Saul Kaplan: Our Obsession With Scalability Must End

photo-saulWelcome to the era of business model proliferation.

Our obsession with scalability is getting in the way of unleashing the potential of the 21stcentury. We are so fixated with scalability we have taken our eye off of delivering value at every scale including the most important scale of one. The Industrial Era did that to us. Reaching the mass market takes precedence over delivering value to each customer. New customer acquisition trumps delivering value to existing customers. It’s not only business that is obsessed with scale. Our obsession with scaling a national education, health care, and government system has also taken our eye off of delivering value to each student, patient, and citizen. We have been talking about the idea of mass customization for years while we continue to hang on to business models that were designed for scale more than for delivering customer value.

The Industrial Era brought us the reign of the predominant business model. Every industry quickly became dominated by one business model that defined the rules, roles, and practices for all competitors and stakeholders. We became a nation of share takers clamoring to replicate industry best practices to gain or protect every precious market share point. Companies moved up or down industry leadership rankings based on their ability to compete for market share. Business schools minted CEOs who became share-taking clones of one another. It was all about scale. Bigger was always better. So what if the predominant business model doesn’t serve everyone’s needs? So what if it doesn’t even serve existing customers well? Scalability and share taking became about protecting the predominant business model by preventing the emergence of new business models. Incumbents do everything in their power to erect regulatory and legal moats to keep new business models out of the market.

You know the scalability frenzy is out of control when iconic entrepreneur, Facebook founder Mark Zuckerberg, proclaims;

“For us, products don’t get interesting to turn into businesses until they have about one billion users.”

No wonder entrepreneurs are obsessed with scalability. Everyone wants to be the next Mark Zuckerberg. Entrepreneurs always fall into the scalability trap of trying to imagine what it will take for a model to reach large numbers of customers before they have demonstrated that they can create, deliver, and capture value for only a few. Over many years of mentoring entrepreneurs I have observed them, particularly tech entrepreneurs, spend too much sweat equity and startup capital focused on developing code and a beta version of a web platform before they have a clear value proposition and a testable business model concept that can withstand initial customer contact.

Serial entrepreneur and Y Combinator co-founder Paul Graham says it well:

“As long as you can find just one user who really needs something and can act on that need, you’ve got a toehold in making something people want, and that’s as much as any startup needs initially.”

I always advise entrepreneurs to take a minimum viable business model to the market before thinking about scalability. Start by uncovering the job someone is trying to do, figure out how you can get the job done better, and demonstrate it.  Entrepreneurs skip this step at their own peril. Develop a business model prototype and test it with a few people.  If the business model prototype works, then and only then, start working on what it will take to scale it to reach more customers. It takes successful entrepreneurs three, four, sometimes five tries to get a business model right. Why worry about scalability until you land on one that works for the customer? Focusing on scale too early leads to too many elegant solutions too far removed from real customer contact resulting in too many dead ends.

Institutional leaders are even more obsessed with scalability than entrepreneurs. They fixate on protecting their current scale and assess all new customer value creating ideas through the lens of their current business model.  If opportunities to create customer value in new ways are distracting to the organization or would cannibalize current business they’re routinely dismissed.  The questions asked and metrics applied to evaluate new opportunities are more about scalability and fit, than about creating new customer value. The baseline for evaluation is the current business model. Market making opportunities are routinely screened out or ignored for more predictable share taking opportunities to increase scale.  This is why CEO’s are so hungry for merger and acquisition opportunities. It’s all about scale, not changing the customer value equation.  New business models force institutional leaders to rethink scalability.

We live in an era that screams for less share taking and more market making. Market makers don’t accept the idea that a predominant business model has to dictate the industry landscape.  They create a new market with a different playbook. We have access to more enabling technology than we humans and the stubborn institutions we live and work in know how to absorb. Today, it’s possible to unleash an infinite number of exciting business models to create, deliver, and capture customer value. Today’s consumers refuse to accept that there is only one predominant business model in every industry and that they have to take or leave its offerings.  Consumers now demand personalized experiences, products, and services.

Consumers are bringing the era of the predominant business model to an end. Business models don’t last as long as they used to. Predominant business models are crumbling all around us. The new strategic imperative for all institutional leaders is R&D for business models as a core competency.  It was easier to be a CEO in a world constrained by a predominant business model. In a world defined by business model proliferation CEOs have the trickier task of both pedaling the bicycle of today’s business model while leading the exploration for a steady flow of new business models.  If they don’t there is a market maker out there who will.

It’s time end our obsession with scalability. There are too many consumer, student, patient, and citizen needs left unmet by predominant business models in every industry. There are too many new business model concepts stuck on white boards and in consulting decks.  We are still allowing predominant business models to slow down and block the emergence of new business models that can better meet our needs.  It’s time to move from the era of the predominant business model to the era of business model proliferation. Let a thousand business models bloom.

John Y’s Musings from the Middle: Facebook Fever Break?

jyb_musingsFor the first time I just had the urge to post something on Facebook –but resisted doing it. Because —and this is so weird for me to type — because it seemed “silly.” I can’t recall that ever happening to me. Ever!

I don’t know what this means …but I fear it means something. That something unusual is happening to me. Something pivotal. Like that first deep raspy cough you notice before pnuemonia sets it. Or like the feeling when a fever breaks and you know you are going to be okay.

I feel like this disinclination to post something absurd and pointless on Facebook may well be the first “deep cough” or “fever break,” so to speak, indicating the beginning of the end of my mid-life crisis.

I mean, of course it is true that the trajectory of a mid-life crisis can’t go up and up forever. At some.point it has to decline and resolve itself. After all, the “crisis” part of the term “mid-life crisis” suggests a downward spiral. So, you kmow, one more reason the upward trajectory thing can’t go on forever.

If this is true I am going to start acting more maturely in all kinds of ordinary situations. People won’t recognize me and others will wonder if I died or moved out of the country or was buried alive by someone who had to spend a lot of time around me.

Others may wonder if I am finally starting to grow up and act my own age. And if this “grown-up acting thing” really takes hold of me, still others may simply conclude that I have come down with pnuemonia. Or that my fever has finally broken.

I don’t know what I will do with myself.

Or maybe this means I am going to start really getting into Instagram?

Julie Rath: 3 Mistakes You Are Making Everyday — And How to Fix Them

People often ask me – usually at parties – if I walk around every day critiquing peoples’ outfits. While I can turn my critical eye on and off, and I certainly never go up to anyone and give them my opinion unsolicited, there are certain mistakes that I see consistently. If you’re someone who cares about how he looks (and I assume if you’re reading this article, you are), read on for three common errors and how to easily nip them in the bud.

Black-Ralph-Lauren-Double-M
1) Loafers with your suit – I get it. Traveling in lace-ups is no fun. Try a monkstrap instead, like the pair above. You can slip in and out of them, and they work with a suit.

Men's Style: How Pants Should Fit2) Wearing pants that are too big in the waist – If your belt loops are pulling up when you tighten your belt like in the picture above, it means the waist on your pants is too big, and you run the risk of having diaper butt. Go down a size and your pants and belt won’t work against each other.

Men's Style Advice: Boots
3) Mismatching themes – I often see guys in preppy polo shirts or khakis wearing things that are edgy in feel (like a biker jacket or boots) elsewhere in their outfit. It doesn’t work. If one piece in your outfit is preppy or conservative, the whole look should be such. Likewise, if one piece in your outfit has an edge to it, the rest of your outfit should too. For example, you wouldn’t wear a rough and tumble boot like the one above with a pair of traditional khakis. A pair of dark jeans or slim dark dress pants would suit them much better.

Have you ever made any of these mistakes? Fess up! I’d love to hear where things have gone awry for you. Leave me a comment below, and perhaps I can offer some additional solutions.

-Content provided by Rath & Co. Men’s Style Consulting. Read more: http://rathandco.com/2014/09/3-style-mistakes-youre-making-everyday-and-how-to-fix-them/#ixzz3KJh7Zx00

John Y’s Musings from the Middle: In praise of Goldilocks and the Golden Mean

jyb_musingsThis holiday season be Goldilocks-esque and seek that desireable middle point between two extremes.

Don’t eat too much nor eat too little.

Don’t talk too much nor talk too little

Don’t expect too much of yourself but don’t expect too little.

Don’t expect too much of others but don’t expect too little of them either.

Don’t sleep too much but don’t sleep too little.

Don’t buy too much but don’t buy too little.

Don’t feel too much but be sure to not feel too little.

Don’t think too much nor think too little.

Don’t act too old but don’t act too young.

Don’t love too mucb but be sure not to love too litle.

Don’t eat anything too hot and don’t eat anything too cold. Only eat things at the temperature that is “just right.”

Make sure your bed isn’t too soft or too hard –but “just right”

And don’t try to be too good but don’t be too bad either. Strive instesd to be “just right.”

Josh Bowen: Got Protein?

joshNutrition is polarizing. Nutrition is not black and white. Nutrition can not and never should be the same for everyone. These statements are the reason we have so many diet books, nutritional questions and a population of people that have analysis by paralysis on trying to eat “healthy.”

As I have written before, not all proteins are created equal. Some contain more essential amino acids than others. To keep from rehashing old material click on the link above to read about the differences in proteins.

The biggest question I get is “How much protein should I take in?” This is a great question and one that has been researched for the past 50 years. The results may be slightly different but the one fact that stays the same is “it depends on your activity and level of intensity.” Meaning in order to know how much you should take in, you need to align your intake with your activity and how vigorous that activity is.

In a normal untrained person, the recommended protein intake is 0.8 grams per kilogram of body weight (or 0.36 grams per pound of body weight). This recommendation is for sedentary people and only is a bare minimum to keep from protein degradation or the burning of muscle as fuel. In this example a 150 lbs person would take in 54 grams of protein per day. Obviously not enough to build muscle tissue.

For individuals participating in high intensity training, protein needs to go up to 1.4-2.0 g/kg (or around 0.64-0.9 g/lb) of body mass. In our 150 lbs example, this person would need to take in 95-135 grams of protein per day. A much more ideal percentage of protein.

Hold up there is more…

Beyond the basics of preventing deficiency and ensuring a baseline of protein synthesis, we may need even more protein in our diets for optimal functioning, including good immune function, metabolism, satiety, weight management and performance. In other words, we need a small amount of protein to survive, but we need a lot more to thrive.

We can only store so much protein at one time.So in order to optimally supply your body with much needed protein, you must eat it periodically throughout the day. Eating a 16 oz. steak and calling it a day, is not going to give you the overall effects that eating 5-6 servings of high protein foods will.

Can you eat too much protein? Possibly, but it would be hard. Protein can be converted to sugar and stored. However, it is an inefficient process and not one the body wants to undergo. Studies have shown that a high amount of protein intake (up to 1.2 grams per lb) has no health risks to the kidneys.

So which protein is best?

Research has shown that foods high in the essential amino acid, leucine, increase protein synthesis (breakdown of protein to be stored) higher than the other two essential amino acids. Foods high in leucine are spirulina, egg white, fish, poultry, and meat.

Take home points…

1. Shoot for at least half your body weight in grams of protein per day. If wanting to gain muscle increase to your body weight in grams.

2. If weight loss is a struggle, evaluate where and how much protein you are getting. Odds are it is not enough for your body weight and fitness goals.

3. Try to eat protein in every meal.

4. Choose whole foods over supplementation. However, choose supplementation over nothing at all.

5. Can’t stress this enough, if you want to get leaner you must consume more protein!

John Y’s Musings from the Middle: The Modernized Ecclesiastes 3

jyb_musingsThere is a time to love

There is a time to hate

There is a time to be sad 

There is a time to be joyful

There is a time to judge

There is a time to seek forgiveness

There is a time to feel ecstatic and have hallucinations

There is a time to feel paranoid and have cotton mouth

And there is a time to titrate your medications

Lauren Mayer: What War on Christmas?

Bill O’Reilly et al. like to paint themselves as victims of a secular conspiracy to destroy the meaning of Christmas.  To hear them tell it, our founding fathers based the Constitution on a mashup of the bible (only selected portions, mind you, none of that keeping kosher stuff) and the Burl Ives ‘Frosty The Snowman’ TV special.  So any attempt to reflect the diversity of our country around this time of year is not only unAmerican, but it threatens the very existence of the holiday they are thus compelled to defend.

Maybe if they got out of their studio once in a while, they’ll get a sense of just how well Christmas is doing versus any other holiday.  Even here in the godlessly liberal/socialist Bay Area, every mall, business, or residential street looks like an elf’s wet dream, festooned with tinsel, red & green baubles, and enough mechanical reindeer & inflated lit-up snowmen to completely confuse my dog every time I walk her.  (Not to mention the fact that Christmas has totally taken over Thanksgiving, and is probably going after Halloween and Labor Day next . . . )

Meanwhile, Bob Geldof has trotted out yet another rendition of his classic/monstrosity (depending on your perspective), “Do They Know It’s Christmas,” this time to raise awareness of Ebola, but continuing in the same vein of overblown rock anthem as expressed by patronizing Westerners.  (Apparently, just in Nigera there are 3 times as many Christians as in England, so it seems like they don’t need Geldof’s song to enlighten them.)  So in that same spirit, here’s my own overblown anthem in an effort to raise awareness of the existence of other holidays.

John Y’s Musings from the Middle: Minnesota

jyb_musingsMinnesota is probably my favorite place anywhere to freeze my arse off (during the winter, anyway).

The people are pretty close to how they are depicted in Lake Wobegon –but Keillor did embellish a little bit. Not everyone is really above average. But not many seem below average either.

Minnesotans seem a lot like Kentuckians ….they are just as nice but they don’t try quite as hard as we do. They walk faster (because of the cold), talk faster (not sure why….maybe a “Viking thing”), and say “You betcha” a lot. When they talk they sound like a nasally and impatient Southerner — without any of the Southern accent, of course, but with all the friendly and kindly disposition. When you talk to them (if you are from Kentucky), you sound more Southern than you thought you sounded. And Minnesotans are fun to talk to and easy to make friends with. 

I guess what I am saying is that Minnesota is a much warmer place personally than it is a cold place physically. And that is saying a lot!

W. Carlton Weddington: Comeback, Denied & Flopped

carlton weddingtonTo comeback to prison after serving 8, 10, 15, 20 or more hard gut wrenching years in general population’s gladiator school or if lucky the maggot pool of protective control were snitches breath freely, child molesters go unnoticed and man boy love is normal.

To be denied transitional control or a judicial release because one is not deemed worthy by the prosecution or even worse the court. You didn’t think when you committed that violent crime; it would bite you in the ass. Or maybe you thought your institutional record of dirty urines, fights, and numerous contraband tickets was a non-issue.

To be “flopped” , the term used by an inmate up for parole who is serving a 20, 25 year, or life bid, and given another two (2) or five (5) years to do before they are asked to return before the parole board that has become its own institution. The harsh reality is they are probably never going home anytime soon.

Why do ex-offenders return to prison? Do they not really want the second chance? Is the idea of being free too much to handle? Is life easier when they are given everything they need and told what to do? Are the vices and pressures too much to overcome that they fall back into the poor negative habits and destructive actions that got them caught up in the first place? Aside from not having a steady job that enables you to make a living, a place to rest your head and avoid the chaos of the everyday world, positive role models and loved ones to support your transition back into society. What brings you back to this hell hole? This is a warehouse of criminal misfits broken, battered, and scared. It appears prison has become the only family they have, the only place they can find love, friendship, have fun or feel a part of something.

The prison subculture is described by Britannica as – standing opposed to the official hierarchy of the prisons, which demands the loyalty of the prisoner and expects him to conform to series of informal rules, enforcing his compliance by violence and social pressures,

The 8th Amendment states that “…excessive bail shall not be required, nor excessive fines imposed, nor cruel and unusual punishment inflicted.”

The 14th Amendment states that “…nor shall any state deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.

Yet still these are the issues inmates and ex-offenders subject themselves to when they are denied, flopped, or return to prison after having the opportunity to be free.

Poor institutional records are unfortunately keeping many men from seeing the other side of the barbed wire fencing. It is a discouraging spectacle for all other aspiring inmates and a dream dashing revelation for the inmate who had his hopes set on going home only to return before the committee in two (2) to five (5) years from now or receive no response at all. As if it could get no more tragic, there are some who received their “golden ticket” but less than a year later return on parole violation or catch another felony case.

This year, 2014 already in my W-2 unit of 94 inmates; two (2) have returned, four (4) have been flopped by the parole board, two (2) denied transitional control and one (1) denied judicial release, It’ s August, is anybody going home…? What will my own fate be?

Erica and Matt Chua: The Experience that is Khao San Road

Khao San Road is the gateway to Southeast Asia, which means this is the first stop for many young and often inexperienced travelers planning a trip to the region.  It has almost a spring break type atmosphere and just about anything goes, before I go into detail about “anything” lets take a quick look at history. According to wikitravel  the word khao san itself means milled rice and is an attribution to the historical role of this street in the rice trade. The first business to open on Khao San Road was a small hotel aimed at serving civil servants from the provinces who came to Bangkok on business. The hotel was followed by Sor Thambhakdi, a shop selling monks’ accessories. Four similar businesses moved in after, and Khao San became known as a “religious road”.  Let me tell you that the only religious thing about Khao San Road anymore is how people drink religiously when they visit.  Nonetheless, Khao San Road is a must-see in Bangkok.  You might not choose to stay at one of the  cheap guesthouses in the middle of the action, but you may want to do one of the following:

Top Ten Things to do on Khao San Road

1. Drink, I’m not condoning binge drinking here, but this is definitely the place to grab a local Chang beer or a bucket.   A bucket is just that a sand-pale style bucket filled with liquor it’s typically whiskey (the local Sang Som) and Coke,  but you can pick your poison.

2. Stay awake, Khao San Road never sleeps so you can visit anytime day or night.  The morning is the quietest and at night everything comes alive.  Once the bars close by 2:00 am or so, the patrons will flood the street moving the party outside.

3. People Watch, this goes hand-in hand with staying awake as night offers the best people watching.  Herds of young backpackers roam the streets intermingled with street vendors, lady boys and tuk tuk drivers.  It’s hard not to stare at all the crazy characters hanging out.

4. Buy Art, there are some very talented artists that sell their paintings and photographs on the side of the street, it is definitely worth checking out.  Remember to bargain and you could take home a fantastic painting for under $20.

5. Shop, Khao San Road is the bohemian capital of Bangkok, so if you are looking for patchwork skirts, a buddha t-shirt or want to get a singing bowl you will find it on Khao San. Make sure you bargain because all the vendors are willing to “make good price for you.”

Read the rest of…
Erica and Matt Chua: The Experience that is Khao San Road

The Recovering Politician Bookstore

     

The RP on The Daily Show

Sign Up For The RP's Email List!

*