One minute introduction to the Value Maturity Model: Connect>Share>Solve>Innovate
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Writing
Disrupt Success Metrics not Risk Appetite
Big corporates take big risky decisions all the time. They also lose money in spectacular ways at times. What stand in the way of most corporates and disruptive digital is not risk appetite. Disrupters have a different set of measures of success.
It is Not Risk Appetite
In a conversation about digital disruptive threats to large organisations today the view was expressed that it was their risk appetite that holds them back. There are undoubtedly companies for whom this is the case. Entrepreneurs have high risk appetite than many companies.
However risk management is one thing that large corporates tend to do a lot. They specialise in it. They have expensive professionals to measure and value risk. The global financial crisis showed us their preparedness to take big risks, not always wisely.
Every day large organisations make multi-million and even billion dollar investments in highly uncertain returns. The fact that many of these fail but there is still an appetite to make the plunge shows this.
Big companies make bet the company decisions too. IBM did so when it developed the System/360. Boeing did it with its early jets. Intel was a leader in chips because In part of its investment in plants. Many long lived capital assets like mines, property and large scale industrial plants can involve huge risk and highly uncertain returns.
However these decisions were made and justified by logic of the traditional business measures of success like discounted cashflow valuation, margin, profit growth and shareholder returns.
Different Measures
Tried any of these arguments to justify an investment recently?
‘There are currently billions of dollars of margin in this industry. We think we can wipe out 90% and capture half of what’s left’
‘We have no revenue but we will be valued in an exit for our incredible exponential customer growth rate and because we might be a threat’
‘We will invest billions and spend all our margin in profit less growth for decades to dominate our category globally’
‘We have billions of dollars of funding to operate in developing markets below cost to expand a new market because what we are doing is revolutionising our industry, we promised to be global and people guess that we are capable of more’
For disruptive startups, it takes bravery, a good pitch deck, the right investors and a whole lot of momentum to make people buy what you are selling. In corporate life, these arguments rarely ever fly. Usually, the premise is so divergent from the usual measures of success the risk of the venture is irrelevant.
Newspapers struggled to react to advertising online because 90% of their highly profitable and very tangible revenue vanished. Kodak didn’t invent Instagram because it had a film business that dominated through its profitable film processing. Retailers struggle to compete with Amazon because nobody is really sure what Amazon wants to define as success. Uber’s global expansion into markets like India where they have paid drivers as much as twice the fare charged follows no short term transactional financial logic.
Even in a more traditional example we see the stickiness of our measures. A recent study from the Reserve Bank of Australia showed that one of the barriers to investment in this country is the inflexibility of return thresholds for investment. Investment return thresholds don’t change even in low interest rate environments. Our Boards, CEOs and CFOs like their measures and stick to them.
How are you going to compete with new measures? If you want to play the disruptive game how do you disrupt your traditional definition of success?
Your next career network
Your next career is about your networks as much if not more than your expertise.
Jon Husband made an insightful comment on my post asking ‘What’s your next career?’ Jon noted your next network is an important question too.
I meet many talented people who haven’t had the success that they deserve. They have great expertise & potential. What they lack are the networks to grow or share their expertise. Without the support of networks to remain current and to offer new edge opportunities the expertise goes wasted.
Today global networks power expertise in ways that change the game. In Moses Naim’s End of Power he highlights that there are more chess grandmasters than ever because there are more opportunities than ever for people to connect, learn and play. With access to global experts powered by global connection you can’t assume opportunities will find you if you are not engaged in building and sharing your expertise.
Your step into your next career is going to ask people to take a chance on someone unproven. Whatever your expertise, people will make that decision based on their relationship with you or your relationship with people that they trust. Network connections enable career change.
We have all heard about the 10,000 hours to build mastery. What is less discussed is the deep network connections required to support mastery. As you commit 10,000 hours to developing your next career spend half that on the network and you will get exponential results. Thick networks of connection help with any transformation.
Infographic of my CMI Keynote presentation on 11 November 2015
Stay in
“The guys in the white hats win in the second half of the movie” – Anonymous
We have two responsibilities: to stay in the quest for change and to draw others to join us.
Stay in
Change is hard. We all get disappointed and consider bailing on change. That can be the right move when it is required for personal preservation or when we need time to create a totally new approach after a big failure.
However, the bigger need is to give change time. Our instant success culture sees many people seeking to bail when the momentum towards success is around the corner. We need to stay engaged and keep pushing for change. Finding the right path and the right experiments takes time and effort.
Cynicism is easy and ever so tempting. Cynicism doesn’t get anyone anywhere. Worse abandoning change or turning cynical sends a message to others to stay out. Bailing puts change back because others get the message that change can’t be done.
Something made you believe change is needed. If that still stands, then stay the course of change.
Bring Others in
Change succeeds when people are moving towards it, not away. We all need to help others to engage with our changes.
Global connection has made it easier to find people who share your views and to define sharply the other. We see increasing polarisation in many debates and stereotypes and generalisations to demean or denigrate opponents. A little sense of the other helps to define a movement. Too much is counterproductive.
Change does not happen from within the safe community of your supporters. Change happens when others join in and opponents finally meet you in the middle ground to move forward together. We have to find ways to bring others in. We have to find others who see the need for change.
Stay the course and when you are in your darkest times seek to find others to join you and help you sustain the change.
What’s your next career?
A simple question that shocks people.
In my twenties I hard worked really hard to get into my chosen career. I looked around the organisations I worked in and I noticed something. All the grey haired people were being pushed out. A few successful ones got to stay but most were gone with their potential ahead of them. I realised I needed a second career for later.
I have only a little grey hair left today and I’m still not as old as the people I saw leaving. My life today is more like a sixth career but it had its foundations in asking myself the question ‘what’s your next career?’ I still have more options to go.
Too many people have no answer or haven’t even considered the question. They are just lucky the question has not yet been forced on them.
We may not be able to predict the average number of careers easily but it is more than one. When we add robots, automation and new career options, there is a good chance that we need to be at least considering future options. There’s an opportunity cost to every decision to stay put.
Understand your options. Grow your skills and capabilities. Build networks for careers beyond your first one. Experiment with different things to discover your purpose and to gain experience for next steps. You will find these things make it more likely you get to stay in your current career too.
This career won’t be your last so plan an answer to the question. Then when you have that plan start bringing it to life. If nothing else, prepare yourself that you might need to stop defining yourself by your current role.
Opportunity Cost
The value of your time is not what you are doing now. The value is what you could be doing.
In economics, the opportunity cost is the value of the best option forgone in making a choice. The option given up may well be more valuable than the option chosen.
We don’t consider opportunity cost of our time quite as often as we should. Time is scarce. Time comes only once and expires every minute. We either allocate time well or we miss out on the value it can create. Realising the value of time is about choices. If we don’t consider our options or don’t chose, we waste time.
The value of time need not be measured in money. Often the opportunity cost of our current great income is a far larger sense of satisfaction, happiness and better relationships with others in our lives.
The opportunity cost may also be our learning, growth and new options. We often discount the value of options and uncertainty. We can’t find out the uncertain value of an opportunity if we never try. The comedian Jim Carrey shared a little wisdom about options when he said ‘You can fail at what you don’t want, so you might as well do what you love’.
Ask yourself ‘what’s the best use of my time now?’ Make choices taking account of the opportunity cost of your time. Realise the value you might otherwise be missing.
What goes wrong with #wol: #wolweek
A short handy guide to (almost) everything that can go wrong when working out loud
People ignore you: the most common experience. You feel like a madman shouting in a busy street. Actually everyone else is just so busy they don’t notice. Keep going. Also try working out loud in smaller, more connected communities.
People don’t get it: old habits die hard. Another person’s lack of understanding is no barrier to you. Keep practising and keep explaining. They will see the benefits eventually.
People think you are bragging: make sure you are sharing work that is still in progress and sharing the good and bad. Otherwise keep going.
People think you are too noisy: Noise is personal. Help those people to see how they can manage noise. Be reasonable with your own sharing.
People think you are indiscreet: often a perception that passes as people come to know you better. Build relationships. Making sure you are sharing about work helps. Keep going.
People think you are pushy: separate perceptions and reality. You can’t force others to work out loud with you. You can’t expect others to help you if you don’t help in reply.
People think you are selfish: Celebrate others and recognise their help. No work is all about you.
People think you have too much time on your hands: let people know how much you have on. Help them to understand how easy it is to share work when you don’t have to dress it up. Show them how much time you save.
People think you are ignorant or incompetent: they might think that anyway. Better to show them your passion to learn and get help.
People think you are different, divergent, a trouble maker or a rebel: you are. Deal with it.
People tell you that you shouldn’t need to work out loud because of the process, the training, the manual, the system or other support: trust your judgement. Sometimes this helps you find the answer you need.
People think you are lazy: just keep showing the work you are doing.
People tell you they are already doing it: people may well be sharing their work in their own way. Help others to understand your practice. Let them work their own way.
People tell you it is a waste of time: discuss the benefits you get. However don’t feel the need to convert everyone. Know the value to you.
People ask ‘but what’s in it for me?’: explain the benefits.
People tell you that you are not doing it right: Ignore the experts.
People tell you that you aren’t expert enough: Ignore the experts. You work out loud to learn.
Corporate affairs, legal or HR get upset: hmm, hopefully you’ve followed policy to the extent that is possible. Make sure you are clear on the reasons why you are working out loud.
You violate national security laws, anti-competitive protection, intellectual property, espionage laws, conflict of interests or otherwise commit a crime: don’t do this again. Probably wise that you paid attention in your compliance training.
You make a mistake: it happens. Be honest. Move on.
You misspell a word, have an autocorrect issue, bad grammar, bad audio or video or people can’t otherwise understand you: see You make a mistake.
You embarrass someone else: some times working out loud draws in other private people. Take care of their feelings and check first.
Your boss tells you to stop: are they right? If yes, stop. If no, continue in a different way. If your boss is really wrong, do you need another job?
Your family think you spend too much time doing it: probably worth listening to them. Working out loud is about work. You don’t want work intruding everywhere.
All the issues are survivable. Keep going
Keep learning.
If you have more suggestions, please add them in the comments.
Bet on Change #wolweek
Change is work. It is not a game of trumps played with opinions. If there’s debate, even more reason to seek to make change and see what happens.
Those trying to stop your change will tell you the job has been done, can’t be done & isn’t worth doing. They can’t be all right, so maybe they are all wrong. You won’t know the answer if you don’t try to make change happen.
People will demand clarity. Others will say you need to be less prescriptive. People will say you are too narrow and too broad. People will say you need to name your change. Others will call your change a fad or dismiss it as mere marketing. The diversity of human opinions challenges all change.
Change agents need to recognise these views for what they are, opinions. Those opinions need to sit alongside your opinion that change is required. Many of these opinion leaders will want to engage you in a long debate at to the absence of merits of your plans. Sadly debates based on opinions are rarely productive.
Remember momentum is your friend in creating change. Action solves the issues of debates. The obstacles are the work and will be overcome as you adapt and experiment forward. Clarity can be refined as you work forward. Value will either be proved or fail. Action helps you recruit more change agents.
For all the people saying there was no need for International Working Out Loud week, there was a far larger group engaging for the first time and learning how to make it valuable. For all the debate about different views of the future of learning and development last week, there was still a need for people to back their views on how to make learning more effective and engaging which won’t happen on a blog or social stream.
Debates are fine. You can learn in a debate when they compare facts and experiences. When debates are just an exchange of opinions, it is far better to move forward, test your opinion and help everyone learn through action.
The What, Where and Why of Working Out Loud