Saturday, November 19, 2005

The Tipping Point

I just finished reading The Tipping Point by Malcolm Gladwell. Published in 2000, the book soon became an international bestseller. Although I had heard enthusiastic stories about this book, it was not until last weekend that I bought my own copy of The Tipping Point, together with Gladwell's second book, Blink, which was published earlier this year.

In the book, whose subtitle is "How Little Things Can Make A Big Difference", Gladwell explains and analyses the 'tipping point', that magic moment when ideas, trends and social behaviours cross a threshold, tip and spread like wildfire. In other words, Gladwell looks at what causes social epidemics.

According to Gladwell, three rules underlie the Tipping Point: the Law of the Few, the Stickiness Factor and the Power of Context. The first rule, the Law of the Few, states that the success of any kind of social epidemic is heavily dependent on the involvement of people with a particular and rare set of social gifts. There are three kinds of people: Connectors, Mavens and Salesmen. Connectors are people who are (surprise!) very well-connected in that they know many others. They bring distinct groups together, acting as 'hubs'. A Maven, on the other hand, is someone who accumulates knowledge, they are information brokers and can be compared to human data banks. Salesmen, finally, are pursuaders, who build trust and rapport far quicker than normal people. It is Connectors, Mavens and Salesmen who super-charge the word-of-mouth mechanism, thereby starting social epidemics.

Not every message, however, will start an epidemic. Such messages should be 'sticky' and hence the Stickiness Factor relates to the structure and format of the message. The message should create some sort of involvement, moving people to action. Furthermore, the delivery of the message should involve repetition, making the message more memorable. Finally, there is the Power of Context, which means that the circumstances have a lot to do with the fact of a message tipping or not; to tip or not to tip, that's the question.

A former business and science writer at the Washington Post, Gladwell illustrates the rules primarily with social examples, apart from a brief discussion of the concept of the 'chasm' in high-tech marketing as described by Geoffrey Moore in his book Crossing the Chasm. It is not difficult to see, however, that buzz marketing is based on similar concepts. I was surprised to find that the author did not make any reference to the field of system dynamics, especially because Jay W. Forrester has written extensively on the application of system dynamics to social problems such as unemployment in America's big cities. Nevertheless, The Tipping Point is an interesting read and I can only hope that Blink is equally insightful.

Postscript: Check out www.digitaltippingpoint.com, which addresses the question as to when Open Source software and in particular Linux will reach the tipping point and overtake closed source and Microsoft Windows on the desktop.

Peter F. Drucker

A week ago, on Friday November 11th, Peter F. Drucker passed away in his sleep, aged 95. Having published 38 books, Drucker is generally considered the guru's guru and according to BusinessWeek Drucker was "the man who invented management." However, being the business junkie I am, I must admit that I have never read any of Drucker's books. I am not alone in this, though. Tom Peters says he earned two advanced degrees, including a PhD in business, without once studying Drucker or reading a single book written by him.

This week, many of the publications I read dedicate one or more articles to Peter F. Drucker and his legacy. BusinessWeek's cover story is aptly titled "The Man Who Invented Management: Peter Drucker", while The Economist runs a special report, "Trusting the teacher in the grey-flannel suit." Knowledge@Wharton runs a story, "Farewell, Peter Drucker: A Tribute to an Intellectual Giant", wherein various Wharton professors reflect on his legacy and his contribution to management education and Wharton in particular. Having read these articles it is clear to me that the next book I buy has to be one by Peter Drucker. According to Drucker himself, he did his best work early on - in the 1950s, so I think I will start with The Practice of Management, published in 1954.

Thursday, November 10, 2005

Books on System Dynamics

I just finished reading The Critical Path, Building strategic performance through time by Kim Warren, who recently received the System Dynamics Society's Jay W. Forrester Prize 2005 for his contributions to the field, especially his 2002 book Competitive Strategy Dynamics. The Critical Path is a nice 'primer' for time-strung managers, but those who consider using strategy dynamics' related techniques within their own organization are advised to read the more elaborate Competitive Strategy Dynamics as well. In these two books, Kim Warren, who was one of my lecturers at London Business School back in '97/'98, discusses the use of system dynamics in a strategic management context, which also explains why he is talking about 'strategy dynamics' instead of the more traditional 'system dynamics' or 'business dynamics'.

Warren's books are just two of the books on system dynamics in my personal business 'library'. Holding over 100 titles, at least 7 of them deal with system dynamics and systems thinking:

  • Industrial Dynamics, Jay W. Forrester, 1961 (the book that got it all started!)
  • The Fifth Discipline, The Art & Practice of The Learning Organization, Peter M. Senge, 1990
  • Modeling for Learning Organizations, John D.W. Morecroft, John D. Sterman (editors), 1994
  • Business Dynamics, Overcoming the limits to growth, The McKinsey Quarterly Anthologies, 1995
  • Business Dynamics, Systems Thinking and Modeling for a Complex World, John D. Sterman, 2000
  • Competitive Strategy Dynamics, Kim Warren, 2002
  • The Critical Path, Building strategic performance through time, Kim Warren, 2003

As mentioned in previous posts, I am quite fond of the system dynamics/systems thinking approach and this list illustrates that I at least put my money where my mouth is, namely in books on the subject...