Acronym

My last post explored the serious and irrevocable challenges our society faces and called for associations to adopt new beliefs in order to succeed in the decade ahead. In The New Capitalist Manifesto, author Umair Haque argues for a shift beyond 20th-century competitive advantage, toward the 21st-century framework he calls "constructive advantage." According to Umair, constructive advantage is built on five cornerstones (shown below in bold italics) and flows from five sources (shown below in bold):

• Loss advantage stems from a value cycle that renews resources and makes waste useful. Example: Associations can create a technology-enabled value cycle that makes it possible for stakeholders to renew dated knowledge resources while situated in a meaningful social context without wasting time and energy.
  
  
• Responsiveness is the result of fluid, on-going, many-sided value conversations. Example: Associations can nurture greater intimacy with their stakeholders by creating opportunities to discuss, deliberate, and express dissent through social networking platforms.
  
  
• Resilience, an evolutionary edge, is achieved by competing with an enduring philosophy. Example: Associations can create thicker value by going beyond strategy to embrace principles of continuous experimentation and learning that drive radical innovation.
  
  
• Creativity happens when companies strive to complete marketplaces, creating new arenas of competition. Example: Associations can design new business models that make it possible to serve underserved markets and segments previously considered impossible to serve.
  
  
• Difference happens when companies seek meaningful payoffs that matter; when companies produce betters, they literally make a difference. Example: Associations can shift their focus from simply delivering outputs—i.e., products and services—to achieving better outcomes for their stakeholders.

The intention behind constructive advantage is not to outdo your existing rivals on the narrow terms of the current competitive landscape but, in Umair's words, to "build a disruptively better business," with long-term positive consequences for current and future stakeholders, as well as society as a whole. Associations adopting this new mindset will be better able to achieve "smart growth" through the creation of thicker, more enduring value.

Over the last year, the phrase "build to thrive" has emerged as a personal mantra, an urgent appeal to association leaders to take responsible and purposeful action to prepare their organizations for the profound uncertainties of the decade ahead. My final post in this series will share a set of critical questions on which staff and volunteer leaders can reflect to ascertain whether their intentions are focused on the future or stuck in the past.

Let's close this post with a question:

How is your association creating its "constructive advantage?"

[BIG NEWS! If you're planning to attend ASAE's Great Ideas Conference at The Broadmoor next month, I will facilitate an informal group discussion of The New Capitalist Manifesto on Tuesday, March 15, beginning at 2 p.m. in Colorado Hall Room E. Please contact me at jeff@principledinnovation.com if you have any questions.]

In The New Capitalist Manifesto: Building a Disruptively Better Business, author Umair Haque asks readers to imagine two worlds:

The first is a big world of abundant resources and raw materials, an empty world where demand is infrequent and easily satiated, and a stable world where disasters are infrequent and weak. The second is a tiny world, emptying of raw resources, a crowded world where demand is always hungry, and a fragile world, where contagion of every kind can flow across the globe in a matter of minutes, days, or weeks. [Emphasis in original]

Umair continues his allegory by comparing the big, empty, and stable world to an untouched game reserve, while the tiny, crowded, and fragile world is more like an ark. In Umair's view, the former description accurately depicts the world for which "industrial era" capitalism was built, and the latter captures the state of the world in these early years of the 21st century. The economics of the last century have used the rules of daily hunting on the game reserve: maximum efficiency in going after the biggest game. Unfortunately, these rules have also led society to consume, borrow, and use resources to the point of serious harm, placing our sustained prosperity in peril.

The realities of today's world, Umair argues, demand a new approach to creating meaningful value and achieving smarter growth. He writes:

To gain an intuitive feel for 21st century economics, put yourself at the helm of … an ark. You're the captain, and on board, every resource you've got isn't just valuable, but invaluable. Whether people, trees, animals, ideas, trust, creativity, or governance itself, you must safeguard all against damage, depletion, and exhaustion. Conversely, every resource you do decide to utilize must results in more tangible, meaningful, and enduring benefits than merely ephemeral "product" to be overconsumed.

Some association leaders continue to view the last few years of economic distress as nothing more than a cyclical occurrence that ultimately will ease into a so-called "new normal." But I share Umair's view that we are the midst of an irrevocable shift that will force us to reconsider all our fundamental beliefs. My next post will explore some of the new beliefs we will need to adopt to navigate our arks safely through the treacherous waters ahead.

Let's continue the dialogue. Please post your comments below in response to the following question:

Are you leading your association like a hunter or the captain of an ark?

[BIG NEWS! If you're planning to attend ASAE's Great Ideas Conference at The Broadmoor next month, I will facilitate an informal group discussion of The New Capitalist Manifesto on Tuesday, March 15, beginning at 2 p.m. in Colorado Hall Room E. Please contact me at jeff@principledinnovation.com if you have any questions.]

In our recent podcast interview, Umair Haque, author of The New Capitalist Manifesto: Building a Disruptively Better Business (Harvard Business Review Press), told me he makes the following pitch, in the form of a simple question, to boards that need to be persuaded to confront what Umair regards as the "existential threats" facing so many organizations today and going forward:

This question is the perfect way to frame the series of posts about The New Capitalist Manifesto I'll be publishing on Acronym throughout the month of February. In these posts, I will do what I have been doing for the last few years: challenge association leaders to take seriously the idea that their most significant responsibility is building their organizations to thrive over the next decade and beyond.

I'm sure that some association boards and CEOs would prefer to dismiss Umair's question as a rhetorical scare tactic, but what's actually happening in the world around us does not support that view. It's not just about the increasingly rapid flows of learning and knowledge that have overwhelmed the association's traditional information franchise, or the growth of social technologies that have made interaction and collaboration ubiquitous and inexpensive. Today's associations exist as institutions within a broader economic system that is seriously out of balance, something we have all experienced firsthand in the last few years. As a result, our ability to create authentic, meaningful and enduring value--what Umair calls thick value--is compromised. To change the dynamics of this situation and create a different kind of future, incremental change will never be enough. We need truly transformative shifts in both thinking and action.

Association leaders need to get comfortable with this reality very quickly, and engage in the work of transformation as a strategic imperative, not an intellectual exercise. In every organization of every size and scope, we must act to disrupt ourselves without further delay. If we don't, a rapidly failing status quo will continue to wreak havoc with "what we've always done," and cause further damage to our long-term prospects for success. There is no middle ground here. We must be bold, or those willing to be bold will supplant us.

In this post, I have staked out my position. In my upcoming posts, I will develop these themes further and explore ideas from Umair's book that can help individual associations, and the association community as a whole, think differently about what is possible going forward. Of course, this is a conversation, so I hope you will share your thoughts in the comments below. Let's begin the dialogue with Umair's question:

Does your association want to be one of the disruptors, or one of the disrupted?

Please welcome our latest Acronym bookblogger, Jeff De Cagna. Jeff, as I'm sure you know, is chief strategist and founder of Principled Innovation LLC as well as an association blogger and a regular commenter on Acronym.

Jeff will be writing about The New Capitalist Manifesto: Building a Disruptively Better Business by Umair Haque, published last month by Harvard Business Press. Jeff has a lot to say about how Haque's insights apply to associations and the future of our sector. I hope you'll add your thoughts to the discussion.

Thanks to Jeff for volunteering to share this thoughts on The New Capitalist Manifesto on Acronym!

"The easiest and most seductive escape from the project plateau is the most dangerous one: a new idea. New ideas offer a quick return to the high energy and commitment zone, but they also cause us to lose focus. As the new star rises, our execution efforts for the original idea start to fall off. The end result? A plateau filled with the skeleton of abandoned ideas."

Making Ideas Happen, p. 71.

Guilty. As. Charged.

It's certainly not unusual in associations to find a graveyard of ideas abandoned before their complete execution. As volunteers move into leadership positions, they often want to start fresh with their own ideas rather than finish implementing the ideas of their predecessors. As a result, resources are often wasted, staff morale sometimes suffers (here we go again), and potentially great ideas wither from lack of sufficient attention and cultivation.

We can try to manage this recurring phenomenon by:

• Asking boards to make multi-year resource commitments for new initiatives and specify appropriate milestones and results for each year's efforts.
• Ensuring part of leadership transition involves discussing works-in-progress and what attention they will require from the new team.
• Ask new leaders how they plan on continuing the implementation of heir predecessor's good ideas.
• Managing the initial high that comes during the creative process by exploring the commitments successful implementation of ideas will require.
• Making it easier to move from ideas to action, accelerating the implementation stage by removing administrative barriers to getting things done.
• Getting those in major leadership positions to facilitate focus and discipline during the implementation stages.
• Creating parallel paths for individual contributions based on their strengths: (1) an incubator/think tank path for those who like to generate ideas, and an (2) implementer/executor path whose gifts align most with refining others' ideas and seeing them successfully operationalized.

Progress begets progress is an important mantra for making ideas happen. It's why we like to pass cars on the highway even if going so really doesn't get us to our destination much sooner.

If we don't want to produce more skeletons of abandoned ideas, we need to carefully revise our processes and procedures and make it easier for big ideas to have a presence beyond an individual's term of office; small wins to be achieved, celebrated, and experienced; and opportunities to contribute to the next series of action steps to happen.

How else would you suggest we do that?

"Having just the vision's no solution
Everything depends on execution
The art of making art
Is putting it together."

Stephen Sondheim, Sunday in the Park with George

While we all can probably enhance our ability to generate great ideas and being more creative, innovation requires us to not only have the idea, but also to successfully implement it so that our members and stakeholders experience enhanced value.

And for some great insights on how to execute and implement creative possibilities, I'll be sharing ideas and commentary throughout December from the book, Making Ideas Happen, by Scott Belsky, founder and CEO of Behance. The Behance Network offers the Action Method set of resources for project planning, and I follow their Tweets and blog posts (published as The 99 Percent) for their valuable tips.

Insight #1: "The ideas that move industries forward are not the result of tremendous creative insight but rather of masterful stewardship."

Really? So often we seem to be looking for the breakthrough idea that will transform our organization or lamenting our seeming inability to be more innovative.

But stop for a second and think about you. Think about your organization. Are you really short on ideas? Is the association community really running on low on creative thinking, new insights, alternative approaches? Every day my RSS feed and Twitter screen is filled with dozens more ideas than I can possibly process. My bookshelves heave with environmental scans, research reports, and other publications from ASAE and a myriad of other organizations, each one containing more ideas for me to consider.

Yet, so often, the practices of association management don't seem to be changing. The questions we explore at conferences are often the same questions discussed a decade ago, and it often is evident that the answers identified then have yet to be implemented.

So while we may indeed need fresh answers for certain questions, perhaps what we need is more masterful stewardship of the ones we have ... just as Belsky suggests.

What do you think? Are we lacking ideas or falling short on execution? And why?

As we continue our experiment with blogging more regularly about books on Acronym, I'm pleased to introduce a special guest: Jeffrey Cufaude of Idea Architects, who will be joining us for the month to write about Making Ideas Happen by Scott Belsky. Jeffrey is of course no stranger to Acronym--he's contributed guest posts in the past and is one of our most thoughtful and regular commenters. (He's also a blogger himself, at the Idea Architects blog, not to mention a facilitator, writer, consultant, and speaker.)

Please welcome Jeffrey to Acronym this month. I'm looking forward to his insights and thoughts around Making Ideas Happen.

"We believe in operational excellence, and realize that there is always room for improvement in everything we do ... We must never lose our sense of urgency in making improvements. We must never settle for 'good enough.'"

Tony Hsieh writes this in a section of Delivering Happiness based on Zappos' core value "Do More With Less." I think it's a great place to end our discussion of the book, because it's a challenge every association, and every individual, can take to heart. The biggest association can always improve its operations--and so can the smallest. The most junior staff person can improve his or her work--and so can the most senior.

At the end of this section, Hsieh writes: "Ask yourself: How can you do what you're doing more efficiently? How can your department become more efficient? How can the company as a whole become more efficient? How can you personally help the company become more efficient?"

I'd say: Don't stop with efficiency. Can you make what you're doing (or what your department or association is doing) simpler? More impactful? Less resource-intensive? More engaging? More in line with our association's values? More valuable? If you look at one thing you do every day with fresh eyes, I bet you'll find room for improvement in many unexpected places.

***

Thank you for reading along with Delivering Happiness! In October, we'll be discussing The Networked Nonprofit: Connecting With Social Media to Drive Change, by Beth Kanter and Allison Fine. I'm looking forward to taking a look at what Kanter and Fine have to say about making our organizations simpler, reshaping governance, and learning through social media.

After October we have a few more books planned for you:

November: The Checklist Manifesto: How to Get Things Right, by Atul Gawande (blogger: Lisa Junker)

December: Making Ideas Happen: Overcoming the Obstacles Between Vision and Reality, by Scott Belsky (blogger: Jeffrey Cufaude)

January: Surviving and Thriving in Uncertainty: Creating the Risk Intelligent Enterprise, by Frederick Funston and Stephen Wagner (blogger: Melanie Herman)

If you're reading a book other members of the association community might enjoy, and you'd be interested in blogging about it, contact me at any time at ljunker@asaecenter.org.

In my last post on Delivering Happiness, I looked at some of the reasons why Tony Hsieh and his team have made culture the cornerstone of Zappos' business. Several other points Hsieh makes about culture stood out for me as well:

Culture is about the tough decisions. Zappos was originally founded to be a drop-ship business: Zappos would take the orders, but shoe companies would actually fulfill them.

Over time, even as Zappos began to carry inventory and fulfilled more and more sales through its own warehouse, the drop-ship part of their business was still important; it was 25 percent of their overall sales, and, as Hsieh writes, it was "easy money." But as Hsieh and his team realized that the Zappos brand was going to be focused on the very best customer service, they also realized that drop-shipping put the customer service experience partially in another company's hands--with sometimes negative results.

So, in March 2003, Zappos eliminated the drop-ship part of their business. With the literal flip of a switch, they cut 25 percent of their sales--at a time when they were tight on cash and having trouble making payroll week to week. Imagine a culture strong enough to propel that leap of faith.

Culture isn't just about staff. One of the ways Zappos reinforces its culture is through its Culture Book, a collection of unedited answers to the question "What does Zappos culture mean to you?" (The Culture Book is available to anyone interested in the company, by the way.)

At first, the Culture Book answers came from employees only. But over time, Zappos began asking vendors, partners, and customers to be part of the book, too.

Imagine asking your members, volunteers, vendor partners, and customers to write down their take on your culture. How would it contrast with staff perspectives? What could you learn?

Culture means turning some people off. As much as I love Delivering Happiness and the ideas Tony Hsieh presents, I don't think I could ever work at Zappos. Several times in the book, Hsieh writes about the importance Zappos places on hiring employees who want to spend lots of time with their coworkers outside the office; he writes that the company's best ideas often come during social events and happy hours.

I can see his perspective, but I also know that I wouldn't fit in in that culture. As much as I enjoy my coworkers, at the end of the day, I have two children who have to come ahead of social time with anyone else. That doesn't make Zappos wrong; it just makes me wrong for Zappos. And I admire a culture that's well-defined enough that it's easy to identify who fits and who doesn't (and confident enough to act on that information).

Next week, we'll wrap up Delivering Happiness. For a look at the books we'll be blogging about in future months, click the cut tag below.

Continue reading "Delivering Happiness: Culture When the Going Gets Tough" »

To continue our month-long look at Tony Hsieh's book Delivering Happiness, let's talk about culture.

Zappos is perhaps as well known for its culture as it is for its shoes. Every article I've read about the company (including one we ran in Associations Now) finds space to cite at least a story or two about the culture of the organization and the lengths its employees will go to because of that culture. But Zappos didn't wake up one morning to discover that they had a strong company culture. They committed to it and put in the sweat required to build it.

"Over time, as we focused more and more on our culture, we ultimately came to the realization that a company's culture and a company's brand are really just two sides of the same coin. The brand is just a lagging indicator of the company's culture," writes Hsieh in Delivering Happiness. (boldface mine, because I love that quote)

Hsieh's point here goes back to a lot of what's been written over the years about authenticity. The argument isn't that you should be authentic just because it's better to be authentic; the argument is that you should be authentic because over time it's impossible to hide who you really are. Eventually, you'll get tired, you'll speak without thinking, and your real self will be visible, no matter how hard you work to craft an alternate image of yourself.

The same is true of organizations. Hsieh puts it this way: "The fundamental problem is that you can't anticipate every possible touch point that could influence the perception of your company's brand." You can script your customer service reps' responses to frequently asked questions; you can have approved language and messaging for a wide variety of situations. But who knows? Maybe a member will run into one of your staff on the street or sit near them in a restaurant. (On my flight back from LA a few weeks ago, I looked across the aisle and realized the gentleman sitting across from me was reading Associations Now. Admittedly, the fact that I was returning from the Annual Meeting raised the odds of that happening, but my point is that you never know where members will be.)

If you've hired the right people and they've completely committed to your culture, it won't matter where or when your staff encounter a member or customer. Your members will experience the same brand, always, no matter what.

"At the end of the day," Hsieh writes, "just remember that if you get the culture right, most of the other stuff--including building a great brand--will fall into place on its own."

Next week, I'll take a look at a few more a-has about culture that I got from Delivering Happiness. (And click the link below for a look at our upcoming bookblogging schedule for October through December.)

Continue reading "Delivering Happiness: What Culture Really Is" »

Welcome to Acronym's new experiment in bookblogging! As I announced a few weeks ago, we're going to be blogging about a different book each month--books with lessons and ideas that the association community can be inspired and challenged by. This month, I'll be writing about Delivering Happiness, by Zappos.com CEO Tony Hsieh. (Click on the link at the bottom of this post for the schedule of upcoming books and bookbloggers.)

If you haven't read Delivering Happiness--which I highly recommend--here's some quick background: Tony Hsieh co-founded LinkExchange shortly after he graduated from college. After Microsoft bought LinkExchange for $265 million, Hsieh became a venture capitalist, played poker, and developed a business incubator--none of which fully captured his imagination and passion. But one of the companies his venture-capital firm had invested in did: Zappos.com. Hsieh joined Zappos full time in 2000.

After some rough years in the beginning, Zappos became a company strong enough to do more than $1 billion in annual gross sales and built a culture strong enough to generate a whole host of "Did you hear about the time that Zappos ..." stories. Tony Hsieh would surely tell you that the second part of that sentence is responsible for the first.

One thing really stands out about Hsieh, right from the first few pages of his book, is his entrepreneurial drive. As a child, he started a worm-farming business (which didn't work out) and button-making business (which did); that same drive led to his involvement in LinkExchange, Zappos, and a host of other business opportunities. So I was surprised to see him, of all people, write about the power of inertia.

Hsieh's insight about inertia came to him when he was learning to play poker, first in California and then in Las Vegas. "My big 'ah-ha!' moment came when I finally learned that the game started before I even sat down," writes Hsieh.

Hsieh had learned that the most important decision in a game of poker was your choice of table. An experienced player, he writes, can win significantly more at a table with inexperienced or tired players than at a table with good players who are focused on the game. But even more important, Hsieh realized that sitting down at a table didn't mean he had to stay there. If the game wasn't going well, he always had the option to get up and move.

That may sound obvious, but in real life, it's easy to get caught up in the day-to-day and forget that we have the option to do things differently--essentially, to switch tables. As Hsieh writes in his discussion of the business lessons poker taught him, "Without conscious and deliberate effort, inertia always wins." The infamous phrase "we have always done it that way" is just a longer way of saying "Inertia 1, Me 0."

And I love Hsieh's phrase "conscious and deliberate effort." Conscious and deliberate effort trumps waiting and hoping every time.

Next week, I'll be blogging about the heart of Delivering Happiness: culture, and some of the tough decisions Hsieh and his team made to preserve the culture at Zappos.

Continue reading "Delivering Happiness: Watch Out for Inertia" »

I've had the chance to read some particularly great books lately, and the first thing I want to do when I read a good book is talk with other people about it. So we're going to try something new here on Acronym: regular bookblogging.

Each month, starting in September, we'll do a series of posts on a particular book. We'll let you know the books in advance so you can read along--and I hope you will. But even if you don't have time to read a particular book, feel free to jump into the discussion at any time!

I'm going to do the first three months' worth of bookblogging, because I'm a geek, but we'd love to bring in others as well. If you've got a book you're excited about and you'd like to blog about it on Acronym in a future month, let me know (ljunker@asaecenter.org).

Here are the first three books we'll be blogging about:

- September: Delivering Happiness, by Tony Hsieh. The story of Zappos.com and Tony Hsieh's role in building the company, but also a compelling case for the power of organizational culture. Also just a fun read.

- October: The Networked Nonprofit, by Beth Kanter and Allison H. Fine. How nonprofits can leverage social media to drive change. This one I haven't actually read yet, but I really admire Beth's blog, so I'm looking forward to it.

- November: The Checklist Manifesto, by Atul Gawande. The subtitle of the book is "How to Get Things Right," and Gawande shares a number of compelling stories about situations and professions where getting it right is crucial--flying a plane, performing surgery, building a skyscraper. But at its heart the book is about how the human mind can manage complexity, and there are some great lessons for association leaders (who have plenty of complexity to manage).

I'm looking forward to discussing these books with you, and to seeing which books other folks suggest. In the meantime, happy reading!