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 BLOG >> August 2016

Patterns of Innovation [Business Models
Posted on August 17, 2016 @ 07:52:00 AM by Paul Meagher

Clayton Christenson is known his for ideas around disruptive innovation. Clayton has studied how leading technologies and companies are displaced by startup companies. He observed a pattern in how they operated below the radar of the market leaders, how the market leaders success led to their own demise, how the technology often succeeds by turning non-consumers into consumers (e.g., personal computers), and so on. He has many documented case studies to support his theories about how disuptive innovation happens. His theory amounts to recognizing a pattern that many disruptive companies fit. There is some debate about whether you can use these disruptive innovation patterns to create or identity unicorn startups. I think the disruptive innovation pattern is definately worthy of study and you may be able to execute a startup or an investment based upon disruptive innovation theory.

Clayton's theory does not explain all examples of innovation as it is mostly focused on giving an account of innovations that result in an industry disruption. Are there other patterns of innovation that we might identify? After giving it some thought yesterday I came up with two more patterns of innovation that I call "Unlocking The Potential" and "Let A Thousand Flowers Bloom".

In real estate, one type of innovation is to "unlock the potential" of a site. There may be a building or site that other people do not regard that highly. A real estate innovator might see it quite differently and follow an execution pattern that turns that recognition into a project that creates increased value in the eyes of others as well.

The "let a thousand flowers bloom" type of innovation occurs when an innovator conducts a large number of simultaneous experiments in the hopes that a few of them might make it to the next round of experimentation. Through this process the entrepreneur hones in on the opportunities that seem most promising and viable. New farmers and pharmaceutical companies often exhibit this pattern of innovation.

Real estate and farming might not be regarded as particularly innovative industries; however, we all have to be innovative in some capacity to survive and trive. While a theory of disruptive innovation may explain alot of innovation we see in the news, it may not account for these less glamorous types of innovation. We need more than one pattern to recognize and characterize all the types of innovation that are out there.


Customer Quality [Management
Posted on August 11, 2016 @ 06:14:00 AM by Paul Meagher

Yesterday I caught up on a few Urban Farmer podcasts at Permaculture Voices. I found the podcast All Customers ARE NOT worth Selling To, An In-Depth Look at High Maintenance versus Low Maintenance Customers particularly interesting and useful. One of the main ideas discussed in this podcast is the idea that not all customers are the same, some are better to have than others. The main type of customer to watch out for is the low volume, high maintenance customer; a customer that requires alot of management but who is only providing a small volume of business. These can sink your business. Alternatively, the low maintenance, high volume customer is the best type of customer to have. You often do not get these customers overnight but attain them over time as you gain trust and rapport.

Customers come in all shapes and sizes and have their unique personalities; however, from a business point of view, maintenance and volume are important dimensions that you might use to guage customer quality. The table below grades customers according to where they fit on these dimensions.

Table 1 - Customer Quality


I encourage you to listen to the podcast to see how Curtis and Diego flesh out this table. They mention several times the concept of "firing" the customer because they fall into the Bad quadrant of this table. This contrasts with the messaging one might hear that the customer is always right. If you rigidly believe that, you may not be in business long, or you will be strugging, if too many of those customers are high maintenance and low volume.


Scouting Skills [Management
Posted on August 9, 2016 @ 06:32:00 AM by Paul Meagher

Yesterday I noticed some tent caterpillar nests in an apple tree by my house. I cut the branch it was on out and stomped on the nest. I didn't think too much of this discovery at the time.

Later in the day I was working in a back field and decided to take a ride in my tractor along the edge of the field. I examined some wild apple trees on the border of the field and noticed that the same tent caterpillar nests were on some of those apple trees as well.

After seeing a few nests I returned to my barn, picked up some pruning tools, and returned to deal with the threat - cutting out the branches they inhabited and stomping them. Hopefully this will help to limit the population of these caterpillars which will defoliate an apple tree quickly once they escape the caccoon-like tent they grow up in.

Scouting for threats is not something I think about doing often enough. Today I was simply lucky to notice this potential issue and it was because I was going for a joyride around the edge of a field in my old tractor that it happened. I am coming to the view that scouting is too important to be left to chance and that I should be more systematic in deciding when and where I will scout for threats in the future.

You can also scout for wild food resources as well so scouting can be done both to detect threats and, more positively, to find resources. The effectiveness of scouting can be improved by being more systematic about how, when and where you investigate although there is always some element of chance to what you might encounter as you wander about.

Is scouting a useful skill to develop for your business? Should you take time to simply to explore around to see what threats or resources are out there? Should you be more systematic in how you scout for threats or resources in your business environment? I don't have alot of answers this early in my thinking about scouting but I do know that scouting is not just nice, it is necessary to keep ahead of the threats and to find food resources. Optimal Foraging Theory provides some guidance for thinking about scouting even though it appears to be mostly focused on food foraging. It has been extended to information foraging behavior as well. You can't spend all your time exploiting your current food patch, you also have to spend some time discovering where your next food patch might be. To do this effectively, you need to develop some scouting skills to detect the next patch effectively.


Do Nothing Gardening [Permaculture
Posted on August 3, 2016 @ 06:54:00 AM by Paul Meagher

I am currently conducting an experiment with some Brandywine tomatos. I planted some Brandywines last year and this year I had some volunteer seedlings that I transplanted into a small 8 x 10 plot. I planted them over a month ago and ignored them for the most part until I noticed how big they had grown in the last few weeks. Here is a photo of them taken yesterday:

I'm hoping I can get away with some do-nothing tomato gardening. I'll be looking to see if the dense growth of the tomato vines will be self-supporting so I don't have to stake anything. This vigorous indeterminate vining tomato variety may grow completely out of control. I'm not expecting high production, but it might happen. Decent production without having to do any ongoing work would be fine.

I'm also experimenting with some do-nothing potato growing. I planted my own seed potatos from last year into a rotten hay pile about a month ago. A few have started to sprout and grow above the hay.

Growing potatos in hay is not as simple as it is often portrayed to be. I've tried 5 different approaches and only one has panned out so far. The depth of this pile of hay is quite thick to retain moisture better and to provide more room for growth, this hay pile was turned last fall bringing rotted bottom hay to the top and disturbing any rodent habitat, there is not alot of new seed to attract rodents and I created a nearby pile of newer hay (unfit bales from this year's haymaking) that might attract any rodents better than this pile. I'm looking for fairly high production from these potatos, higher than when planted in the ground. I'm also looking for unblemished potatos with a mix of smaller and larger potatoes. They should be clean enough to eat without much cleaning. Just because it is a do-nothing method of gardening does not mean that I always have low expections.

In business we often expend effort unnecessarily trying to control a process that might unfold better if left alone. This is also true of gardening. Do nothing gardening can help change your perspective on gardening and business. A business will not become successful by "doing nothing". That is not what I am suggesting. What I am suggesting is that you evaluate whether you really have to put out effort to control a person or process, or whether you would get better results by standing back and letting things happen naturally. You often need to setup the context (based on some pattern understanding) in which do-nothing happens but then you can step away and see if that is all the effort you need to put in to get and keep the ball rolling rolling for awhile. Put your time into something else that is more worthy of your time and attention. Doing nothing frees up time for doing something in other areas that need it more.

Easier said than done. The Japanese farmer/philosopher Masanobu Fukuoka was the founder of Natural Farming which is a farming approach that is popular in Asia. He discussed the philosophical bases and practical techniques he used to minimize the amount of work/intervention required to grow grain crops, veggies, and fruits. You can find inspiration for this approach in his books. It is a buddism-inspired approach so should appeal to those with that inclination or background.

The decison to use natural methods versus more conventional growing methods is not an all-or-nothing decision. I don't put all my eggs into the natural approach as I've gotten burned trying to grow potatoes in hay. I am currently also growing some tomatoes and potatoes using conventional approaches. If I ever develop enough pattern understanding to use natural methods effectively, I would probably opt to use natural approaches as there is not much point in putting in more effort than you have to to get the same or greater yield. I have better things to focus my limited resources on. Strategically doing nothing means you have time to do something else and is, paradoxically, a key to productivity.




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