What’s luck got to do with it?

One of the things that used to drive Boyd nuts was trusting to “luck”: Once you’ve run through your bag of tricks, you give up and “trust to luck.” We’ve done all we can. It’s out of our hands now.

Boyd would insist that you never do this, that you keep on building snowmobiles and learning from the results right up until the end. Keep your team from “coming unglued,” as he would put it. This is not luck but lots of clear thinking, hard work, and leadership before and during the conflict.

A little of this flavor comes from a recent interview in The Guardian by Peter Thiel, of “monopoly is good” (WSJ — paywall) fame. I had never thought of “luck” as being an atheistic god, but he may have a point:

What I do think is that as a society we attribute too much to luck. Luck is like an atheistic word for God: we ascribe things to it that we don’t understand or don’t want to understand. As a venture capitalist, I think one of the most toxic things to do is to treat the people I’m investing in as lottery tickets where I say: “Well I don’t know if your business is going to work. It might, it might not.” I think that’s a horrible way to treat people. The anti-lottery ticket approach is to try to achieve a high level of conviction, to ask: “Is this a business that I have enough confidence in that I would consider joining it myself?”

In other words, Fingerspitzengefühl as an antidote to “luck.” I think this is an interpretation that Boyd would have liked.

“Uncertainty” is reality; it’s the climate of all competition, and like climate, it affects all competitors. So as Richards’ Third Law states:

If you lost because of luck, you were a loser going in.

It would be like a general blaming his debacle on rain.

Uncertainty is really nasty stuff, so you don’t want to leave it to chance. The essence of Boyd’s approach to tactics is that you don’t have to wait on acts of God — you can create the climate of uncertainty yourself, you can build your own Fog of War Machine.

A tip on grand strategy

Boyd insisted that one of the primary functions of grand strategy was to “attract the uncommitted to your cause.” If we take the prudent path and assume that all our current and potential customers are uncommitted, then as far as business goes, strategy and grand strategy are the same thing. One of the many ways that business isn’t war.

People buy from you for many reasons, and one of these is because they want to. People refuse to go anywhere near you for many reasons, and one of these is they don’t like you. So we get fanboys on the one hand and boycotts on the other.

Why, then, do some businesses alienate their own customers, giving them, as it were, reasons not to like them? How do you win that one? Here’s a neat example, “The perils of shaming bad tippers,” by Mario Castillo on LinkedIn. I think behavior like this may often result from an internal focus, maybe tough guy politics within the organization.

Of course, if you’re a monopoly, as Peter Thiel lauds over at the Wall St. J. (paywall), treat your customers any way you damn well please.

 

Always question the obvious

It’s common wisdom that among the virtues needed to succeed in business, and for that matter, any competitive enterprise, are passion and a sense of urgency.

Both of these, though, have drawbacks. They lock orientation, sort of like painting over your windshield and stomping on the accelerator. “Urgency” is particularly pernicious because it becomes a corporate loyalty test: Just execute the plan, act now, don’t think, and for God’s sake, don’t question. Continue reading

Orientation — not what it seems

Once, while musing on the essence of things, Boyd noted that:

Orientation is the Schwerpunkt. It shapes the way we interact with the environment—hence orientation shapes the way we observe, the way we decide, the way we act. In this sense, Orientation shapes the character of present observation-orientation-decision-action loops—while these present loops shape the character of future orientation. Implication: We need to create mental images, views, or impressions, hence patterns that match with activity of world, and we need to deny adversary the possibility of uncovering or discerning patterns that match our activity, or other aspects of reality in the world. Organic Design, 16

In other words, conflict is a game of dueling orientations, where we try to maintain a more accurate model of unfolding circumstances than the other players’. We don’t leave this to chance:  ” … and we need to deny adversary the possibility of uncovering or discerning patterns that match our activity, or other aspects of reality in the world.” Boyd suggested many ways to do this, including camouflage, concealment, security, deception, and most powerful of all, ambiguity particularly by operating inside adversary’s OODA loops. Continue reading

Precision in shoe boxes

Here’s the box for my wife’s latest pair of Tevas:

TEVA_Box

This is the complete box, seen from the inside, including the lid and reinforcements for the sides. No glue and no tape. Completely recyclable.

It’s still amazing to me how someone can think of things like this, not to mention manufacture them. What’s coming next — fractals?

Mind the gaps!

Like those between private jets and fractional ownership or between fractional ownership and Imperial Class.

One of the strengths of the free enterprise system is that if somebody imagines a gap, or even the possibility of creating one, and if that someone can get funding, then said someone will give it a try. That’s what we’re seeing now in the commercial aviation business.

The old model is broken. The four legacy majors — American, Delta, United, and Southwest — are moving upmarket as fast as they can, with the logical conclusion that in the near future, they’ll ditch coach entirely. So instead of coach, business, and first, the new model will be business/first, and a new ultra premium class that I’ve called “Imperial.” At least two airlines are well along in this process. Watch the commercials for Dubai’s Emirates, https://www.youtube.com/watch?v=OFbryriZ3is and http://www.emirates.com/english/about/advertising/advertising.aspx. Abu Dhabi’s Etihad now goes them a little better, or should I say closer to Imperial Class, with “The Residence”: http://www.thedailybeast.com/cheats/2014/08/12/etihad-launches-planes-with-full-suites.html Continue reading

Coffee Culture

I tweeted this a few days ago, but it’s such a nice article that it’s worth reposting here.

The Future of Iced Coffee, by Alex Madrigal on Atlantic.com. “Somehow, (Blue Bottle CEO James) Freeman had scaled perfection.”

Not an easy job. As you read the article, be on the lookout for Schwerpunkt (Patterns 78)/ unifying vision (Patterns 143), which are common among entrepreneurs.

Even more interesting, at least to me, the author draws his own conclusions about why the Blue Bottle culture works:

But everywhere I looked, the most important component of scaling was the ideas of the people working with Blue Bottle.

Pure Boyd, although I’d be surprised to find out that Freeman had ever heard of the good colonel. Remember, one way to characterize Boyd’s philosophy is “Pump up the creativity and initiative of everybody in the organization and focus it to accomplish the objectives of the organization.”

The Discourse elaborates on this philosophy and provides examples, and you may find a few more parts for your snowmobiles in the article.

Oh, and watch out for the poodles! I know you already do, but could you show me how?

Strange goings-on in the airline industry

The four big carriers reported 2Q results last week. Here are a few thoughts:

  • They all made money. As the WSJ reported (paywall), “Those announcements came as American, United and Southwest reported record-setting second-quarter results, building on Delta’s solid performance a day earlier.”
  • How did they do this? Again, the Journal:

Airlines are prospering as mergers have reduced competition, making it easier to keep prices high and raise billions from extra fees. They used bankruptcy to squeeze costs from employees and suppliers such as the smaller carriers that operate regional flights.

  • Competition is definitely down. The four legacies now control 82% of domestic capacity.
  • Another way they make money is by shrinking themselves down to those routes and those aircraft where they can make a profit. This means fewer flights to fewer destinations, at least domestically.
  • If they aren’t investing in new capacity, what are they doing with their money? Well, customer service may be in the pits, but shareholder service is great. All four are buying back shares, and three of the four — all except United — are paying dividends.
  • And finally, virtually all the profit made by the four majors came from fees. In other words, the price of the ticket covers just the cost of the seat.* Profit has to come from something else. This raises the interesting question, so beloved of MBA professors, of what business are they actually in?

Continue reading

No, Johnny, no!

As Business Intelligence reports, John Chambers, long-time CEO of Cisco, recently told attendees at the Fortune Brainstorm conference in Aspen:

On the one hand, he hints that Cisco might carry more fat on its payroll than it should, but that he “doesn’t have the heart” to implement some kind of brutal, competitive HR practice, like a stack ranking performance review, where employees are rated against each other and the bottom percent are let go.

“A well-run organizations turns over 10% of their organizations, including senior leadership. I don’t have the heart to do that.

Arrrgh!  Either Einheit is important or it isn’t. If it isn’t, then a “stack ranking performance review” is a wonderful way to kill it. Deming pointed this out in Out of the Crisis and it’s embodied in his 14 points. He was right then, and he’s still right.

Stick with your instincts, John.

Alternatives to EBFAS?

Boyd’s organizational climate stokes up creativity and initiative throughout the organization and harmonizes them to accomplish the purposes of the organization. Examples run throughout his work:

Without a common outlook superiors cannot give subordinates freedom-of-action and maintain coherency of ongoing action. Patterns 74

… exploit lower-level initiative yet realize higher-level intent, thereby diminish friction and reduce time, hence gain both quickness and security. Patterns 79, repeated on Organic Design 18

How do we generate harmony/initiative so that we can exploit variety/rapidity? Organic Design 9

A similar implicit orientation for commanders and subordinates alike will allow them to diminish their friction and reduce time, thereby permit them to exploit variety/rapidity while maintaining harmony/initiative Organic Design 23

The EBFAS climate is designed to do just this: With a basis of Einheit, intuitive skill, and mental agility, it employs the Schwerpunkt concept to focus the efforts of the entire team and the Auftragstaktik device to assign missions to individuals.

Sounds awfully militaristic. Are there alternatives? Continue reading