In his excellent new book Why the West Rules – For Now Ian Morris tells many great stories while trying to explain the trends in human history from around 14,000 BC to now. One of them jumped out at me – the story of the rise of Portuguese sea power on the back of guns in the early 16th century (emphasis mine):
Dozens of Portuguese ships followed in da Gama’s wake, exploiting the one advantage they did have: firepower. Slipping as the occasion demanded among trading, bullying, and shooting, the Portuguese found that nothing closed a deal quite like a gun….
Their tiny numbers meant that Portuguese ships were more like mosquitoes buzzing around the great kingdoms of the Indian Ocean than like conquistadors, but after a decade of their biting, the sultans and kinds of Turkey, Egypt, Gujarat and Calicut – egged on by Venice – decided enough was enough. Massing more than a hundred vessels in 1509, they trapped 18 Portuguese warships against the Indian coast and closed to ram and board them. The Portuguese blasted them into splinters.
Like the Ottomans when they advanced into the Balkans a century earlier, rulers all around the Indian Ocean rushed to copy European guns, only to learn that it took more than just cannons to outshoot the Portuguese. They needed to import an entire military system and transform the social order to make room for new kinds of warriors, which proved just as difficult in sixteenth-century South Asia as it had been three thousand years earlier, when the kings of the Western core struggled to adapt their armies to chariots.
Here is my take on lesson of this story: benchmarking doesn’t work.
The problem with benchmarking is the basic assumption that a particular tool or process will function in the same way in your firm as it does in its original context. This is rarely true.
Just as the kings around the Indian Ocean didn’t just need guns, they needed entirely new military processes and personnel, firms trying to change can’t just copy a tool that a successful firm uses, like Google’s 20% rule (discussed here), they need to support the tool with different processes and people.
“Bad ideas come from bad structures. One of the best ways to eliminate bad ideas is to build new, better structures.”
Oops, how would you know if they are “better?” I would say that to show up bad ideas for what they are, build new structures and EXPERIMENT like your life depended on it (because it does).
As discussed yesterday, one of the difficulties in managing in uncertain environments is that hierarchies often don’t function well in these circumstances. They respond slowly to change.
This is important to innovation, because it means that you can’t simply say “we need to be more innovative” in response to competitive pressures. You actually have to change the way you do business – much as the kings around the Indian Ocean had to change their entire military systems in response to pressure from the Portuguese.
I’ve talked about Steve Denning’s ideas in this regard a few times. He has a set of prescriptions for changing your management systems to deal with such threats. They are well worth exploring.
He says that experimenting is a key to building such systems, just as Matt suggests. He quotes The Power of Pull to show how self-managing teams can do this:
Organize work in short cycles: As the authors of The Power of Pull point out, one proceeds “by setting things up in short, consecutive waves of effort, iterations that foster deep, trust-based relationships among the participants… Knowledge begins to flow and team begins to learn, innovate and perform better and faster.… Rather than trying to specify the activities in the processes in great detail…specify what they want to come out of the process, providing more space for individual participants to experiment, improvise and innovate.”
When you are faced with competitive threats that change the playing field, you can’t respond by simply doing more of what you’re currently doing. Furthermore, you usually can’t copy what the new competitors are doing either – their systems and contexts are often too different, which means that even if you can copy what they’re doing, it won’t work the same way.
To succeed, you need a system that supports experimentation – that’s what really provides firepower.
Experimentation beats benchmarking.