book does is to extend Big Shift thinking into a detailed analysis of what it means to move from a static “stocks”-based view of the firm to a dynamic “flows”-based view, the radical compression of product/service lifecycles this represents, and the imperative to concentrate on refreshing stocks by participating in flows. [They also raise very serious questions on the whole concept of Intellectual Property Rights as a result]. I quote:

“Refreshing the stocks of what we know by participating in flows of new knowledge is fundamental to performance improvement, no matter the endeavour, both for individuals and, more broadly, for institutions”.

The collapse of old models: changes in the flow of work

Two of my other favourite East Coast thinkers, Andrew McAfee and Clay Shirky, have both been covering the collapse of old models from different perspectives. Andrew, with Enterprise 2.0, and Clay, with Here Comes Everybody, both look at the changes taking place at work and in society as a result of what Tim O’Reilly branded Web 2.0. Again, if you’re interested in this subject, you should really go out and get their books. [Disclosure: Andrew spent some time studying my department and organisation when preparing the case studies that would later become the book, and is a friend and regular dinner companion. Clay is also a friend, thought I don’t get to see him that often].

Clay’s recent thought-provoking writings on the collapse of complex business models are also worth reading in this context.

In the Power of Pull, what the authors do is to place the importance of the new tools in the context of “creation spaces”, analogous to mashing the McAfee and Shirky ideas into the area usually reserved for the agile and lean-programming people. I quote:

We believe that in the digital age, as social networking sites, powerful search engines and the like continue to exert their democratising influences, the power of pull will become the governing principle for success, and, that those who learn how to use these tools and methods most effectively are the ones who will pull their influence into a new age of higher performance and achievement, often through the use of edge practices at the core.

The book places a lot of emphasis on how learning is improved as a result of our having better sharing tools. What do I mean? Take an example from my own life, recently. On Friday night, a little over a week ago, I went for a long walk on Mount Tamalpais with Howard Rheingold and Kevin Marks. A wonderful, relaxed-yet-bracing walk along trodden and untrodden ways. The tools we have today make it easy for me to share precisely what we did (and, importantly, make it possible for me to repeat that walk with my family some other time!).

Here’s what we did, also visible from this url: http://maps.google.com/maps/ms?msa=0&msid=200218344844629065129.00048465450c61e15c44f:

From transactional to relational

From a completely different angle, Doc Searls, Christopher Locke, David Weinberger and Rick Levine took the world of work apart a decade ago with The Cluetrain Manifesto, and continue to do so. They looked more closely at the relationship between the firm and its customers and the need for change there. Again, a must-read book, recently republished in a 10th Anniversary edition (in which yours truly has a guest chapter, to boot).

In the Power of Pull, the very concept of transaction costs is brought into question as part of the stocks-to-flows shift, raising the prospect that the cost of creating and maintaining relationships becomes far more important. [Here, maybe it’s my interpretation, but I felt the authors had sympathy for my view that the Dunbar number is higher as a result of technological advances, particularly in communications and their persistence, archivability and searchability].

Emergence and serendipity

Two more related themes come into play, themes introduced to me by people as varied as Steven Berlin Johnson (with Emergence), Mihaly Csikszentmihalyi (with Flow) and Malcolm Gladwell (with Blink).

Tellingly, the authors of The Power of Pull extend the concept of relationship- and attraction-based “spikes” in geographical skill concentration (at least one of the reasons why BT bought Ribbit in Silicon Valley rather than choose firms elsewhere. I should know: I work for BT and chair Ribbit on their behalf). They tie this relational value to improving the probability of serendipitous events, increasing both the likelihood and quality of encounters between high-performing people in such spikes.

The value of serendipity is also exhibited in examples of how learning takes place at the edge, how people apply learning from adjacencies to solving new problems. My favourite recent example is this, the train that doesn’t stop at stations:

My thanks to kottke.org for the example, which you can read about here. I just love the way that concepts I would normally encounter on a running track get transferred over to the rail track. Brilliant.

I could have chosen a series of other themes that are interwoven in the book, but then this review will have become unmanageable and unreadable. Suffice it to say that they would have included the diminishing-returns aspect of the experience curve, changing education, communities and opensource, and work-life balance.

All this is brought together in a way that is simply majestic, reminiscent of the way Esther Dyson took my breath away with Release 2.0 over a decade ago, or as Carlota Perez did with Technological Revolutions and Financial Capital a few years later.

So. In summary. The Power of Pull is a masterful book, bringing together many disparate strands of thinking over the years, placing them in a grounded, measured manner within the context of the institution. It helps us move from the decreasing-returns transaction-costs hierarchical closed model of the enterprise to an increasing-returns abundance-economy networked and open model. It helps us understand the move from stocks to flows, how the boundaries of the firm must change as a result, what will happen to firms that don’t. How the right talent is attracted, how serendipitous value is created by that attraction and consequent spiking.

As you may have gathered from this review, I’ve been following many of the trends and themes in the book in their original streams. That in turn may have sensitised me, my anchors and frames and biases may have blinded me. If this review makes you think that is the case, my apologies.

Because that was not my intention.

My intention was to HOLLER: go out and buy this book, read it and read it again before your competitors do.

Why? Because it puts a lot of things in context, eloquently and enjoyably. Because, as the authors say, something fundamental is broken and needs fixing. Because the creation-space idea is fundamental to anyone who wants to understand how platform-based services organisations work. Or should work.

So don’t make me holler any more. Go out. Buy the book. Read it.

Thinking about #ashtags

Interesting times. I’m in San Francisco on Ribbit work, and it looks like I might be here for some time, thanks to the fallout from the Icelandic volcanic eruptions. I’m scheduled to fly out Tuesday, let’s see what happens. No point fretting about what I cannot change.

There’s always a bright side. Like finding out that the hashtag for related incidents is #ashtag. Or discovering this site, flightradar24, which plots the positions of all planes in the air, identifying each plane by its callsign. Blue crosses are airports. Yellow planes are … you guessed it.