Review: The Design of Business–Why Design Thinking is the Next Competitive Advantage

6 Star Special, Best Practices in Management, Capitalism (Good & Bad), Change & Innovation, Complexity & Resilience, Culture, Research, Economics, Education (Universities), Environment (Solutions), Future, Intelligence (Commercial), Intelligence (Government/Secret), Intelligence (Public), Nature, Diet, Memetics, Design, Philosophy, Public Administration, Strategy, True Cost & Toxicity, Values, Ethics, Sustainable Evolution
Amazon Page
Amazon Page
5.0 out of 5 stars In Its Niche Beyond a Six–In Larger Context a Four
October 11, 2009
Roger Martin
First off, what got me to buy this book does not appear in the book at all–the author on record as saying that Wall Street was not designed to make money for its investors, only for its mandarins–the same is true of how universities are designed, businesses, etc. but that one observation really got my attention. I bought the book before BusinessWeek featured it as one of four in the October 5th edition (Europe version), and after looking the others over, chose this one.
In the larger context of changes to the Earth that now take three years instead of ten thousand years, as an entire literature flourishes on The Philosophy of Sustainable Design, Green to Gold: How Smart Companies Use Environmental Strategy to Innovate, Create Value, and Build Competitive Advantage and Natural Capitalism: Creating the Next Industrial Revolution, the book is a four for narrow-casting and lack of context, but you can use Phi Beta Iota, the Public Intelligence Blog, to search and sort among my other 1,400 reviews, so no penalty is warranted, This book will be scored Beyond 6 Stars at PBI/PIB for the simple reason that it addresses the core need of all eight tribes of intelligence (academia, civil society, commerce, government, law enforcement, media, military, and non-governmental organizations), to re-design away from the Industrial Era waste (where Six Sigma stops), and to instead envision how the world could and should be, and set out to achieve that–a prosperous world at peace.
I am eagerly awaiting Redesigning Society (Stanford Business Books) and consider its author, Russell Ackoff, to be the equal of Buckminster Fuller. The author of this book, Roger Martin, in my judgment, not only equal Dean Gartner and his seminal work, The Politics of Fortune: A New Agenda For Business Leaders but moves to another higher plane with all that this book sets forth. I funded the Earth Intelligence Network (EIN), a 501c3 Public Charity, after twenty years to trying to get secret intelligence communities to redesign, and this book has not only articulated all that I could not, but it is written simply enough for any bureaucrat to understand. In that sense, it joins Orbiting the Giant Hairball: A Corporate Fool’s Guide to Surviving with Grace as a primer and an inspiration.

Here are my fly-leaf notes. I hope that someone close to the Director of National Intelligence (DNI) will flag this for his attention, because I believe that this book not only can save the $75 billion a year tar-pit that the DNI is nominally in charge of, but that the national intelligence community, if it were led properly, could be the seed crystal for the redesign of the US Government and of the United States of America, to the lasting benefit of all humanity.

Here are my fly-leaf notes that seek to summarize this extraordinary work in terms applicable to creating a Smart Nation such as Congressman Rob Simmons (R-CT-02) and I sought to lay out in THE SMART NATION ACT: Public Intelligence in the Public Interest

+ Design thinking is abductive thinking, neither deductive (from general to specific) nor inductive (from specific to general, the academics call this ethnocentric studies now). It seeks to employ observation and imagination to explore, to intuit, and to create “new ways.”

+ Design thinking is NOT an unaffordable flight of fancy. CEOs must keep their designers connected to the triangle of envisioned needs for which no poll or survey exists; technology on the bleeding edge of innovation, AND business bottom-line common sense. The author takes great care to stress the need for blending. Design thinking is NOT an either-or proposition, but rather a HYBRID that takes best of the best to a new level.

+ The author credits James March and the knowledge funnel as being the information operations (IO) aspect of design in that writ large, design moves knowledge from mystery (climate change is an example) to heuristics (weather forecasting) to algorithms (barometers) to computer code (not there, but HAARP, High Frequency Active Auroral Research Program appears to be a nasty example). Design, in other words, is the embodiment of strategy, of IO, and ultimately of how one plans, programs, and budgets the enterprise. Heavy stuff in the most positive way!

+ Alvin Toffler called me and open source intelligence (OSINT) “the rival store” to the secret intelligence community in 1993 (in the chapter on “The Future of the Spy” in War and Anti-War: Making Sense of Today’s Global Chaos and I honestly did not understand the implications until I read this book and appreciated the author’s emphasis on transformation having to address structures (switch rewards and focus from legacy systems to new projects); processes (solve wicked new problems rather than repeating the same old analysis again); and cultural norms (get away from current secrets for the president and instead focus on providing decision support to every action officer in every domain at every level of government).

+ To emphasize this point: the secret intelligence community spends $75 billion a year on legacy systems that provide “at best” 4% of what a very small consumer group (no more than 100 individuals) needs–for that amount of money, I could create the World Brain with embedded EarthGame, provide free education and decision-support to every person on the planet, and in passing end poverty, assure clean water for all, and eliminate most infectious diseases. Secret sources and methods no longer yield innovation–the innovation is to be had at the other end of the telescope, the open end….and at very low cost reaching billions of end-users. THIS is the “aha experience” that this book provided to me personally.

+ The book, the author, and the concept of design thinking are HUGE on embracing the customer or user as a source of inspiration and innovation.

I’ve reached Amazon’s word limit. More at PBI/PIB.

See also:
The Knowledge Executive
Building a Knowledge-Driven Organization

Below text not at Amazon.
Fouir Quadrants Clean Slide JPEG+  Design thinkers must have the integrity to pursue advances in knowledge DERSPITE repressive cultures, which is to say all successful cultures from the Industrial Era not yet ready for the Information Era.
+  Design is not just about appearance or utility, but about moving knowledge elegantly.  This was huge for me and ties into Organizational Intelligence (Wilensky, Organizational Intelligence), see the image here to the right.
+  Reliability is what is prized by legacy organizations that seeks to replicate the past and improve means of achieving the same goals.
+  Validity strives to achieve a future objective that cannot be proven on the basis of the past precisely because it is so pioneering in nature.
+    McKinsey and other similar consulting firms continue to focus on reliability and repetition of formulas from the past to the EXCLUSION of validity, exploration, and innovation.  [I am much more critical of all the so-called consulting firms, they tend to throw ignorant MBA billing hours at a problem better understood by the janitor on site.]
+  Three forces converge to marginalize the future: 1) demand for prior proof of sources and/or method; 2) aversion to bias i.e. not open-minded; and 3) constraints on time, demanding results in too short a timeframe.  In short, organizations are poor at SENSING, not OPEN-MINDED, and therefore not ADAPTIVE.
+  Capital markets reward certainty (when not being corrupted by Goldman Sacks et al who like to explode the client while internalizing profits) and this leads to stagnation–neither risk nor innovation are actually encouraged.  [One could make the case that IPOs get funded solely because the venture capitalists know how to ride the first wave and then dump all the risk on the public.]
+  WIKED PROBLEMS:  Insert by Jennifer Riel on page 94, the following quote credited to C. West Churchman in his 1968 article in Management Science is totally applicable to most important problems associated with the ten high-level threats to humanity, defining wicked problems as “a class of social system problems which are ill-formulated, where the information is confusing, where there are many cleints and decision makers with conflicting values, and where the ramifications in the whole system are thoroughly confusing.”  In my view, this is what the US intelligence community should be thinking about, offering OUTPUTS that solve wicked problems, rather than seeking to protect budget share on INPUTS that are NOT providing the return on investment the taxpayer deserves (neither does the government as a whole, so the IC is not alone here, but secrecy allows it to avoid even the sembalnce of accountability).
+  Roadblocks to innovation include a refusal by management to consider mysteries; the isolation of the heuristics that lead to success in the hands of an elite (e.g. brand managers); and a refusal to code the obvious (e.g. scheduling of workers).
+  Abduction, unbeknownst to this author, is a huge part of the transpartisan meme developed by Don Beck and Jim Turner (Voice of the People), and I am also glad to observe trhat abduction appears to be something We the People can do better than any government–as Norman Cousins suggests in The Pathology of Power, only the people can sense the great truths and the great truth right now isthat we have huge problems that require our collective intelligence and the elimination of “representatives” that are inherently corrupt in following party-line direction and Wall Street briberty.  See also Smart Mobs, Groundswell, Here Comes Everybody, etcetera.
This book really helped me to think through what I personally have been committed to these past twenty years–the reform of the secret community to better serve the public–and this book has raised my sights: my extended objective now is to use public intelligence to help the public redesign both government and society.