Multiplicator effects – key to the economy, key to our business success

Multiplicator effect

I sat down this morning to ponder the multiplicater effect and what it tells us about management in the new age of knowledge and information.

This is how I look at it.

In the 1900’s

In the olden days, business was like a household budget. Money came in and money went out.

The way to get a bit richer was to take the job you did and get someone to do parts of it more cheaply than you could do yourself.

Let’s imagine I was a cobbler. If I could get you to stand in a line and one of you put on the soles, one thread the laces, and so on.  I could pay you each less than I could pay myself. And I could keep the profit that each would make if he worked for himself.

We used simple arithmetic and success was mainly about keeping the change.

Confusing housekeeping with economics

This business model leads to weird behaviour. Everyone believes that a one pound coin is indivisible. Either I have it, or you have it. And we fight to the death over it.

National wealth does not work like that. Indeed, company wealth doesn’t work like that.

Stock turn is important in shops. I don’t want to buy stock and having it sit on the shelves. I want it in and I want it out and the money banked. Circulation is the key. Not hoarding.

In a town, the same applies. When we fight over the one pound coin, we are wasting time and energy. Let me buy something from you with the coin. Then let you buy something from the next person and they from the next and ultimately someone buys from me. That one pound serves many of us. The more people served by the same one pound coin, the healthier the economy.

Installation art

I keep threatening to put an GPS device in a pound coin to follow it as it moves in the wild. If you would like to collaborate in that project, do get in touch.

In the 2000’s

In the modern business world, few of us are like the cobbler with a skill which can be broken into parts, each of which can be done by someone less skilled than us for less money than we would do it ourselves.

Adam Smith and the division of labor

In this day and age, that model of division of labour is a nonsense. Yes, it made perfect sense in the 1800 hundreds in Scotland when Adam Smith said that we can make more pins when we each made part of the pin. And maybe this rule-of-thumb is still true when we are making pins.

Today’s products are more complicated than pins

But in today’s world, we are often making something a lot more complicated than a pin. We’ve moved on. There isn’t any one person who has made the whole of what we are making. There isn’t any person who knows how to do everything. In truth, if we put a 1000 elves in with Santa we wouldn’t be able to draw or visualize exactly what we are making

We are like the blind men describing the elephant. I think the elephant is his trunk. You think it is his tail.

The elephant knows he is an elephant, of course. But he has no way of communicating with the blind men We have to wait until the blind men get the concept of a possible elephant and start communicating with each other. Then they can work out there is an elephant and what it looks like.

You cannot fool all of the people all of the time but there is no end to the people who will try

Now there are plenty of people out there trying to pretend that they know how to make a pin and hoping to delegate part of it to you. Notice well though, that they will be reluctant to give you a good contract that goes beyond chance.   They have no market for that pin. (Sorry people who make real pins ~ I know you are real.)

Before you part with an hour of your time, ask them for their sales report

The point is not that the heaven has finally fallen on Chicken Licken. The point is that the world is making bigger things than pins. When you hear someone claim that they understand the whole elephant and you should play a small part at the trunk for a pittance, ask sweetly to see the sales reports. They won’t show the report to you because it doesn’t exist.

Listen to those who want genuinely to collaborate

But when someone says, hey, I feel something interesting in front of me. What do you feel? Do you think there is any connection between what you feel and I feel? THEN, we have a show.

When we network our skills together, then we can make something that we cannot see alone.

This is not the age of division of labor

Division of labour aimed to do things faster and cheaper. Today’s world is about networking specialist labour to do something no one person or company can do alone.

This is the age of connecting with other skilled people

This is not the age of division of labour and making smaller and smaller things. This is the age of networking skill and making bigger and bigger things.

To be practical

As a career coach and work psychologist, I put my practical cap on and ask: what does this mean in practice?

  • The essential career tool of today is a set of modular pieces of work which have the potential to link up with others. I say potential because other people may not have work ready to link up.  We do our work anyway but rather than just do it, we do it in a way that has potential to link up with others so they can see where they could join in.
  • The essential career management tool of today is to be adaptable and do whatever work is available without losing sight of our skill base. The test of any task is not whether we are paid for it but whether we are willing to put it on our website for others to link up to.
  • The essential selection criteria for inclusion in a permanent team will be
    • number of modules we have available for others to use
    • the diversity of modules (are we able to clean the floor and do the accounts as readily as paint a Picasso)
    • the readiness at which we create modules in new situations (rate and diversity)
    • the connections we make with the team and importantly are now possible between other team members without our presence!
  • The ethics of selection come down to whether a person’s connections will be richer by working with us (do they become more creative and are they involved in richer sets of connections?)
  • Pay is likely to be more equal with money paid into development funds to pay for capital when it is needed and the opening up new opportunities. Where there are differentials they are likely to come from being central to a network because the pound moves through us more often (we buy and we sell). People who only sell should receive less.
  • Ranks of professions might change. Lets imagine we paid a toll to a receptionist each time we walked through the door. We might be come reluctant to have a receptionist. Indeed, this is a test of a division of labour philosophy operating. We may not need the service if we had to pay more for it. Let’s imagine the hospital workers mentioned in a paper today who create a lot more value than they take home. What if they decided to run a hospital and just hire the doctors and nurses around them. That makes sort of sense to me!
  • In the olden days, training meant starting with a small task and growing into the ‘owner’. Obviously the tasks in our early career will be small.  But what if the goal was to move increasingly into the centre of a network where we are able to work with a wider number of people?  Have the pound coin pass through us more often? What if the goal was to increase whom we are able to work with on a project of value?  What if I took a person into a room and said: take two people, figure out what they can do and figure out, not what you can sell to each of them, but what you can take/buy from one, transform and pass on to the next. It’s what entrepreneurs do, of course. But what if the entire training process was geared to the capacity to detect and executive collaboration?
  • Jane McGonigle lists the qualities of projects that have this magical capacity which I restated here I would look for these multiplicator competencies in someone’s portfolio and help them find opportunities to broaden their experience in new ways of working.

The beginning is the ability to do modular work that has capacity for collaboration. To be potentiated, so to speak, to collaborate. A change of focus but an important one. Learn to be a multiplier rather than a taker.

And after EQ comes PQ . . .

Jane McGonigal, game designer and games researcher, specializing in pervasive games and alternate reality games.

 

Image via Wikipedia

IQ, EQ and now PQ

PQ is going to be the next big thing in work psychology and management. What competencies do we need for participating, leading and influencing in today’s interconnected world?

Here is a list from Jane McGonigal, the games designer who talks of the engines of happiness. I’ve found links to her work here, here and here.

1 Mobbability

“- the ability to do real-time work in very large groups

– a talent for coordinating with many people simultaneously”

Restated: My immediate thought is the ability to mobilize people for anything – a party, a demonstration, etc. This is a little more though. It probably begins with the ability to appreciate the dynamics of a music festival, or the crowd at a big sporting event. A Mexican Wave is one of the simplest forms

My questions: I get the feeling that I am missing something!

2 Ping quotient

“- measures your responsiveness to other people’s requests for engagement
– your propensity and ability to reach out to others in a network”

Restated: How quickly do you respond to requests for your attention and participation? Do you plan your communication systems so that you are able to respond? Do you anticipate the types of inquiries you will receive and do you update your communication systems to reflect the inquiries you receive? Do you initiate contacts and broaden your network? How do people find you and how do you find them?

My questions: Where is listening?

3 Collaboration radar

“the ability to sense, almost intuitively, who would make the best collaborators on a particular task”

Restated: When you start a task, do you think about who can and will help you? Do you take an interest in what work other people like to do? Have you some kind of model in your head about how to collaborate with other people and what helps collaboration to be satisfactory or unsatisfactory?

My questions: Is this ability to engender collaboration? Or just detect it?

4 Influency

“- the ability to be persuasive in diverse social contexts and media spaces
– understanding that each work environment and collaboration space requires a different persuasive strategy and technique”

Restated: Are you persuasive and are you persuasive to different audiences and in different settings? Are you interested in persuasion and how other people are persuasive? Are you able to communicate through different channels? Do you understand the nuances of using different channels? Have you an emerging theory of when to use various techniques and why? Do you have some idea of what motivates other people in various settings? Are you curious about their motivation? Are interested in how motivation changes when we take part in groups? Can you predict what will individuals will do next in a social settings and what an entire group or community will do? Can you anticipate what individuals, groups and communities are willing to do?

My questions: The arts are so important, aren’t they?

5 Multicapitalism

“fluency in working with different capitals, e.g., natural, intellectual, social, and financial”

Restated: How much capital do you need for your business to succeed? What do you have now? What do you need to do to

Financial?

Intellectual?

Social? Whuffie?

My questions: What is natural capital? Is social capital tradable? Is the “securitization” of social capital the next political innovation?

6 Protovation

“- fearless innovation in rapid, iterative cycles
– ability to lower the costs and increase the speed of failure”

Restated: Do you “have a go” and look for feedback from other people? Do you pick small, cheap, easy ways to experiment with new things that don’t just lead to success but teach you something important when you fail? Do you learn the meaning of errors? Are they useful signals or just sources of distress? Do you celebrate the errors of others (and I don’t mean gloat!) so their experiences are seen as useful and valuable by everyone?

My questions: Has anyone linked protovation to self-efficacy (Bandura) and error-training (Michael Frese)?

7 Open authorship

“creating content for public consumption and modification”

Restated: Do you write, speak, make videos, etc. for other people? Do you expect them to take what you use and change it (mash it)? Do you judge your effectiveness by the extent to which your audience uses and changes your ideas?

My questions: Is this a major aspect of social media? That we expect our ideas to be an input rather than an output or expert opinion? Is expecting a reply rather than approval or disapproval the major behavioral shift of our time?

8 Signal/noise management

“filtering meaningful info, patterns, and commonalities from massively multiple streams of data”

Restated: Have you set up your data streams so that you receive information from many, many sources? Have you set up your data streams so that you can detect repetition (without checking our original sources), speculation, rumor? Are you interested in how information is passed around the world on matters that interest you? Do you streams allow you the benefit of serendipty? Have you got people (lots and lots) to consult when you are stuck?

My questions: How much have these skills changed from the checking of provenance taught in universities? How much can we transfer skills from one domain to another?

What have I still got to learn?

9 Longbroading

“thinking in terms of higher level systems, cycles, the big picture”

Restated: Having a “helicopter view” and seeing a problem from different perspectives have long been valued business skills. This seems to go further – to understand a situation in terms of its dynamics

My questions: If I am correct, then we need to see situations in terms of their feedback loops? And is this an important skill that kids learn when they work out different ways of playing a game?

10 Emergensight

“the ability to prepare for and handle surprising results and complexity”

Spot unexpected patterns as they pop up, and be ready to take advantage of them – even when systems scale in size and messiness.

Restated: Do you look of for the way a pattern unfolds? Do you look for changes in speed as well – from the lull before the storm to the tempest that will blow itself out? Do you look for small levers that have huge impacts?

My questions: Is this improvisation? Are we talking about good reaction times, or understanding complex dynamics?

Hat-tip to NLabNetworks and Andrea Saveri of the Institute of the Future who spoke at the recent NLabNetworks meeting at Leicester.

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