Turning a Customer into an Investor

In short, that is the Disques story, as told by Fred Wilson.

It illustrates an interesting phenomenon that we will likely see much more of. The “roles” that we assign to actors in various games — whether they are “managers”, “staff”, “customers”, “investors”, “partners”, etc. used to be fixed. They will become less and less so. For example, a staff person —  let’s call him Dan — may come up with an idea with a customer  — let’s call her Diane —  that a firm doesn’t want to do itself. That firm may help  Dan and Diane set up a new firm and may even invest in it. Dan and Diane may develop new partners that are welcomed into the network.

Instead of “roles” and “rules” the above is generated by perceptions of potential value added.

Flawed Ideas and Real Problems

We all want more and faster innovation. And therefore, we wonder how to maximize the rate that new ideas are translated into better products and services.

When we look at this challenge — how to maximize — we start asking, what is holding us back? What barriers can be removed that might speed things up?

It turns out, that these problems are mostly in how we talk about what we are trying to do. There is a big gap between thinking and using what we think about.

Greg Satell offers an interesting glimpse at some efforts to close this gap. Very cool!

Group Dynamics and Change

The strategic mindset starts within the self. That is because you have to take over certain values in order to become a strategic leader. Sadly, we do not learn these values at a deep level in school. Some do, but most do not. Those that do not are left to their own devices to manage the challenges of life.

And those challenges present a second strategic dimension – the social dimension. To be successful in life, you need to “add value”. In the old days, this meant physical work. It took lots and lots of physical work to get anything done. As technology advanced,  the need for physical input has decreased and the need for mental input has increased.

So we get the modern notion of work as the ability to add value via strategic decision making. Those who can “move the ball forward” succeed.  And moving the ball forward means producing change within groups.

How do you do that?  There is a huge amount of writing on the subject. Most of it is about how to build companies and institutions around missions. Greg Satell points out that this might be better understood using a model of producing social change – by looking at the history of successful social movements.  He lists a few key ideas

  • embracing a concrete objective rather than a broad abstract goal
  • work the spectrum of allies – start by mobilizing strong allies, then move to passive allies, neutrals, passive opponents and finally strong opponents.
  • find and leverage institutional power
  • attract rather than coerce
  • survive the immediate victory

It is a nice tactical tool box.

Finding a Gap and Filling it

Perhaps the simplest way to add value in a give context is to !fill the gap”.

A young entrepreneur who was engaged in a project to help handicapped people in Uganda realized this. She found that it was difficult to find a bra in Kampala that fit her. And she noticed that a significant number of Ugandan women had breasts that were similar to her own. Bingo — she began importing large sized broa, and has built up a nice business.  She filled a gap.

This strategy can be applied in a more generalized way. Consider this ecology(1) people want better solutions to problems that the have and they turn to the market for products and services that offer these better solutions (2) companies profit by listening and fashioning a steady flow of upgraded solutions. (3) companies need intellectual resources to fashion those new solutions – they need to connect with researchers who spend their time thinking about this sort of stuff

So you would think that there would be no gaps between customers and firms, nor between firms and researchers. Wrong. Greg Satell writes about those gaps.


Trust as a Strategic Asset

The highest level of strategic gaming is social. The question or challenge here is how to add value at the community level.

BTW,  this raises an interesting question — how much value is actually built at the community level? I would argue that modern western society has reduced the relative value of community as it has increased its focus on economies of scale through mass production. So big cities, the coordinators of mass production, grow rich, while small villages and towns shrivel on the vine.

So, back to our game. If we want to add value, we need to establish and build connections that make it possible. Amy Cuddy argues that the first impression that we make is critical to get this game started There are two critical measures – (1) can we be trusted, and (2) are we competent. According to Cuddy, establishing a basis for trust is the pre-condition for the second.

Start by Solving Problems

Let’s say that you have experienced a great st back. it has wiped you out. You have no job, connections and no apparent opportunities. After you get over the shock, the question arises, what to do?

Many would retreat into themselves. Pout. Complain. It is natural. And of course, it will not get you very far.

To get started again, you need a certain amount of conviction that enables you to translate beliefs into action. Where do these come from? The answer, according to Great Satell, is to develop a problem solving mentality.  that mentality gives you  a learning tool to re-connect with other people.

How does one develop this? Think of it as a learning challenge. We need to break this down into tasks and then find ways to master the most important tasks first (Tim Ferriss). So how about this for a breakdown.

  • identifying problems
  • developing  conviction around potential solutions
  • experimenting to test potential solutions
  • packaging solutions into lifestyle
  • sharing solutions

The more one practices each of these steps, the better one gets at them.