Jun 21, 2023 | Governance, Strategy
Commercial success, that which delivers more than a wage, comes from only two places:
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- Critical thinking
- The ability and willingness to be a bit different, experiment and embrace risk.
Why is it then that the web is full of ‘7 point plans to….’ Templates designed to remove the need to think, and assuring us that if we follow the plan, all will be well.
I have been as guilty as most, reducing some of what I publish on this blog to lists of sequential actions. This sort of headline increases readership of a post significantly, people want packaged solutions that promise an answer to a complex problem but removes the need to think.
I have been as seduced as anyone by the vanity of page views.
The important part of any plan, from the most complex to the mundane list of what you must do today is that it is the result of critical thought.
What is important vs urgent?
Is this the best use of that absolutely finite resource: Your time?
How will this impact on those around me?
General Eisenhower made the observation that ‘plans are worthless, but planning is everything‘. Eisenhower further noted that emergencies were unexpected, and therefore planning for them was impossible.
Noted philosopher Michael Tyson’s contribution is perhaps the best known “everyone has a plan until they get hit in the mouth”.
Besides, without a plan, and associated goals, how will you ever know how you are performing?
The act of planning should be an act of critical and creative thinking, not filling in a formulaic set of generic questions.
Header credit: Scott Adams with an early question from Dilbert.
Jun 15, 2023 | Change, Governance, Strategy
There is no way around the fact that AI is now with us, and evolving at logarithmic rates. The unanswered question is ‘so what?
There are two extreme schools of thought, and everything in between.
On one hand we have those who are extremely wary:
# It will replace jobs, creating an unemployed under-class
# It will take away peoples rights to privacy, choice, and freedom, creating risk from baddies
# The buggars will take over, we become the slaves of some dystopian thinking ‘terminator’ machines.
On the other hand, there are those who see:
# Huge commercial and community benefits from the automation and efficiency AI brings
# Every platform change in the last 200 years from coal to electricity, horses to cars, vacuum tubes to integrated circuits, PC networks to the cloud, all delivering huge benefit. Why not again?
# The risks are manageable, and less than the benefits that will flow, besides, it is now an unstoppable force, so choices are limited.
Let’s first have some context.
We have been idolising AI from our earliest times, seeking assistance, advice and guidance from all manner of sources. The beguilingly named Ada Lovelace, daughter of Lord Byron wrote what is seen as the first ‘software’ for the Babbage machine in around 1840, with Babbage taking the credit. In 1943 the first paper that associated the neural networks in our brains to electrical circuits was published. In 1950, 73 years ago, Alan Turing wrote a paper called ‘Computing machinery and Intelligence’ which posed the ‘Turing test’. This remains the central question of AI: ‘When can machines think?
The term AI emerged from a 1956 workshop held at Dartmouth College, seen as the birth of modern AI. It kicked off research work in many corners of the scientific world. Google, Microsoft, Amazon, Apple, scientists, and many startups such as Deep Mind, now part of Google, and OpenAI the designer of Chat and Dall-E, significantly funded by Microsoft, have been working on this since the 90’s. The ‘T’ in ChatGPT stands for ‘Transform’ a patented technology breakthrough by Google.
This long scientific road led to an inflection point last November when OpenAI let Chat GPT out into the wild to see what would happen, and take the strategic ‘first mover’ advantage.
What AI is: the application of maths and software code that ‘teach’ computers to synthesise information and generate output. It is controlled by people, although even the scientists are not always sure of what goes on inside the black box of software.
What AI is not: Killer software and robots that spring to life and take over by killing and/or subjugating people.
How does it work? Statistics and probability, combined with huge computing power.
The probability of a ‘u’ following a ‘q’ in English is very high, the probability of that q being followed by any other letter is very low. The probability of that ‘u’ being followed by an ‘e’ is higher than it being followed by a ‘z’. And so it goes, letter by letter, word by word, progressively taking on the context in which those letters, words, sets of words, and sentences are reflected, such that the difference between a ‘party’ in the sense of a happy event, versus a ‘party’ in the political sense is clear.
Having sorted all that out, what are the things we should be thinking about?
- AI as an augmenter. A tool that can assist us to outcomes that are smarter, quicker, and more comprehensive than we might have reached on our own. The role of humans will not be eliminated, but it will be changed.
- AI as a broker. AI stands between us, and an outcome we may not know how to reach, but can be facilitated by AI. You want to write some code, now you do not have to be a coding whizz, AI can do it for you quickly, and with reasonable levels of success.
- AI as a magnifier. Every kid can have an IA tutor, every doctor an AI coach, every scientist an AI collaborator, this will lead to potential productivity growth, scientific breakthroughs, creative boundaries being busted, reduce death in wars. The downside is also magnified, there is always a flip side to be managed.
- Should we be concerned with ‘Synthetic Empathy’? we humans are social animals, what impact will this accelerating trend to isolation from physical contact and interaction have on our collective psyche?
- Blue Vs White collar displacement. Every platform change in our economies over the last 250 years have displaced blue collar workers, in favour of white collar so called ‘knowledge workers’. This one is different, it is the white collar knowledge workers, those who shuffle stuff around who are in the gun. There is no AI/robotics that can replace Albert the plumber, or Steve the sparkie. AI will change the support mechanisms they use, but will not change the simple act of fixing the leak in your bathroom or installing that extra powerpoint in the kitchen..
- Regulation. How can, and indeed should, we regulate, somehow. It is remarkably difficult to regulate something that does not exist. We have failed to regulate social media, despite with the benefit of hindsight, recognising the damage it can do. Compared to AI, regulating Social media would be easy, and we have failed to get that done. The problem is how do we go about crafting regulations that do anything at all beyond catching silly stuff, when it is in the outliers, and things we do not see other than with hindsight, that the real danger hides.
To answer the question posed in the header, it is my view that AI is an enormous avalanche of technical, cultural and digital change. We need to either get with the program, or get out of the way. If it is the latter, you will be consigning yourself to irrelevance.
This is not to imply it is all good.
AI does not have goals, it is not alive, it is just your toaster on steroids, so you can control it. AI is a tool, like any other, which can be used for good and bad, but indifference will lead to whacking your thumb with the hammer. The other thing about tools is that over time, they build equality and productivity.
However, the potential downsides are huge, the opportunity for evil have never been greater, but as the avalanche will not be stopped, you have to be in front of it to see and prepare for the pitfalls before you trip over them and are consumed.
Suck it up and enjoy the benefits!
Header cartoon credit: XKCD comic from the scary mind of Randall Munroe
Jun 7, 2023 | Marketing, Small business, Strategy
Standard marketing advice in this day of homogeneity, and certainly my advice for SME’s, is to ‘find a niche and own it’.
Be the only one that competes in a market niche that you define.
The deeper, darker and more remote the niche the better, because when you get engagement there, you will be alone, you alone will be able to address the needs of those few who inhabit the niche with you.
Kevin Kelly’s now famous quip from his 2008 essay: ‘to be successful you do not need millions of followers, you need only a thousand true fans’ remains as accurate today as it was then.
A true fan is one who will buy anything you produce, they will drive 200kms to see you in a bookstore signing, then buy a bunch of signed books to give away to friends.
The challenge of course is to find those true fans, or more accurately, create the circumstances where they find you, and move through the now standard journey of Awareness, Knowledge, Liking, Preference, Conviction, and Purchase, to Advocacy.
Marketing plays a role in each step of the journey, but the starting point must be ‘macro’. If you start at the niche end of the cycle, too few will be able to find you. There needs to be a filtering process from the macro to the micro for there to be sufficient opportunity for those in the niche who may become true fans to find you in the first place.
It also pays to consider the paradox: There may be a niche in the market, but is there a market in the niche? For you as an SME, the niche may be ideal, but too small for a larger competitor to bother with, or even see.
,Niches can be global, local, and everything in between. To some they represent a ‘Blue Ocean’, a market without competitors. The question now is whether there is a market in the niche, wherever it hides, that will generate an ROI on the resources you allocate towards owning it.
May 24, 2023 | Change, Innovation, Strategy
Dr. Geoffrey Hinton, often labelled ‘the Godfather of AI’ left his ‘home’ at Google so he could ‘freely share his concern that AI could cause the world serious harm’.
The idea of AI is not new. Philosophers and mathematicians through the ages have been speculating and writing about things we would now count as part of the foundations of AI.
Jonathan Swift gave the Lilliputians ‘the Engine’, Thomas Bayes built his probability framework that is still used every day, and Nicola Tesla built a radio-controlled boat for the 1898 New York exhibition controlled by what he called, ‘a borrowed mind’, and the first paper that recognised the potential neural symmetry with our own brains was publsiesh in 1943.
Alan Turing proposed what became known as ‘The Turing Test’ in 1950. This generated a surge of activity, culminating in three academics hosting a workshop at Dartmouth College in 1956. This workshop is now seen as the ‘kick-off’ of AI research, much as the Solvay conference in 1927 was the catalyst to the nuclear research that led to ‘the bomb’ in 1945.
From that workshop, great minds have been busily stuffing the AI equivalent of Pandora’s Box until Pandora, in the form of Open Ai’s ChatGPT opened it in November 2022, and let the whirlwind rip.
As in the fable of Pandora, one of the most enduring of the ancient Greek allegories, once the box was opened, despite all efforts, there was no stuffing the evils back in the box. Luckily, Pandora had also been created with beauty, intelligence, and tellingly, curiosity, which led to her opening the box.
This is as it is with AI.
There is the evil we all see, centred on the rapid destruction of the status quo in all corners of our commercial, private, and public lives. The beauty may be harder to see in the short term, but will become obvious in the longer term, after all, the last thing to escape Pandora’s box was ‘hope’.
If nothing else, it will be exciting, and for some, the source of significant new leverage that can lead anywhere.
Header credit: Dall-E with the instruction: ‘Create a painting of Pandora opening the box allowing the evils to escape, in the style of the ancient Greeks’
May 15, 2023 | Governance, Strategy
‘Occam’s Razor’ is the idea that as you progressively eliminate possibilities, what you have left must be the truth, no matter how unlikely it may seem. Some might call it ‘first principles’.
While Occam’s Razor goes back to William of Occam, the 14th century philosopher, there is a recent iteration.
Occam’s broom.
A molecular biologist by the name of Sidney Brenner introduced that addition to describe the brushing of inconvenient truths under the carpet.
Last Thursday night at a ‘workshop’ hosted by a voluntary group, ‘Re-Invent Australia‘ both were on display.
The strategic objective of Re-Invent Australia might be summarised in the words of the great Peter Drucker: “Ideas are cheap and abundant, what is of value is the effective placement of those ideas into situations that develop into action.”
The task set was to identify the major causes of failure of Australian political governance under the headline five general areas nominated from a wide field by the committee: Education, health, innovation, diversity, and aged care, which need immediate attention.
The second, and to my mind even more important part of the exercise is the question: ‘How would we change them’?
The eternal strategic ‘What and How’ questions.
The objective was not to host another gabfest, but to motivate action that might generate results from which we could all learn.
We have just seen a federal budget. ‘Back in the black’ briefly, for the first time since 2007. If ever there was a time for a federal government to seriously address some of the big and growing structural inequities in the economy, it is now. This is where Occam’s broom came in for some extensive use.
First term government, first (sort of) budget, an opposition in total disarray and incapable of tying its own shoes, and it goes soft on anything that might prove combative with vested interests.
In short, they squibbed it based on the expected noisy backlash, rather than taking the once in a generation opportunity to address those structural challenges we all see.
The agreement of the fossil fuel industry to the barely apparent uptick in the PRRT shows how much harder the government could have gone, minimal changes to a taxation system no longer fit for purpose, the ‘palm-off’ of any discussion about the scheduled income tax cuts, or little genuine analysis of the long term causes of the housing shortage with concrete actions and timetables, and so on.
Vanilla.
The politically difficult reality is that if we want to change the infrastructure of the economy to better reflect the country we want to live in, and the world we wish to be a part of, we will need to take some challenging decisions. Many of these will prove to be unpopular with varying noisy and often cashed up segments of the economy, who will not stop at anything to protect their immediate narrow interests.
We cannot afford any longer to exercise Occam’s broom and sweep them under the carpet.
That is what government should be for, exposing and acting on the failures of the market, to shape the future of the country our children and grandchildren will inherit, not guarantee yourself access to commonwealth cars for the next 3 years.
May 3, 2023 | Marketing, Strategy
Every person on the planet has a frame through which they view the world, built on their life experience, education, background and interests. Unconsciously we all bring these biases into the process of planning our businesses.
If you ask an accountant how to best address the climate crisis, they will give you a response that has an accounting and numeric base, ask the same question of an ecologist, economist, entomologist, or marketer, and you will get different answers, informed by their own unconscious biases.
So, how do we filter them out of our planning, which almost all of the time focusses on the opportunity, the impact of our innovation?
Business planning while having a place for risk assessment, always in my experience lends it far less weight than the opportunity.
In order to ‘de-bias the plan, ask yourself three questions, the first of which is strategist Roger Martin’s claimed most important question:
- What would have to be true? This forces you to consider the drivers of success in the situation being addressed in the plan.
- What future event could sink the plan?
- What would help us if the plan does sink: i.e., what is plan B that avoids commercial demolition?
Anticipating competitive action and planning to accommodate the impact is a necessary part of every plan. This is perhaps the most common failure amongst marketing plans I have seen, including my own.
A long time ago I was with Cerebos, one of the brands I managed was Cerola muesli, at that time a successful brand, and I was keen to expand the brand footprint. I saw a gap in the market between muesli and corn flakes. This was 40 years ago, and there was not the wide choice we have now. We developed a halfway product we called ‘Cerola Light and Crunchy.’ I wrote a marketing plan that had as its first step a test market in Adelaide.
In that plan, well thought out and detailed as it was, I failed to sufficiently consider any of the three questions.
At first, we did remarkably well. The logic we employed was well accepted, the retailer sell-in easily achieved targets, and consumer off-take was strong after the initial burst of advertising. Then in came Kellogg’s with a look-a-like product, ‘Just Right,’ and their resources just blew us away. Light &Crunchy never had a chance in the face of the weight of the competitive reaction by Kellogg’s, and we retreated, recognising the reality that we simply did not have what it took to poke a bear and expect to get away unscathed.
I never made that mistake again, and the only consolation I have is that ‘Just Right’ has survived and prospered, so at least my marketing logic was sound.
I do not agree with the conclusion in the header cartoon that you should roll over and play dead in the face of bear-like opposition. However, it is true that if you poke a bear, you had better do it in such a way that you have some sort of advantage that they cannot replicate.
Header cartoon credit: Tom Fishburne at marketoonist
