Goodbye to All That
A Bit Lost, Chris Haughton
How to Think About the Unthinkable
Author’s Note: This was originally published as a commentary (prediction?) at the close of 2021. It’s been refreshed this morning to reflect current events.
It’s easy to see the end of things, to grasp intuitively that you’re standing astride some sort of stark rupture in the historical timeline, a point between rot and genesis, to know that you’ve stayed too long at The Fair.
“We don’t know if we’re going to succeed, but we do know is what’s in place today isn’t working,” says Novartis president Marie-France Tschudin,. “We need to take a different approach.” She was describing the need to re-conceptualize strategy for the launch of a new heart drug (see here in the Wall Street Journal last month), but her vision echos an ask for something deeper, more fundamental, that’s bouncing across the halls of nearly all business and government and academic settings in the West: a complete overhaul in the nature of “strategy” itself.
And so what's emerging as the building blocks for professional success today are management teams who can work with a new set rules that have imposed themselves (or been imposed by others) on the old order of things,
“We would be safer if we had our own nuclear arsenal,” Donald Tusk, Poland’s prime minister, said in a speech to his country’s parliament on March 7. The reason he gave was the “profound change of American geopolitics,” a euphemism for what Pfizer’s Albert Bourla accurately described as the epic collapse of the conventional frame of reference in an interview with Semafor in January (Pfizer’s Albert Bourla on Trump 2.0: ‘The status quo will collapse’).
Yesterday (March 12) Trump spoke at the quarterly meeting of the Business Roundtable. This is how Reuters covered things (Trump defends tariffs before corporate America as stocks sell off):
“U.S. President Donald Trump defended his use of tariffs and said they could multiply as he met on Tuesday with the CEOs of America's biggest companies, many of whom have watched their market value crater over recession and inflation fears.
Speaking to business leaders and reporters before the roundtable, Trump defiantly maintained his stance, dismissed market volatility and vowed that investors would see gains for putting money to work now.
"The tariffs are going to be throwing off a lot of money for this country," he said to CEOs. "It may go up higher."
The executives in the room sat expressionless as Trump spoke during a brief part of the meeting that was open to the press. There was scattered chuckling when Trump said there were some people in the room he did not like.
Rance Priebus, who was chief of staff during Trump’s first White House, was hired this week by Centerview Partners to help the boutique investment bank’s clients innovate their dealmaking and navigate the new world disorder. “The traditional corporate view that companies could ignore what’s going on in Washington has been shattered.”
What’s changed is the world around us is now within us. There is no ‘out there’ that separates the observer from the observed. From Ecosystem-Centered Business Strategy, Blue Spoon thought leadership published in 2009 at the 3rd IEEE International Conference on Digital Ecosystems and Technologies:
The shape and texture of most mainstream economic theories reflects a two-sided view of market exchange. Competition between economic systems takes the form of competition between agents within those systems, not between the systems themselves.
The actions of government and the foundations for law, built over centuries, have reseeded the grass for this playing field, and the teams who play on the pitch are assumed to know the rules. The role of policy is not to participate in the game, but to manage it, to make sure the parts are prevented from destabilising the whole, and the whole is prevented from destabilising the parts. But the international system in which all businesses and governments now find themselves poses something new entirely. Legal institutions have not kept pace with technology. Government is realizing that it is not separate from the market. Markets are less two-sided than they are N-sided, involving connections and interactions between global networks of buyers and sellers.
The game has clearly changed.
Rather than simply riding the bouncing ball and fighting to avoid being on the bottom when it bounces, it’s time for “leadership” to start working with a new cognitive pattern, a Punk Rock ethos for disruption.
“As 2022 draws near, it is time to face the world’s predictable unpredictability,” wrote The Economist in The New Normal is Already Here. Get Used to It, its commentary closing out 2021. “The pattern for the rest of 2020s is not the familiar routine of the pre-covid years, but the turmoil and bewilderment of the pandemic era. The new normal is already here.. Any boss who thinks their industry is immune to such wild dynamism is unlikely to last long”
Change comes in three wavelengths: There are changes to the game, changes in the rules of the game, and changes in how the rules are changed. The world is flailing to find ‘strategic fit’ to the latter.
It's legacy thinking -- not technology -- that's maybe the biggest barrier to navigating the transition space to a new era. Leadership teams become kinetically-trapped in outmoded structures, orientations, incentives and schools of thought, doomed to be, always, in defense of whatever business model allowed them to be successful in the first place. Most "digital transformations" reinforce the obsolete.
We keep re-submerging ourselves in familiar storylines.
Having normalized cliche, "old" narratives have veto power over the new, keeping us running on the watery residue of the past. Incrementalism edges out exploration.
We tinker in proven domains. We try to survive in a remnant context.
Existential crises abound (look no further than Biogen trying to sell itself to Samsung after its disastrous rollout of Adhulem, cryptocurrencies threat to central banks, or at the geopolitical level, the cracking of United States leadership and the rise of China “remaking the international system” according to its rules). The world is now littered with dying companies, markets and industries buying into the myth of a simple recipe, the allure of new technology, and an obsession with tradition as they search for optimal solutions that don’t exist.
It’s the ‘leadership margin’ that now separates: you have to be comfortable crossing the river as you’re feeling for the stones. The skill in short supply is not technical, but visionary, able to articulate and propagate a new direction, a‘modern strategy story’ to manage a new interface layer with the world.
We have to rearrange the comfortable mental furniture from which we sit and guide thought and action, hoping for the best from legacy operating models. The hard thing is to “break the golden rhythm” of the place in our minds that we know has stopped working for us intellectually, creatively and spiritually.
“I could not tell you when I began to understand that. All I know is that it was very bad when I was twenty-eight. Everything that was said to me I seemed to have heard before, and I could no longer listen. I could no longer sit in little bars near Grand Central and listen to someone complaining of his wife’s inability to cope with the help while he missed another train to Connecticut. I no longer had any interest in hearing about the advances other people had received from their publishers, about plays that were having second-act troubles in Philadelphia, or about people I would like very much if I just came out to meet them. I had already met them, always.”
Joan Didion, Goodbye to All That
It's time to sweep the old concepts out of the saddle, start working with a new category of ideas.
/ jgs
John G. Singer is Executive Director of Blue Spoon, the global leader in positioning strategy at a system level. Blue Spoon specializes in constructing new industry ecosystems.