Thursday, July 09, 2015

The 100-day Corporate get fit plan

I was recently at a rather hellish event listening to a presentation on corporate strategy.  I’ll summarise it for you – “blah, blah, digital, blah, blah, agile, blah, blah, ecosystem, blah, blah innovation, blah, blah, disruption”. 

The folks around me were getting rather excited – “Did you hear that? Agile disruption!  It’s the future” - and I knew these ideas would be inflicted in an ever increasing number of internal PowerPoint meetings. Hell begets many smaller hells it seems.

The problem with words like ecosystem, disruption and innovation is they each refer to multiple things and though they have very precise meanings for specific contexts, relatively few seem to understand this or even the context their companies operate in. Instead we get meme copying, backward causality and the desire to copy others even when it’s not appropriate. “We should be like Uber” sounds exciting but I wouldn’t suggest surge pricing for funeral parlours as a way forward.

Understanding context is key to applying these ideas but such situational awareness is a rarity in corporates. The lack of it causes visible symptoms such as poor communication, misapplication of doctrine (e.g. agile everywhere or six sigma everywhere), massive cost overruns in contracts, silos, duplication, constant reinventing of the wheel and a long list of other undesirable effects.

I did want to write a post on the 61 different forms of strategic play and how to manipulate an economic environment but given the responses I’ve received from the Wardley mapping post, it seems something more basic is needed.

So, I’ve decided to write a hundred day corporate get fit plan for a newly appointed executive. This will help get you into a position from which you can start to learn and talk about strategy.  Obviously, different organisations are at different levels of fitness, so once you’ve completed day 1 then feel free to jump ahead to the appropriate level.

Day 1 – Let us be Honest

Are you a super lean fighting machine or do you just think you are? Let us find out. In table 1 is a simple checklist of things you should have. For reference, I’ve added how often companies seem to believe they have these things.

Table 1 – What you require

Let’s start with the first section, which is purpose. Ideally your company should have a scope i.e. the reason for your organisations existence, the moral imperative that others can rally around and hence the reason why people believe in you. This can often be found as ‘vision’ statements and they are quite common.

Of course, once you have a scope you need to examine how you interact with others and hence you need a list of transactions with others.  For reference, the UK Government has over 750 transactions from paying taxes to a license to bury a relative at sea. For reasons of prioritisation, it’s extremely useful to know what the volume and cost of each of these is. Obviously once you have a list, you can always think of other ways you’d like to interact with others but that’s future stuff. This is a get fit plan, so let us focus on the now and put those future transactions in a notebook for safekeeping. Surprisingly, it’s quite uncommon for a company to have a list of transaction with others.

I use the word transaction very deliberately here because you’re providing something to others that they value. Every transaction therefore has users. NB, there are times when YOU are the user to other companies transactions i.e. your suppliers. Don’t worry about these for the time being, your purpose in life isn’t to make your suppliers happy but rather their purpose should be meeting your needs. If they’re not then maybe you need new suppliers. 

Now by understanding your scope, transactions and users we at least have an idea of your purpose i.e. who your company really is. “We’re the best tea shop in Burmarsh providing tea and scones to members of the public” etc.

Don’t worry if you’re failing already, this is not uncommon. Many companies have a hard time describing their purpose and this is something we will try and fix in the 100 days. To begin with it’s simply important to be honest as to where you are.

We now need to look at the second section covering situational awareness. For each transaction, your users will have needs i.e. a piping hot cup of tea in a friendly and pleasant environment. We simply call this user needs. They will also have wants but that’s future stuff (scribble those in your notebook). 

It really helps to also have the user journey describing the process by which they interact with us e.g. enters building, selects tea and cake, receives tea and cake, pays for items, sits down etc. This helps us in ensuring the journey is simple, meets with the user need and doesn’t have complex and wasteful steps.

Now, each of the user needs will probably require many components to satisfy it e.g. a piping hot cup of tea needs tea, a cup, hot water and someone or something to make it and so on. Of course, those components have their own needs such as hot water needs cold water and a kettle. A kettle of course needs power. So, you can create a chain of needs focused from the visible needs of your users to the invisible components (such as power) that are required to make it happen.  We will call this a value chain on the assumption that meeting the needs of others creates value.

You can now use this value chain to create a map, I won’t go through the details of this as it is covered in the earlier post on Wardley Mapping but these maps enable you to see what is involved (relative position of components) and how those components will evolve (movement). Whether it’s a chessboard or a physical map in a battlefield, position and movement are essential for understanding the context.  For reference, I’ve simply included the map from a TV company in figure 1. 

Figure 1 – A Map of a TV company.


Have you read that post on Wardley Mapping? If not, you really need to do that. It won’t take too long and you’ll find it essential later on. There's no point starting a get fit plan if you're going to skip essential first steps like warming up etc. You'll just cause yourself an injury.

Now, if you have maps we can assume you have some understanding of your scope, your transactions, your users, their needs, the components involved and the context. This is actually very rare in corporations, so well done. If you don’t then don’t worry, we can fix that.

The third section is doctrine.  There are a number of discrete tactics you can use with maps to remove duplication, bias, inappropriate methods and a host of other operational inefficiencies. The scale of bias and duplication in many corporates is quite staggering. To date, the worst example I know of duplication is one large global company that has 380 customised versions of the same ERP system doing exactly the same process. In terms of bias, I’ve seen horrors of customised racks using customised servers in a customised data centre for a company that really doesn’t need to run its own compute. 

I’ll cover how to fix bias and duplication in a later part of this post. Once you have this all sorted (what I refer to as stopping self harm) then you’re in a position to start learning about common economic patterns of change and applying appropriate structure. This is the point at which you not only understand your context but you’re learning from and adapting to it. This is extremely rare in corporations.

Typical symptoms of failure to learn from or adapt to the environment includes bolt on structures (e.g. adding new Chief “something” Officers for every change), meme copying others (i.e. reliance on backward causality), outsourcing failures, lots of duplication including lack of awareness of, and one size fits all methods (e.g. tyranny of agile or six sigma or lean). If this is you then you have problems with your doctrine but this probably extends from little or no understanding of context. This is all quite normal in the corporate world.

The final section is where we start to get into leadership and strategic play. However, for our 100-day plan then I will take us up to the basics of doctrine. Until you get to this point then your only strategy should be “Understand what we do, who for and why and try to do it without breaking the bank”. Everything else is meme copying and could easily cause as much harm as good.

Regarding that table, most companies start failing at transactions, disappear off the cliff at user needs and then bounce back saying “But we have lots of strategy”. That’s surprisingly common.  Let us be honest, what they have are lots of aspirational things that they think are a good idea (probably because they read an article on them) but without any context. Surge pricing for Funeral Parlours, it's the next big thing - see Uber! I’m unlikely to get you to the stage of writing an effective strategy in 100 days, however we should get you closer. So, onto the get fit plan.

Day 2 to Day 20  - Map it!

Ok, the overwhelming chances are that you’re either missing large sections of table 1 or you’re deluding yourself. Don’t panic as you’re in good company.

Now, the first thing we’re going to do is collect information but we’re going to need to create a sense of urgency around this as a forcing function. There’s a reason for the 100 day time limit for the get fit plan because if you don’t get the ball rolling in this time then corporate antibodies will overwhelm you. Yes, the organisation hates change and will resist it even when it is good for itself.

So get your senior management together and point out that you’re lacking basic information and this needs to change quickly. Use table 1 as your guide – “we don’t know our transactions, our users, what’s involved but we’re still writing strategy!” etc. Be reassuring though, just make them aware that change needs to happen and spell out a temporary purpose (you will refine this over time). 

Now, you should add in some spice – sweet and sour. 

The sweet bit is you’re going to create a small team to start collecting this missing data i.e. first identifying what transactions you do, who the users are etc. This same team will also start describing the user journey and mapping the environment. You can also announce that there’s going to be NO CHANGES in terms of budget and existing strategy … we continue as are. Hurrah!

Whilst everyone is breathing a sigh of relief and you’ve diffused any arguments over “extra work” then you introduce the sour bit. Whilst there is no change in budgets you are going to introduce a spend control process for any project or spend over a set figure. Anywhere between £50K and a £1M will do but if you’re large then start with £250K.

Now, this will cause some ructions but you can simply say “Before spending a £250K on something, it just seems a sensible idea to know who the users are, what their needs and the journey is and what components are involved. All I’m asking for is a map. Do we really not know what we’re doing so badly that we can’t spend a few hours quickly mapping it out? It doesn’t have to be a perfect map, no maps are just something we can discuss!”

There’ll be some grumbling. You’ll have to be firm and reassure them that if they can’t map out what they’re doing, you’ll send someone to help them understand what they’re doing. NB, nobody ever takes you up on this offer. Now the spend control process needs to be run by your newly formed team. Their job is simply to collect the maps, help people map and start collecting all the missing data. Make it easy.

Let it run for several weeks and make your team know that you want the entire organisation mapped as fast as possible.

Day 21 to Day 40 – Analyse & challenge.

By now, you should have a pretty clear idea of the transactions that your organisation undertakes and a good few maps. Your team should have started to collate maps together for several purposes. 

First, you ultimately want to create an overall high-level map of the business along with maps of the value chains and maps of components in the value chain where necessary.

Second, you want to generate a common lexicon within the business – a wiki is a useful tool here. You will quickly discover the same thing is described with different terms in different parts of the organisation.

Third, you want to start tackling the duplication and bias that is rife in most organisations. As a rule of thumb, in any decent sized organisation then whenever some group is doing something (e.g. building a marketing system for analysing customer behaviour) then you can normally find five other groups hidden elsewhere in the organisation that are doing the same thing.

NB, when you find lots of duplication then every group tends to have people that argue that their way of doing something is special, unique to them or what we call ‘a snowflake’. In fact, most groups tend to think that their thing is somehow different from the rest of the market i.e. they’re the only group who do mass mailing in this way and it’s what makes us unique! This is what we call bias and whilst in cases it has genuine merit, that is the rarity not the norm.

I tend to find producing an aggregated chart from the maps (see figure 2) to be a useful technique for highlighting duplication and bias. Simply take your maps, identify common points and plot them according to how people have mapped them.

Figure 2 – Aggregated View.

The aggregated view helps you determine the lexicon, the amount of duplication in maps, the level of bias (i.e. custom building that which others consume as a commodity) and how things should be treated i.e. the cluster of common points.

Now, this is the tricky part. You have to start to introduce some challenge to the process. Up until now the spend control process has been about collection but this needs to change. When someone turns up with a map, you need to point out where the components are much more commodity than they realise or where others are building the same thing. You really need to be asking whether this map is reasonable?

To begin with people don’t tend to like to be challenged. You’ll also get bluster such as “I don’t have time for this”, “We have to sign this contract now” etc. You will experience (as I have done) numerous times when someone will be arguing that you need to sign a contract today for £10 million or the world will end. Be prepared to say “no” and to explain that until they produce a map or talk to another group then the project will not proceed. Be prepared for other execs to play power games but stick to the line “If we can’t explain user needs or what we’re actually spending the money on or you can’t be bothered to not duplicate another group’s work then we’re not spending £10 million”. 

The more maps you collect, the more obvious the duplication and bias will become. This can account for huge sums of money. I’ve seen past projects go from £60M to £800K and £1.6M to £96K just by removing duplication and bias. Don’t be shocked to discover levels of waste that exceed 90%+. It’s not you’re making some sort of mistake; it’s just this level of waste exists and very few have gone looking for it in a systematic way. If you clear out the waste, it’ll give you lots of muscle when it comes to strategic gameplay but that’s why this 100 days is all about getting fit.

Also don’t underestimate inertia to change. When you say that someone’s pet custom-built system is best provided as a product or outsourced utility service then expect arguments. There are 16 different forms of inertia (shown in table 2), so be prepared. You’ll get used to them all and learn counter arguments over time. 

Table 2 – Forms of Inertia

Day 41 to Day 60 – Doctrine

In the first 40 days, you’ve been focused on improving situational awareness (i.e. maps) and stopping obvious self-harm (e.g. duplication and bias). You should be collecting more of those maps, building up a lexicon for the business and helping people communicate (maps are great for this) along with challenging what is done and helping overcome inertia. You should start to feel a bit fitter and in control but don’t get ahead of yourself. You’re not ready for strategy and gameplay yet.

What you now need to change is behaviour in the organisation and you do that through understanding. You’re going to start by explaining to the organisation why one size fits all management rarely works. You can do this by taking a map and showing how you need multiple management methods to effectively manage it. As an example, I’ve taken the media company and marked on how to use agile, lean and six-sigma (see figure 3). 

Figure 3 – Appropriate methods for a TV company

Certain parts of the map are suitable for outsourcing and other parts should probably be built in-house. Even the purchasing methods need to change. As a guide, figure 4 provides an idea of where different methods are most appropriate.

Figure 4 – A guide for when to use methods.

It’s important to realise that on the left of your map you want to be focused on reducing the cost of change. This is because components in this area will change as they are uncharted and unexplored. Hence the use of VC based approached, agile (e.g. XP and scrum) and building in-house is appropriate. Experimentation is the name of the game.

As the components evolve (which will happen if supply and demand competition exists) then your focus becomes more on reducing the cost of waste i.e. you have an idea of what is needed and you now need to effectively produce it. Techniques like Lean, MVP (minimal viable product), A/B testing and outcome based approaches are all appropriate. You might still use techniques like Scrum for development but the focus (and the artefacts) will be different. 

As the components evolve further then we’re into volume operations of good enough and our focus must become reducing deviation. Techniques like utility pricing and six-sigma will dominate. This is all about empires of scale, industrialisation and operational efficiency.

What you want to get away from is custom building a commodity in-house or outsourcing something novel and new (which will change because you’re exploring an unknown space) to a fixed price development contract with expensive penalties for change.  So start challenging those maps not only for duplication and bias but also the methods being used and expect some fierce resistance here. People tend to like one size fits all methods and hence there’s a regular outbreak of semi-religious wars over methods. Keep to the line that multiple methods are needed.

In the first days of your new regime, you've probably developed an idea of how much skill your company has and how dependent it is upon others. In many cases, companies lack the skill they need in order to challenge vendors because they’ve outsourced it all or become dependent upon analysts. The maps will also give you an idea what sort of capabilities you require. However, be careful here.

In all probability, you are going to find you’re lacking in one or possibly two skills areas and so you’ll have to bring people in. Don’t try to retrofit people you have unwillingly into these areas. If you’ve mainly got people who are good at ITIL, six sigma & strong contracts then you’re going to need these people for those industrialised components. They are really important to you in the long term and so declaring, “we need agile people” and bringing in outsiders can cause a lot of friction. What you want to avoid is creating a “them and us” situation. Be upfront and clear. Use the maps to show you need additional capabilities to bolster what you have. Explain that all parts of the map are equally important.

It is critically important to understand that you need at least three basic skill areas – those capable of exploring the uncharted space, those capable of turning a poorly worked concept into a viable product and those capable of turning a product into an industrialised component. These are not the same, and after the 100 days we will look to turn these three skill areas into a cell-based structure and start strategic gameplay. Make sure you have all these capabilities to some degree.

It’s also a good idea to start looking into your contracts and have your team mark this up on your map. Ideally, you want small, relevant and focused contracts. It’s worth reading up on FIST principles (USAF, Lt Col Dan Ward) but as an example figure 5 provides a map with how the contract should have been broken up and figure 6 provides how it was.

Figure 5 – A more ideal contract structure.

Figure 6 – A less ideal contract structure.

This map comes from a Government system and the problem with figure 6 is the contract in the middle is too broad. You’ll end up incurring expensive penalties in change control because you’ll be applying a fixed contract to both industrialised components that you can specify in detail along with components that are novel, new and changing and hence can't be specified. Unfortunately, if you only have specification documents and normal box and wire diagrams (business process maps, IT diagrams) then you don’t have a cat’s hell in chance of spotting this problem. Poor contract structure appears to be rife in most organisations.

All this time, you still want to keep building that portfolio of maps, getting people to focus on user needs, improving your lexicon, removing duplication and bias but hopefully by now you should also start applying appropriate methods, balancing the capabilities you need, avoiding the outsource everything pitfall along with using appropriate contract structures. You should notice that your organisation is starting to become more efficient and effective, a bit more fit. Are those abs I can see?

Now, we turn the pressure up.

Day 61 to Day 80 – Flow

This is an important topic but first we need to explain some basic terms related to mapping. These are: -

Position: the position of components simply relates to how things are connected and how visible they are to the user need. The value chain itself is a chain of needs i.e. this needs that etc. At the top of the value chain these needs are exposed as meeting user needs (i.e. customers) and can often be expressed in terms of the customer journey. This doesn't mean the lower components aren't essential but a user who wants a cup of tea doesn't care about the power provider you use to boil the water. They only care about a piping hot cup of tea.

Flow: whenever you look at a value chain then there are often multiple paths within it. These we call flows and along these paths travel such things as information, risk, finance and materials. Sometimes one flow is more viable than another and financial models based upon flow can be developed. Sometimes a flow may be inefficient because it'll have bottlenecks and improvements can be made. There are all sorts of important things to be considered here from inventory to capacity to variability and time. 

Movement: Unfortunately value chains aren't static. They evolve. Fortunately the process of evolution is fairly well defined across activities, practices, data and knowledge and there are many common economic patterns, weak signals and gameplay that can be used to anticipate and manage this. There's however little point in understanding the value chain and managing the flow efficiently if you are treating most of the components as custom built when the market treats them as commodity. You have to accept that everything in your value chain will evolve (i.e. move across the map) and therefore you might be efficiently managing the flow in your value chain but at the same time being ineffective because you're treating components in the wrong way. 

Managing position, movement and flow are essential operational activities but unfortunately many people fail to understand them. Up until now, we’ve looked at position and movement (i.e. the value chain versus evolution) in the guise of a map. To improve we now need to examine flow in those maps.

In figure 7, I’ve taken the TV Company map and marked on two different financial flows (one in dark blue, the other in green). One is for the content provided by Internet broadcasting and the other for content provided by DVDs.

Figure 7 – Flows in the TV Company map.

Now for both of these flows, you can create a separate financial model and then examine the flows to determine whether one path is more profitable than another or whether there are bottlenecks in one or another or both. The same process can be used for fault tree analysis to determine risks (e.g. what is the impact if our web servers are lost?) and for the flow of information and materials.

An alternative way of viewing the flow above is the use of a message sequence diagram. In figure 8, I’ve provided such a diagram for the blue flow with some examples of what you might wish to consider in terms of financial metrics.

Figure 8 – Financial Flow (Blue)

There are alternative ways of viewing these flows e.g. value stream mapping. What’s important to remember is that you have three elements to your map – position, movement and flow. You should not only be making sure you’re effectively treating things (from removing bias and duplication to using the right methods) but also that your value chains are efficiently running. 

Day 81 to Day 100 – Keep it steady

By now you should be motoring in terms of understanding transactions, what users need, improving flow, doctrine and as a consequence you’ll find that mapping helps communication through a common language (Lexicon) and format (Map) across all groups. You’ve been removing bias and duplication. You should have started to balance out the capabilities the organisation needs and even resolved some horror contracts (there’s always a couple). Provide some time to let changes settle in, these are dramatic changes. Keep using those maps, providing challenges through spend control and allow the cycle to improve.

By around Day 100, you should also be able to clearly describe your purpose. You're now ready to start examining structure, mechanisms of learning and the principles of strategic play. You're well on your way to playing the competition game with some finesse. There are at least 61 different forms of gameplay and you’ll use multiple of these when attacking a market. The maps will also help you identify where to attack along with where to gamble. However, for most of you today that is still a long way of … you'll need these 100 days before you’re ready to play.

I do understand how people are tempted to dive into strategy, learning and structure but there is no point until you understand your context and have removed the flab. I know everyone is looking for the "get fit fast pill" for corporations e.g. "Agile Disruption!", "Be Digital!", "APIs ftw!", "SWOT will save the day!" etc but the pill doesn't exist. These are just memes and its potluck or more aptly potbelly luck if they work. You've got to put some effort in before you can be ready to play the games with confidence.

In the next post in the "Get fit" series, I'll cover learning and structure and bring you right to the cusp of strategic play. After that, I'll add a post on strategic play and get back to writing on the 61 different forms of gameplay.

Tuesday, June 23, 2015

Position, Flow and Movement

Given some of the comments on my last post on "Why Agile, Lean and Six Sigma must die" ... I thought I'd take some time to clear up another misunderstanding in the difference between position, flow and movement.

Let us assume you've examined a line of business, starting from the point of user needs and developed a value chain. I'll assume you've also mapped this over evolution. Beyond the obvious of breaking down a system into components and the interfaces between them then there are three things to consider.

Position : the position of components simply relates to how things are connected and how visible they are to the user need. The value chain itself is a chain of needs i.e. this needs that etc. At the top of the value chain these needs are exposed as meeting user needs (i.e. customers) and can often be expressed in terms of the customer journey. This doesn't mean the lower components aren't essential but a user who wants a cup of tea doesn't care about the power provider you use to boil the water. They only care about a piping hot cup of tea.

Flow : whenever you look at a map (an example is provided in figures 1 & 2) then there are multiple flows within the value chain. These flow can cover things such as information, risk, finance and materials. Sometimes one flow is more viable than another and financial models based upon flow can be developed (see figure 3). Sometimes a flow may be inefficient because it'll have bottlenecks and improvements can be made. There's all sorts of important things to be consider from inventory to capacity to variability and time.

Figure 1 - A flow within a value chain (a TV company)

Figure 2 - Another flow within a value chain (a TV company)

Figure 3 - Analysis of a flow.

Movement : Understanding position and flow is a good start but unfortunately value chains aren't static, they evolve. Fortunately the process of evolution is fairly well defined across activities, practices, data and knowledge and there are many common economic patterns, weak signals and gameplay which can be used to anticipate and manage this. There's however little point in understanding the value chain and managing the flow efficiently if you are treating most of the components as custom built when the market treats them as commodity. You have to accept that everything in your value chain will evolve (i.e. move across the map) and therefore you might be efficiently managing the flow in your value chain but at the same time being ineffective because you're treating components in the wrong way.  

Understanding position and flow is critical for efficient provision of an in-situ situation however understanding movement and position is critical for strategic gameplay, anticipation and effectiveness. 

To give an example of this, I'll use the box and wire diagram from the previous post (figure 4). Do remember that box and wire diagrams (IT systems diagrams, Business Process Maps, Value Stream Maps etc) all have their purpose but they only show you connectedness of components (not necessarily even position relative to the user) and can only be used to analyse flow.

Figure 4 - A typical box and wire

Looking at the box and wire above. The questions you need to ask are :-

a) I outsourced B and it was a disaster. Why was it a disaster?
b) Should I outsource A?
c) What components are most directly visible to its consumer?
d) What methods (i.e. doctrine) should I use for each component? Agile, Six Sigma or Lean?

Now, whilst I can't answer these question, I can examine different flows in the box and wire (e.g. the one I've highlighted in blue is C, F, D, A). I can look at it for bottlenecks and mechanisms to improve efficiency and certainly if I have multiple box and wire diagrams then I can look for duplication. But of course, I don't know whether one of those components is representing the visible user need and hence I don't know the travel of flow towards the user unless I add arrows. I also don't know how evolved those components are i.e. if the duplicated components are suitable for provision as platform components?

Exactly the same diagram is provided in figure 5 below but in this case I've added movement represented by an evolution axis. I can now not only examine the flow but answer all the above questions.  I can even anticipate how things will change (I've added some lines for competition effects but in reality all components are likely to be moving).

Figure 5 - A map of the same process

With multiple maps I can remove bias in treatment (people custom building what is a commodity) and find not only duplication but identify those components suitable for provision as a platform.

Furthermore using the above map I can identify where we will have inertia, potential threats from disruption that can be anticipated, co-evolution of practice and even repeatable mechanisms for how I can manipulate the market (i.e. organisational learning). I can determine the appropriate methods both project management and purchasing and even determine appropriate structure. See the previous post for help on some basics or this post for a general introduction to the technique.

Hence with the above map, I can anticipate a future state (figure 6).

Figure 6 - Future State

Hopefully I won't have done the daft thing of outsourcing B but instead I will have moved from using an Agile approach to using Lean to build it (assuming I'm the one building). As for component C, then I'd probably be looking to build that as a utility service for others (ideally with a six sigma style approach) or use some sort of cloud service. With component F then I'd be anticipating to outsource it along with the hopefully already outsourced A.

I still have the same flow C, F, D, A (along with the other flows in the diagram) but the characteristics and the manner in which this flow is provided has evolved. If I'm stuck making the flow efficient using C, F, D all as products (as it used to be) then as efficient as I am, I'm likely to be outcompeted by the market. I can also see from the map that I don't really have anything differentiating me from others, so I'll probably be taking a few gambles to create components that meet others needs built on the components that I already have.

Gamble? Did I say gamble? Yes ... alas with a map, there are some things you can plan but a lot of spaces in which you have to experiment. Remember that evolution axis is determined from ubiquity vs certainty and the uncharted spaces are not only rare ... wait for it ... they're uncertain (see figure 7). Of course, that doesn't mean we can't mark on a map that we suspect something is over there in the uncharted space (a gut feel, an intuition etc). We might even give it a name, we just don't know what it really is yet or even if it'll be successful. Of course, if it is then over time it'll become more defined, it'll become more certain ... you get the picture.

Figure 7 - Plan vs Experiment.

Anyway, the point of this post is rather simple. Position and Flow can only get you so far - even if I've build a customer journey between high level needs. If you really want to learn strategic play and to become efficient and effective then you're going to need to understand Movement (i.e. how things evolve).

Remember ALL maps are imperfect and they are simply communication tools used to describe an environment. They enable collaboration, communication and gameplay but you still have to apply thought. These maps are by no means the ideal way of visualising, they are more like Babylonian clay tablets as opposed to ordinance survey. Mapping business is a field in its infancy but even these are better than no maps.

However, trying to describe an environment based upon position and flow and not allowing for movement prevents you from determining direction and applying any concept of strategic manoeuvring for both yourself and opponents. Unfortunately these box and wire concepts are exactly what most company strategy is built upon normally mixed in with SWOTS, meme copying and other story telling devices.

I cannot emphasise enough how fsck'd your company is if you come up against a player that knows what they're doing when you're trying to use old approaches. I've seen examples of vendors who've taken a beating with Government in the recent past and still haven't clocked why. This is only going to get worse for those companies if they don't adapt, focus on user needs, sell components appropriately and don't try the old "outsource everything" game. I know many departments that are getting better at situational awareness and gameplay. The days of Government being a soft touch are slowly (very slowly) disappearing.

Saturday, June 20, 2015

Why Agile, Lean and Six Sigma must die ...

Every large system (whether a line of business or specific IT project) contains multiple components. Those components have a relationship with each other (known as position) but they're also evolving. 

Every components start as something novel and poorly understood - the uncharted space of the new e.g. the first telephone - and over time through demand and supply competition becomes widespread and well defined or in other words industrialised. The properties of these two extremes are polar opposites. As Salamon & Storey said in 2002, any structure needs to manage both of these polar opposites. Before you shout "Bimodal" or "Two Speed" or "Dual Operating System", there's also the issue of the transition between the two but we've covered that in previous posts.

If you start with user needs, you can map this landscape out in the form of a Wardley Map - named after me! Well, I've been doing this for over a decade now and I did invent the technique, so fair enough. What's interesting with maps is that they not only give you position (the relationship between things) and movement (how things are evolving) which is essential for any form of strategic play but you also find that different techniques and methods (i.e. doctrine) whether it's project management or purchasing are stronger at different parts of the map. None of this is new.

In figure 1, I've provided a map showing the position and movement and how maps can enable you to determine where to attack. In figure 2, I've shown how different methods (including insourcing and outsourcing) can be applied to areas of the map. In figure 3, I've provided a map with different methods applied.

Figure 1 - A Map

Figure 2 - Techniques and Changing Properties

Figure 3 - A map with techniques applied. High Speed Rail

Maps are mainly communication vehicles but they're also useful for organisational learning. However, when it comes to doctrine (e.g. techniques & methods) in IT, let us emphasise the following.

In one part of the map you'll tend you use Agile techniques (with XP or SCRUM) focused on exploring the uncharted and reducing the cost of change. As Michael O. Church points out, agile is best in situations when "dealing with finicky clients who don’t know what they want" i.e. when exploring the uncharted space where no-one knows what is wanted.

Of course, as an act is explored and becomes more widespread and well defined (i.e. we start to understand it) then the focus changes. We start aiming to build a product, sometime in era of custom built examples. Whilst we may continue to use underlying techniques such as XP or SCRUM, our focus is on reducing waste and creating a minimal viable product and improving measurements. Lean rules the waves here.

Of course, as the act continues to evolve becoming more widespread and defined then we're now into the world of volume operations. It's increasingly heading towards commodity and our focus is mass production of good enough which means reducing deviation. At this point, Six Sigma rules the waves.

However, any significant project (as show in figure 3) has components in all these stages. Those components aren't static but evolving and as they become more commodity like they enable rapid development of new higher order systems. But, at any one moment in time, you'll have components at all stages and you will need to use a mix of agile, lean and six sigma throughout the project.

Of course, most companies have no map of their environment and so are forced to plummet for a one size fits all method e.g. all agile, all lean, all six sigma. All of these methods will have their devotees and so regular arguments of agile vs lean, lean vs six sigma, agile vs six sigma break out along with various attempts to create new magic one size fits all methods which combine different stages e.g. lean six sigma or agile lean or prince agile etc. 

This has been going on in one guise or another for a decade now. Suck it up. There's no one size fits all method. [Cue endless rants from agile, lean or six sigma devotees].

You need to use the appropriate methods according to how evolved the component is. Since most companies have no form of maps (i.e. no understanding of position AND movement) or confuse box and wire diagrams (e.g. IT systems diagram, Value Stream maps, Business process maps, Kaplan Strategy Maps - which all have uses) with maps then generally there is no hope of this happening. If you're going to insist on acting blindly and picking a one size fits all method then choose Lean. It's far from ideal but better than focusing on the other extremes.

Personally, I'd learn to map and use all the methods. Personally, I think the idea of being ALL agile, ALL lean or ALL six sigma should die.

I know it won't. A decade of using maps, speaking and writing articles in various publications that point out the need for multiple methods has taught me one thing. In a decade from now, I'll still be hearing people arguing over whether agile, lean, six sigma or some equivalent method is better everywhere. It isn't. It'll never be. Alas, there are two solutions to Ashby's Law of Requisite Variety in management - you either accept the complexity and manage it or you pretend that what is being managed is simple and apply single methods or simple KPIs. The latter tends to rule because the former is hard.

Before I go, some quick notes on the question of strategic thought and mapping. The two most basic properties of a map are position and movement. It doesn't matter whether this is a physical map or a chessboard, they show you where things are and how they can move. More complex maps can include other details. For example in a Wardley map, along with position and movement then you can look at the flow of information, risk and finance in an existing value chain (NB. Value Stream maps also do this but they only show flow within the value chain and not movement i.e. how components will evolve). Without position and movement though, strategic play is guess work.

Hence, look at table 1, print it out and tick off each area that your business knows well or undertakes.

Table 1 - Understanding of the Purpose, Climate, Landscape and Doctrine.

If you haven't ticked off ALL of the first seven steps then any strategy you have is most likely meme copying others. You're running blind and you don't have a hope of understanding where to attack and hence determining why here over there. I strongly suggest you throw away your strategy and replace it with the following ...

Our strategy is to try and understand what we do, for whom, why we do it, what they need and what's involved as efficiently and as effectively as possible without breaking the bank.

... or at worst, don't pay consultants for any future strategy - just click the link here. It'll auto generate you a strategy based upon the common memes around. It's useless but it's free rather than being useless and costing a fortune.

Until you can do the most basic stuff of understanding purpose, landscape (map) and doctrine (methods, techniques etc), there is no point in talking strategy. Anything you'll do is just simply shooting in the dark.

Oh, and to really rub it in, I'm going to emphasise the point about the importance of movement. I've taken a simple process diagram, replaced the terms with letters and provided this glorious BOX and WIRE diagram in figure 4.

Figure 4 - Box and Wire

Now, in the above you can clearly see the relationship between things but I've got four simple questions for you to think about.

a) I outsourced B and it was a disaster. Why was it a disaster?
b) Should I outsource A?
c) What components are most directly visible to its consumer?
d) What methods (i.e. doctrine) should I use for each component? Agile, Six Sigma or Lean?

Can you answer these? I can't. For your interest, in corporations around the world people are trying to manage stuff and answer these questions with diagrams just like the above.

Ok, I've now provided exactly the same diagram in mapping form in figure 5. No additional information was added other than position and movement.

Figure 5 - Map

Now, try answering those questions. If you need help, look at figure 2 above again. It should be trivial.

If you want to know how to organise around this. Start here.
If you're entirely new to mapping then this set of posts should help.

If you're thinking ... "is this mapping the answer!" Let me emphasise that we're roughly at the Babylonian clay tablet stage and not the ordinance survey stage of business mapping. This technique will give you a better map than no map.

Finally ... the only people who can map a business are those that operate in that business i.e. no consultants. The technique is all creative commons share alike, so you've got everything you need to get started.

Wednesday, May 27, 2015

On the impossibility of precognition and whether it's science

Back in the early 1990s, I worked in the field of genetics. Back then we understood the importance of epigenetic effects (i.e. cross generational inheritance of environmental effects or acquired characteristics) but the field was overtaken by a tyranny of the sequence. Why? Well, possibly due to the abundance of vendors selling costly sequencing machines or just an enthusiasm for the sequence. Still, over time we've come to understand the importance of the wider system and epigenetic effects are back with a vengeance.

Despite our pretence of understanding, we understand very little of how the human body works, especially the mind. Most view the brains operations through simply electrical signals however we're discovering all sorts of acoustic propagation or action waves.

I generally try to keep an open mind and not to dismiss things out of hand no matter how unlikely they are unless we have observations that it doesn't happen. Into this mix, I was recently asked whether I thought precognition was possible with reference in particular to the experiments of Dean Radin.

Now, I'll freely admit to having a bias against some of the work but I won't dismiss it out of hand. So let us take Dean Radin's  paper on 'Electrodermal Presentiments of Future Emotions' and precognition in humans, a subject which has garnered some interest of late. The experiment describes how subjects experienced a physical reaction upto 4 seconds in advance of an event happening. Now, naturally we should be highly skeptical of such work but is it impossible given our weak understanding of the human system or could a scenario be imagined where it might be possible?

First, we should have no doubt that any mechanism of precognition - a sense of danger before the danger - carries huge evolutionary advantages. But is such a mechanism even remotely feasible?

Let us invoke a set of proteins that contain part of a entangled pair and a mechanism to transmit and receive information through some form of interference pattern. Let us now assume one of the pair (the transmitter) remains attached to the neuron whilst the other (the receiver) travels around the circulatory system and attaches to the neuron periodically.  With an approximate speed of 0.1 m/s for a period of 20 years, this gives us a time dilation effect of around 2 seconds. Let us assume that at any moment in time that some neurons have both members of these pairs attached (the 'attached pair'). As neurons fire in response to some event, all the normally attached transmitters send a signal to their receiver. In the case of the 'attached pair' the receiver will receive the signal a full 2 seconds before the transmitter sends. The receiver causes the neuron through some other mechanism to activate prior to when the main signal is received. Time travelling information over an entangled pair? Well, maybe.

We can therefore imagine a scenario that enables some of the neurons associated with a response to 'spontaneously fire' prior to the event that triggers that response creating a sense of forewarning. However to do this you'd have to invoke mechanisms of entanglement, mechanisms of transmission / receiving information, time dilation effects and overturn the 'No communication theorem'. To compound the problem, there is absolutely no evidence that such a system exists or even is remotely possible.

Our imaginations can often run wild of what is possible, hence we have the glorious world of science fiction.

That's the problem with such imaginary scenarios, they are easy to construct despite being nonsense. Invoking such a scenario as a possibility would be a ridiculous stretch and there are numerous more likely explanations of the effects reported by Radin and others including error in experimental design, expectation bias, confirmation bias in the observer to statistical error or maybe the 'anticipatory effect' is simply an aberration caused by the brain using 'pre-played' templates.

The question therefore becomes about the quality of the experimental effects. Are there statistically significant results? Is there a rigorous methodology that can be independently tested and reproduced providing consistent results? Is there a reasonable sample size with a strong enough effect or is this statistical noise? As far I'm aware, the answer to all of these is no.

However, I don't agree with simply dismissing precognition as impossible out of hand because you could create conjecture (regardless of how fantastically implausible) on why it might occur. But without evidence that such a system or effect exists, though precognition might not be 'impossible', it firmly remains in the realm of science fiction.

Tuesday, May 26, 2015

What is a map, what isn't?

I was asked recently what makes a map? There are two important aspects of a map [when used for gameplay against competitors or a market, see comment by Alex below] and these are position and movement.

1) Position gives you the relationship between things.
2) Movement shows you how things can change.

Hence when you look at a Chessboard, you can see the position of pieces and where they can move. When you look at a battlefield map, you can see the position of pieces and where they can move. Equally when you look at Wardley Map (see figure 1), you can see the position (i.e. relationship between components in the value chain) and where they can move (i.e. how they can evolve). From this you can determine where to attack etc.

Figure 1 - A Map

What makes a map? Position and movement are fundamental. They provide a means of viewing the landscape and determining direction. Whilst maps are an extremely useful learning tool, they don't give you the answer (for that you apply thought) but instead they show you the landscape.

However, what isn't a map? Anything which doesn't have position and movement isn't a map in my opinion. You do get numerous things called maps but they're normally box and wire diagrams giving relationships between things but no movement (e.g. business process diagram, IT systems diagram) or some form of flow diagram (i.e. flow of things through a value chain, it provides an in-situ examination but has no aspect of movement or change). This doesn't mean they're not useful, they are in their own contexts. Just when it comes to improving situational awareness and strategic play then they are less than ideal.

Thursday, May 21, 2015

The Chief Internet of Things Officer

Back in 2006, I gave a talk at EuroOSCON on Making the Web of Things which covered manufacturing methods from 3D printing to devices connected to services over the internet. I had an interest in this field and the consequences of it in every day life and used to describe its effect through a scenario known as "Any Given Tuesday" which gave a comparison of today's life against the future. I was also involved in a number of side projects (you can't learn unless you get your hands dirty) from a paper book with printed electronics (i.e. turning a paper book into an interactive device) to various animatronic experiments.

For Background (general interest) ...

A background on the combination of physical and digital including future languages e.g. Spimescript is provided here. The presentation from EuroFoo is below.

The scenario for Any Given Tuesday is provided here. There is a slidedeck from 2005 for this and at some point I'll post it, however it's not necessary.

For the interactive book (physical + electronics), then the following video from 2008 gives a good enough description.

You'll also find discussion on the future of books along with various reports of mine (from 2002 to 2006) on 3D printing and techniques behind this e.g.

So, back to today ...

These days we call the Web of Things the Internet of Things. We still haven't invented SpimeScript though some are getting close. We're seeing more interaction in physical devices and the continued growth of 3D printing including hybrid forms of physical and electronics. It's all very exciting ... well, some of it is. I'm a bit of an old hand and so parts of this change (especially endless pontifications by consultants / analysts) tend to send me to sleep - it's a bit like the cloud crowd - some good, some "blah, blah, blah".

However, there's something I do want to point out with this change and why everyone who can should attend the O'Reilly Solid conference

Most organisations are terrible at coping with change. You're not designed to cope. You don't exist in adaptive structures that deal with evolution. You have to bolt on new things as a new structure and somehow muddle through the mess it creates. You're probably doing this now by adding a Chief Digital Officer. You're probably adding on Agile or Lean or even worse yo-yoing from one extreme (e.g. six sigma) to another. You might even have done something daft like organising by dual structure in the "hope" that this fixes you p.s. it won't. Yes, we have extremes but the key is how to organise to include the transition between the extremes.

So, what's this got to do with Solid and IoT.

Well, unfortunately IoT requires a different set of practices (from design to construction), a different set of techniques and a mix of attitude from "pioneer" to "settler". The underlying components might be quite commodity but what is being built with these is often a process of discovery and exploration. Though there are common lessons, there's a very different mindset and value chain relationships to IoT which is built from experience. What I'm saying is Physical + Digital is not the same as Digital.

Now, if you're one of those very lucky organisations that have a strategic CIO then you're ok, they'll adapt and muddle through. If you're not and you've had to bolt on a Chief Digital Officer then you might have a problem. Digital is not the same as IoT and unfortunately I've met quite a few Chief Digital Officers that are about as un-strategic as the CIOs they were mean't to replace. If you've got one of these (and don't be surprised if you do) then you'll going to need a Chief Internet of Things Officer (CITO). As Venture Beat says 'The most important CxO you haven't hired'  and they're spot on, until the next change of this type and the next bolt on.

So, get yourself along to Solid and start scouting. Learn a little about the wonder of the combination of physical & digital and if you're lucky, hire some talent.

Personally, if you want to avoid adding more CxOs then I'd recommend creating an adaptive organisation able to cope with change. But that requires extremely high levels of situational awareness which alone is way beyond most companies. It's also often unnecessary unless you're competing against such adaptive structures (which in the commercial world seems rare). Hence it's usually easier to simply bolt on and deal with some of the conflict that this will create. Cue endless bunfights between CIO vs CDO vs CMO vs CITO and proclamations of death of one over the other.

Of course that means we're going to get endless Chief Internet of Things Officer societies, institutes, awards, proclamations of greatness, the CITO is the new CIO or CDO or whatever along with  blah, blah, blah. That's life.

Tuesday, May 19, 2015

The probable problem with Watson

I like IBM Watson. It seems likely to be a roaring success. But there is a future problem in my opinion.

The issue with such 'reasoning' and interpretive capabilities (unlike machine learning through patterns) is that they are relatively novel and we're still in a mode of discovery. During this time Watson will grow, it will become more refined and IBM will build a successful product and rental business.

However, around 2030 (see figure 1) then such 'intelligent' agents will be on the cusp of industrialisation (the 'war' phase of economic change, the shift from product to commodity). New entrants not encumbered by an existing business will launch a range of highly industrialised services (most likely Amazon - and yes, I see no reason why they won't be around by then, bigger than ever). In the following 10-15 years the previous players all encumbered by existing and successful businesses will be taken out of the game unless they adapt.

Figure 1 - The Wars

This pattern (known as the peace, war and wonder cycle) occurs relentlessly throughout history. Those who develop and build the field rarely reap the rewards of industrialisation. IBM is no different. As has happened to it in the past, IBM tends to develop the field, grow a successful business and then is forced to reinvent itself.

The timeframe today for this process (which is affected by commoditisation of means of communication) is currently around 20-30 years from genesis to point of industrialisation (the onset of war) and 10-15 years for the previous industry to be taken down.

To counter this pattern then you need to have enough situational awareness that you can industrialise yourself before your opponents do. There are two forms of disruption and this type can be anticipated through awareness and weak signals. However such awareness which is created through the use of maps and weak signal detection is rare and normally confined to Government circles.

Mapping of economic landscapes is itself on a journey and is only ten years down the path. It'll be another 10-20 years before maps get to the point of industrialisation in which case businesses built around sharing maps, use of industry maps and changes to the whole field of strategic play may well occur. Those too will take a further 10-15 years to develop.

Unfortunately, at the point IBM will need to industrialise Watson then it will have many of the 16 different forms of inertia to change (including pre-existing business) but in all likelihood it'll lack the situational awareness needed to know when to industrialise. The odds don't appear in its favour here.

If you want a timeline then .... well there isn't one. The future depends upon actors actions, it's an uncertainty barrier we can't see through and you can't pre-determine action but instead only look at possible scenarios.

In one scenario ...

IBM by 2025 should be a very different beast due to the changes in cloud. It'll be a shadow of its former might in infrastructure but still significant in terms of specific application services (e.g. healthcare) and the platform arena of cloud (e.g. Bluemix Cloud Foundry). The idea that IBM built hardware will become a fading memory. The building of an ecosystem around Watson will help it to grow and evolve and you should have no doubt that IBM will create a successful product and rental business in this space. This is why I've said that you shouldn't count them out. However the problem with IBM is its constant reinvention. It's a great company but it fails to learn the game and tends to get industrialised out of a space. It might like to view this as exiting a commoditising space but those commoditising spaces (e.g. cloud) can and do provide huge ecosystem advantages.  

The industrialisation of the intelligent agent space will kick in (around 2030), started by a player like Amazon. In the first instance IBM will dismiss the new approaches. By 8-10 years (2040) then the new player services will be less than 3% of the market. By 2045, they will be 50%+. The game will be over.

Watson will have created new glory but it will now be in decline as industrialised forms take over. Watson is also likely to have sapped strength from the platform effort whilst building inertia to its own industrialisation. IBM will be facing a new crisis of reinvention against much larger and much deadlier foes. It won't be the case of the giant IBM being taken on and losing to the minnow of Amazon ($125 Bn vs $15 Bn, as it was in 2006) but instead the minnow of IBM losing a core revenue stream to the giant of Amazon.

Of course, the future depends upon actors actions and it doesn't have to be like this. 

In another scenario, IBM could play this game to its favour but to do so it would need to capture those industrialised spaces and play fragmentation games against competitors. It will need to exploit constraints and the platform play has to be at the heart of this. To achieve this, it should already be working on how to industrialise Watson into a commodity service. This is more than just providing a rental service but looking at how to use Watson to create that industrialised future. It should be building upon competitors services and using this to cut them out of data flows and diminish their ability to sense the future. This a tough road to travel because success with products and rental services will constantly provide data against making such a move.

So which way will it go?

Alas, the incentive just isn't there for long term play with most commercial companies. Many of us will retire and some of us will have died through old age before this game plays out. However, if we could travel in time then I'd suspect we will see a new group of IBM execs facing a future of reinventing IBM as another pillar gets taken away. Of course, every now and then, you get someone who can play the game to its advantage - a Jeff Bezos, a Tim Cook etc. Every now and then, even companies get lucky.

However, the one thing I've learned after 25 years in business is that companies are singularly bad at long term gameplay and constantly get taken out by changes that can be anticipated and defended against. The only thing I know of which is worse than long term company gameplay is my ability to bet correctly on individual actors' actions. 

That said, if I was a betting man (and no, I'm not) then I'd plummet for a cup of tea on 2040-2045 as when IBM finally expires. For me Watson is not only its future but its doom. Of course, I could be wrong ... I frequently am.

Friday, May 15, 2015

On 61 different forms of gameplay

Over the next year, through a series of 61 posts, I'm going to go through in some detail various forms of gameplay that can be used when you have a map of a business environment

I need to emphasise Sun Tzu's five factors in competition - purpose, climate, landscape, leadership and doctrine - however unfortunately most ignore climate & landscape (a bit like trying to use Boyd's OODA loop but ignoring the observe & orientate bit). The problem with this is that whilst the game plays can help you manipulate the landscape, if you can't see the environment then they can be downright dangerous. It's always a good idea to look where you're shooting before you fire the rifle.

In normal circumstances, you will use your map with multiple of these game plays in concert. Of course, you'll need to have used your map to determine your direction of travel and where you wish to attack first. This is often an iterative process itself known as scenario planning.

The complete set of plays that I'll be covering are provided in figure 1. NB, I've shaded the plays according to how 'evil' or 'good' they are using AD&D terminology. I've provided some basic summary descriptions below and as I post the details then I'll add links to make it easy to navigate.

Figure 1 - The plays.

Basic Operations
These forms are about improving the organisation itself.
  • Focus on user needs
    A key aspect of mapping is to focus the organisation on user needs rather than internal needs. Often this process enables unmet needs (opportunities) to be discovered and friction to be removed from the process of dealing with customers.
  • Situational Awareness
    The act of mapping tends to remove alignment issues between business, IT and other groups by providing a common language. It enables the development of a common purpose and empowers groups to take advantage of their part of the map whilst understanding the whole.
  • Effective & Efficient
    Removal of bias and duplication within an organisation along with the use of appropriate methods for management and purchasing. Do not underestimate the potential savings possible, cost reductions of 90-95% are not uncommon.
  • Structure & Culture
    Implementation of cell based & PST structures along with multiple cultures to deal with aptitude and attitude. Both autonomy and mastery can be enabled by these forms of structure and they avoid the silos and inertia created by traditional structures.
  • Optimising Flow
    Risk, performance, information and financial flow can be analysed and improved through mapping. This is necessary for increasing margin, removing friction and increasing speed.
  • Channel Conflict
    Exploiting new channels and conflict within existing channels to create favourable terms.

User Perception
These forms are about influencing the end user view of the world.
  • Education
    Overcoming user inertia to a change through education. There are 16 different forms of inertia and many can be overcome directly with education. Don't underestimate this.
  • Bundling
    Hiding a disadvantageous change by bundling the change with other needs.
  • Creating artificial needs
    Creating and elevating an artificial need through marketing and behavioural influence. Take a rock and make it a pet etc.
  • Confusion of Choice
    Preventing users from making rational decisions by overwhelming them with choice.
  • FUD
    Creating fear, uncertainty and doubt over a change in order to slow it down.
  • Artificial competition
    Creating two competing bodies to become the focus of competition and in effect driving oxygen out of a market.
  • Lobbying
    Persuading Government of a favourable position.

These enable you to accelerate the process of evolution.
  • Market Enablement
    Encouraging the development of competition in a market
  • Open Approaches
    Encouraging competition through open source, open data, open APIs, open processes by removing barriers to adoption and encouraging a focus for competition.
  • Exploiting Network Effects
    Techniques which increases the marginal value of something with increased number of users.
  • Co-operation
    Working with others. Sounds easy, actually it's not.
  • Industrial Policy
    Government investment in a field.

These enable you to slow down the process of evolution
  • Exploiting existing constraints
    Finding a constraint and reinforcing it through supply or demand manipulation.
  • Patents & IPR
    Preventing competitors from developing a space including ring fencing a competitor.
  • Creating constraints
    Supply chain manipulation with a view of creating a new constraint where none existed.
  • Limitation of competition
    Through regulatory or other means including erecting barriers to prevent or limit competitors.

Dealing with toxicity
Elements of your value chain will be irrelevant with evolution over time, there's numerous ways of dealing with this especially as the inertia created can become toxic.
  • Disposal of liability
    Overcoming the internal inertia to disposal. Your own organisation is likely to fight you even when you're trying to get rid of the toxic.
  • Sweat & Dump
    Exploiting a 3rd party to take over operating the toxic asset whilst you prepare to remove yourself.
  • Pig in a poke
    Creating a situation where others believe the toxic asset has long term value and disposing of it through sale before the toxicity reveals itself.

Standard ways of playing in the market
  • Differentiation
    Creating a visible difference through user needs.
  • Pricing policy
    Exploiting supply and demand effects including price elasticity, Jevons paradox and constraints including fragmentation plays.
  • Exploiting buyer / supplier power
    Creating a position of strength for yourself.
  • Harvesting
    Allowing others to develop upon your offerings and harvesting those that are successful. Techniques for ensuring harvesting creates positive signals rather than creating an environment others avoid.
  • Standards game
    Driving a market to a standard to create a cost of transition for others or remove the ability of others to differentiate.
  • Signal distortion
    Exploiting commonly used signals in the market by manipulation of analysts to create a perception of change.

Standard ways of protecting your market position
  • Threat acquisition
    Buying up those companies that may threaten your market.
  • Raising barriers to entry
    Increasing expectations within a market for a range of user needs to be met in order to prevent others entering the market.
  • Procrastination
    Do nothing and allowing competition to drive a system to a more evolved form.
  • Defensive regulation
    Using Government's to create protection for your market and slow down competitors.

Standard ways of attacking a market change
  • Directed investment
    VC approach to a specific or identified future change.
  • Experimentation
    Use of specialists groups, hackdays and other mechanisms of experimentation.
  • Creating centres of gravity
    Creating a focus of talent to encourage a market focus on your organisation.
  • Undermining barriers to entry
    Identifying a barrier to entry into a market and reducing it to encourage competition.
  • Fool's mate
    Using a constraint to force industrialisation of a higher order system.

Using others to help achieve your goals.
  • Alliances
    Working with other companies to drive evolution of a specific activity, practice or data set.
  • Co-creation
    Working with end users to drive evolution of a specific activity, practice or data set.
  • Sensing Engines (ILC)
    Using consumption data to detect future success.
  • Tower and Moat
    Dominating a future position and prevent future competitors from creating any differential.
  • Two factor
    Bringing together consumers and producers and exploiting the relationship between them.
  • Co-opting
    Copying competitors move and undermining any ecosystem advantage by interrupting data flows.
  • Embrace & Extend
    Capturing an existing ecosystem.

Dealing with the opposition if you can't work with them
  • Tech Drops
    Creating a 'follow me' situation and dropping large technology changes onto the market.
  • Fragmentation
    Exploiting pricing effects, constraints and co-opting to fragment a competitor's market.
  • Reinforcing inertia
    Identifying inertia within a competitor and forcing market changes that reinforce this.
  • Sapping
    Opening up multiple fronts on a competitor to weaken their ability to react.
  • Misdirection
    Sending false signals to competitors or future competitors including investment focused on the wrong direction.
  • Restriction
    Limiting a competitors ability to adapt.
  • Talent Raid
    Removing core talent from a competitor either directly or indirectly.

General forms of playing with the future market
  • Land grab
    Identifying and position a company to capture a future market space.
  • First mover
    Exploiting first mover advantage especially with industrialisation to component services.
  • Fast follower
    Exploiting fast follower advantage into uncharted spaces.
  • Weak Signal
    Use of common economic patterns to identify where and when to attack.

General forms of preventing others playing with the future market. If you can't capture then poison it.
  • Licensing
    Use of licensing to prevent future competitor moves.
  • Insertion
    Either through talent or misdirection, encouraging false moves in a competitor.
  • Design to fail
    Removing potential future threats by poisoning a market space before anyone attempts to establish it.

As mentioned above, the techniques are normally used in combination plays e.g. you might be a first mover to industrialise a specific component and use this to establish an ILC type ecosystem whilst exploiting competitors' inertia and misdirecting any would be threats.

These are not the full list of plays but the ones that I think it's reasonable I can cover over a period of one year. There are some other plays but I'll leave that to a future date.

Again, I cannot emphasise the importance of situational awareness before using some of these plays. It is trivially easy to create a disaster e.g. being a first mover to try and build an ILC ecosystem around a relatively novel activity and harvesting aggressively. This will just end up destroying your ability to create an ecosystem leaving you with a bad reputation in a field which might at a later date become suitable for the same sort of play. Some of the plays are also downright evil, so be warned. Understand the environment, learn to play the game and build with experience.