James S.H. Lee’s paperclip armrest, designed in 2009, still is not in use.
I’ve known Valdis Krebs for over 15 years, back to the time when I was immersed in a foray into knowledge management. I’m uncertain when we first met, but I’ve followed his work closely since then. We’ve shared a passionate interest in understanding social networks since before that term meant Facebook and Twitter, and instead was a scientific discipline based on graph theory and the work of sociologists. And now, we are socialogists!
About Valdis Krebs
Valdis Krebs is the Founder, and Chief Scientist, at Orgnet, LLC. Valdis is a management consultant, researcher, trainer, author, and the developer of InFlow software for social and organizational network analysis [SNA/ONA]. InFlow maps and measures knowledge exchange, information flow, emergent communities, networks of alliances and other connections within and between organizations and communities. Since 1987, Valdis has participated in over 500 SNA/ONA projects.
Before starting his own business, Valdis held various HR management positions at Disney, TRW, Toyota, and Ford. Valdis works from his office in Cleveland, Ohio with a network of colleagues in the USA, Canada and Europe.
Stowe Boyd: I like the concept of the AAA organization that you cooked up to cut through the fog of scientific terminology when working with business people. It stands for Awareness, Alternatives and Action. Could you explain that notion, and describe the reception you’ve had?
Leadership that is too focused on one or a few individuals is actually constraining for self-organizing, adaptive local learning behavior. - Valdis Krebs
Valdis Krebs: The idea of the AAA Organization is to reveal three critical attributes that modern organizations need, in a language that their management understands. Further, if an organization executes well on each of the three attributes, it becomes a Triple A Organization — triple A usually associated with best in class.
The AAA Organization model emerges from Organizational Network Analysis [ONA] which is an adaptation of Social Network Analysis [SNA], a field that has a lot of academic terminology — betweenness, eigenvector centrality, homophily. These concepts and terms do not go over well with business clients. In addition, SNA and ONA academic measures have never been shown to be correlated with actual organizational performance. The three As each describe a key attribute/behavior of successful business organizations. In addition, Awareness, Alternatives, and Action are measurable with network metrics and can be improved with new network behaviors which can be taught.
Orgnet, LLC was working with the IBM Consulting Group (now IBM Global Services) in the mid 1990s. IBM was using our InFlow ONA software internally, and externally with their clients. IBM had just recovered from a big downturn in the early 1990s and were nervously looking looking forward to the next century. They wondered:
will we be able to adapt to the changes that seem to be coming faster and faster with each decade? How do we need to be structured to handle constant change and adapt effectively to the increasingly ‘hard-to-predict’ marketplace? Will we be able to master change in the 21st Century?
They did not want to go through another scare like we survived in the early 1990s.
Every age has a theory of rising and falling, of growth and decay, of bloom and wilt: a theory of nature. Every age also has a theory about the past and the present, of what was and what is, a notion of time: a theory of history. Theories of history used to be supernatural: the divine ruled time; the hand of God, a special providence, lay behind the fall of each sparrow. If the present differed from the past, it was usually worse: supernatural theories of history tend to involve decline, a fall from grace, the loss of God’s favor, corruption. Beginning in the eighteenth century, as the intellectual historian Dorothy Ross once pointed out, theories of history became secular; then they started something new—historicism, the idea “that all events in historical time can be explained by prior events in historical time.” Things began looking up. First, there was that, then there was this, and this is better than that. The eighteenth century embraced the idea of progress; the nineteenth century had evolution; the twentieth century had growth and then innovation. Our era has disruption, which, despite its futurism, is atavistic. It’s a theory of history founded on a profound anxiety about financial collapse, an apocalyptic fear of global devastation, and shaky evidence.
Most big ideas have loud critics. Not disruption. Disruptive innovation as the explanation for how change happens has been subject to little serious criticism, partly because it’s headlong, while critical inquiry is unhurried; partly because disrupters ridicule doubters by charging them with fogyism, as if to criticize a theory of change were identical to decrying change; and partly because, in its modern usage, innovation is the idea of progress jammed into a criticism-proof jack-in-the-box.
Google sees you as a user, Amazon sees you as a consumer, Microsoft sees you as an employee (though they’re trying to change that).
Apple sees you as a person, but one at leisure who doesn’t want to be using a computer in the first place.
Invest yourself in everything you do. There’s fun in being serious. - John Coltrane
Arthur C. Clarke
Is the Fed tieing it shoe laces together by predicting high growth and then revising downward?
Binyamin Appelbaum, Fed Expected to Reduce Growth Forecast but Cut Stimulus
The pattern is striking. In every year since 2008, Fed officials have steadily reduced their initial expectations for economic growth. In each year except 2012, they had still overestimated the strength of the economy in June of the forecast year.
The consequences at times have been painful. Fed officials have said they did not act more strongly to stimulate the economy in the immediate aftermath of the recession because they expected the economy to rebound more quickly.
Fed officials argue that unanticipated economic setbacks have contributed to their failures of foresight, including spending cuts by federal, state and local governments, the European economic crisis and, most recently, an unusually cold winter.
But officials have also acknowledged that the impact of those setbacks appears to reflect an underlying weakness in the economy that they did not anticipate.
Josh Bivens, director of research and policy at the left-leaning Economic Policy Institute, said economic conditions in recent years had few precedents, making it hard to predict the pace of the recovery. Traditional models assume the Fed can restore growth by cutting interest rates, but the Fed has held interest rates near zero since late 2008, and that has proved insufficient. That has left forecasters guessing, he said.
“You can definitely be sympathetic with them,” he said. “We’re just in uncharted territory.”
Fed officials have adjusted by gradually backing away from their assumption that the economy will rebound strongly. Officials make an initial forecast two years before the beginning of a given year. Those long-range forecasts reflect their views of the economy’s potential more than the conditions that are likely to prevail at that time. And for the last five years, Fed officials have steadily reduced their expectations. In 2009, they estimated that growth in 2012 would run as high as 4.8 percent. Last year, they estimated that growth in 2016 would run no higher than 3.3 percent.
Such slow adjustments are typical, researchers have found. William D. Nordhaus, a professor of economics at Yale, found in a benchmark 1985 paper that forecasters are anchored to their opinions. “We break the good or bad news to ourselves slowly, taking too long to allow surprises to be incorporated into our forecasts,” Mr. Nordhaus wrote.
The Fed is no better than other market watchers: they are all caught in the postnormal fog, unable to peer into the uncertain future. But the consequences of the irrational exuberance of the Fed’s projections are much more significant than an investment fund guessing wrong on Apple. It seems that the optimism may be another tool in the Fed’s bag to influence behavior of other parties, but this rapidly turns into the boy who cried wolf.
The officials of the Central Arizona Project — that manages the 336 mile water system of Lake Mead and pipelines to various Arizona cities, like Tucson and Phoenix — are attempting to deal with declining water in the middle of a desert. And they have few options, given the projections for continued drought and desertification. They have starrted — for the first time — to raise the prospect of cutting water to the cities, formerly never contemplated, officially:
The mere prospect of a shortage in Arizona cities, now raised publicly for the first time, is but a proxy for the rising concern among many experts over a longer-term water crisis across the entire Southwest. States along the lower Colorado River use much more water than flows into the lake in an average year, a deficit that upstream states shouldered for decades by opening their reservoir sluices to release more water.
But the drought has all but ended that practice, and Lake Mead has begun a sharp decline; the principal upstream reservoir, Lake Powell, now holds only 42 percent of its capacity, and Lake Mead about 45 percent.
If upstream states continue to be unable to make up the shortage, Lake Mead, whose surface is now about 1,085 feet above sea level, will drop to 1,000 feet by 2020. Under present conditions, that would cut off most of Las Vegas’s water supply and much of Arizona’s. Phoenix gets about half its water from Lake Mead, and Tucson nearly all of its.
As a practical matter, neither the states nor the federal government can allow major cities to run dry. But because the lakes’ water levels drop faster the lower they get — the canyons holding their water are V-shaped — Arizona officials say governments must act soon to stave off that worst-case scenario.
Under an accord negotiated in 2007, the lower Colorado states have already laid out cuts in water deliveries for every 25-foot drop in Mead’s level, down to 1,025 feet above sea level. For example, Arizona farmers are expected to lose some of their allotment when the lake falls below 1,075 feet.
But lake levels lower than 1,025 feet are uncharted territory. “We have a plan to deal with less severe shortages, but we need to start coming up with a plan to avoid deeper shortages, or to figure out how to deal with the impacts that will come,” said Tom Buschatzke, an assistant director of the Arizona Department of Water Resources.
I get a kick out of the statement ‘As a practical matter, neither the states nor the federal government can allow major cities to run dry’. That’s preposterous. Of course they can, and on a practical level, shouldn’t there be a discussion of what has happened in other parts of the world where desertification is happening? The people move away, because they can’t raise crops or feed animals.
Of course, here in America, people live fairly divorced from the land’s capacity to provide food (which is an element of our insanity, frankly), but the physics of the situation are fairly stark. Water is extremely heavy. It is impractical to pump it up hill or over long distances. So the idea that the government would be able to desalinate on the Pacific and pump desalinated water from, say, San Diego to Phoenix is nuts. And there is no kay known to science to reliably create more rain.
We will wind up relocating the people, and letting the land go to desert. There’s plenty of water in Detroit, for example.