Thursday, January 26, 2017

Applying Chaos Theory to Advance New Product and Service Development

We had the delight of being led in discussion by Dominic Wong, MS, MBA over the topic of Chaos Theory, one of his favorites.  We wanted to review APQC step 2 "Develop and Manage Products and Services' through this lens and it was a blast.  We were joined by about ten amazing contributors.

Dominic started the conversation with a definition of chaos theory and the question, "What is one change or issue that had a very major and surprising impact? where the size of the cause looked small but wound up having catastrophic or huge difference?  He asked us for an initial condition in our experience at work or in the world where a very major impact was made.

Software Developer and Systems Thinker Andrew Sengul gave us the example of early teams at Microsoft that gave rise to a pattern of innovation that is still oftentimes seen today.  Although imperfect, it became the standard for many other teams.  But there is opportunity to change and improve upon that model. And those changes are being seen within the Microsoft organization as we speak such as the removal of a separate Quality Assurance function in some groups.

"Decisions are the butterflies shaping the world."

Steve Kubacki, PhD said that many of us are just repeating incantations we have heard of the same thing; that many of us do not know or necessarily use a scientifically rigorous method that helps us see and understand the world appropriately.  Since people are oftentimes irrational, Steve also does not believe in Game Theory or that it is very closely associated with Chaos Theory or Non-Linear Dynamics, the chosen topic for the evening.

Speaking of death and disaster, Richard asked, "What are the indicators that something has shifted so completely that we cannot win against it?"  It's a good "how would you know" question.  There is an issue of identifying unknown indicators and their relationship to the model or system.

In talking about complex systems, Bruce Follansbee offered that sometimes it feels like, "There are too many variables for mathematics." ie we need to at least try to keep it simple, not over complicate or apply a single tool (math) to all problems, decisions and domains.  This is the benefit of brains and decisions and information, that we can filter it out and keep acting based on assumption.  Clearly this strategy is not always good but it is very often necessary rather then being plagued by analysis paralysis, being too myopic and indecision, fear, uncertainty and doubt (FUD).

Chaos Theory can be thought of in a couple of ways A) "we don't know" ie chaos or B) "we don't know why" ie wtf.

I shared a Wikipedia article about Non-Linear Management to the group and there were a lot of grumbles about how much of a joke it seemed.  They weren't buying into it.  They were skeptical.  Steve has previously raised ideas about many of the companies in the USA actually being co-ops and not tops-down, shareholder-owned hierarchies.  Steve highly recommended the book Altruism: The Power of Compassion to Change Yourself and the World by Matthieu Ricard and suggested that many of the assumptions that are current world and economics are based on are false and require close re-examination.  Steve does not believe that people are as savage and out for blood as many of our economic principles and societies may suggest.

JJ Dubray showed up a little late and also right got down to the point: what's hard about product and service development is "insight alignment".  He said that the issue is like the elephant and the blind man that each insight and perspective looks like a new and entirely separate thing but it's not.  Aligning the perspectives, beliefs, etc. of the authors and audience is a challenge and requires many schools to bring it all about.  JJ also referred to the social pressures that get in the way of the alignment for example, an entire organization having to do what the boss wants where there may be blind spots on that person's vision.

JJ and I talked privately about his love for the DJI Mavic drone.  He thought it was a simply amazing product, and I agreed.  We were both very impressed that so much technology could be available to the public for under $1,000.  We agreed that there needs to be the right product at the right price.  The price property helps people size and understand whether the object is an elephant or a mouse.

Tom was new to the group and had a lot to add.  He has been an executive over engineering and R&D groups for decades and said he's never had less than 100 engineers working for him at any given time during the period.  We diverged into politics and Tom highly recommended Season 20 of South Park as a genius rendition of a product.  The season encompasses different and fascinating, poignant aspects of the 2016 USA Presidential Election.  Tom had another good comment about entropy as a driving force.

The idea of the importance of an immune system for your organization was brought up.  Organizational Immunology appears to be the topic.  I have blogged in the past about good project management being a surgical skill.

Business Intelligence, Product Intelligence and the Internet of Things (and their associated instrumentation and telemetry) are a few big topics that are very relevant for containing the chaos and bring some degree of control and assimilation to complex systems.

Richard firmly expressed his belief that all systems are yin and yang; that they have a little piece of either edge on the other side.  He had a good quote when he said, "When you cross domains, genius happens."

We all agreed there was something to the validity of yin and yang in thinking, systems and design; that it may be an immutable truth.

Richard shared with us a model he has used of applying chaos theory to different areas. I asked for him to share it with me.  XXX

We talked about what to do on the podcast this month and the ideas were (from Tom) to do a comparative study of businesses like Uber and AirBnB: what makes them unique?  Valuable? Stand out?  Risky.  Does their existence represent a larger pattern that could be leveraged for profit?

Someone claimed that chaos is a symptom of something that is not understood and I wondered how we would / could reasonably attribute outcomes to small causes.  It seems to be an issue of human vision, insight and thought at the macro and micro levels.  For example, the butterfly flapping its wings (micro) causing the hurricane (macro) and the question is how would we ever know or realize which butterfly, where and when?

Tom referenced Catastrophe Theory quite a few times.  To me, it was reminiscent of Steve Kubacki's claim on the third episode of the podcast that things and systems are created with seeds of success and seeds of disaster.  Around this same time, Richard was trying to explain the Russian Doll model as a metaphor used in design.  From wikipedia, "Matryoshkas are used metaphorically, as a design paradigm, known as the "matryoshka principle" or "nested doll principle". It denotes a recognizable relationship of "object-within-similar-object" that appears in the design of many other natural and crafted objects. Examples of this use include the matrioshka brain and the Matroska media-container format."  Richard referred to the "seeds of disaster" as fractures that are put into systems at their inception.  He calls this the divine flaw(s).  Perhaps by analyzing and understanding fractures, more robust systems can be realized.  Richard also talked about the death process of a business, product, person, etc.

What was behind the driving need, reason and rationale for a creation can come into question at some point (hopefully very late) in a product's life and those base assumptions need to be re-examined and re-questioned.  One clear form of risk is never testing assumptions or having those assumptions become the divine or fatal flaw that leads to an organization's death.  Through diversification, organizations are able to balance out some of these losses at the aggregate level.

Mr. Webb talked about the transverse properties of love (to be loved, someone has to love you), leadership and value.  To him, these principles were also immutable.

Richard shared with us the idea of needing to "go up one level of abstraction" to understand the system.  This makes sense and is in some ways "not being able to see the forest for the trees".  It can be complex, challenging and in some cases seemingly impossible to continue to climb this latter of abstractions.  For example, how would we ever know that we were abstracted enough? Or that we were not making grave assumptions that we were indeed abstracted enough?

Richard liked the idea of suggesting that 'there is no center' and that many people seem to have an issue with this concept.  I don't.  But I think it's a good design principle.  See The Starfish and the Spider for writing about this topic of the value of distributed organizations.

Richard used the phrase "to collapse the quantum field" in the context of making decisions, meaning that people reference a quantum field at pre-decision time (are operating at the macro or many level) and then collapse that into a decision, bifurcation or fork to simplify and move on.  Here's a bit more on quantum field theory and the idea of collapsing.  He also talked a bit about String Theory and the 11th Dimension.

Another comment from Richard was that "things fall for thousands of years".  He referenced and that there are essentially forces where everything and everyone is dying.  And some of these forces can be at least be acted upon and perhaps in some cases even overcome through technological solutions.  But is anything at all truly sustainable?

Andrew brought up the idea of "two roles" in technology organizations that create a conflict that has found its way into the world, at scale.  The two roles are A) implementers and B) designers.  He said they each speak different languages and have different values.  Andrew also had the word of the day when he used moribund, "in terminal decline; lacking vitality or vigor."  Richard was pleased with the word.  I suggested that this same discord is true between many groups and not just those in tech which leads to even greater disorder.

Another possible angle for the podcast and further discussion is the question, "What are the secrets of the best product lifecycle management organizations?"  Siemens has an entire group dedicated to the practice.  I worked with in a PLM group at Siemens for six years and learned a ton there.  Application Lifecycle Management (ALM) became a popular buzzword a few years ago and has generated products by big players like IBM, HP and others.

Another idea for the podcast is "Which KPIs to look at for optimal performance?"  Ted Clark focuses on this issue, even has classes about it and Richard Webb is very passionate about the topic.  I always wonder if we have a metric "harness" or view on the producess, product, etc. how we know our blind spots until they happen?  It is hard to see very accurately into the future.

There was general agreement that there are two main phases of PLM: 1) innovation and prototyping: building the thing for the first time, perhaps in isolation and 2) integration and normalization between that product and the rest of the company and product line.  The thing needs to fit into the overall vision, strategy, and customer expectations.  These two forces in many ways can work against one another and create a natural tension.

Check out our meetup group to join us for an upcoming conversation.  And listen to our podcast, the AppsJack Capable Communities Podcast, where we step through the APQC model seeking insights we can apply to our businesses, lives and ideas today.