The way of the Industrial Age

It was at this very same time that I chanced to look at the Microsoft Power Point application that my son was using to do his homework. This contained a number of templates to help business people make various forms of presentation (Dale Carnegie templates). What attracted my attention was that they were being provided as aids to help presenters explain and convince others of their ideas and concepts. In view of my difficulties in getting through to the telecom company's employees, I thought they might offer me some badly needed assistance.

There were over a dozen, step by step guides, which included how to sell your ideas, facilitate a meeting, motivate a team and recommend a strategy - templates that provided a direct entry into the corporate mind. I looked at the relevant templates which detailed the standard procedures for putting across ideas and defining strategies. They tell you to begin by defining goals, describing visions and long term objectives. They emphasise the need to make short clear bullet point statements. They tell you to provide evidence and examples. They recommend producing testimonials, case histories, statistics and anything that might provide some form of concrete evidence that the idea or plan can succeed. They tell you to detail all anticipated costs and estimates of out goings and expenditures.

The final expected outcome, they tell you, must be clearly stated and full details of anticipated benefits unambiguously defined. All assume that you are going to use a carefully worked out plan from which you can anticipate and monitor the progress all the way to through to a final successful conclusion.

When I tried to use these templates to help me describe an evolutionary design strategy, the result were laughable. What concrete goals could I describe, when the evolutionary process was expected to come up with something better than I could currently imagine? Technology and competition in the e-business environment is changing too fast to be able to predict progress with any reasonable degree of accuracy. How can even the most authoritative exponents of e-commerce, be able to work out all the technological changes that could take place even within the next six moths?

There are too many new products and initiatives continually appearing from every corner of the planet to be able to keep up to date with current developments. New techniques, software, ideas and strategies are no longer the domain of a few major players; they were coming from hundreds of thousands of different sources from every part of the world. How can any mortal mind keep track of even a small percentage of this fractal of evolving activity? Any picture of the future would be at best doubtful.

As I went through the templates, the prompts began to get even more and more unrealistic. How can you estimate costs without knowing where an evolutionary strategy will take you. How can you state expected benefits and outcomes when these will be determined by emergence: these will not be known until they manifest at some unknown time. As for being able to provide a step by step plan to allow progress to be monitored - it would be no more valid than a poker player predicting his cash flow and details of play.

Now these techniques of persuasion are going out to hundreds of thousands of people who are buying Microsoft office. They are templates to use in presentations of various kinds. They are instructions on how to promote ideas, how to run meetings and how to sell things. These kind of instructions are not only going to all the owners of Power Point, they are the tried and tested methods being taught to millions of business study students at colleges and universities all over the world. This is the standard corporate way designed for Industrial Age businesses. All potential managers are taught to think in this way: logically, with clearly planned routes to achieve optimum results and performance. How can these people be expected to perform well in the strategic world of e- business where these templates cannot be applied?

In most areas of Industrial Age corporate life, everybody is busy working in well defined areas. Everyone can increase their efficiency by communicating with each other through bullet point memos. It works fine when most information is known or knowable. However, when it comes to tackling problems of complexity, with unknowns and unknowables, this kind of corporate mind set is found wanting. It just cannot cope with the new kind of competition which is now starting to appear in the commercial world of digital communication: the Age of Information.

These boiler plate solutions rely on having a good knowledge of the past and the present; plus a reasonable expectation of future events. It assumes that most knowledge is known, obtainable or can be accurately predicted With rapid technological advances and the near impossibility to know all there is to know in the Information Age - how can anyone possibly plan a strategy in advance? The templates tell you to state your vision. Vision in the environment of digital communications is about as useful as binoculars in the fog. How can you possibly know where you are going, how you are going to get there and where you are going to end up? The vision you end up with is likely to be beyond your powers of imagination in the rapidly changing world of the Information Age.

In dealing with a complex, constantly changing environment, there is not a single one of the Industrial Age template recommended points that can be satisfactorily answered. In the Information Age, goals, visions and long term objectives can only be specified in the vaguest of terms. Bullet points are inadequate to describe the kind of strategies that will be needed. There are no credible statistics, testimonials or case histories that can be used; the successes of yesterday are not always successful today and today's successes are unlikely to be the successes of tomorrow.

In this starting phase of the Information Age there is no way to estimate costs or expenditures because the conditions applying today are unlikely to be the conditions applying tomorrow. Who in the beginning could have anticipated that all software products used on the Internet would start off by being free? Who could have envisaged ISP services being offered free of charge. Who could have imagined a time when hundreds of people were offering free Web space, rent free space for on line shopping stores in grand, Web based malls? Free shopping cart services, free ISGs and almost everything else anyone would need for e-commerce - available for free? How can anyone predict costs, future developments and likely outcomes in such a crazy unpredictable world? These conditions drive the Industrial Age, corporate Power Point mind into apoplexy.

The way many of the the Industrial Age corporates seem to be coping with this problem is by avoiding it. During the conversations with my friend in the menswear company, he had explained his attitude to using email. "I don't use it" he'd told me. "My secretary goes through the emails and puts aside anything she thinks might be important. Most of it she trashes".

Enquiring as to why he had so little use for email, he told me that there was too much junk mail for it to be worth the effort of looking through". He went on to explain that email was used mainly by employees to cover their backs. When I asked what he meant by this, he told me that when anyone in the company made any kind of initiative they'd inform just about everyone in the company who they could think of. In this way, if anything went wrong and somebody reproached them, they could easily transfer the blame by saying "But I sent you an email telling you I was going to do this. As you hadn't questioned it, I'd assumed you'd approved". As everyone was doing this, and the overworked executives weren't reading their emails because of these irrelevant messages cluttering up their mail boxes, it was a pretty safe insurance against getting reprimands for mistakes".

This tendency for employees of all ranks to try to avoid situations where they can make mistakes is rife in large Industrial Age corporations. Perhaps this is another reason why those big companies are not leading the way on the web. With no adequate training to cope with the uncertainties and an inability to get to grips with the fast expanding knowledge base, this is enough for Industrial Age employees to use all the usual corporate employee tricks to avoid getting involved with e-commerce.

In an email discussion, with some of the readers of the draft of this book, Dai Williams wrote:

"Traditional corporate culture is based on operating in a largely understood,

largely predictable environment. A culture of discouraging mistakes is

arguably appropriate here (though only arguably, I don't happen to agree) on

the premise that as long as you don't do anything stupid, like chronically

mispricing your goods/services or publicly exposing your weakness you will,

by default, chunter along to an acceptable profit.

Sure, you may need to be a bit more creative if you want serious growth or

higher margins, but you can survive without ("No-one got fired for buying

IBM"). The best way to avoid such cock-ups is to stay in your field of

expertise and if you must move into new markets (geographical, product,

market segment, whatever) you do so slowly and with complete clarity of

direction. Novell a few years ago was an example of a company that didn't

do this (buying applications business), got crucified (ended up "focusing on

core business") and is used as proof that this must be true - standard,

perceptual filtering, ignoring examples that don't fit the hypothesis.

This premise has inevitably permeated most large corporates and results in a

culture where the majority of employees have a "survival instinct" that says

"Don't take risk. If you take risk, don't be seen to take risk and if you get

caught taking risk it was all the next guys fault". This turns new and

radical ventures such as those involving "e-commerce" into corporate hot

potatoes, where no-one wants to be seen to be too involved in case it goes

wrong. Sure they would like to take the glory if it works, but, as mistakes

are punished harder than successes are rewarded, the balance is to keep

clear.

This is illustrated by a joke I heard recently (at least, I think it's a joke):

Take four chimps in a cage. Place a banana at the top of some steps in one

corner. Whenever one of the chimps starts towards the banana, give an electric

shock to ALL chimps. After a while, any chimp who moves towards the steps

will be dragged back and beaten by the other chimps. Remove electrical shock

device. Replace one of original chimps with new chimp. New chimp moves

towards banana and is pulled back and beaten by the others. Repeatedly replace

other original chimps and you come to the point where four chimps can see

the banana which they could easily take but they "know" they mustn't and

hence won't. Isn't that corporate culture?

Yes we all know it is wrong for today's world, but you won't change it just

with a flash of knowledge, it is a major culture change and one that most

corporates are unwilling or, as the previous example suggests, unable to take.

Hence the success of start-ups: they don't (necessarily) have the same

prejudices.

Dai William's post sums up the situation in a nutshell. His observations further emphasises the point that not only are many Industrial Age corporations not structurally set up for tackling e-commerce, the situation is compounded by many employees being neither trained nor sufficiently motivated to become involved.

Another problem for people who try to carry Industrial Age thinking across to the Internet is typified by another reader of the draft of the first chapter. He objected to the suggestion that a top down approach wouldn't be appropriate for Internet products and services. He wrote:

[What about] "the first moon landing. The

landing was achieved (allegedly) on the back of JFK saying

'we will land on the moon before the end of the decade'.

A plan had to be formulated. Scientists and engineers had to sit down and

decide what they needed to build in order to achieve the goal of a moon

landing. They discovered that many of the things they needed had not yet

been invented! So, as well as needing to develop existing technology

(rockets for instance) other things which had not yet been created had to be

developed.

Here was a top-down strategy if ever I saw one. It worked. Would Neil

Armstrong and co. have got to the moon as soon if things had been allowed to

evolve 'naturally' ? I doubt it.....

Would the space race have continued to grow instead of stagnating had it

been allowed to evolve naturally?.........

Here is described an application that is ideally suited for a top down approach to design. It is a prime example of an Industrial Age project. But, this has nothing to do with Information Age business. Even though in this example there has to be new technologies developed, the scope of the technological initiatives would have been reasonably easy to predict. There is very little competition and most of the main factors involved in the decision making were known and predictable: even the elements of risk.

Compare this with the development of an e-business product in the Information Age. All the critical factors involved in the design would be totally unpredictable. Competition would be intense. The environment into which the product would be launched is likely to be quite different from that existing when the product was conceived and designed. To approach the design of an e-business or e-commerce product or service with the same, top down planning approach used to design the moon landing project would be commercial suicide.