Prediction for 2012

Prediction for 2012: A year of unimaginable extremes. The fiction of wall street broken by the occupy movement will see a broader decrease in trust in the economy and corporations. Jobs will be lost. Free agents will struggle as the economy to support them hasn’t gained ground yet. Depression will be the word of the year in many circles. Politics in the US will seem chaotic and highly unpredictable.

At the same time, trust in neighbors will go up along with bartering. As the middle class dies a begrudging death, the sleeping giant of America awakens. Survival will be about connecting to people around you. Quality of life will start to improve in dark contrast to economic stability. You will rate elements of the year either a 1 or a 9.

There will be at least 3 and likely 7 major catastrophes, some weather related and 2 or more economic black swans. Fear will not be about terrorism, it will be about the chaos and structure change by the amassing disenfranchised. (When 65% feels disenfranchised, there will be change, and it won’t be pretty)

Major factor in making it, from a business perspective, will be how trustworthy are you. Some iteration of “micro” will be seen everywhere. Set directions but not destinations. Push decision-making to the edge or you won’t be nimble enough to adjust to extreme economic climate.

The divide in the US will grow larger. On many axis. Short term thinking will result in short term gains that never add up to long term endurance. Think and be like a marathon runner. Drink lots of water. Meditate. Act small with a long view.

If you let go of all your assumptions and the story you had about your life, your business, and your world, and instead focus on your confidence in responding in this moment to what is before you, directing yourself and your business toward a direction you believe in; then you will end the year grateful. If you resist…well, the infrastructure collapses with or without you in it. Make quality of life your mantra. Seek the path you can be in with grace.

 

I was asked on Facebook what mechanisms I was using to think of this. This is my quick answer:
1. studying currency design, trust and radical economists (money is a collective agreement to pretend there is value in a number. The number 1435 has no value as anything more than a number, but if I say you have that much money, we can do something with it. Context matters. Don’t trust the context? Value goes up in smoke – start bartering and find other ways to exchange value.)
2. conversations with economic historian and reading about transitions in smaller scales (http://srnels.people.wm.edu/and on blockage – http://thrivable.wagn.org/wagn/Book+blockage)
3. watching what is working – what is and has been making communities more resilient
4. playing with models in my head – what if there is more of that… or less of this… what would happen then?
5. Swarm behavior and complexity science – looking at meta stable states, phase changes, slime molds as metaphor of individual/collective.

Influenced also by: Age fo the Unthinkable – http://www.hachettebookgroup.com/features/unthinkable/index.html which I recommend highly.

Transparency and Living Well

What is a good life? What is it to act with intention on the life you want for yourself? What matters? What doesn’t? When are you thriving? Are you contributing to thriving around you – in your family, community, and the world?

My whole life I have been gnawing on questions like this. And perhaps I have become so accustomed to acting on my answers without any fanfare that I didn’t stop to think it might be useful to anyone else. I don’t know how you are navigating these changing times. I will be transparent here. If it is useful to you, then I am honored. Everyone must come up with their own solutions, and I worry that this will seem self-righteous (which would offend me). So I qualify – again – your answers are yours. Great. Do that. I am not a better or worse person for my choices. I was triggered to write this post by something Vinay Gupta wrote about what he called the “Precariat” or people living on the edge of the capitalistic system. And then by Venkatesh Rao on Ribbon Farm writing about leaving the middle class. So here is my story.

Deep history. I grew up in the country on some acreage my father took a lot of risk in buying. Our money, tied up in land, with four kids on an assistant professor salary was tough. We took to growing our own food, planted an orchard, and avoided any more loans. When my parents did spend money, they bought as high a quality as they could afford. As intellectuals, my parents were considered upper middle class. As income earners, I wouldn’t think so. That said, my home – which my Dad built himself – looked like something in Metropolitan Home. Always ready for a photo. Immaculate. Designed. Elegant.

I never thought too much about the strange dissonance of living in such elegance while never having new clothes and using the dozen toys we had. (My kids have more toys under their bed than I remember having in my entire childhood, but more on that later.) So I guess I have always straddled the middle class by having certain things be high quality, and the rest be either forgone, DIY, or budget. This is what Venkat and others are calling Trading Up.

Early Independence. I started running my own financial life at 13. When my parents divorced that year, they decided the child support checks would go directly to me. I put it in the bank. When I started my sophomore year at 17, I used the money – not only to pay for college myself – but to get an apartment near campus. I was, for the most part, a saver, and I continued the Trading Up approach. It was almost a game to see how long I could make it last. Money was independence. And I was going to make sure I had independence. Then the child support stopped when I turned 18, and I had to shift to earning a living and using my savings.

Anti-Capitalism. By 21, I was in love with a much older man. A theater director. He wasn’t quite a marxist, and said simply that he was anti-capitalist. Consider it personal tutoring in the pitfalls and consequences of capitalism. The world was unveiled for me, as a new narrative about the system and poverty wove into my thinking. I was losing any desire to be rich as I saw that the rich of the past made their money off the poor people’s labor.  After eight years of this sort of thinking, I was tired of being in a head space of theory. I needed to see for myself. I left the art world for international finance – the belly of the beast. [If only they had known that I was, at the same time, getting published in a marxist literary journal!]

The Beast. Within a few months, I could see that the income ladder was a drug. The more you got, the more addicted you were to having it and dependent on it. It was never enough. There were so many wonderful and good hearted people around me, who were totally addicted to this drug – money. I decided not to play the game that way. It was 1999. I got married. We were cash poor, house rich on the North side of Chicago. I was making $800 car payments,  which would have been enough money to live on each month in the 90s for me when I was in college for a decade. I married a man who had bought a house at 28 and started fixing it up. He was a hoarder too, but he hoarded stuff where I had hoarded money itself. We went to garage sales every weekend and the flea markets too. Most of our disposable income went toward “investments” in goods. I had the feeling that I could have anything I wanted, if I waited for it to show up. Not because we had a lot of money, but because the pricing in this backyard economy was so reasonable. The 1900 square foot house underwent renovations DIY style, while it also began to fill with stuff. We were way ahead of most of our peers in our “adult-like” activities – having kids, house, car. But they had money to have a nightlife. We didn’t. Were we middle class then? I don’t know. Probably, but not in the usual ways. What else would you call it?

Cashing Out. In 2003, we decided to sell. Our second child was born in ’02, and we wanted to be closer to family, get out of the money pit of the house, and real estate was peeking. (If you need help with drywall, wood floors, cabinet installation, siding, painting, etc, I can probably be useful.) We sold for well over twice what we had bought for. It was like finally getting one big check for all the hours over years laboring on the house. We bought a 4000 square foot monster of a house near where my family lived. It needed no work. There was plenty of room for stuff. And 3.5 bathrooms to clean. There were things I loved about it: the dental work, the two story bay window, the master bath. Upper middle class luxury down to the wood trim. We bought it with cash – no mortgage. We paid off any debt. We bought mid-century modern furniture and a home theater. We had landed. We intentionally stepped off the ladder. We hardly needed to make any money at all. 20K would have cleared our living expenses. I ramped up my business (writing and design work), and we focused on our two kids.

Integrity and Guilt. A few things happened in quick order. I was online and began meeting social entrepreneurs. I was writing, for work, about child survival issues in Africa. And my environmental awareness kicked up a notch. I got training as a neuro-linguistic programming (NLP) coach thanks to my core client. My marriage had been struggling for years at this point and finally collapsed. I had a crisis of integrity. Yes, I had felt like everything I had been doing was intentional and aiming toward a good life, but my perspective had been narrow. I went through a massive overhaul toward a much deeper level of integrity. And along with it suffered a great deal of guilt.

The guilt was accompanied by a lot of gratitude, so I never would have spoken of it as guilt at the time. I was grateful for what life had given me. But underneath that was a guilt over the privilege I felt.

I walked away from the house and my marriage. Did I really want another pinball machine when we had 8 arcade games already? Could I raise my children in a house where their own bedroom was the size of entire homes for millions of people in the world? Could I really have my house be the largest part of my carbon footprint? No. I can make it seem clean in hindsight, but it was messy at the time. Lots of learning. Lots of beating myself up over my choices and their outcomes. Lots of feeling that it was all a wicked mess. And the guilt masked as pride at my frugality, haunted me, driving me toward ever greater frugality.

I rented a small apartment. Took only what I needed from my past life. And switched gears in my work and lifestyle. Since 2005, I have lived off 15-25k a year, supplemented in 2010 by the finalizing of my divorce and cashing out of the house. At first my ex just took care of the kids while I worked on my business and paid child support (which fully supported him). My kids now have nearly every video game console made since Atari came out. And most of the games. A near endless supply of movies and music. Every toy they can dream of (just not when it comes out, they have to wait until it shows up at a garage sale). They have such a state of abundance it is hard to come up with things they want or need. They cycle through things in order not to be crowded out of their giant bedrooms.

After 2 years, I decreased his dependence on me, and he started selling all the stuff he had been hoarding all those years. He now seems to make a decent living as a seller on ebay. He lives in the backyard economy. And I have been living in the gift economy. And I feel guilty of that too.

Appearances. The outward appearance of my lifestyle seems vastly richer than my actual living. Trading Up again. I fly to NYC, San Francisco, New York, and Boston regularly – as in about one a month. And sometimes I fly to other places around the world and country. It looks pretty jet-setting. Few would realize that most of this is paid for by clients or other people and that I can travel at far less expense than the usual middle class person. I stay with friends instead of hotels. I avoid taking taxis. I am humble enough to graciously allow others to buy my meals (and then try to treat someone else so I can keep the karmic flow going). I rarely attend an event that I have to pay for. I ask my network to pitch in to help me financially when I need it and can see value for them. I buy organic, fair trade, lifestyle products, but I may hardly eat for several days. I get frustrated when someone in my network asks for my financial support, and I can’t give it when I want to because there is no such thing as “spare” for me now. I can go days without spending money, and I gawk at the goods for sale wondering how anyone else can be buying all this stuff. Or why they would.

I have learned how to stretch resources out. I know how to live a very frugal life  – and live it well. I could write a book on how to move to a town and set up a home in 30 days on $150. I could give classes on finding serenity when you don’t know how next month’s few bills will be paid and you have cut everything out that you could.

But I have become so good at it and stopped chasing money so long ago, that I am now at the opposite end of the spectrum. I don’t seem to remember what abundance feels like. I would feel guilty for having it anyway. I don’t feel like I am thriving. I feel like I don’t catalyze abundance in the network around me either, as I use the spare resources I have learned so well to ferret out. I worry that I lessen the resources available to others doing important work.

I don’t think thriving is just about getting beyond the middle class defaults and money-drug-ladder addiction. I don’t think it is about being so frugal that you wither away into nothing. I think thriving is about making more out of less for more people. Life enabling more life. But maybe someone else has a better idea of how to answer it. I need new answers, of that I am sure. I Traded Up a lot. I still need to be mindful not to “Act Dead” too.

Questions. What I wonder now is how I can be responsible with the gifts I have been given? I have talents that are valuable in the world which others would pay to have access to. And I have denied myself and these people those talents for some misbegotten sense that I was acting with integrity by living so frugally and with what I looked at as high standards. I have a great deal of disdain for sales. Even of my own work, even when I think it is very valuable.

I wonder what it would look like to use what I have and earn what I can and be responsible to myself, my family, and my network with what that brings me.

Any suggestions? Some rebalancing would be really useful, before I start selling my furniture in the name of some grand notion of the boot-strapped entrepreneur.

 

 

 

Time Horizons

Much of what I do has to do with generating perspectives that are useful in offering us new information that enables wise action. And one of the most crucial in this area is time horizons. I have written in the past on zooming – that we can zoom in and out of a perspective, but when I wrote on that I focused on physical distance rather than time.

We can zoom through time as well. I can focus on the next five minutes or on the next century or millenium. When I was developing the thrivability cards (which in part became the Table of Contents for the Thrivability Sketch), I had a suit that was about time, because it is so valuable to move through time horizons.

If you are in a stuck place or holding a view of catastrophe, one very effective strategy is to expand a sense of time. Another is to shrink it. Let’s look in practice. Neon Time
Creative Commons License photo credit: Moe-tography

I can look at the current economic dynamics and become very depressed at the breakdown in our systems and the suffering that this is creating for millions of people. Pretty daunting. Very sad. If I think about it in a two year time frame, I might feel like screaming at people to do something – anything even – that will shift what is happening. Which is what I see Umair Haque doing a lot of.

To escape the fear, threat, disaster experience and focus on something productive I can do, I might look at a longer view. What if I consider it from a twenty year perspective? Can I imagine that the path in the short term might be quite painful, it will enable us to do something we could not have done otherwise? What would that be? What can I do now to catalyze that?

If I look at a hundred year flow. Can I look to the past and see how we have experienced challenging times before and had it work out for the greater good? Can I imagine, in another hundred years, people telling that same story about us – that we went through a challenging time and came out better for it?

Let’s say I can’t do that. (You know I can, but others may not or may think this is escapist thinking). Given the gritty reality before me, and my negative expectations of the future, what can I do in the next five minutes to make this one wild and precious life worth living for now? What can I do with this one day? While I have this moment in time, what will I make of it? The future will be what it will be, but we are not there yet. No, we are here, in this moment and only ever in the present moment. And the only action I can take is in this moment. So what do I want to make of this very moment?

Do I have ideas about how I want the succession of moments to be? Who am I? Start being who you want to be right now, because there is no other time but right now. So be the change you want to see in the world — already. Now. Not soon. Not in progress. Now.

Zooming in or out of our time horizons frees us from the fear-ridden anxiety of the uncertainty we face to hold a view that enable calm, intentional action. Make a choice. Be proactive about the perspective you hold. Don’t let fear blind you to the alternatives in time horizons.

 

Sharing and Intellectual Property

A contested space in sharing is intellectual property. Can I share a song that I bought with all my friends? If I have a paperback book, I can share it one friend at a time. If I have a digital copy, can I share it with all of them at once? Does my sharing take away from the rewards the creator and producer get? The manufacturer doesn’t get any funds when I sell something at a garage sale or donate it to a cause. Should the maker of intellectual property continue to get revenue when the property is shared?

In a world of sharing, how can and will we reward the makers? If one person were to pay me to write a book (and they got one copy they could do anything with), it would costs them tens of thousands of dollars (what it cost me to write it). If hundreds or thousands of people all get copies, then my time and energy can be distributed across all of them, making the book affordable to each.IMG_4488
Creative Commons License photo credit: tsakshaug

I haven’t seen any strong solutions to the intellectual property debate. The sharing economy seems fantastic in many regards, and it doesn’t solve an age old issue of how to reward significant effort toward often intangible non-rival goods. In the very potential of real abundance and infinite sharing in the space of intangible non-rival goods, our incentive system seems due for revision and no clear compelling and convincing answers emerge yet to reward the makers financially.

Looking again at how technologists address the issue – the business models tend to be: develop the software and offer it for free, add a premium version, and then do consulting and customization for a fee. For writers, this is also the model most often practiced – write the book and make little to nothing on it. Give away to lots of people. Make a living from the consulting and speaking that comes from that.

If Rich Dad and Poor Dad is right, and we should be seeking the passive revenue stream, then we are going in the wrong direction as producers. Trapping ourselves in hourly wage work after producing something with a lot of man-hours that we aren’t paid for and that could have generated passive income.

What ways will we create to support creative and innovative people for the often non-rival – easily shareable work they generate?

What models for future practice exist? For example, in the fashion industry, designers can get top prices, but they can’t copyright their designs or lines. Where else is this flourishing?

a note on non-rival goods. Rival goods are things that if I have it you can’t have it. My coffee maker is mine. If I give it to you, it becomes yours. But I can’t give it to you and also keep it for myself. We tend to assume everything works this way. Scarce commodities. Scarce time. However, there are a group of goods that either don’t diminish by being shared or even increase in value. My cheesecake recipe is mine, but if I share it with you, then we both can enjoy making cheesecake (and eating it! Yum!). The recipe is non-rival. If I share it with hundreds of people in a community, someone might even contribute some improvements or variations. Then it gets even better. Partially rival goods are things like roads – they can seem non-rival until they hit a threshold of use then they become rival.

The Great Unfolding

The Great Disruption by Paul Gilding tells of the impending and unavoidable crisis financially and environmentally and offers a grand plan to change course. The Big Shift proposed by Hagel and Seeley-Brown tracks shifts in financial viability, argues for talent engagement, and describes a new world of Pull methods. There are many namings for the future before us. No matter what we call it, there is a convergence of crisis at hand that involve a breakdown in the growth-focused form of capitalism. You don’t have to be a Marxist to perceive this, all you have to do is look out your windows and see the infectious #occupyeverywhere movement peopled across the political spectrum who say, “we have had enough.”

The Great Disruption might describe the short term picture. The Big Shift offers a longer view. Personally, I believe it could be useful to call what’s happening the Great Unfolding. It isn’t just the tremendous infrastructure that has aged and crumbled, it is the systemic infrastructures our society lives upon that are disintegrating from their own weight and internal contradictions. Financial. Political. Social. As they collapse, breakdown, or transform, they pull on the warp and weft of our flatland, opening new dimensions. It is as if we have been living in a two dimensional world, and another dimension must open to extract us from the dilemma of our dualisms and unfold a greater possibility.

While much of what is laid out here may apply broadly to many places in the world, I focus specifically here on the unfolding from a US-centric position (what I know and sense more tangibly). However, the world becomes so interconnected and intra-dependent that what impacts one ripples out to impact us all. A shift in capitalism itself transcends, in many ways, the boundaries of a nation-state. While the politics remains necessarily tied to the state itself, political memes spread beyond the borders of countries.

The polarizing marketplace tensions of the twentieth century — capitalism and communism; and the their drivers: the political left and the political right — fall away as useful but limited improvements on what came before: feudalism. Communism may have fallen first from its inconsistencies and poorly designed incentives, but Capitalism – as we have know it – teeters precariously too. We have learned much from both as we evolve through systems that better enable autonomy, mastery, and purpose – what Daniel Pink claims as the three keys to human motivation. Capitalism enabled a greater degree of these keys. It enabled much more autonomy than feudalism as well as deeper specialization (which brings with it a sense of mastery). However, it is time to improve on the human drive for purpose that goes beyond the self and harkens toward purpose for something greater than one. And we have before us the perfect storm for triggering a sense of purpose: convergent catastrophes across numerous domains: environmentally, economically, politically, and socially.

What has been touted about capitalism, markets, and endless growth — that consumptive abundance leads to human progress and betterment — turns out to be a myth. While many argue about what the limits to the environment for supporting economic systems based on infinite growth are, a more concise argument exists, one that proves the fallacy of the logic itself. The Death of Demand shows solid long-term data revealing that growth rates rise once and fall once in a very consistent pattern. All companies experience two growth trends during the life cycle – an uptrend and a downtrend.

“After experiencing a period of ever-increasing growth rates, a company hits a wall at which time growth rates turn south at ever-decreasing rates,” says economist Tom Osenton and author of The Death of Demand. “At this point, revenue as a profit driver loses steam and in its place cost-cutting grows in importance in order to deliver what Wall Street demands – ever-increasing earnings. However, just as revenue as an earnings driver has its limits, so too does cost-cutting. This illusory dance can continue for many years – but make no mistake about where it’s headed. And it’s very important to remember that cost-cutting and job-creation are enemies that cannot possibly co-exist – especially at a maturing organization.” So growth-decay companies are effectively starving themselves of resources to give the appearance of continually expanding margins. Who is in growth decay? The majority of companies listed on Wall Street.

Increasing rates of growth are something of the past for too large of a portion of Wall Street. Too many of the companies traded there have past their growth peak. Wall Street was meant for investment in businesses that were growing and now contains too many companies that no longer increase their rates of growth. The whole system becomes untenable. Unless a new sector kicks off, there isn’t enough mass in the early growth stages to counter the tremendous size and scale of those entering the late stages of growth decay. We have become so effective at growth that the time from “start” to “growth peak” is getting significantly shorter. Instead of long slopes of growth like we see with a company like Procter and Gamble over 100 years, we have Microsoft in 20 years, and Groupon in a couple years. The time to peak is so short in fact that even products or companies a decade old can be past their growth peak.

The illusion of infinite growth, like the Emperor’s New Clothes, is maintained by the Emperor. The citizenry see something naked and ridiculous which can’t be sustained. Much like the housing crisis and the dot-com boom/bust, the Wall Street Empire is revealed as naked, even to the emperor himself. #OWS has already succeeded by one measure, they broke the shared fiction about Wall Street for all of us.

As the incentive system of Wall Street – financial rewards for growth – demands what too many companies can’t provide. We should not be surprised that the ethics of companies decline to feed the “valuation” beast. It isn’t as simple as a few bad actors; rather, it’s a system that places such high demands on post-growth companies that bad acts become the only means to satisfy traders. As a result, bad becomes good in the lens of efficiency as marked by survival and marketplace robustness. The ultimate end result? A decay of trust in the systems themselves as people intuit how badly the system functions. This then undermines what the entire system requires – faith and trust – the root catalysts for financial and political action and transaction.

We begin to understand that what we consider to be the epicenter of capitalism turns out to be not just unsustainable but self-consuming even cannibalistic. Starving for the opportunity to meet stockholders/shareholders with growth by any means, corporations use ever more drastic, illusory measures to hide declining rates of growth. They truncate their lenses to short-term thinking and short-term gains/results. We can trust them to devour themselves as traders watch and gain, but we can’t trust them to serve the needs of citizens.

Is there hope? Where will we go? The center of the business universe implodes. And this is a very big problem. Are there options? Where is there stability in these changing time?

Outside Wall Street, small and medium size business don’t face these issues. Many businesses don’t focus on infinite growth. For these companies, what matters is staying trim enough to be agile and thick enough to stay alive in lean times. Non-publicly traded companies focus on providing goods and services in profitable ways. The local mom-and-pop restaurant isn’t trying to put more tables in the room, more seats at every table, or more meals in every day (or whatever scaling innovations corporations create to prop up their rates of growth). They understand that there are natural limits within their systems. They suffer no illusion about infinitely increasing their sales. Small business isn’t serving stockholders/shareholders of Wall Street. Small business is accountable to owners – to people who live in and engage with their communities. The feedback cycle between small business activity and their communities – is usually tight enough to ensure integrity in most small businesses who want to endure. An increasing demand for transparency, even in non-publicly traded companies can ensure the work of the invisible hand. True: the profit margins on these smaller businesses may not be significant enough to afford their executives or owners multi-million dollar bonuses. Oh, well, I guess that might have a secondary effect of reducing the extreme and increasing disparities between rich and poor. If you want a glimpse into what this might be starting to look like, explore the Slow Money movement, BALLE, and all the Go-Local endeavors. (If you don’t think income “diversity” is an issue for you, check the data from Richard Wilkinson: How Income Inequality Harms Society)

More than this, a new sector is coming to life. B corporations, L3Cs, and other ways of indicating For-Benefit Corporations, Social Enterprises, other blended models open the way for a hybrid of business and social benefit. While this movement has roots that are decades old, the scale and scope of the market is rapidly expanding and offers, perhaps, an opportunity to evolve our current form of capitalism to one that is more human-centric, impact-aware, and community-oriented. Marketplaces for social business expand daily with businesses that are still young enough to be in their upward growth cycle, prime for investment. And the returns are financial as well as social/environmental.

There is, of course, another disturbance beside the economic one. It is a related political one. Mostly because politics has morphed into corporations as a result of campaign finance reform – serving corporate needs. (State for Sale: A conservative multimillionaire has taken control in North Carolina, one of 2012’s top battlegrounds by Jane Mayer http://www.newyorker.com/reporting/2011/10/10/111010fa_fact_mayer?)

What was once a useful distinction between the left and the right has become artificially crafted polarity of two sides to the same position. As both the left and right have tried to sway the margins of the opposing group, they have moved closer and closer to the center. The political center becomes a gnarly knot. This is the entanglement of the current political scene that serves funders (read as corporations). The majority of the left and the right have come so close to the center to serve corporate interests and woo uncertain voters, that they collapsed into each other in a meaningless muddle.

The interesting question becomes: Is there something else emerging? Yes. And it isn’t just the Tea Party. (Because parties that fight AGAINST things rather than FOR things are not creative. They have no center of being once their demands are met or become irrelevant — they implode without something to resist – because they are not creating, they are opposing. This is yet another reason why the fear-mongering of the current republican and democratic parties is killing both sides.) Is there an emerging political energy that is elbows deep in making a community of voters and politicians that stands for something? Is there a force emerging that counters the tangled middle?

One way I imagine this could look: The Libertarians meet the Green Party or Pragmatic Progressives. On the left are pragmatic progressives focused on social justice, social change, and driven by a moral code bound to equality. The Pragmatic Progressives may value justice over business, but they know business can be more just and support causes making their efforts more resilient and financially self-stabilizing (rather than grant-dependent). On the right, we find Libertarians instead of Liberals. The Libertarians, valuing freedom, small government, and free markets want to show that we can bootstrap ourselves and make it on our own – the vision of the rugged individual – autonomous. They feel that business – not government or philanthropy – is the solution to social ills.

Both sides show up together in a place called social enterprise. Attend events for social entrepreneurs, and you will see these people who, under the old model of politics, are at opposite ends of the spectrum, rubbing shoulders, making deals, and agreeing vigorously on a path forward. They could rally under the flag of Agency. Agency for individuals – that we have each the right to act with agency in our lives.

Look around them to the larger group tied in there. Take a walk around Silicon Valley or much of San Francisco. Peruse the funding models of Skoll, Omidyar, and other dot.com mega-millionaires like Tim O’Reilly – a big advocate of Open Government. They are a strange blend of Steward Brand’s Whole Earth Catalogue and self-made millionaire geeks. This is not a small group and those in it wield significant financial and cultural influence.

Weave together the Pragmatic Progressives and the Libertarians, if we can even use these outdated terms. The old poles of politics disappear, and new poles of tension emerge. Oh, and the Slow Money, BALLE, and other emerging indicators of the new financial space? You will find a similar political “crossover” or alignment when you visit them too.

Even more than that, this group – the Social Entrepreneur party, you might say – often closely aligns to another group – the Pirate Party, aka the Open Government/ Transparency Party, emerging now in many parts of the world. Pirates are interested in shifting how we handle intellectual property, strengthening individual privacy, and also increasing government transparency.

In the old forms, identity was constructed by what we bought or what party we belonged to. In the unfolding, identity is made by what you make or create and whether others can share and build on that. In the Unfolding, politics will continue to drive toward greater transparency. As people move away from the collapsed political center, it may be that the unfolding brings with it a party focused on enabling agency at the individual and community level. We may even see Elinor Ostrom’s notion of polycentricity become more prominent in political discourse.

For now, the Great Unfolding is about the promise of the new systems we can step into as we move beyond the polarization of the old systems that have proven to be useful but limited. The future is already here, it simply hasn’t scaled nor been mapped yet. The edges move toward each other as the center collapses. It folds in upon itself. It unfolds a new era.

It is not a question of whether you are blue or red, or whether you prefer Pepsi to Coke. It is a question of moving toward new systems that have successful pilots or trying to salvage a broken, limited past. And we already know what the past gets for us. And they are protesting it around the world – from the Arab Spring to the #occupyeverywhere action.

For Liberty and Progress, we unite to step into the unfolding together.

What do you sense that might look like?

Encouraging Creativity

After the last post on Catalyzing Creativity, Curtis Faith asked me to answer the question on Quora – How do you incentivize creativity. Here is how I answered.

1. Disney creative strategies –

  • phase 1: wild brainstorming (divergent thinking)- this is the phase to make room for lots and lots of ideas without criticizing or considering plausibility of any of them – just generate, which needs to be distinct from phase 2
  • phase 2: editor (convergent thinking and refining) move through options and sort for most interesting, see if they are plausible…whatever criteria you establish for a good outcome.
  • phase 3: critic – rip to shreds. consider minimum viable product, test for market interest, be rigorous. To that, I would add a social gathering phase after the critic period, so there can be shared appreciation for the ideas generated, refinement, and polishing. Close the process with good team morale.

2. Don’t incentivize with money (Pink on Drive)

3. See conditions I listed on Catalyzing Creativity.
4. Celebrate mistakes and failure. Congratulate people on trying. Ask for what wisdom was learned.
5. Generate interesting questions and ask for help generating more questions.
6. Have leaders and influencers model creativity.
7. Consider how you can apply Cialdini’s 6 key principles of persuasion.
8. Acknowledge play-masters. I don’t mean play ping pong. I mean play with the real things there. Thank people for

9. Go to making and play and prototype soon and often.


10. Rule #6 (Art of Possibility) – Don’t take yourself so god damn seriously. Do something to get perspective on risk – think about how lucky you are not to be x. Encourage lightness of being.

Catalyzing Creativity

While I am not sure I quite agree, a recent article in The Atlantic proclaims that there are two ways to save the economy: innovation and inflation. Inflation sounds like a postponement of the issue, so let’s focus on innovation. As I wrote Innovation Types a few weeks ago, I had in mind the processes that we use to go about these different types.  Before we explore how they are different, let’s look at the conditions for creativity and innovation that they share.

Conditions. Not a formula. This is about emergence. It doesn’t happen in a linear fashion. It isn’t clearly causal. It is something that we can increase the probability of rather than directly ensure. Creativity could happen without these conditions, but most of the time it happens with some of these conditions. Increase the conditions and you may increase your chances.

My insights here come from conversations with Valdis Krebs and Steve Crandall among others. Valdis approaches the subject as a social network analyst, watching for the characteristics of networks that give rise to creativity. Steve… well, Pip Coborn says of Steve that he “is one of those rare Bell Labs genuises that when I was growing up people spoke of in hushed tones.” My relationship with Steve is as an amazing friend rather than a creative collaborator/innovator/partner. And, I am aware that he has given significant attention to what gives rise to creativity and has deep experience creating very forward thinking innovations. I have heard his stories. I will share a few with you.

So when Venessa Miemis asked

I knew it was time to write about what I have learned from Steve and Valdis. There are two other groups I also learned from – conversations here and there over the last five years with many people and a deep devouring of written information. And then, my years in the creative fields of art, theater, and literature.

Let’s begin. What conditions contribute to creativity and innovation? My response to Venessa was:

And Valdis added:

In no particular order, then:

Randomness – I say randomness because things, even in hindsight, seem to look a bit random. Steve talks about developing the idea for MP3 technology by trying to figure out how mother bats can find their baby bats in a cave of thousands. Ah…they screen out sounds other than the sound of their baby. Bats? When I first heard this story, I was shaking my head, thinking who would have guessed that bats led to MP3s? The path to innovation is not a straight line or a clear flow chart. It is a jumble of odd experience that a creative brain makes note of and creates meaning from. Creative people are ones who can take the random bits and make something from some of them. Encourage randomness. Go for walks in nature and notice things. Visit an art museum or take an odd dive into history. Look elsewhere than right in front of you.

Time – Innovation doesn’t happen on pre-determined timelines. In fact, time pressure can undermine creativity. Time pressure and monetary incentives both trigger analytical thinking instead of creative flowing. Time also works in two ways for creative outputs. There is often a tremendous amount of time gathering all the information relevant to a creation. It is as if the warehouse of the unconscious mind must be filled with all the relevant parts but you have no list of relevant parts to be adding to the warehouse, so you can’t know when what you need is in stock. However, the moment where those things are in stock and meaning is made – creation happens – can feel instantaneous. Sometimes the ideas emerge fully formed and plop into the conscious mind ready for action. That can’t be scheduled.

The other crucial element to time is having long enough stretches of it. When interrupted from deep mental activity, it can take 20 minutes to return to the same headspace. For creative activity, turn off phones, put away social media, and reduce your chances of being distracted. Steve says there are institutions that actively encourage this “offline” time for deeper creative activity. Give yourself the time to explore without distraction. Go deep into the warehouses of the mind and play there.

Right mix of Sameness and Difference – Valdis drew a Gaussian curve for me and said – I think the left side of the curve is something where people are so different they can hardly communicate at all. And on the right side of the curve, people are so similar that adding another person doesn’t increase information available – the homophily doesn’t generate creativity. He said he wasn’t sure what the numbers were or what the curve was precisely, but somewhere between those two ends of the spectrum there is enough sameness to enable communication & trust and enough difference to generate something creative that the people involved couldn’t come up with on their own. Think of that warehouse metaphor above – if you have difference, then you have more inventory to be pulling from. And he had this nice phrase to go along with it: “connect on your sameness and profit from your difference.”

Play (lightness) – This might be the most important condition. A significant portion of creativity involves trying many different combinations of things together. Steve has this wonderful expression: innovation is like throwing yourself at the ground over and over again until you finally miss the ground and start flying. If you take yourself too seriously in the act of throwing yourself at the ground, you won’t take enough risks to generate something really creative. Instead you will try 100 small variations in a very methodical process. If you are afraid of hitting the ground, you won’t really throw yourself at it. Tickle the fear out of yourself and play with possibility and with your collaborators.

Steve also tells stories of Friday creative jams at Bell Labs. He and several others would gather together. One – a catalyst – would listen and encourage them, then, later in the session, sort and summarize their best ideas. I call it a jam because, like jazz, it was each person knowing how to play with others and giving forth their best pieces in a space of play. The vast majority of the ideas generated were tossed away. We should ask Steve for some of the outcomes from these jams. When he describes them, he is focused on how much fun they were and how creative they could be instead of what they led to. This is a sign of play – that the process is alive and enjoyable (even when challenging).

Aesthete (deep sensitivity) – Steve was explaining to me, after many conversations about creativity and innovation, that serendipity is not only the seemingly random connection of things in a meaningful way, it is also noticing that the connection is significant. If you create something incredibly original, but no one realizes it including you, then it is lost. What does it take to notice that a new connection is made that could be significant? A deep sensitivity. I surround myself with really brilliant and creative people. And what I notice about them is that they are “noticers” by which I mean they are giving their attention to details – the flavors used in foods, the unique sound combinations in music, the way light moves through a water glass. Whatever their passion, they devote significant time to building up that warehouse of data in their minds using a great deal of discernment in their sorting. They have a deep awareness of and sensitivity to the topography of their interest areas.

Trust/Safety – Whether this is trust and safety we perceive in ourselves or between us and our collaborators, the trust and safety acts as the ground of creativity. If we don’t have it, we can’t try things. We become afraid to fail or look silly. Our mind-time focuses on social dynamics instead of playing with ideas. If we happen to be in groups where trust is missing, the only course is to trust ourselves. But trust must be there. Question everything…but not all at once…and not without trusting yourself to figure it out. Safety is also important. Sure, I mean physical safety as possible. But I also mean things like financial safety.

Deep curiosity – I almost forget this one because I tend to have it as a pre-requisite for people I share time with. When I was in the humanities, I noticed that those most dedicated to their work shared a trait – a deep curiosity about some question or another. Curiosity is the fuel for exploration. It is what feeds us in a space of profound un-knowing – the vast realms of unmapped possibility. We ask “why?” And the asking leads deeper into the question. Steve says the best questions lead to more questions. Only the deeply curious are willing to go there. One of my favorite quotes is an anonymous one: “go out on a limb, that is where all the fruit is.”

Network poised for Serendipity – As mentioned above, serendipity plays an important role in creativity. A network poised for serendipity is more likely to generate creativity. Steve talks about how the buildings at Bell Labs were like a labyrinth. It was easy to get lost. People of different backgrounds were mixed together and chalkboards filled the halls. This encouraged random interactions between people with differences and tools for them to brainstorm together. Steve also says another creative organization he has worked with designed their building with too few bathrooms to encourage waiting in line so interactions happen with unexpected people.

Some luck – Creativity and innovation operate in that space of probability. We can’t methodically try all possibilities (this would take much too long). There has to be some sensitivity to what could work and an ability to catalyze innovation to increase that probability. Whether it is the humility of those I have spoken to who are deeply creative or truly a matter of what is required, it seems luck has a hand in innovation. (Mind you, I am a big fan of the Richard Wiseman’s research book: The Luck Factor.)

And with that, I wish you luck. Innovate!

Experience Stories

Today I posted on twitter:

“It continues to amaze and baffle me how much the interior mind creates the experience of the exterior world. What do you do with that?”

It simply deserves more than just that, so I am expounding on it here. Play with me?

First, let me not imply that the interior world is making the exterior world in some magical way. I can’t think coffee and have coffee show up in my cup. The world of objects is a world of objects. However, those objects remain meaningless until we shape a story or stories about them. A rock is a rock until I say, this is the rock I picked up on the beach the day we played with the sand together and ate that delicious chocolate carmel tart. Now it is a rock that has a memory attached to it. It has a meaning for me. And that meaning is entirely in my own internal world. I can tell you that story, and maybe some of what is meaningful about it to me can be meaningful to you (but even if I tell the story well, it will only be a small portion of what is alive for me about it).

I am driving on 90/94 past downtown Chicago. A driver comes up fast behind me, swerves around me, and cuts me off before speeding ahead. These are the facts. And the internal experience I have could take several different paths. I could make up a story that this person is a selfish jerk, a menace to society, and probably thinks of himself as a race car driver. (And then what will I do in response to him? honk? give him the bird?) Or I could make up a story that the driver is racing to get to the hospital because they are a doctor and a patient urgently needs their skill in order to stay alive. (And then what will I do in response to him? move out of the way?).

What happens to my body and my frame of mind as a result of either of these stories? In the first, my body is most likely to tense up or get angry, frentic. In the second, my body is more likely to calm down. I have no evidence by which I can judge whether the first story or the second story is accurate. None. I could imagine the driver of that car is insane and the demons in his mind propel him to behave this way. Or any number of many other possibilities of how the facts can be interpreted. I get to choose which story I am going to tell.

I get to choose the story I want to tell about the worlds I inhabit as part of a dance between the facts that I am aware of and the interior mental models and beliefs I have. The experience I have is not some default or single choice. I get to choose. Most people do not realize this. For most of my life, I didn’t realize this.

Doing so has created profound shifts in how I interact with others, the sense of power and control I have in my life, my sense of agency, my ability to create options for action, my capacity to be compassionate, and my ability to stay “grounded” in the flux of changes around me.

Step 1: Realize that you are choosing.

Step 2: Realize that there are options. Pick the ones that are useful for having the experience you want to be having to the degree that the evidence is not being ignored.

Step 3: Recognize that while there is choice, my ability to communicate and connect with others is in some ways limited by my ability to have an overlap in the story I am telling about my experience of something. This isn’t about making random choices because the choice is there…there are choices in the creation of the story and your internal experience of it that interconnect with other humans.

Step 4: Response and actions are not foretold by the facts before you, they are foretold by the story you weave around those facts. Engage the story you are telling about your experience when you want to create options to act upon.

Make your experience of the world something you actively engage in co-creating.

 

Financial Thrivability

I have had google alerts on “thrivability” for three years now, and I was very excited when a recent alert sent me to a press release: The Patterson Foundation Invests in Partner’s Thrivability. When the Patterson Foundation uses the term thrivability, they mean financial thrivability. Our collaborator Kevin Clark has also been working with nonprofits on thrivability plans (rather than business plans because nonprofits are not businesses nor should they pretend to be). He has a template for those plans, if you are interested. I wondered if the Patterson Foundation thought of financial thrivability in the same ways as Kevin Clark.

I was so excited by what I read on the press release that I contacted the foundation to open a dialogue. I have been working as a writer and editor in philanthropy since 2003, and I co-founded Inspired Legacies, a donor education organization catalyzing millions of dollars in philanthropy. And I have been, in that space, particularly interested in innovative forms of philanthropy, so for me, this was doubly exciting. I spoke with their interim COO, Michael Corley.

So often in the philanthropic world, grantees receive gifts on an annual basis or on a short term cycle (such as three years). Executive Directors in small organizations and Development staff in larger ones can devour large amounts of time and energy in a revolving cycle of chasing the next round of funding. I have personally watched an ED devote 50% of their energy to this funds-chasing cycle {note that this is also true in startups seeking funding} This significantly detracts from the organization’s ability to act on the mission they have. Patterson Foundation wants to change that dynamic with their grantees. Debra Jacobs, their president and CEO, explains this perspective on the Patterson Foundation blog in an article entitled: Investing in endowed philanthropy to thrive for impact.

Think of it like incubation. The Patterson Foundation perceives the potential in an organization or collaboration for them to achieve financial thrivability. Over the course of two or three years, the Patterson Foundation works beside the grantee much like an incubator – making connections, providing appropriate consultants, building necessary software and skills as well as financial support, so that the end of the grant period the organization is launched and standing on its own financial viability/thrivability.

What does financial thrivability look like? I am not completely sure yet. We are making this up as we go along. There are likely many ways that can be achieved. In the case of the press release from the Patterson Foundation, this is about creating an endowment that enables the organization to exist into perpetuity. I imagine it can also be the case if we view the philanthropy as seed capital for a social enterprise that is then enabled to grow itself. In the Patterson Foundation blog post it is clear they are also looking for more methods for supporting financial thrivability. Perhaps you have some ideas or suggestions that you can share with us? I have spoken with several donors who believe similar to the Patterson Foundation that the circling back year after year for more funding of programs isn’t as potent in the transformation of our world and organizations as the nudge that philanthropy can give to enable an organization to move toward more self-perpetuating financial methods.

I am eager to see more organizations working in parallel with the Patterson Foundation to incubate socially transformative organizations – both by assisting with financial thrivability and by acting as partners to help organizations learn, evolve, share and take effective action. There is significant waste in the philanthropic process. And I excited to see lead organizations leap in to address those inefficiencies.

Positively Insane

Today Gregory (On the Spiral) tweets:

Which links to a Scientific American article, The Pitfalls of Positive Thinking. And I think this is a great excuse to debunk the sense that because I am positive focused and nurturing, that I live in some lala land of illusion where everything is soft and beautiful and unicorns run wild and perfectly groomed and everything is sprinkled with fairy dust.

Unicorn (Design by Román Díaz)

Unicorn (Design by Román Díaz)

Positive thinking doesn’t have to be about daydreaming some future in which you are the bestest, most beautiful, and amazing person ever and then assuming that will somehow magically make it happen. Positive thinking is about wondering about possibility. Is it possible that I could get that? If I could, how would that happen? What would I need to do to get closer to it? Are there other ways I could go about it? When I encounter hurdles, I am not going to tell myself some self-hating story about how I suck. Instead, I am going to tell myself that I am trying, I can keep trying, or I can use feedback to decide how realistic my goals are…and adjust.
Creative Commons License photo credit: Origamiancy

Positive thinking can be knowing that while I feel crushed right now, I have been crushed before, and I survived that and grew from it. I am resilient. So instead of using self-talk that denigrates my efforts by focusing on what went wrong (and how that is my fault), I am going to focus on getting to that place where I am not crushed because I know I can do it (and learn from where I can do better next time).

I have worked with coaching clients who want to set big hairy audacious goals for themselves. And that is fantastic. I applaud that. AND… let’s celebrate each step toward that instead of waiting to see if we shoot past that goal. Let’s work on enjoying the process instead of the outcome. Because even when we achieve the big hairy audacious goals, as we sometimes do, we are often then beset by post-goal hitting blues! If you emotionally hype yourself up too much for a bold goal, you collapse at the finish line. Which is fine, if you can accept and enjoy that process. But for you high-performing addicts, the dip after the high seems to be a negative space most people weren’t expecting and have a tricky time navigating (aren’t they supposed to be happy when they succeed?).

Positive thinking is about having an intentional conversation with yourself about the experience you want to be having. What experience do you want to be having, what experience are you having, what is the gap, what do you want to adjust about that? And it turns out, reframing your perspective is the quickest way to level out emotional spikes (of both highs and lows). I know, because I have had to become masterful at thinking my way out of emotional highs and lows. I am a pretty excitable and emotional person. And I don’t like getting hijacked by my emotions. So I learned how to have a conversation with my emotions and give them different perspectives to look through. Sometimes I have to sit with myself in conversation before I can find a perspective that soothes my emotions… but I am looking, and I feel empowered by the process instead of feeling hijacked. No one gave me a users manual for my brain and heart. I had to create it myself. And so do you. We can learn together.

In sum, positive thinking is not about airy fairy day dreaming wish making. If you do it that way, you will be disappointed. Wishful thinking is like Wiley E Coyote stepping off a cliff assuming there is ground there. There isn’t. There is a real world out there with a fair bit of complexity to it, and if you want to make it yours, you better put in persistent and determined effort and manage your expectations. Be mindful of your surroundings.

Oh, that is the one other guide to positive thinking. Manage your expectations. I have a saying I usually only use in private with clients: Expectations are a bitch. Hope for something. Dream of something. Imagine wild possibilities. Drive toward something. All of those can go well. But once you start to expect them, you put your emotions at risk of being disappointed. Find the balance that works for you between what you want to expect for and of yourself and what dreams you want to seek out and make real for yourself.