Iceland; Ireland; Greece; California. They are all in trouble – deep, serious trouble. The debts are massive. The way out looks… well, there doesn’t seem to be a very workable way out.
And the financial situation in other corners of the globe have ripple effects in every corner of the globe like never before. What happens here does not stay here, not in the financial arena.
This is the disturbing message of the new Michael Lewis book, Boomerang: Travels in the New Third World. I’m reading this book, and preparing a synopsis for a client group. It is Michael Lewis at his best – great storytelling, with plenty of “this is really important, and genuinely enlightening” insights. I have read, and presented three other books by Lewis: The New, New Thing; Moneyball; The Big Short. They are all still worth reading. This new one, Boomerang, just adds to my appreciation of Lewis as a writer and thinker, even as it adds to my understanding of the current fiscal crisis.
But it is more than a financial crisis alone. It is a moral crisis. Here’s an excerpt from an interview with Lewis conducted by Fareed Zakaria.
“I think we get the democracy we deserve, and in California it’s very hard to argue otherwise. We have essentially direct democracy – all big fiscal decisions are made by the people by plebiscite. And the idea that somehow in essence the people are not getting what they want – they are getting what they want. That’s the problem.
They (the people in California) are getting what they want. They want public services, and they don’t want to pay for them. They want to cheat the future for the present. And that’s not just a financial problem. That’s a cultural/moral problem.” (emphasis added).
A moral crisis. And a moral crisis requires a moral solution. And, so far, I’m not reading much in the solution department.
We live in a troubling time.
Here’s the interview with Lewis. The excert above is just after 3:30 in the video.
The Internet formula for success turned traditional capitalism on its head. Traditionally a company persuaded people to invest in it by making profits. Now it persuaded people to invest in it first, and hoped the profits would follow.
A single assumption underpinned the entire boom: the future would be better than the past. (Michael Lewis, The New New Thing)
We are an age born of innovation. The entire assumption was based on this — if this idea won’t be the big one, then we will keep innovating until we find the next new new thing. And find it we will!
Not all innovations work. Not all innovations last. But the ability to innovate – to change, even with genuinely big changes in big ways, is maybe the ultimate business success trait.
In an article I found on the Huffington Post business page entitled 10 Huge Successes Built On Second Ideas from BusinessInsider.com, there is a list of ten companies that made major changes in their business plans. Here’s the list:
Here are some more companies that only saw huge success after a good bit of evolution:
• Facebook was briefly a “Hot Or Not” for Harvard.
• AOL began as a videogame on-demand service.
• Twitter started as podcast delivery service.
• Intel sold computer memory, not microchips.
• Microsoft wanted to build software tools.
• Tiffany & Co sold paper.
• Google wanted to search bulletin boards.
• Silicon Graphics got its start making graphics terminals.
• Avon sold books door to door.
(go to the article to click through for complete descriptions for each of these company change stories)
And here’s a little smart advice:
Marc Andreessen, the serial entrepreneur who successfully created and sold two billion dollar companies — Netscape and Opsware — preaches this lesson: “Trying to understand how a tech company is going to be successful is a little bit like looking at a sonogram and trying to predict the baby’s hair color,” Marc said recently.
“The idea really matters and the products really matter, but you know so little about the adventure you’re undertaking when you’re starting a new tech company, you have to assume that things are going to change. You have to have a very healthy awareness of what you don’t know. You have to be super flexible and able to reverse yourself very quickly.”
The path to success is riddled with ideas that did not quite work right, and other ideas that caught on, and then even these have to change in order to remain on the cutting edge of success. Yesterday’s good ideas do not always lead to ongoing success. So, yes, “you have to be super flexible.”