The Restless Mind

I have a story to tell you. Well, two stories. But let’s start with the rabbit.

Rudy, a two-foot tall yellow rabbit, ran out of carrots on the day he planned to make soup for his neighbor. Panicking, he ransacked his house and tore up the backyard—but he couldn’t find any carrots. Luckily, though, two smart kids befriended him and together, working as a team, they managed to scrounge some carrots up in time for dinner. Crisis averted.

Now, this story probably won’t win the Caldecott, nor will it be much use to drive traffic to my blog. But in my family, Rudy the Rabbit is more powerful than anything Pixar could have dreamed up. It’s a story that my wife started for our (then) young son based on one of his stuffed animals. We convinced him that Rudy the Rabbit was, in fact, quite real—and had magical (albeit plain) adventures while he was at school. For a few years, Rudy became a staple of bedtime stories about life, love, hardship, and determination.

Little did I know that a decade later Rudy would become the inspiration for my own adventure. But more on that in a minute.

For families—and I could extrapolate this to society—stories are the bedrock of communication. Kids use them to contextualize and understand the world. Parents depend on them to frame issues, pass on family values, and entertain. Stories are a currency, passing back and forth among us, trading in an idea for something tangible, permanent, and valuable.

Most of us think about books and movies when we hear the word “story.” Curling up with your kids to read Where The Wild Things Are or tossing popcorn at each other while watching re-runs of Mary Poppins are staples of growing up in Western culture. But stories are traded in less obvious ways throughout the day: over dinner or on the phone, while playing a board game or taking a drive to see Grandma. We’re constantly narrating our lives to each other, largely to ensure we stay connected.

Connection, and how stories act as glue between us, is something that fascinates me. And it fascinates me precisely because that glue runs a little thin these days. With a divorce rate hovering around 50%, many of us live apart. A mobile society has meant we travel more, so calls from a hotel room or airport have become routine for kids trying to hear mummy or daddy’s voice. And when we’re lucky enough to be together, rituals like a bedtime story or nighttime walk get shooed away as we hurry to prepare for the next day.

Amidst this pace and chaos, networks like YouTube, Flickr, and Facebook have mushroomed largely because they help us grapple with fragmentation. They give us a chance to glue together our relationships and keep some context in our lives. And, intriguingly, they’re also new forms of storytelling. Blogs are our diaries, Flickr is the new documentary, and Facebook is the new sitcom.

For families, though, these new services and storytelling mediums don’t quite have the right form factor to provide the intimacy, context, and power of reading, making, or sharing stories together. You can upload or forward a funny clip to your kid through YouTube, but it’s microbroadcasting at best and doesn’t enable the subtle back and forth nature of shared stories. (And that’s if the kid actually noticed the email link in the first place. They’ve likely got their head stuck in Club Penguin, Habbo, or Gaia—the new Saturday morning cartoons.)

I was thinking about all this—stories, connection, and emerging digital services—when Rudy the Rabbit popped into my head. You see, a couple of years into the Rudy phenomena, my son and I created a book about our yellow-colored lapin for my wife’s birthday. I wrote, he illustrated, and we printed, bound, and wrapped it in all of it’s slim glory. Naturally, she loved it. It was her story, after all, coming back to her in a different shade, full of energy and love.

For us, though, the best part was in the making. Working together as a team, adjusting the story to suit his artistic ability (he was seven), keeping the story short enough to manage—all of the back and forth was something that made the process something close to magic. Now, not only was Rudy a way for us to frame life for our son, but it became a way to create something out of nothing. Creation culture as opposed to consumption culture.

That’s when Storybird popped into my head, a new service that my friends and I are unveiling soon. Storybird is the same process I described above, made digital, pushed into the cloud, and aimed at families and friends. We call it “collaborative storytelling.”

Storybird has a simple premise: you and I play around with some words and pictures and voila! We have a story we can share over the grid or print into a book we can keep forever.

The making of Storybird, and our goals for it, is something less simple. It’s a longer story, and an unfolding story, and something I plan to share with all of you in the months ahead.

It’s the beginning of my awfully big adventure.

Farhad Manjoo at Slate thinks we should “Fear the Kindle” and suggests Amazon will hamstring publishing the way Apple did the music industry.

We can only hope.

New markets or categories are always created by one player. It’s a feature, not a bug.

One player MUST initially dominate the new category to carve the way and make sense of it to consumers. Kodak, IBM, Microsoft, Apple, Netflix, Amazon, Miramax, and Threadless didn’t emerge as leaders so much by designing new products as they did by contextualizing new ideas. By creating understanding during times of change—in some kind of marketable form factor—they were rewarded by patronage.

Where was non-professional photography before Kodak? Multiplex art-house films before Miramax? Or crowdsourced t-shirts before Threadless? Nowhere.

Each category-in-waiting, like every idea, needs an author to shape and sell it. Once they do, consumers can understand and buy it.

And like authorship, only one person can write the story. (How many of your favorite novels were written by committee?) That’s essential to your enjoyment, but it’s also essential to the author.

Founders, like writers, must wrestle with ambiguous ideas and make sense of them, trimming unnecessary features while retaining the core. In the process, they reveal to themselves the hidden themes that make the concept valuable. It’s that clarity that helps them position their product to solve our problem.

When Bill Gates realized he could syndicate his OS, he was able to articulate his vision for “a computer on every desk in every home” and the personal computing era bloomed. In turn, WE made Microsoft a monopoly as thanks for ushering-in the digital age.

When Harvey Weinstein tinkered with foreign-film aesthetics by adding Hollywood casting and multiplex distribution, he created the modern indie and trumped Robert Redford’s Sundance Institute who had been laboring on the idea for years. As a result, Miramax defined—and dominated—film during the 90s and ushered in an era of storytelling so skilled that it was dubbed the “new realism.”

When Steve Jobs linked the player, the store, and the jukebox, he joined the ranks of Philip K. Dick and Arthur C. Clarke by demonstrating the future and articulating something we all sensed but couldn’t define. As a result, iPod’s musical ecosystem and Apple were rewarded with a monopoly.

(Hint: monopolies, like Barack Obama, are voted into power to make change when the presiding regime no longer works.)

So when Manjoo quotes Paul Aiken, executive director of the Authors Guild, as saying “Everyone is worried that Amazon will end up becoming to books what Apple is to music,” hum a silent prayer this comes true. Traditional publishing is broken. Digital publishing is a mess. We should be so lucky to have someone fix it.

The Kindle + store + wireless is preceded by Sony’s Reader by years and several other “well positioned” players. What happened? Their story made no sense. They revealed no purpose. They generated no clarity. (They’re the Jonathan Franzen of their category: byzantine and commercially unviable.)

If Amazon DOES come to dominate the market, it will be because Bezos’ unlocked the mystery of digital publishing and penned a story we could all understand (and threw in one-click convenience!)

Fear the reaper. Fear another Franzen novel. But not the Kindle.

Summary: American innovation is stumbling, reports BusinessWeek. Yet P&G reports that 10 years of innovation have doubled their sales to $80b. How? By operating in an analogue equivalent to the “link economy.”

BusinessWeek’s Chief Economist Mike Mandel recently penned “Can America Invent Its Way Back?” and highlighted that while the US spends on R&D, it doesn’t get its bang for its buck:

“Since 2000, the nation’s public and private sectors have poured almost $5 trillion into research and development and higher education, the key contributors to innovation. Nevertheless, employment in most technologically advanced industries has stagnated or even fallen. The number of domestic jobs in the computer and electronics sector continues to plunge while pharmaceutical and biotech companies lay off as many workers as they hire. And even the industry category that includes Google (GOOG)—Internet publishing and Web search portals—has added only 15,000 jobs since 2003.”

Mandel’s piece goes on to suggest that “innovation economics” are an important part of the road forward, stressing that idea management, culture, and “creation economics” are the antidote to traditional economic thinking that emphasize taxes, inflation, and cost-control.

He’s right, of course. Corporations (and the infrastructure that supports them like public labs, universities, and policy makers) are still in an industrial-age hangover, too blurry-eyed to notice that their organizational DNA—a military blueprint that favors information asymmetry and strict vertical hierarchies—is counterproductive to the post-grid era, a network model that encourages edge-competencies and group coordination.

Today, companies that act porously—enabling and encouraging the flow of IP and talent in and out of their sphere of influence—are winning. Google is an obvious example, an organization that thrives largely by coordinating—rather than suppressing—the flow of information between people and markets.

So remarkable is their success that the “link economy” has become an increasingly recognizable phenomena, a pattern that spotlights value wherever it resides and manages abundance rather than controls scarcity.

Proctor and Gamble seems to understand this, despite their distance from Mountain View. Under the stewardship of A.G Lafley the Cincinnati manufacturer, responsible for all number of household items from Tide to Swiffer to Oil of Olay, has doubled its revenue to US$80b by focusing on innovation alone.

Lafley wrote about the firm’s approach in Strategy+Business, noting a few key points about the aggregation and syndication (my words) of IP and people:

“We focused on creating a practice of open innovation: taking advantage of the skills and interests of people throughout the company and looking for partnerships outside P&G.

We grow our business in these countries only by consistently developing new products, processes, and forms of community presence. And to do that, we need to involve people, inside the company and out, who are comfortable and familiar with the values and needs of consumers in these parts of the world.

We move people around geographically. We bring people into our Cincinnati headquarters from around the world, and we make a point of moving our headquarters people to our global businesses. Almost all of us have worked outside our home region. Almost all of us have worked in developing or emerging markets. And almost all of us have worked across the businesses. We track that progress very carefully.”

And on their substantial retooling of Febreeze for the Japanese market, he notes:

“This is a story we tell ourselves at P&G to drive home the need for integrative thinking. The project started with a consumer-centric concept. It involved people in a variety of functions and at least two regions. It opened our team members’ eyes to other possibilities. And it came to fruition because we were skilled at having the kinds of processes and conversations that would lead people to synthesize their ideas.”

Makes sense, doesn’t it? Work across boundaries and find value wherever it resides, use integrative thinking, be open to mistakes and possibilities, and, importantly, include people from “outside” the firm with cultural differences to highlight opportunity.

What’s ironic (or sad, or both) is that while Lafley’s been talking about this for ten years, P&G’s peers—big, traditional, manufacturing-oriented companies—still don’t seem to get it. “Most companies are unwilling to draw on outside expertise,” notes Mandel in his BusinessWeek piece.

Furthermore, most are scared:

“Globalizing research and production can also alter the direction of technological change—with potentially negative effects on U.S. prosperity. MIT’s Acemoglu, who holds dual American and Turkish citizenship, argues in his work that in the past U.S. companies directed their research to take advantage of the well-educated American workforce. Now, as more multinationals move operations overseas, they are developing technologies adapted for their less skilled foreign workforces. In other words, offshoring is affecting the direction of innovation in ways that are more favorable to countries such as China and India. In particular, says Acemoglu, “China is going to have a major effect on technology.”

Perhaps CEO’s would find Threadless a less intimidating case study than P&G. Skinny Corp, the Chicago-based owners of Threadless, have proven that peer-production—a native business model in the network economy—can provide high margins AND avoid commoditization.

Threadless sells t-shirts (a commodity business if ever there was one) but does so by aligning the t-shirt designers with customers—much the same way that Google connects publishers and advertisers. Their monthly design contest receives thousands of submissions from designers around the world (none who work for them) and tens of thousands of votes from their rabid fan base.

The result: a business that manages abundance (t-shirt ideas), provides value through transparency (the audience becomes both editor and consumer), and values the flow of IP and talent through them—rather than by them. (Doc Searls calls this kind of value “a shift from “making money with” to “making money because.”)

Can applying “link economy” strategies work for “traditional” companies? Here are Jeff Jarvis’ four principles. And below is a modified version, applied to companies in pursuit of innovation:

1. All companies must be transparent. Your talent base and IP must be exposed and connected. They’re not useable unless they’re linked.

2. The recipient of IP and talent is the party responsible for monetizing them. The more you enable the flow of IP and talent AWAY from you, the more it comes BACK—with greater value and skills to monetize. Just watch how Hollywood operates.

3. A porous organization is the key to efficiency. In other words: do what you do best and link to the rest.

4. There are opportunities to add value atop the IP and talent layer. This is where one can find business opportunities: by managing abundance rather than the old model of managing scarcity. The market needs help finding the good stuff; that curation is a business opportunity.

A final note. The roots of the link economy are empathy (rather than “ego,” which is the root of the industrial economy. More on that in another post.) Abundance causes anxiety. Those who can carefully manage, curate, design, and syndicate value reduce customer anxiety and create stronger links.

And in the “all this has happened before” footnote, consider the strategy of retailer Rowland Macy who, 140 years ago, counseled his employees to help shoppers find what they were looking for even if it meant sending them across the street to their competitors. Sending people away, just like Google, established Macy’s as the definitive department store.

Summary: Want to understand data portability and the fuss between Facebook and Google’s Friend Connect? Watch the river.

A few months ago Wired ran an article on Gavin Potter, a retired British consultant who was out to crack the Netflix challenge and pocket a million bucks.

While the interview focused on Potter’s use of psychology in contrast to the usual algorithmic glue that solves complex sorting issues, a side comment jumped out and has stuck with me since:

“The 20th century was about sorting out supply,” Potter says. “The 21st is going to be about sorting out demand.”

I’ve been thinking about that quote in relation to the recent noise about data portability and the fuss between Facebook’s closed view in contrast to Google’s (seemingly) open strategy.

Jeff Jarvis got me going when he posted:

“Any choke point of control, via ownership, decreases the value of the network. Enablers increase the value of the network. The network will abhor and find ways around choke points. The network will value enablers and that is the point at which value may be extracted from the network. The value in networks in the open future is not in ownership and control but in enabling others to control.”

But it was Fred Wilson who cemented the Potter connection for me. As he notes, the crux of the issue is less about ownership and more about flow: the service that enables an effortless flow of your data—and experience—will hold your attention. Whether you “own” it isn’t the key issue since a) average people don’t know how to “own” it or b) don’t care to “own” it. If the service works, after all, what’s the problem?

“The social graph itself is being commoditized as all things get commoditized by the subversive technology we have created on the Internet.

What you cannot commoditize is the desire to create a social graph on a web service and the desire to maintain a social graph on a web service and the flow of data into and around that social graph.

Social web services need not fear data portability. They need to fear others providing a better experience. Because when others do that, the flow of data moves and they aren’t in the middle anymore. They might still have your data but they won’t have you. And that’s where the value is.”

That last paragraph is the Potter parable, in my mind. The 21st century is about sorting out demand. Where the 20th century grappled with real and artificial constraints of supply—how do we get these raw materials into this product that we can deliver to those regions—the post-grid generation must grapple with the real and artificial constraints of demand flow, a tidal wave of data and interactions that constitute our relationships to one another.

Interestingly, the architects of the supply side needed to address flow in a similar, albeit analogue, format. Transportation routes, shipping schedules, manufacturing output: to succeed, friction needed to be removed between the flow of objects (read “data”) from one port to another. The more elegant the solution, the faster and more durable the flow.

And, of course, artificial constraints were also introduced into the supply side to manipulate flow, from the good (Treasury limits money supply to avoid inflation), to the bad (five-year plans to regulate food production), to the ugly (manipulating markets, politics, and war to control diamond supply).

We’re now dealing with the same flow and constraint issues on the demand side. As Jarvis points out, services that unnaturally restrict data flow will have to grapple with the consequences of rigging and what to do with excess. In some situations, flow will organically adjust itself and simply bypass the obstruction (read “new service”). And in other cases, as Wilson notes with Facebook, flow tampering is semi-sustainable if the consumer doesn’t feel the consequence.

The real opportunity in flow constraint, though, is putting capacity to use and amplifying the effect. Data is like a river: you can dam it and generate electricity.

That’s what Google did with search. They created a machine that, as we pass through it on our way to find something, harnesses our collective energy and turns our data flow into the most powerful asset of this generation. And interestingly, they did it by subverting the prevailing notion of search: the portal, a benign (if not annoying) throttling technique that tried to control flow by creating smaller tributaries.

Really, life in general is about flow, from our biology to our relationships to our communities. And the study of flow almost always deals with “allowable constraints.” What we give versus take is situational and contextual, but it’s also the simplest and most profound way to recognize the value of flow—supply or demand.

Khoi Vinh, art director of The New York Times online, was recently interviewed by design chronicler Stephen Heller. Vinh, always thoughtful, is bang on with this comment about the shift from “designing inward to outward:”

We’re entering a new era of design where the brands and experiences we create are no longer closely held, highly controlled cathedrals, but rather bazaars of commerce and conversation. Historically, graphic design has been a discipline that deals in control, in creating carefully managed, organized experiences that are then distributed to people to be consumed in whole. Digital media has upended that equation, and now—yes—the audience is an active participant in the process of design.

In fact, the process is now a conversation between designers and users.

That last sentence reminded me of MIT Professor Donald Schön’s observation that design is a “conversation with materials.” In many ways users have become “materials” as much as participants. We not only engage them explicitly through interaction design to create discrete features, but also in aggregate as social systems and platforms amplify their implicit actions to create value.

Flickr’s a good example of both these kinds of “conversations.” Their perpetual beta is nothing if not an active, explicit dialogue with members to remove friction from, or add features to, the system. And “interestingness,” their intelligent aggregator that surfaces the most promising photos from the database, is, in essence, a “conversation with materials” in that the algorithm constantly jockeys members implicit behavior into new value. It automates the conversation Vinh describes into a never-ending telepathic exchange that asks nothing of the user, if only to watch over their shoulder and make some notes.

In that respect, the flickr team is both engaged in a conversation while simultaneously designing the conversation. As my pal Jeff Faulkner would say, “they’re designing the thing, and the thing about the thing.”

If that notion seems tricky to grasp—or at least master—it gets even trickier when you think about designing “on brand.” Tomorrow’s designers not only have to think about how to engage their users and interpret their actions into features or systems, they have to consider how the results reinforce the brand—a particular kind of relationship—and the quality, tempo, and durability of the exchange.

Look at how LastFM, which deals with recording artists with whom you have no direct relationship, lets you “ban” a song from your playlist. Flickr has no such mechanism baked into a member’s photo page feature set. You can “fave” a photo, but you can’t explicitly use the system to denigrate a contribution. And why should you? Flickr relies on almost 70 percent of their users to publicly share their photos and build on their brand promise to “see the world.” If you share a photo—a little piece of you—are you incented to share more if visitors are actively encouraged to hurt your feelings?

The end game in Vinh’s comments is that we’re not just designing the bazaars of conversation—we’re designing the conversation itself. We’re specifying often intangible and implicit nuances of how people interact and create value together.

That’s hard work. If relationship design is ambigous and complex, so are the relationships between the designers. Interface, systems, interaction, aesthetics—rarely are these talents invested in one person who can birth a solution outright. Rather, in an ironic twist, the architects of participation must first be able to grok their own relationships and sort out “the thing” or “the thing about the thing” before they engage their community.

Update: An eloquent and vivid example of visualizing “the relationship of relationships.” Via Danah.

Image: Mike Rohde, SXSWi 2008 sketches

Summary: Bundling helps you sell something good alongside something not as good. Unbundling helps you distinguish between the two.

The smartest decision Ringo Starr ever made was joining the Beatles. On his own, Ringo wasn’t much. As the drummer for the Fab Four he was, well, fab.

The smartest decision John Lennon and Paul McCartney made wasn’t forming the Beatles. It was allowing Ringo to join the Beatles. Stars need players on the team to distribute the wear-and-tear of interaction and create the right form factor. Adding Ringo was an insulation factor for the duo. It enabled them to be stars and focus on the core asset that people were paying for.

The bundle
That’s the power of the bundle. The bundle enables the less-than-stars to be sold alongside the stars, insulates the stars from the cost of interaction, and adds the appropriate form factor to make the bundle attractive for consumption.

Bundles explain just about everything in the marketplace. Albums bundle two great songs with eight so-so songs. Neighborhoods bundle three great streets with ten mid-list streets. Cars bundle a beautiful shape with a crappy engine. Cable companies bundle good internet services with not-so-good VoIP services. And so on.

Bundling is a fact of life. Most things in life are average. Few things in life are exceptional. Bundling the latter with the former means you can sell more things that people might otherwise not buy. To sell value, bundling is the way to go.

But to create value, you unbundle.

Unbundling is the mechanism to find the real value within a system.

The unbundle
Shawn Fanning unbundled the music industry with Napster and discovered that fidelity mattered less than distribution efficiency. The MP3 is a crappy music format, but it’s frictionless distribution quality revealed gaping holes in the music industry.

Larry Page and Sergey Brin unbundled paid links from organic linking. Pagerank revealed the true value of the citation and radically changed the efficiency of search.

Stewart Butterfield and Caterina Fake unbundled the meaning of photography. Flickr revealed that photo storage and printing were inconsequential next to public photo sharing.

Unbundling provides you with important insights:
-it highlights the real star of the system
-it spotlights the flaws in the system
-it reveals how the system evolved

What do you do once you’ve cracked the code?

You bundle. You extract the star feature/idea/offer, insulate it with a new cast of complimentary features/ideas/offers, and craft the right form factor.

Un/bundle
If “public photo sharing” was the flickr insight, then their interestingness algorithm is the #2 feature of the flickr bundle. It supports the key notion and makes it better by removing friction from the system. (Interestingness is the citation and tracking system that surfaces the most intriguing photos in any tag category. ) Interestingness is to flickr what Paul McCartney was to John Lennon: a vital counterbalance that made the star asset accessible and scaleable.

Google bundled Pagerank with Adsense and Adwords. Search is the star—but Adsense and Adwords are the brokers. They ensure the system’s sustainability, synchronize the connections, and keep everyone talking about Google. They insulate the star by distributing the cost of interaction (ie. they generate the revenue so R&D can continue exploring search innovations).

Shawn Fanning didn’t get to bundle MP3s with a new system, of course. He was sued out of existence. The job of bundling MP3s with several supporting “features” went to Steve Jobs. Today, iPod, iTunes, and the store are a massively successful bundle around the MP3.

Strategy vs phenomena
The trick with un/bundling a system is that sometimes it’s a natural phenomenon and sometimes it’s a strategic initiative. In other words, sometimes you can do something about it and sometimes you can’t.

In flickr’s case, the founders knew sharing would distinguish the service. They also knew the need for interestingness. They may not have expressed it as such (who would?), but they were making strategic decisions about bundles.

Google knew they were unbundling search with Pagerank. But they didn’t grasp how to bundle their new asset until years later.

Fanning didn’t understand his role or the importance of Napster. He was part of a phenomena that only later was bundled into the right form factor by Apple.

No worries, though. If you miss an opportunity to bundle, you might have the chance to unbundle. They’re a bit yin and yang, a little recursive and repeating.

Right now, the grid is creating perpetual opportunities to un/bundle new products, services, and industries. Friendfeed is unbundling Facebooks’ News Feed. ETSY is unbundling Wal-Mart. Ponoko is unbundling traditional manufacturing. Etcetera and so forth.

What are you dismantling?

Summary: time determines the success of systems more than any other factor. This can be maddening for strategists and designers slaving away at product, service, hardware, and software ecosystems.

Systems are seductive ideas. Like stories, they have the ability to immerse us in tangible and lingering experiences. Unbox an iPod, connect it to your Powerbook, and buy No Country for Old Men from the iTunes store and you’ll know what I mean. Well-designed systems, like well-designed products, are sensuous creatures.

Well-designed systems, though, are hard work. And well-designed systems are not, in fact, designed. They are the product of evolution.

Why systems matter
Product strategist Adam Richardson blogged “the system is the product,” observing that in our multichannel, multi-device world the ecosystem of products, services, hardware, and software must be regarded as a unit and designed as a whole.

For those who manage it, the strategic rewards of systems are nontrivial: sustainable growth, durable profits, unassailable marketshare—even network effects. Witness:
-Apple’s iUniverse, powered by an elegant, extensible Unix platform
-Nintendo’s “play” architecture and the resulting hardware and software
-IKEA’s modular furniture ecosystem

Unfortunately, designing systems is tough. As Richardson notes,
-systems are abstract and difficult to see
-systems are boring
-systems cross-over organizational boundaries

Even if companies jump these hurdles, waves of technology keep capsizing the boat. Some of the unseated:
-Palm by Motorola, both by Apple
-MTV for MySpace
-Blockbuster by Netflix
-Ford, rooked by Toyota
-Kodak, beat by just about everyone

And, if you jump the hurdles and manage the disruption, you still won’t necessarily win. That’s because the most significant factor in system success is time.

Time decides who wins and loses in two significant ways:
-it reveals the system “purpose;” consequently,
-it limits who participates

Time reveals the system
Systems, like narratives, take time to reveal themselves to their authors. Changes in technology, consumer preferences, and markets take years to play out. It’s not clear from day one where the system will go or how it will adapt.

Steve Jobs had no idea that his purchase of SoundJam in 2000 would be the cornerstone of his current empire. He re-skinned it as iTunes simply to respond to the Napster effect and the rise of the MP3. But once he had it in place, it became the nexus for the iPod, the store, hardware synchronization, and now, eight years later, software delivery for the iPhone. Time told Steve what iTunes was, not consultants or engineers.

Hiroshi Yamauchi did not predict the death of the coin-op in the mid-80s would be the birth of the NES, let alone the Wii. But NES gave Shigeru Miyamoto the canvas to re-interpret Donkey Kong into Mario. And Mario’s appeal with younger children (and their parents) was a central theme in Nintendo’s departure from the “fidelity wars” with Sony and Microsoft and the introduction of the playful DS and Wii. Time, not market studies or ethnography, showed Nintendo the way forward.

Ingvar Kamprad did not foresee a $15b furniture juggernaut when he started selling seeds, watches, and pens to farmers in 1943. IKEA didn’t sell furniture until five years later, and it took twelve years before they began designing their own. Flat-packaging, a concept that ultimately transformed furniture design, manufacturing, distribution, and retailing happened by accident when designer Gillis Lundgren couldn’t fit a newly-designed table into the back of a car. Time—a lot of time—showed Kamprad the advantages of systems.

Time reveals all. Just ask authors. Each one starts with “something”—a plot, an event, a character. But only as the they write—as they spend time turning over weak ideas, false starts, and bad pacing—does the true story reveal itself. Many authors describe this phenomena as something that happens to them rather than by them. If they’re patient, the system reveals itself.

Time limits the participants
Most companies don’t have the patience (or the time) for the system to reveal itself. Public companies are focused on three month cycles. Their CEO’s have three-year tenures. Their middle-management has 50% churn. At the other end, startups have no resources. Two-thirds have the wrong-market strategy. Ninety-percent of them fail in three years.

Systems are so rarely produced because they take time and time is one resource companies don’t have. Most die long before the system is revealed.

This is the market equivalent of natural selection.

This is not to say that companies can’t produce good products, services, hardware, or software. But these aren’t systems. They’re the biological equivalent of single cell organisms. They might do fine, for a time, on their own. But as market conditions require them to merge or companies tinker with their DNA to accelerate growth, these cells don’t grow. They mutate. They create mass that biologists call tumors (and in some cases, Vista.) They grow uncontrollably (Palm, circa 1997) until they don’t. Then they die (Palm, circa 2003).

Time is the issue. Without time to correctly translate their DNA, cells rapidly lose their ability to communicate and become mute. Without the ability to speak, so to speak, they can’t reveal anything to their creators. Their system remains unidentified.

To counteract this, an industry of “innovators” have stepped up to insulate (and incubate) the process. Ethnographers look for “unmet needs.” Boardrooms are riddled with pathway analyses to demonstrate inflection points. Prototypes are built and iterated. The goal: jumpstart the process and out-innovate the innovators. But, like asking a friend for feedback on an unfinished manuscript, the interactions simply create more opinions. (“I think the character would do this.”) Occasionally, as IDEO did with Palm, a new product emerges from “design thinking.” It toddles along for a bit until someone like Jobs—waiting a long, long time in the shadows—crushes it.

The test of time
That’s the final test of time. The stamina, luck, and insanity of those dogged enough to fight it out AND wait it out.

Jobs has been at this for over 30 years. Miyamoto for over 25 years. Kamprad has been doing it since World War II. These are grizzled men. If we were in Troy, they’d be the warriors who behead six men at a time while dodging a rainfall of arrows—and laughing.

If “system success” was a book, it would be the Odyssey. Most of the crew fell for the siren’s song and were crushed by the sea. It took Odysseus ten years to fight the war and another ten just to get home.