Every company wants to build a billion-dollar business. But if successful and unsuccessful companies often have the same goals, why do so many organizations fail at achieving their goals? Because the vast majority of companies focus on the goals, but for extraordinary, great firms the systemic change is the new business as usual, even when all’s going well. Goals are about the results you want to achieve and they are adequate for setting direction, but systemic change is best for making progress because is about the model of change that lead to continuous improvement and results.
But despite the fact that systemic change is becoming the new normal for business success, the vast majority of change efforts don’t deliver the hoped-for results. Estimates vary, but transformation failure rates range from 60 to 80 percent and don’t seem to improve over time. This is the reason why 151 of the Fortune 500 from 2010 have disappeared because of their inability to change, adapt and transform.
How to beat these odds? Evidence says that a great way is by building a model of systemic change that connects three fundamental questions: WHY we do WHAT we do and HOW we can do it better. It’s not about a series of incremental changes. Rather, it is a fundamental reboot by making the change a partner in life.
This model of systemic change breaks down into intent, impact, and intelligence. Firstly companies need a purpose to change every single day for the better. A singular intent is the purpose that companies need to drive a systematic change towards something much bigger than themselves, so essential the can transcend successive changes of the organization. Secondly, companies have to play a proper strategy play to maximize the impact of what they do. Systemic change generates sustainable, exponential impact as companies break down silos and connect the dots through ecosystems. Finally, since intelligence is the human ability to adapt to change, companies can to be extremely fit for steady change by scaling their intelligence through a culture that cultivates tiny, continuous improvements.
This endless, iterative loop of systemic change is the essence of infinite thinking in terms of the mindset of those great people and organizations that have made the change a partner in life for continually creating an improved version of themselves in a singular, sustainable and scalable way.
Why? Singular Intent
Why does a company exists? “A business is simply an idea that will improve people’s lives and hopefully some money will come out of it”. I love to quote this sentence of Sir Richard Branson, Virgin Group’s founder, because it sums up perfectly the idea of having a singular intent to drive a business. Intent is the company’s purpose for existing, playing the infinite game of business and changing systematically for the better, beyond what it makes and sells at any time. Any organization needs to energize and motivate its people with a singular intent in order to cope with the constant effort that demands the systematic change. Companies with this strong sense of purpose become the best version of themselves because people become better by changing.
Expressed as a powerful and memorable purpose, the singular intent can serve as a company’s North Star in a world of perpetual evolution, guiding its strategic decisions and investment choices. At its core, a company’s purpose is the reason why it exists in order to solve specify people’s and to address the needs of society at large. A singular intent goes beyond the determination to make great products; it stakes out an ambition to advance society’s well-being.
Most iconic value hackers are well known for their singular intents, typically crystallized in bold purpose statements that reflect the aspirations of new philosophy of doing business that, objectively speaking, is shaping the future of the human experience. For example, Apple is enriching people’s lives in all the ways people want to experience, Google is organizing the world’s information and make it universally accessible, Amazon is building a place where people can come to find and discover anything they might want to buy online, and Microsoft is empowering every person and every organization on the planet to achieve more.
Even institutional investors are discovering the power of purpose and expect that a company’s contribution to society should go beyond its financial performance. For example, BlackRock, the world’s largest institutional investor with about $6 trillion in assets, encourages companies to not only deliver financial performance, but also show how to make a positive contribution to society.
Business is much more than money. Any company has the potential to change the future of human life for the better, from products and services that improve the daily life for billions of people, to breakthrough solutions that solve wicked, global problems like climate change and chronic disease. Companies will thrive only if they drive a systematic change towards something much bigger than themselves, so essential the can transcend successive changes.
What? Sustainable Impact
Systematic change generates a sustainable, exponential impact as we break down silos and connect the dots through ecosystems. The world operates from a flow of unbroken wholeness, where everything is connected and behave like a network. Since the value of a network is directly proportional to the square of the number of connected nodes, the wholeness of an ecosystem is larger than the sum of their parts and has additional properties and potential not possessed individually by the parts.
Companies must play like an orchestra. The individual musicians and their instruments don’t lose their singular contribution, but they blend into an orchestrated concert so that the whole is not only greater than the parts, but is also immeasurably more complex and beautiful. In business, the emergence of orchestration is a beautiful story of change and innovation. In 2007 Apple introduced the iPhone. The iPhone’s revolutionary touch UI and its all-screen design made smartphones accessible to mainstream users, changing the relationship of people with technology for ever. However, it was even more transcendental, when Apple opened the App Store one year later. When the first iPhone was introduced in 2007, the iPhone worked as an integrated and closed value chain with no way to install third-party software. But the app store was a remarkable change of strategy for Apple that created an open ecosystem connecting users and developers. The concept was that Apple and developers could share in one another’s success with the iPhone user as the ultimate beneficiary. It worked beyond the wildest expectation. The app store launched with just about 500 apps, and a year later it already offered 50,000. This ecosystem has become a major global business unto itself, where Apple customers downloaded 32 billion iOS apps in 2019, spending a total of $58 billion. The app store showed how powerful orchestration is for augmenting impact of change in an exponential, sustainable way.
The more the connected dots, the better the impact of change. Ecosystems are changing the rules of the game and rewriting traditional playbooks about change. Thinking in the wholeness and connecting to others provide one of strongest foundations to make the most of change both in life and business. The most fundamental implication of ecosystems is the shift of perspective from the parts to the whole, from competition to creation, from domination to collaboration, ultimately, from me to we. We must see our world as an integrated whole rather than a dissociated collections of parts, because “the whole is more than the sum of the parts”. Or, as Mother Teresa once said, “I can do things you cannot, you can do things I cannot; together we can do great things.”
How? Scalable Intelligence
In the era of always-on transformation, companies ned be fit for systemic change. But there is no doubt that change, transformation, innovation, and disruption can put a lot of stress on individuals and organizations, as stress is the normal body’s reaction to dealing with changes in life when our change load is greater than our capacity to adapt. But even though many people experience significant stress with change, we are genetically programmed to cope with it. Our human intelligence is precisely our ability to adapt to change. There is no intelligence where there is no need of change in nature. Intelligence is an inner power that translate our intents into impact, it connects dreams with reality.
Therefore, systemic change is certainly possible, but only when it is scalable over time. It is like building muscle. If the weight is too light, your muscles will atrophy. If the weight is too heavy, you’ll end up injured. But if the weight is just a touch beyond your normal, then your muscles will adapt to the new stimulus and equilibrium will take a small step forward. When you accumulate small wins and focus on one percent improvements, you nudge equilibrium forward.
Likewise, systemic changes requires a scalable intelligence cultivated by compounding everyday small improvements. We often overestimate what we can accomplish in the short term, but we greatly underestimate what we could accomplish in the long term. The power of scalable intelligence only comes when it gets perpetual change and we capitalize on the exponential benefits of capitalizing tiny, continuous improvements. Our intelligence rises exponentially if we can get 1 percent better everyday. Here is how the algorithm works out: if you can get 1 percent better each day for one year, you’ll become thirty-seven times more intelligent by the end of the year. The same way that money multiplies through compound interest, the effects of small changes multiply as you repeat them. This is why Albert Einstein is said to have called “the power of compound interest the most powerful force in the universe.” This universal force creates exponential impact and it allows us to achieve things we never thought possible.
Amazon is probably the most amazing company of the last decades not because of any technology but because of its culture. Jeff Bezos implemented a culture that is keeping the company on a continuous culture of experimentation, innovation, learning, and improvement. Bezos calls this mindset “Day 1” and it has become the company’s mantra for longevity. The essence of Day 1 Amazon Thinking – described in Bezos’ 2017 shareholder letter – is how the company is scaling its model of systematic change around its obsession for the best possible customer experience.
At the end of the day, scalable intelligence means properly cultivating both personal habits and organizational culture to harness the extraordinary benefits of compounding small improvements. Great infinite thinkers, both individuals and organizations, have patience because they know that what they are really doing is creating a system to capitalize on change. The longer we play the infinite game of change, the more the benefits compound and the greater the rewards are.
Companies do not rise to the level of their objectives, but they fall at the level of their capacity for change. But change doesn’t mean executing a well-defined list of finite shifts in the way things work. Change is not equal to finiteness, it must be systemic. The overall goal is to embed change in the business as usual. Then we can begin to see the fruits of change, because life walks in the hand of perpetual transformation, infinite change.