Skip to content

Where is Your Tent City?

2012 October 7
by Greg Satell

I learned most of what I know about innovation during the 15 years I spent living and working in the former Eastern Bloc.  People are surprised when I tell them that and I admit, it’s a strange thing to say.

After all, the Soviet Union failed miserably.  It was a drab place, filled with heavy tractors and people with gray clothes and dour looks on their faces.  Innovation isn’t the first word that comes to mind.

However, while the system was crumbling, people still had to get things done.  They needed housing, food, electricity and means to entertain themselves.  Officially, these things weren’t a priority and the power structure put forth little effort to provide them. When leadership fails, innovation goes underground and people learn to hack to get by.

A Short Economic History of the Soviet Union

In 1956, at the height of the second red scare, Soviet Premier Nikita Khrushchev famously said, “We will bury you!

He meant economically, of course, and he had good reason to be optimistic.  His country had achieved an economic miracle, moving from an agrarian to an industrial society in a single generation.  They had no Great Depression in the ‘30’s like the West had, economic output was growing and unemployment was nonexistent.

Yet things were not as they seemed.  Underneath, the system was crumbling. Economists now know that total factor productivity, the ratio of capital and labor to output had begun to fall in the 50’s and would become negative during the 70’s and 80’s, meaning that what they put into making a product would be worth less than what they got out of it.

That’s no way to run a society.  It was only a matter of time before the system collapsed under it’s own weight and, in the end, it didn’t matter how many tractors they built, because measuring total output doesn’t tell you whether you are building the right things or not.

Warning Signs

There were, of course, early signs of trouble, including the Hungarian uprising in 1956, the erection of the Berlin Wall in 1961, the Prague Spring in 1968 and the Polish Solidarity movement of the 1980’s, just to name a few.  To meet these challenges, Soviet military spending grew to almost 15% of GDP.

They fell prey to what is known as a “Hobbesian paradox.”  Any law that the majority of people aren’t voluntarily willing to follow is ultimately doomed, because enforcement costs exceed any benefit  When you have to expend enormous effort to keep your people in line and they, in turn, spend their days trying to break the yoke, very little gets done.

You have to wonder what would have happened if someone stopped and said, “Hey, it seems like we have serious problems that we need to fix,” and some did, including Khrushchev himself, but their first loyalty was to the ideal and the leadership as a whole was convinced that it would win out in the end.

They also had some successes they could point to; tanks put down the uprisings, the Berlin Wall kept the East Berliners from walking across the border, there were political triumphs in the third world and scientific achievements like Sputnik.  All of these things helped obscure the uncomfortable fact that core needs were not being met.

Hacking Things Together

Above all there were shortages.  Top officials could shop at special foreign currency stores, but most could not, so they had to find another way.  The Poles called it “kombinować” and it worked like this:

If you wanted to build a house and needed bricks, you couldn’t easily buy them, so you might get a bicycle instead.  You could then trade the bicycle to get some chocolates and bring those chocolates to the lady at the meat store.  With that invaluable extra ration of meat, you could get your bricks.  You then repeated the process for nails, wood, etc.

And so, in the end, you got your house built.  It was all an incredible waste of time and effort, but when there is no official way to get things done, people will go to great lengths to get what they need.  They learn how to hack the system and pretty soon, the system itself becomes a hack.

The Orange Revolution

I learned all of this second hand.  Some from researching the history of the region, but most over beer and vodka, listening to old stories my friends would tell me.  What struck me about the stories was how much fun everybody had scamming for toilet paper and other necessities.  In a world of absurdity, there is always room for laughs.

However, I did have the opportunity to witness a major historical event first hand, Ukraine’s Orange Revolution in 2004.  To the outside world it looked like this:

That’s the conventional view of a revolution, an inspirational leader unifying the people and driving them towards their objective.  However, the truth is that the leaders are often the beneficiaries, rather than the drivers, of the movement.  The real changes happen in places that look like this:

This was the tent city, which lay just down the street from the stage at Independence Square.  There were no celebrities there, nor were there speeches, just students in the freezing November cold, living in tents.  Many came and donated blankets, warm food and other things, but it was mostly a mixture of frustration and hope that sustained them.

It had started from a student movement called Pora, which was inspired by the Otpor movement that overthrew Slobodan Milošević in Serbia and the Kmara group that led to the Rose Revolution in Georgia.  While most of the country had just joined the revolution, the students had been organizing long before.

Anywhere you see immense change, somewhere lurking behind the scenes is a group of young revolutionaries on the fringe, meeting in anonymous, out of the way places.  Few care to look and history often forgets them.  Everybody knows Steve Jobs, hardly any have heard of the Homebrew Computer Club; LOLCats are famous, 4Chan is not.

Potemkin Villages and Tent Cities

In 1787. Catherine the Great travelled to visit Crimea by train.  Her adviser, Grigory Potemkin, had facades of villages built so that the new conquest would appear prosperous to his Empress as she travelled past.  It was that elaborate ruse that inspired the phrase “Potemkin village.”

The term has resonance because it points to a truth that we all know but often forget. Bosses want to see results and everybody wants to impress them.  However, it is often easier to create the illusion of success.  Tractors and railroads provide concrete output, but they often obscure the fact that people need to hack to survive.

And it is the hacking that produces change.  There is no plan to guide it nor a metric to evaluate it, because it arises when plans and metrics leave needs unmet.  People do what they need to get by, often under the guise of secrecy.  Leaders are always the last to know that their private carriages are passing by Potemkin villages.

So, if you want to create an innovation revolution, don’t go in search of a messiah, find your tent city instead.  You can be sure it is close by, but it is usually hiding, waiting to be set free.

– Greg

10 Responses leave one →
  1. October 7, 2012


    Great story – and insight. I had a chance to visit Russia in the ’70’s – and saw some of the black market “hacks” first hand. I was briefly detained for trying to exploit one – but that’s an entirely separate story. Safe to say I survived – passport intact.

    Thanks for sharing. I may elect to quote from this (with links and reference of course) as a part of the coverage I do in the healthcare space. There are some similarities that are worth noting – and like much of global history – we seem forever doomed to repeat it in both large and small ways.

  2. October 7, 2012

    Thanks Dan. Feel free to quote as you like. Looking forward to seeing what you come up with!

    – Greg

  3. October 9, 2012

    what a great story.
    thank you..

    love this:

    And it is the hacking that produces change. There is no plan to guide it nor a metric to evaluate it, because it arises when plans and metrics leave needs unmet.
    So, if you want to create an innovation revolution, don’t go in search of a messiah, find your tent city instead. You can be sure it is close by, but it is usually hiding, waiting to be set free.

  4. October 9, 2012

    Thanks Monika. Good luck with your tent city!

    – Greg

  5. tony permalink
    October 10, 2012

    Great piece Greg – as you know, was there too. You see this around every aspect of life, but I didn’t connect the dots before. Nice one. T

  6. October 10, 2012

    Thanks Tony. Nice to see that you’re doing well.

    – Greg

  7. Olga permalink
    October 12, 2012

    Love your stories, Greg!

  8. October 12, 2012

    Those were amazing days!

    – Greg

  9. Brendan permalink
    October 20, 2012

    Sometimes the tent cities are hiding in plain view: farmer’s markets, union meetings, credit union AGMs, parent-teacher committees, food co-ops…anywhere the status quo is operatively under scrutiny, *simply by virtue of the conversations around an alternative*.

    In my experience, any political/union mobilization talent worth their salt can TKO any given CMO on any given day—because they do for zilch ( what the status quo would far sooner take six months to mull over. I live in a small arts community/blue collar town in SW Ontario (Stratford, home to the big theatre festival) where innovation in the arts, IT and digital media ( is taken very, very seriously…and it happens, because the scale of things is do-able here. The politics of innovation is as important as the innovation itself (

    An example from the politics of food: Fair Trade coffee’s tipping point wasn’t the decades of small-scale activism from all across Latin America and North Africa, essential though that ‘dripdripdrip’ from below was.

    No: it was when Nestlé’s decided that value-add ‘artisanal coffees’—the value-add often being the social activism of the coffee hacienda owners on behalf of their workers (from school uniforms to soccer balls to subsidized healthcare)—were (duh) where the margins were.

    The elephant rolled over; Fair Trade took off. This is however a simple example. Your cautionary reference to Thomas Kuhn in suggests to me there are indeed ‘tectonic plates’ to the structure of every revolution, vectors of forces sometimes exceedingly difficult to parse out.

    Point is, the status quo is far more vulnerable than we think; inertia is, after all, a state of inactivity. Activity destabilizes the status quo; focused activity moves it; focused activity dedicated to real change breaks the game open.

    Here’s a bird’s eye view of inertia moving at full speed, as it were: the Soviet-led Politburo debates on what to do with Czechoslovakia in 1968:


  10. October 20, 2012

    Good thoughts. Thanks Brendan.

    – Greg

Leave a Reply

Note: You can use basic XHTML in your comments. Your email address will never be published.

Subscribe to this comment feed via RSS