To be honest, I didn’t have much in mind when I started Digital Tonto in my apartment in Kyiv, Ukraine ten years ago. We were in the middle of an enormous financial crisis, I was looking to change my career path and I had some things that I wanted to get off my chest. I never dreamed it would really amount to much.
Yet here we are, ten years later and still going with two books under my belt. The latest, Cascades, just came out in April and is going gangbusters! I’ve been working with my partners throughout the spring and summer to develop a workshop series based on the book, which we should be ready to launch this fall.
The best part about Digital Tonto, however, is YOU, the readers. Over the years you have become a true community and a sounding board. Your support invigorates me and your ideas and feedback enriches me. I can’t tell you how much I appreciate your support. So, as in the past, I’m posting my favorite articles over the last year. Happy Birthday Digital Tonto!
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In February 2004, Viacom announced that it would spin off Blockbuster Video into its own independent company, which gave its CEO, John Antioco, the opportunity to begin addressing the disruptive threat emanating from Netflix head on. He developed a viable strategy, executed it well, but in the end his efforts were for naught.
Around the same time General Stanley McChrystal was tapped to take command of Special Forces in Iraq. Much like Antioco and Blockbuster, he faced a disruptive threat in the form of Al Qaeda that, using unconventional tactics, threatened to thwart his efforts. Unlike Antioco, however, McChrystal succeeded brilliantly.
We tend to think about transformation in terms of strategy and tactics, but if that was all there was to it, Blockbuster would still be thriving today. As I explain in Cascades, the difference between Antioco and McChrystal wasn’t that one had a good plan and the other didn’t, but that McChrystal saw that he had to rewire the networks in his organization.
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In 1999, the day before his eighth startup went public, Steve Blank decided to retire at the age of 45. With time to reflect, he sat in a ski lodge and began to write a memoir with a “lessons learned” section at the end of each chapter. “In hindsight, it was a catharsis of moving from one part of my life to another,” he later told me.
“I was 80 pages in when I realized there was a pattern. When I sat inside the building things didn’t go very well, but when I got outside the building things turned around and got much better,” he remembered. What he meant was that it was only when he got out and talked to customers that he could really get a handle on the business.
We like to think that innovation is about ideas, but it’s really about solving problems. In order to surface problems, you need to ask questions, which is why Steve’s businesses started doing better when he got out of the building to talk to customers. The better questions you ask, the better problems you can identify. Here are 4 questions that will help you do that.
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Don’t worry about people stealing your ideas,” said the computing pioneer Howard Aiken. “If your ideas are any good, you’ll have to ram them down people’s throats.” The truth is that any idea important enough to be valuable will be disruptive enough to inspire significant opposition to it ever gaining traction.
This phenomenon is often known as the Semmelweis Effect, after the Hungarian physician who pioneered hand washing in hospitals. Unfortunately, the medical establishment rejected his ideas and antiseptic procedures didn’t come into common use decades later. Millions of people died needlessly.
Yet as I’ve previously explained, much of the blame lays at Semmelweis’s door. Instead of taking into account valid criticisms of how he collected and communicated his data, he railed against the establishment, became a pariah and lost all credibility. The truth is that we need our critics, if for no other reason than that they have the power to save us from ourselves.
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Every startup is exciting and romantic in the beginning. The founders usually know each other well and want to work together. They bring on others who are likeminded and committed to the mission of the enterprise. Long hours and shared experience makes the business feel less like work and more like a family.
Yet as the company grows and more people are brought on, the social fabric begins to fray. Roles, which once were fluid and interchangeable, begin to formalize and solidify. Tight camaraderie gives way to office politics. What was once a “family” begins to seem like just another place to work and earn a living.
The story is so common that nobody should be surprised when it happens, but inevitably most are, which is why few entrepreneurs prepare for it. Often, because they still feel connected to the senior team, they don’t even realize it’s happening until it’s too late. That’s a shame, because the breakdown of the family atmosphere can be avoided if you prepare for it.
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We tend to think of innovation as an individual effort. It’s much easier to visualize someone like Thomas Edison, Steve Jobs or Elon Musk, in a flash of inspiration, coming up with a brilliant idea than it is to imagine a vast, collective effort. Yet make no mistake. Innovation is a team sport and great innovators are great collaborators.
This year marks the 50th anniversary of the Apollo mission which put a man on the moon, one of the most vast collective efforts in history. It involved 400,000 scientists, engineers and technicians working across government, academia and private industry. It was, above all, a public effort that mobilized resources across all facets of society.
Today, the moonshot seems like a relic from another era, when we expected, and often welcomed, government to play a bigger role in our lives. Yet the challenges we face now, such as climate change, energy, manufacturing and healthcare are, in many ways, far more complex than going to the moon and government needs to play a role in solving them.
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In 2011, MIT economists Erik Brynjolfsson and Andrew McAfee self-published an unassuming e-book titled Race Against The Machine. It quickly became a runaway hit. Before long, the two signed a contract with W. W. Norton & Company to publish a full-length version, The Second Machine Age that was an immediate bestseller.
The subject of both books was how “digital technologies are rapidly encroaching on skills that used to belong to humans alone.” Although the authors were careful to point out that automation is nothing new, they argued, essentially, that at some point a difference in scale becomes a difference in kind and forecasted we were close to hitting a tipping point.
In recent years, their vision has come to be seen as deterministic and apocalyptic, with humans struggling to stay relevant in the face of a future ruled by robot overlords. There’s no evidence that’s true. The future, in fact, will be driven by humans collaborating with other humans to design work for machines to create value for other humans.
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In a disruptive era, the only viable strategy is to adapt and that is especially true today. With change seeming to accelerate with each passing year, every organization must transform itself. Those who are unable to change often find that they are unable to compete and soon disappear altogether.
There has been a long running debate about whether change should be top-down or bottom-up. Some say that true change can only take hold if it comes from the top and is pushed through the entire organization. Others argue that you must first get buy-in from the rank-and-file before any real change can take place.
As I explain in Cascades, the truth is that transformation isn’t top-down or bottom-up, but happens from side-to-side. Change never happens all at once and can’t simply be willed into existence. It can only happen when people truly internalize and embrace it. The best way to do that is to empower those who already believe in change to bring in those around them
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In 1936, Alan Turing’s published a breakthrough paper describing a universal computer which could be programmed to do any task. Essentially, he argued that rather than having different machines for different tasks, a single machine, using a system of ones and zeroes, could be programmed to do any task.
Today, we can see Turing’s vision writ large. Digital technology pervades just about everything we do, from producing documents to navigating the physical world. Although the basic technology has evolved from vacuum tubes to transistors to integrated circuits, modern computers are essentially scaled up versions of that initial idea.
Yet even the most powerful ideas have their limits. While it is true that digital computers can perform almost any informational task, the technology is approaching theoretical barriers and we can no longer rely on a single technology to power the future. At Intel, scientists are working to create a new vision in which computing is no longer universal, but heterogeneous.
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There is a line of thinking that says that the world is built on ideas. It was an idea that launched the American Revolution and created a nation. It was an idea that led Albert Einstein to pursue relativity, Linus Pauling to invent a vaccine and for Steve Jobs to create the iPhone and build the most valuable company in the world.
It is because of the power of ideas that we hold them so dear. We want to protect those we believe are valuable and sometimes become jealous when others think them up first. There’s nothing so rapturous as the moment of epiphany in which an idea forms in our mind and begins to take shape.
Clearly, ideas are important, but not as many believe. America is what it is today, for better or worse, not just because of the principles of its founding, but because of the actions that came after it. We revere people like Einstein, Pauling and Jobs not because of their ideas, but what they did with them. The truth is that although possibilities are infinite, ideas are limited.
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