Jeremie Averous | The Fourth Revolution Blog

How Innovation Will Necessarily Alter the Power Balance

Following up on our previous post on why real disruptive innovation does have to change business models, this inspirational image from Hugh MacLeod is a great complement.

original_ideas_hugh2 Real good ideas do necessarily alter the power relationships (and that is why they are always resisted, but that is another story).

Power relationships include those relationships in an organization’s hierarchy as well as those relationships in a market.

When I am facilitating, it is interesting to see how I can feel that the group stumbled upon a good idea – when someone starts feeling uneasy about this is going to change power relationships (and in general, his or her own power). Resistance starts to kick-in. It is a sure sign that we hit the nail on the head and that a good idea has been produced. It needs to be captured before it dilutes itself, and assessed to check whether it is just good, or whether it is great.

Image and inspiration by Hugh MacLeod at GapingVoid.com

How True Innovation Requires a Business Model Transformation

Tesla Motors (an electrical car-maker) is one of the hottest hardware start-ups in the US at the moment. The CEO Elon Musk is one of the stars of the new economy. Apart from the innovative quality of their product (if you have the opportunity, visit one their showrooms!), and of the underlying technologies (some say that the battery technology is going to be even more important than the cars themselves) the most interesting part of this long term experiment is how Tesla has to upend the well-set business model of car selling to be successful.

It appears that there are strong regulations in the US about the fact that cars would need to be sold through franchised car-dealerships and this creates all sorts of weird market effects. Tesla is currently battling to topple these old-fashioned regulations, and might well eventually win at that game, although that will take long consistent efforts (see Bloomberg’s paper on “Can Tesla Topple the Car Dealer Monopoly” and this post “Tesla versus the rent-seekers“). In the meantime there are strong legal cases based on old-fashioned regulations that prevent the start-up to effectively deploy its business model.

The more general question is: can there be real innovation without disruptive existing business models? Or, is a technical innovation that does not disrupt an existing business model a real transformational innovation?

We can take this question further: can established players really be innovative, because real innovation would challenge their existing business model? For example, in Tesla’s market, could conventional car makers really lead a transformation into electrical cars, because they also need to protect their conventional business and modes of distribution?

I am more and more convinced that true innovation is not technical. It is innovating at the business model level. Look for innovations in that space, because that is really what is changing the world.

How Innovative Organization Forms Must Address our Psychological Need for Visible Status

In this blog we have made the case on how the Fourth Revolution (and its widespread availability of communication capability) will lead to a much flatter organization – and that it does scare many people (see the post “What is so Awful About the Disappearance of Hierarchy?“). There is currently considerable debate about the need for hierarchy, like for example in this recent Stanford Business School article, ‘The Case for Workplace Hierarchy‘.

hierarchy One of the points of the paper is that “power structures haven’t changed much over time, […] the way organizations operate today actually reflects hundreds of years of hierarchical power structures, and remains unchanged because these structures ‘can be linked to survival advantages’ in the workplace“. Also, “hierarchies deliver practical and psychological value, in part by fulfilling deep-seated needs for order and security“.

Hierarchy would then be justified by deep psychological needs to recognize effectively and visibly a power structure that would help people orient themselves.

There is no doubt that societies or groups or people do tend to organize themselves around a spoken or unspoken power balance and that hierarchy has the benefit of making power and status immediately visible. It is very possible that most of us do need some kind of social hierarchy to fit in, as a deep-seated psychological need. Still there are other ways to show visibly power or importance, and these ways are being used or developed by social networks today (recognition of top contributors, peer ratings, Klout score etc.). They are not mature yet and this is an area of interesting and controversial development.

What I take from this debate is clearly that flatter or no hierarchy is only possible if there is a clear way to visibility show some kind of status in the organization, and that successful companies that implement new ways of organizing themselves need to address this psychological need. What do you think?

Don’t miss my talk this Wednesday evening in Versailles, France

The title of the talk is “from Versailles to Singapore: opportunities in the present world”.

It will be held on May 21st from 7:30 pm onwards in Versailles (Lycee Hoche) near Paris, France, and… in French!

Of course that will be a great opportunity to speak about my experience as a global executive and consultant and speak about the Fourth Revolution and how it changes the world.. and see the reaction of current and former french alumni to these ideas! I plan to keep the talk relatively informal and hope that there will be a lively debate. Be there if you can!

Why the Fourth Revolution will Promote Meritocracy

I strongly encourage you to take a few minutes to go through this video/ transcript of a MIT research assistant about research on the impact of network connection on whether societies are meritocratic (people get rewarded in proportion of their contribution) or topocratic (intermediaries get rewarded, not the contributors). [The text on the page is the transcript of the video if you prefer reading].

A network model shows that as the number of connections increase, the system becomes increasingly meritocratic (click on the image for a large version)

Basically research shows that the more connected the network is, the more it becomes meritocratic. A very basic model suggests that if everybody is connected to 150 people on average (which is approximately the case on Facebook), the network is meritocratic only on a section of 22,000 people in your close network. The network is still topocratic (enhances the intermediaries’ value) at the size of a country. Now if your number of connections is larger, the size of the society subset which will be meritocratic will increase dramatically and you will receive increasingly more rewards from your contribution.

As the Fourth Revolution expands and the inter-connectivity of our world increases substantially, we can expect our societies to become more and more meritocratic even if it will still take time to avoid intermediaries at a country or at global level. What a better demonstration that the Fourth Revolution will bring tremendous changes to our benefit?

Why Excellence should be a Consistent Attitude

“If you are going to achieve excellence in big things, you develop the habit in little matters. Excellence is not an exception, it is a prevailing attitude” – so says Colin Powell. Like other things, excellence seems to be what you should do when others are not looking!

What I find interesting in this quote is how is could be misinterpreted as for some people, the line is extremely fine between excellence and perfectionism. And if perfectionism is applied to everything including the things, it can obviously be a quite counter-productive behavior.

According to Wikipedia, “excellence is a talent or quality which is unusually good and so surpasses ordinary standards”. Colin Powell thus suggests that we should develop an attitude that seeks to always surpass normal standards, even by a little – and not be satisfied by the ordinary in all circumstances.

That is a tough standard, still Colin Powell is probably right to suggest that it is only by being relentless seeking excellence in all aspects that one will also become excellent in large endeavors. In my experience, excellence in executing large projects is a close attention to detail and excellence in all aspects of execution.

Be relentless seeking excellence. And you’ll achieve great things.

Credits: I found this great quote on Lifehack from where the image is also imported from.

How to Unleash the Power of Connectional Intelligence

“In our new world of an embedded digital infrastructure that connects all of our lives, the power of connectional intelligence holds exponential, and previously untapped, potential for breakthroughs in ways we can barely begin to imagine” writes Saj-Nicole Joni in ‘Win Big by Unleashing Millennials’ Connective Intelligence‘.

She continues “Connectional intelligence is your ability to make breakthroughs by connecting ideas, people, information, and resources. You use CxQ whenever you sift through multiple sources of information to put pieces of a puzzling problem together in new ways. It’s in your ability to build and realize value from networks of relationships, in your ability to convene communities, to marshal a various of resources to focus on a result, and to make diversity and differences productive.”. According to her, people with high connectional intelligence have always existed – but now it is much easier and much more widespread than ever before.

So, how much do you develop and exploit your connectional intelligence in your daily practice? If you do not – at least consciously – it looks like a good time to go at it – and enter the Fourth Revolution world in a more active way!

Participate to my next talk in Versailles, France, on 21 May evening!

My former high school has asked me to come and speak to the association of former alumni about my life and the opportunities we all can encounter in today’s world. The title of the talk is “from Versailles to Singapore: opportunities in the present world”.

It will be held on May 21st from 7:30 pm onwards in Versailles (Lycee Hoche) near Paris, France, and… in French!

In Truth, are You a Freelancer or an Entrepreneur?

Am I a freelancer or an entrepreneur? Contrary to what I thought I am probably in the first category. And before that realization I had some difficult moments – I should not believe I am an entrepreneur while I am just an elaborate freelancer. And that might just be good news that I just get this realization now.

I had this realization listening to Seth Godin in a Skillshare class on entrepreneurship. This issue is actually explained at length in Seth’s post “The Difference Between a Freelancer and an Entrepreneur”.

Seth Godin goes on to explain:

If you’re a freelancer:
- Ensure a steady stream of work
- Create an environment where you don’t go crazy and melt because of overwork
- Consistently increase the quality of your work and generate a waiting list for your time (and increase your prices) (at the same time).
- Scaling will be limited, linear and occur through the hiring of a limited number of additional partners
If you’re an entrepreneur:
- you look for an exponential scaling of your business, so:
- Relentlessly hire people to delegate work to
- Give yourself a promotion so you are constantly doing work you’re unable to hire anyone else to do
- Build an organization that has the cash flow to permit you to do those two things…

The business I am building in consulting, focusing on high-end specialized consulting, without an army of junior consultants, will not scale exponentially. It does not mean that it cannot influence deeply and leave an imprint in the world. It means I should not be frustrated for lack of (exponential) growth but focus on developing the contents and depth of intellectual property, and grow linearly by recruiting a number of partners.

This difference between (elaborate) freelancer and entrepreneur is fundamental. When I look around I realize how many people call themselves entrepreneurs when they are freelancers. It’s trendy to be an entrepreneur but in truth there are not so many around.

Maybe someday I will venture into real entrepreneurship, building a product that has the capability to scale. Now, I focus on developing my business brand with a better understanding of what it entails in terms of business model. And with more excitement than ever.

How to Manage your Personal Idea Funnel

Following on our previous post “How to Focus on Execution and Still be Open to New Ideas”, let’s develop further the concept of “idea funnel”

The Funnel is a marketing concept that is available in Sales & Marketing and as well in Innovation. But rather than take the innovation funnel I like to compare my own Idea Funnel to the Sales one, because the steps are more relevant. The reason is that the sales funnel is linked to emotional awareness while innovation funnels are more often very rational in their description.

Let’s look at a common representation of a sales funnel. Translated to my personal Idea Funnel, the steps cover the following:

Awareness: an idea just popped up in my consciousness! Can I verbalize it now?
Qualifying interest: a quick ‘due diligence’ to check that the idea is relevant, feasible and could be somewhat useful – and that it is not just a mere fantasy?
Desire: do I feel an emotional twinkling when I consider this idea? Does it get me excited? A definite key factor if I would consider putting the effort to put it in action!
Action: how would this idea fit into my current execution program? Is it time-driven with an expiry date or can it be queued in my execution program? What could be synergies with some other projects I am working on?

And naturally, most of your ideas should fall to the side somewhere along the way – because remember that Focus Means Saying No to most ideas!

What about using this Personal Idea Funnel for your own ideas?

How to Focus on Execution and Still be Open to New Ideas

As an entrepreneur and a creative writer, I steadily encounter the issue of having too many ideas popping up even in the middle of the (painful) execution of a previous idea. The same can be said of business opportunities, which are but a certain version of an idea.

Ideas are cheap until they are executed; and execution is tough – you can’t execute so many ideas simultaneously with the right focus – a focus that is required to be ultimately successful. And time is scarce so you can’t properly execute fully too many ideas in a given timeframe.

One of the issues is of course that during execution, new ideas will necessarily pop up from the work that you can’t just throw away for later. And some more from your life. What can you do? Bloggers and authors suggest several opposed strategies which can be summarized as follows:

Note new ideas for later and ignore them for the time being (so as not to lose focus)
Don’t bother about the sunken costs of what you’ve been doing – if a new idea has much higher merit just go for it, now (in start-up talk, “pivot”!)

I tend to believe that there is value being persistent in the execution of a idea, even if it does not turn out to be as successful as anticipated. The learning from executing an idea until the end is invaluable. At the same time, if a really great idea crosses your life it would be dumb not to go for it – but that should be quite a rare thing.

I thus suggest to go for a middle road: don’t stop executing what you’re doing but still do a basic ‘due diligence’ on your new ideas to evaluate their potential before deciding to go for it or not. In marketing terms, have an idea funnel. But still, do finalize execution on some ideas to get the learning, and limit the number of ideas you pursue at any one time to a handful!

Picture from Julia Sweeten’s blog post Stop Generating New Ideas with is a great glimpse into the struggles of the creator (although the issue might not be to stop generating ideas but how to recognize if a new idea might have more merit and value than the one you’re executing).

Why Organization’s Stability Should Be Used To Enhance External Disruption

Following on our latest post on the increase of the world’s unpredictability, Robert Branche makes also an excellent point that as nature designed living organisms that would dramatically increase the unpredictability of the world, it had to design organisms that were more stable inside. And actually, from plants to animals, to mammals, internal stability has increased dramatically with evolution.

storm and stability — A storm on stability

This is a very interesting contradiction: to enhance the world’s changes, internal stability is required. And this observation actually applies to many situations.

Robert Branche extends this observation to organizations: for him, companies or organizations are a way to build an internal stability to become able to transform the world. “Internal order and rules should not reduce uncertainty, but make its development and acceptance easier” states Robert Branche in the case of large corporations.

Organizations that would implement internal rules for the sake of increasing internal and external certainty are ultimately doomed. Organizations need to develop and nurture internal stability as a way to enhance their disruptive impact on the world.

What a challenge to all established organizations!

How does your organization fare? Is it really defending its stability to make a bigger, more disruptive impact on the world?

Reference is made to Robert Branche‘s latest book “les Radeaux de Feu” (in French). Visit Robert Branche’s blog (in French) for more about the author and his latest book.

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