Quotes From Whispers Under Ground, Broken Homes, and Foxglove Summer

Written by Sean Murphy. Posted in Books, skmurphy

Some quotes from “Whispers Under Ground“, “Broken Homes“, and “Foxglove Summer.” They are the third, fourth, and fifth novels in Ben Aaronovitch’s “Rivers of London” series of novels about Peter Grant, a London Police Constable and apprentice magician.

I bought these three on the strength of his first book  I had the feeling that Aaronovitch succumbed to “Game of Thrones” disease–not greyscale but “literary elephantiasis”–where he is afraid to bring anything to a conclusion because his series has become so popular–and profitable.

Rivers of London by Ben Aaronovitch

Written by Sean Murphy. Posted in Books, skmurphy

Rivers Of London CoverRivers of London by Ben Aaronovitch infuses magic into the police procedural. The narrator is Peter Grant, a young London Metropolitan Police Constable newly apprenticed to a wizard. It’s a strangely compelling read that I could not put down until I finished it.

The novel is deeply rooted in the day to day realities of policing modern London and offers humor and a number of twists. Because the narrator is only an apprentice magician he understands some of the hows for performing magic but little of the why so he is conducting three investigations in parallel: the first is to understand not just the surface skills needed for magic but the real mechanisms for spooky action at a distance, the second is to find a way to resolve a dispute between a number of powerful river spirits, and the third is to uncover the real culprit behind a series of assaults and murders.

Webinar Replay: Innovator’s DNA Series Overview

Written by Sean Murphy. Posted in 1 Idea Stage, Books, Customer Development, Video

Steve Hogan and Sean Murphy walk through a five part webinar series on “The Innovator’s DNA” by Jeff Dyer, Hal Gregersen,and Clayton Christensen. Sean thinks it’s the best book on innovation and entrepreneurship for 2011 and useful for any team that is trying to innovate. Each webinar will be in a roundtable format and include first time entrepreneurs and experienced innovators discussing lessons learned applying the five key discovery skills described in the book.

Don’t Give Your Investor Pitch To Customers, They Have Different Questions

Written by Sean Murphy. Posted in 1 Idea Stage, 2 Open for Business Stage, 3 Early Customer Stage, Books, skmurphy

Q: Can you please take a look at this pitch. I have created it as a promo for investors and potential users.

Selling your offering to customers and selling your business to investors requires two different presentations They have fundamentally different questions they need answered before they “buy.”

Customers want to understand how your product will meet their needs. Investors want to know how much their investment will return and why: they may want to understand your customer presentation but only if you cannot offer strong evidence of traction: revenue, signups, etc…They are always interested in what you have learned and what you plan to learn: what hypothesis you need to test using their money.

In B2B markets early business customers may be interested in your investment pitch if they believe you will need investment to be viable but that is rarely the case in a consumer market.

One of the best guides to constructing an investment pitch is “Pitching Hacks” by the Venture Hacks team. Here is there explanation for what needs to go into your elevator pitch:

The major components of an elevator pitch are traction, product, team, and social proof. And investors care about traction over everything else. A story without traction is a work of fiction.

Traction is a measure of your product’s engagement with its market, a.k.a. product/market fit. In order of importance, it is demonstrated through:

  • profit
  • revenue
  • customers
  • pilot customers
  • non-paying users
  • verified hypotheses about customer problems.

And their rates of change.

Pitching Hacks is a slim 83 page book that packs a lot of insight. Many longer books have a good 4-5 page magazine article trapped inside, this book has already been boiled to the essentials.  Definitely worth $20 if you are wiling to follow at least one of the many pieces of advice in the book.

Quotes For Entrepreneurs–July 2013

Written by Sean Murphy. Posted in Books, Quotes, skmurphy

You can follow @skmurphy to get these hot off the mojo wire or wait until these quotes for entrepreneurs are collected in a blog post at the end of each month. Enter your E-mail address if you would like have new blog posts sent to you.

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“There is no distance on this Earth as far away as yesterday.”
Robert Nathan

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“Talent hits a target no one else can hit; genius hits a target no one else can see.”
Arthur Schopenhauer

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“The shrewd guess, the fertile hypothesis, the courageous leap to a tentative conclusion–these are the most valuable coin of the thinker at work. But in most schools guessing is heavily penalized and is associated somehow with laziness.”
Jerome S. Bruner

I used this as the closing quote for “Early Markets Offer Fluid Opportunities

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“Good design successfully manages the tensions between user needs, technology feasibility, and business viability.”
Tim Brown

From an interview in “Imagine Design Create

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“The secret to success is constancy of purpose”
Benjamin Disraeli

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“The right way to build a company is to experiment in lots of small ways, so that you have plenty of room to make mistakes and change strategies.”
Vinod Khosla quoted in “What Does Vinod Khosla Know About Web 2.0 That Others Don’t?” (2005)

Used as closing quote in “Making Our Business More Credible in 2006

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“A reputation for good judgment, for fair dealing, for truth, and for rectitude, is itself a fortune.”
Henry Ward Beecher

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“Don’t save the canary. Fix the coal mine.”
Seth Godin in “Canaries and Coal Mines

This is not the best line in the blog post, it’s “My own little Potemkin Village” which highlights Godin’s insight into the perils of celebrity.

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“Innovation is fostered by information gathered from new connections; from insights gained by journeys into other disciplines or places; from active, collegial networks and fluid, open boundaries. Innovation arises from ongoing circles of exchange, where information is not just accumulated or stored, but created. Knowledge is generated anew from connections that weren’t there before.”
Margaret J. Wheatley

h/t Valeria Maltoni
Used as closing quote in “Byron Wien’s Lessons Learned in 80 Years: Seven for Entrepreneurs.”

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“Before you can score you must have a goal.”
Greek proverb

Used as the title for “Before you can score you must have a goal.

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The days you work are the best days.
Georgia O’Keeffe

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“Nothing happens to you that has not happened to someone else.”
William Feather

I really liked William Feather’s 1949 book, “The Business of Life.” It’s a collection of short notes, letters, newspaper columns magazine articles. Very insightful, and something like reading a blog from the 1930?s and 40?s. I used it as the basis for four blog posts:

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“If you were were really crushing it,
you’d be too busy crushing it
to tell people how much you’re crushing it.”
Griffin Caprio (@gcaprio)

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“I like breakfast-time better than any other moment in the day,” said Mr. Irwine. “No dust has settled on one’s mind then, and it presents a clear mirror to the rays of things”.
George Eliot in Adam Bede (1859)

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“When you struggle to reach for something you don’t know, that’s where most of the interesting stuff is.”
Herbie Hancock

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“Expect nothing. Live frugally on surprise.”
Alice Walker

Added as part of a July 2013 postscript to “Good Fortune.

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“Look around. Find the stories that are the ones that one day, you’re going to wish somebody had told sooner. Tell them.
Scott Rosenberg (@scottros)  in Missed stories: About that Horace Mann School article in the Times

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“That’s the scary thing about hope, if you let it go too long it turns into faith.”
Christopher Moore in “Coyote Blue

Used as the closing quote for “Christopher Moore’s Coyote Blue.”

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“Sometimes when you start losing detail, whether it’s in music or in life, something as small as failing to be polite, you start to lose substance.”
Benny Goodman

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“To select well among old things is almost equal to inventing new ones.”
Nicolas Charles Joseph Trublet

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“What is the quality of your intent? Certain people have a way of saying things that shake us to the core. Even when the words do not seem harsh or offensive, the impact is shattering. What we could be experiencing is the intent behind the words.”
Thurgood Marshall

Used as the opening quote for “Advising Entrepreneurs

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“It is too late now for earlier ways;
now there are only some other ways,
and only one way to find them–fail.”
William Stafford excerpt from “Level Light”

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“The point of a notebook is to jumpstart the mind.”
John Gregory Dunne

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“One startup’s earlyvangelist is another enterprise’s intrapreneur.”
Sean Murphy

It’s taken me a while to recognize this duality. I think “change agent” is an equally useful term for intrapreneur.

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“There is a difference between knowing a thing and understanding it.
You can know a lot about something and not really understand it.”
Charles Kettering

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“I try to do the right thing at the right time. They may be just little things, but they usually make the difference between winning and losing.”
Kareem Abdul-Jabbar

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“Marry for love, stay married, and raise happy children who are quick to laugh and slow to judge.”
Christopher Moore in “Coyote Blue

Great advice. I used this quote in “Christopher Moore’s Coyote Blue.”

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“True deception goes unnoticed.”
Les Coleman

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“‘Fortune favors the bold,’ but only if they are playing a game they thoroughly know.”
Lois Grafe

I think Grafe adds a useful qualification to Virgil‘s “Fortune favors the bold.” (line 284 of Book 10 of the Aeneid: “Audentes fortuna juvat.”)

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The need to be right all the time is the biggest bar to new ideas.”
Edward de Bono

h/t Jabe Bloom (@cyetain)

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“Try to be one on whom nothing is lost.”
Henry James

From his essay “The Art of Fiction” James advises:

The power to guess the unseen from the seen, to trace the implication of things, to judge the whole piece by the pattern, the condition of feeling life in general so completely that you are well on your way to knowing any particular corner of it–this cluster of gifts may almost be said to constitute experience. […]I should certainly say to a novice, “Write from experience and experience only” […] and “Try to be one of those people on whom nothing is lost.”

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Christopher Moore’s Coyote Blue

Written by Sean Murphy. Posted in Books, skmurphy

Christopher Moore’s Coyote BlueChristopher Moore’s novel “Coyote Blue.” is full of personal observations and asides that I found very applicable to the entrepreneurial roller coaster.

In his author’s note he writes:

Do you ever get the feeling that forces unseen are messing with your life? Yeah, me too. And there is little doubt that those forces are driven by the greatest force in the universe — irony, right? Right?

So imagine my surprise when, some years ago, while I was researching a book on demons, I kept running across references to tricksters, and one trickster in particular, the trickster god Coyote. I thought, Heres a god whose main function seems to be acting as an agent of irony — the special prosecutor of Murphy’s Law, if you will. And, I figured, if ever there was a time during which the god of irony seemed to be testing his powers that time would be now.

What entrepreneur has not been at least indicted by the “special prosecutor for Murphy’s Law?”

Here are a few excerpts

“When everything is right with you, but you are so worried that something might go wrong that it ruins your balance, then you are Coyote Blue.”

Those of us with a firm grasp of contingencies are familiar with the uneasy feeling that “things are going too well, I must have overlooked something.” Startups are often well served by having at least one member of the team with this attitude, although–like cayenne pepper or wasabe–a pinch or two is often enough to season an elephant’s worth of stew.

“There are those who, deprived of physical beauty, develop a sincerity and beauty of spirit that seems to eclipse their appearance. They marry for love, stay married, and raise happy children who are quick to laugh and slow to judge.”

Good advice for many technical entrepreneurs and–in hindsight–my plan of record as well.

“Before the television arrived Samson did not know he was poor. Now he spent every evening piled in the front room with his family watching people he did not know do things he did not understand in places he could not fathom, while the commercials told him he could be just like those people.”

I gave up my television a few years ago and was surprised at how much more time that I had. Last month I spent two days in bed in a room with a television and after I finished the book I had brought with me, “No Way In” by Richard Fernandez, I spent an hour or two getting re-acquainted with how Samson feels in this passage. Many firms appear to be hard at work to port this same experience to the web. More’s the pity.

“The ostentation of the casinos did not create a desire for money; it made money meaningless. There were no mortgages in a casino, no children needing food, no car needing repairs, no work, no time, no day, no night; those things–the context of money–were someplace else. A place where people returned before they realized that a turd rolled in rhinestones is a turd nonetheless.”

Other web firms are hard at work to bring this experience to the web. Please apply your talents to another problem.

“He followed the signs down the surface streets lined with pawnshops, convenience stores, and low-slung cinder-block buildings under neon signs that proclaimed, CASH FOR YOUR CAR, CHECKS CASHED HERE, MARRIAGES AND DIVORCES–TWENTY-FOUR-HOUR DRIVE-THRU WINDOW.

Coyote said, “What are these places?”

Sam tried to think of a quick explanation, but was too weary from lack of sleep to tackle the concept of Las Vegas in twenty-five words or less. Finally he said, “These are places where you go if you want to fuck up your life and you don’t have a lot of time to do it in.”

“Are we going to stop?”

“No, I seem to be fucking up at a fine rate of speed, thank you.”

Bootstrappers often feel this conflicted when they  think about reaching out to a venture capital firm.

“That’s the scary thing about hope, if you let it go too long it turns into faith.”

In the end making the leap to an entrepreneurial venture is hope that persists into a leap to faith.

Summer Reading for 2013: Applying Ecosystem Models To Business

Written by Sean Murphy. Posted in Books, skmurphy

Unlocking the World of Knowledge If you are looking for some good books on how to apply ecosystem models (systems thinking informed by biological metaphors) to your business here are three good choices to take on vacation.


Photo credit: Unlocking the World of Knowledge by Max Murphy

Two Excerpts from Walter Bagehot’s “Physics and Politics”

Written by Sean Murphy. Posted in Books, skmurphy

From the opening paragraph of the first chapter “The Preliminary Age” of Walter Bagehot‘s “Physics and Politics

One peculiarity of this age is the sudden acquisition of much physical knowledge. There is scarcely a department of science or art which is the same, or at all the same, as it was fifty years ago. A new world of inventions—of railways and of telegraphs—has grown up around us which we cannot help seeing; a new world of ideas is in the air and affects us, though we do not see it.

Writing in 1872 Bagehot sees a rapid transformation of the arts and sciences by new transport and communications technologies. I think too often we think of the Internet, or the integrated circuit as the kickoff for accelerating progress. But writing 140 years ago Bagehot witnessed the changes that the telegraph (e.g. first telegram had sent by transatlantic cable in 1858)  and the steam engine had wrought.

From the last paragraph of the second chapter “The Use of Conflict”

The military habit makes man think far too much of definite action, and far too little of brooding meditation. Life is not a set campaign, but an irregular work, and the main forces in it are not overt resolutions, but latent and half-involuntary promptings. The mistake of military ethics is to exaggerate the conception of discipline, and so to present the moral force of the will in a barer form than it ever ought to take. Military morals can direct the axe to cut down the tree, but it knows nothing of the quiet force by which the forest grows.

As entrepreneurs we value self-discipline (if only in the ability to chart our own course), fast decision making, and bold action. But, as Bagehot argues, there is also value in thoughtful reflection, quiet exploration and experimentation, and slower but more deliberate decision making.

It’s an interesting book that traces the need for a robust military to enable any society–especially an early or primitive society–to survive against the depredations of neighboring societies. But Bagehot is clear on the need for cooperation and collaboration for any one individual to survive much less thrive. An excerpt from the final chapter “Verifiable Progress Politically Considered”

The progress of MAN requires the co—operation of MEN for its development. That which any one man or any one family could invent for themselves is obviously exceedingly limited. And even if this were not true, isolated progress could never be traced. The rudest sort of cooperative society, the lowest tribe and the feeblest government, is so much stronger than isolated man, that isolated man (if he ever existed in any shape which could be called man), might very easily have ceased to exist. The first principle of the subject is that man can only progress in ‘co-operative groups;’ I might say tribes and nations, but I use the less common word because few people would at once see that tribes and nations ARE co-operative groups, and that it is their being so which makes their value; that unless you can make a strong co-operative bond, your society will be conquered and killed out by some other society which has such a bond; and the second principle is that the members of such a group should be similar enough to one another to co-operate easily and readily together.

Amar Bhide: Start With Affordable Bets in Markets Too Small to Interest Large Players

Written by Sean Murphy. Posted in Books, skmurphy

Four quotes from Amar Bhide‘s “Origin and Evolution of New Business.

“Entrepreneurs who undertake uncertain initiatives face a wide spread between desirable and undesirable outcomes, but they cannot quantify the odds they face or even fully anticipate the possible results. The uncertainty is irreducible to the degree it cannot be resolved without actually undertaking the initiative by prior testing and research.”

Testing and research can reduce the ambiguity  and uncertainty associated with the entering new markets but they cannot eliminate it. A few hours on Google can save you a few months pursuing an opportunity that a little more research might have indicated was a non-starter but even there I think you are still well served by a dozen conversations with people who have direct knowledge of the problem: there is an important category of information that has not been written down (yet) and cannot be found in Mr. Google’s basement.

If you attack a large and well established market there is much less uncertainty but there will be established competitors.

“Serving niche markets not only allows entrepreneurs to start a business with limited funds, it also limits the competition they face from well capitalized entities. Established corporations and professional venture capital funds expend considerable resources on evaluating and monitoring their investments. They tend to avoid investments in niche opportunities whose profit potential isn’t large enough to cover their fixed evaluation and monitoring costs. Therefore, the  bootstrapped entrepreneur in a niche market faces direct competition mainly from other undercapitalized businesses.”

But larger well capitalized firms normally avoid ambiguous markets because they can earn more certain returns in established markets and they are less deterred by the idea of competing with other large firms.

Ambiguity is known to be missing information or not knowing relevant information that could be known.

The key ambiguity to resolve is to develop a model for the impact of your product on your prospect’s business–the costs you are imposing and the value of the benefits that you are delivering–as a way of fine tuning your feature set, messaging, and business model. You may need a slightly different one for each niche or customer segment you are considering. This gets updated the more you learn in exploring the market. This approach is “outside in” where customer reality drives your decisions.

One way to choose a new market is to pick a space that has not changed in a while. It’s more likely that you can learn something that the incumbents have either ignored or decided not to pursue because it would conflict with a currently successful business model.

Promising startups cluster in market niches characterized by high uncertainty generated by technological, regulatory, or other such exogenous changes or by the amorphous nature of customer wants. High uncertainty and low capital and opportunity costs create a “heads-I-win-tails-I-don’t-lost-much” proposition for entrepreneurs.

This is a second approach, to look for markets likely to be impacted by new technology, new regulation, or changes in the zeitgeist.  By making small bets you can risk little but potentially find a significant opportunity.

Related posts

Kurt Lewin on Insight

Written by Sean Murphy. Posted in Books

I came across a great essay on insight,  “Behavior and development as a function of the total situation (1946)”, written by Kurt Lewin in a collection of his papers published as “Resolving Social Conflict & Field Theory in Social Science.”  Here are some excerpts and commentary:

Insight can always be viewed as a change in the cognitive structure of the situation. It frequently include differentiating and restructuring in the sense of separating certain regions which have been connected and connecting regions that have been connected.

Entrepreneurs rely on insights for new products, new markets, new customers, and new business models because insights re-arrange our understanding of how things work and enable them to see new possibilities and previously unappreciated connections. Insights obsolete some old understandings and enable new ones. Because they are often sudden and preceded by a feeling of being trapped, stuck, or confused their arrival is hard to predict.

I think the net effect of an insight is to lengthen your time horizon and improve your morale. Sometimes insights show a shorter path, but often they show a path where you couldn’t see one before, even it’s a long way around. Insights can be acted upon immediately but this new course of action may take some time to have an effect.

Becoming emotional frequently leads to a narrowing-down of the psychologically existing area. A state of strong emotionality should, therefore, be detrimental to finding solutions. A distance sufficient to permit a survey of the larger situation helps in the solution of intellectual problems.

When you are feeling stuck, forcing yourself to zoom out, to breathe deeply and relax, to drift a little, can help to lower the psychological and emotional stress you may be placing yourself under. For the most part entrepreneurs don’t have to manage physical stress (e.g. submerging yourself in an bathtub full of ice water) but do need to manage psychological stress, which is the bodies’ involuntary reaction to the way that a situation is perceived. If you can reframe your perception, you indirectly impact reactions that are not under conscious control.

Being in an unknown surrounding is equivalent to being in a region which is  unstructured in the double sense that neither the quality nor the subparts of the present region, nor the immediately neighboring regions, are  determined.

I think this can also be experience as the sensation of being lost, or in the dark, or trapped.

Orientation is the structurization of the unstructured region.

Although John Boyd does not reference Kurt Lewin in his description of the Orientation process of the OODA Loop, I think Lewin’s description neatly summarizes what happens between observation and decision.

An unstructured region usually has the same effect as an impassable obstacle. Being in unstructured surroundings leads to uncertainty of behavior because it is not clear whether a certain action will lead to or away from the goal. It is undetermined whether the neighboring regions are dangerous or friendly.

I think an unstructured region is equivalent to what Snowden is referring to when he talks about chaotic regions in his cynefin model. The only way to proceed is to explore and experiment, where exploration may take the form of careful observation, talking with other people who may have relevant experience, being explicit about the questions that you need to answer to frame the “known unknowns”, and to take the time reflect periodically on what you have learned.

In another essay in the book “Action Research and Minority Problems” he defines action research as “a spiral of steps, each of which is composed of a circle of planning, action and fact-finding about the result of action.” This is also a good model for how to proceed when you don’t have a good mental model for your current situation.

Three Great Books on Generating Innovative Business Ideas

Written by Sean Murphy. Posted in 1 Idea Stage, Books

These three books contain a wealth of useful suggestions for generating innovative business ideas from observing, questioning, and networking with customers and others:

  • The Innovator’s DNA” by Christensen, Dyer, and Gregerson outlines a set of five skills that innovator’s use to develop entrepreneurial ideas: questioning, observing, networking, experimenting, and associating. They offer a number of suggestions for how to cultivate these skills. But even their formulation assumes a fair amount of iteration as candidate ideas are developed, tested, recombined to create novel value.
  • Customer Visits” by Edward McQuarrie goes into extensive detail about techniques and strategies for interviewing business customers not only to refine existing offerings but to identify new product opportunities.
  • Innovation and Entrepreneurship” by Peter Drucker suggests that you develop innovative business ideas by searching for changes that have already occurred but where the full effects have not been felt.  In particular in “Innovation and Entrepreneurship” he lists seven sources for innovative ideas in decreasing order of importance:
    • The Unexpected (e.g. unexpected success or failure of an existing product or service)
    • The Incongruous
    • Weak Link In Existing Process
    • Industry Or Market Structure Change
    • Demographics: Size, Age Structure
    • New Zeitgeist: Perception, Mood, Meaning
    • New Knowledge

Related Posts on Developing Innovative Business Ideas

I Am Reading “The Wide Lens” by Ron Adner

Written by Sean Murphy. Posted in Books, skmurphy

I am reading “The Wide Lens” by Ron Adner for a second time this year. It’s that good and in my opinion the best book of 2012 for entrepreneurs. I would encourage you to pick up a copy and read it.

The book draws it title from the need for entrepreneurs to broaden their planning beyond a narrow focus on execution (“what does it take to deliver the right innovation on time, to spec, and beat the competition”) to include an understanding of

  • Co-innovation: Who else need to innovate for your innovation to matter.
  • Adoption Chain: Who else needs to adopt your innovation before the end customer sees the full value proposition.

Adner outlines three broad phases for the development and delivery of innovative products:

  1. Seeing the Ecosystem: which requires you to identify both co-innovation and adoption chain risks.
  2. Mapping the Ecosystem: which requires that you map the value blueprint (the activities that must take place outside of your firm for value to be created for your customer) and understand if you would have first mover advantage.
  3. Reconfiguring the Ecosystem: consider what existing elements can separated, combined, relocated, or subtracted and what new element can be added. Develop a plan for the evolution of your new ecosystem that comprehends:
    1. Minimum Viable Footprint (MVF): the smallest configuration of elements that can be brought together to create unique commercial value. Note that this differs from an MVP in that it includes co-innovation and adoption chain needs.
    2. Staged Expansion: the order to add elements to the MVF so that each new element benefits from the system already in place and increases the value creation potential for the next element planned.
    3. Ecosystem Carryover: can you leverage elements from a current ecosystem to enable the construction of a new ecosystem.

We are firming up plans to do several webinars in the Book Club for Business Impact series on it this Fall. Please let me know if you would like to take part in one.

De Tocqueville on Concept of “Self-Interest Rightly Understood”

Written by Sean Murphy. Posted in Books, Rules of Thumb

Excerpts from Alexis De Tocqueville‘s “Democracy in America” Volume 2, Section 2, Chapter 8 “How the Americans Combat Individualism by the Principle of Self-Interest Rightly Understood.

“In the United States hardly anybody talks of the beauty of virtue, but they maintain that virtue is useful and prove it every day. The American moralists do not profess that men ought to sacrifice themselves for their fellow creatures because it is noble to make such sacrifices, but they boldly aver that such sacrifices are as necessary to him who imposes them upon himself as to him for whose sake they are made.”

We exist in a web of relationships with membership in overlapping but distinct communities. As entrepreneurs we can be seen as agents of chaos by the status quo but our aim is innovation that leaves society on balance better off.

“They have found out that, in their country and their age, man is brought home to himself by an irresistible force; and, losing all hope of stopping that force, they turn all their thoughts to the direction of it. They therefore do not deny that every man may follow his own interest, but they endeavor to prove that it is the interest of every man to be virtuous. I shall not here enter into the reasons they allege, which would divert me from my subject; suffice it to say that they have convinced their fellow countrymen.”

Of course we have to make a profit for our businesses to continue, but there are other gains that come from entrepreneurship beyond the financial that lead us to invest in our employees education, to invest in our communities and to “leave a little money on the table” when dealing with partners and suppliers in the interest of good will and future relationships.

Montaigne said long ago: “Were I not to follow the straight road for its straightness, I should follow it for having found by experience that in the end it is commonly the happiest and most useful track.” The doctrine of interest rightly understood is not then new, but among the Americans of our time it finds universal acceptance; it has become popular there; you may trace it at the bottom of all their actions, you will remark it in all they say. It is as often asserted by the poor man as by the rich.

Business is situated in community and a social context: a good reputation as fair dealer committed to the values of the community, as evidenced by actual kindness and charity will create more value in the long run than treating every transaction as the last one you will ever do with the other party.

The principle of self-interest rightly understood produces no great acts of self-sacrifice, but it suggests daily small acts of self-denial. By itself it cannot suffice to make a man virtuous; but it disciplines a number of persons in habits of regularity, temperance, moderation, foresight, self- command; and if it does not lead men straight to virtue by the will, it gradually draws them in that direction by their habits. If the principle of interest rightly understood were to sway the whole moral world, extraordinary virtues would doubtless be more rare; but I think that gross depravity would then also be less common. The principle of interest rightly understood perhaps prevents men from rising far above the level of mankind, but a great number of other men, who were falling far below it, are caught and restrained by it. Observe some few individuals, they are lowered by it; survey mankind, they are raised.

You meet people who have a clear understanding of their own needs and seem to spend no time on anything else. But the deals that they make seem to based only on fear and threat. To create real opportunities in your own business requires that you explore and understand the needs and aspirations of your current and potential customers. To bring them ideas that will improve their lives and businesses requires that they trust you have their interests at heart when they talk about current problems that may expose their weaknesses and shortcomings.

I do not think, on the whole, that there is more selfishness among us than in America; the only difference is that there it is enlightened, here it is not. Each American knows when to sacrifice some of his private interests to save the rest; we want to save everything, and often we lose it all. Everybody I see about me seems bent on teaching his contemporaries, by precept and example, that what is useful is never wrong Will nobody undertake to make them understand how what is right may be useful?

I want to live in communities where people help one another. Where kindness is the norm. Not a kindness based on weakness or supplication, but one where people are strong and have the foresight to be kind. Communities of those who understand when it is more  valuable to forego an advantage instead of pressing it (to paraphrase Disraeli).

“…it remains to be seen how each man will understand his personal interest. […] I do not think that the system of self-interest as it is professed in America is in all its parts self- evident, but it contains a great number of truths so evident that men, if they are only educated, cannot fail to see them.

I worry there is too much focus in Silicon Valley on making a killing and “moving to another lifetime” But this is a teenager’s fantasy of getting away from home. Marriage and child rearing are not easy, much harder in many ways than doing a startup. But creating a decent workplace that provides a good living for your employees and value for your customers is easier when you are situated in a long term relationship and a family.

All “Democracy in America” quotes are from translation available at “American Studies at University of Virginia

Related blog posts

“Next to knowing when to seize an opportunity, the most important thing in life is to know when to forego an advantage.”
Benjamin Disraeli

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