Let's see how simple 1,2, 3 management is on your Big Red Boat.

One - the strong winds come from known clusters. These winds can reach gale force. Such extreme conditions demand a strong boat with dedicated systems and a specialist crew. A crew with more systems specialists than sailors. Crew are on this boat to make running repairs not to pick wind shifts. Their onboard systems are packed full of rigorous knowledge and built-in redundancy. So long as these systems do not bend, tear, or break the crew is happy to simply add much needed ballast.

Two - the medium winds come from committed groups. These winds are normally steady but can vary in direction and force. These conditions suit a boat with an equal emphasis on systems and crew. This crew has both practical and theoretical skills. On this boat both crew and systems are flexible and adaptable – both are also bound to a clear and present purpose. Every change on this boat comes about because the crew disrupts with purpose. The perfect condition onboard is a state of dynamic homeostasis between systems and people. Once homeostasis is achieved this boat can sail with the full advantage of prevailing winds or swiftly change course to pick up the windshifts.

Three – the light winds come from networks. These winds range from strong short bursts to gentle zephyrs. These conditions require a lightweight boat with spartan systems and huge sails that can pick up every puff of breeze. The key asset here is a crew of sailors who know how to utilise the slightest breeze. This crew is made up largely of facilitators who comb their networks for any breeze. This crew has talent, it can innovate, it can make quick changes, and it can read the big picture. Success comes to this boat because its crew can make the most of even the slightest puff of wind.

The remarkable thing is each of these boats can be best of breed and yet all three can operate at the same time.

You have your Big Red Boat organisation in “heavy mode” because your growth is extraordinary. As you learn to deal with these unprecedented levels of growth you will notice two things.

First, growth is no longer sustained by Brands. It is no longer sustained by traditional advertising. It is no longer sustained by reputation, price points, customer service, etc. The consumer has moved on from all those traditional Brand supports because consumers have begun to form their own Experiential Networks.

Second, growth is fueled by the consumers' perceptions of the “experience” they had in dealing with your organisation. Experiential Network begin to form all around you as more and more consumers appreciate your direct access, automated service, and soft-touch systems because they connected them to the information they need. Your new consumer's experience is “got the information, got it fast, got a good feeling”. Their reaction to that experience is to “get on the Internet to tell peers, colleagues, and family about this great experience”.

Once contemporary consumers begin to have a “good feeling about you ” they quickly form an “experiential network”. This new network soon becomes a “revenue cluster” for you. You are then unexpectedly hit by a series of growth waves. If you maintain good connectors to these new revenue clusters then before too long another series of growth waves will hit your Big Red Boat.

You are suddenly being buffeted by growth that you did not create and can not control.

What to do? All you can do is to sail your Big Red Boat the best way you possibly can. To help you do that you can work on improving your connectors to these new revenue clusters. You can ensure you facilitate direct access from these new clusters to all your information, services, and products. You can ensure you automate whatever you can to ensure your new consumers can self-serve for everything they need. You can make “free” what others in your industry still over value. You can improve the “use value” of whatever you provide to your revenue clusters.

In “heavy mode” you now have a guaranteed way of managing growth. It is easy but it is counter-intuitive. It involves understanding the links between growth, connectors, clusters, and revenue.

Let's have a look at what this might mean for you.

Growth now presents as clusters – revenue clusters. These clusters are like storm squalls. They tend to appear and disappear without warning. They blow with differing force and endurance. They are difficult to track. They are hard to predict and they are essentially disconnected.

The key to revenue clusters is the connectors. First there are connectors to your organisation. Second there are connectors within each cluster. Strangely though there are no connectors between clusters. I repeat there are no connectors between clusters. All there is between clusters is space and time – sometimes lots of space and time. Thus each cluster is a separate revenue hub. It is an event in time and space that may or may not be repeated.

Revenue growth is sustained if and only if these clusters become a feature of your landscape.

Once they become a feature of your landscape they re-appear in the same space but with varying levels of strength and endurance. They form similar patterns of distribution but their constituents are different. Yeah that's right the consumers spending the money are different people. It is the same revenue cluster but it is formed by a different set of consumers.

These revenue clusters are re-forming weekly, monthly, quarterly, or annually with a different set of consumers each time. Same revenue clusters but different people spending the money. Thus most of the marketing, customer service, customer relations, etc work done within a traditional organisation is of marginal value.

When your systems are robust, reliable, automated, cost efficient, and user friendly you can grow. More than that you can grow quickly. Scale, volume, and size are all positives for your Big Red Boat organisation if you have “a clear and present purpose” and “effective and efficient systems”.

A lot of myths about growth, scale, size, and volume are needlessly perpetuated in management texts, business schools, blogs, guru presentations, etc. The reason is simple most of these entities or people cater for middle of the road success. They cater for a majority of people who want to be good, not great, and definitely not the best ever. They tell these people what they want to hear – ie their limits to growth, their fierce competition, their wars for talent, etc. Why? Because those messages support their own revenue model.

You and I have no need for those messages here because Clear Space Thinking is about being beyond your best competitor. As I have discuss many times before, you get to that space by sailing your own Big Red Boat to the very best of your ability today, tomorrow, and the next day. You do not follow the fleet. You do not shadow your best competitor. You do not replicate their revenue models. You have no need of such negative advice.

What you need to understand is your own revenue model and just how it impacts your thinking.

Your Big Red Boat is in “heavy mode” so you are forced to rely on your systems more than your crew. The crew steer the boat, set the right sail weight, and make running repairs.

Remember your boat is bobbing around on a wild sea like a piece of kelp. Control has by large been ceded to the wind and the waves. Those who sail best use the prevailing conditions as assets and simply ride out these big winds and waves with glee.

The same is true when your Big Red Boat organisation is in “heavy mode”. You must rely on your systems when you are experiencing rapid growth. Growth is like a storm – it can be a dream or a nightmare.

To ensure it is a dream not a nightmare your organisation must focus on building and supporting the “efficient and effective systems” it needs to scale quickly, to handle unforeseen volumes easily, and to control the cost of size. Reliable performance within your systems is the key to a smooth ride through the “storms of growth”.

There is a management myth about growth that persist despite all of our recent experiences.

Put simply the myth is management must “create growth” and it needs “the talent” to do it.

Wrong and wrong.

In “heavy mode” your Big Red Boat must have systems that are robust, reliable, automated, etc. Those assets are essential when you are caught in a storm. The storm keeps coming at you and the boat keeps rolling and pitching. So you need strength, resilience, ballast, and consistency.

The analogous situation for your Big Red Boat organisation is when you are caught in a storm of excess demand. You must have robust, reliable, automated, and consistently good systems. But you also need scalable systems with a soft-touch, easy access, user friendly features, etc.

In “heavy mode” your Big Red Boat organisation has to connect easily with a raft of user clusters. Networks of users who have similar demands. Networks of users who are innovators and want to test your systems. Networks of users who want everything and more for “free”. Networks of users who want services that you have not yet developed. Networks of users who spread the word about you – both good and bad – based on their experience of your performance not because they love your cool Brand.

Creating “experiential networks” that match and serve this Big Red Boat configuration is your “guiding purpose” when you are in “heavy mode”.

In “heavy mode” your Big Red Boat organisation is all about systems that are automated and packed full of robust, reliable, and applicable knowledge.

In heavy mode you need automation and knowledge. You must ensure that every user's access is automated. You must ensure that a robust platform of knowledge is built into your systems. You must ensure that your systems and people are the best quality you can afford.

In a networked economy your “heavy mode” is all about access, connectors, clusters, and use value. All your users must have direct access to product and services. They must be able to self-serve through reliable connectors. If they trust your connectors they will form “lovemark clusters”. If they do that you will face a new challenge because these clusters will automatically boost demand. Demand will rise almost instantly and thereby put extreme peak load pressure on your systems.

When your Big Red Boat is in “heavy mode” you will often feel like you are crashing headlong through huge waves with a gale howling up your rear end.

The situation is not unlike the Big Red Boat “Liberty” being hit by gale force winds and crashing headlong through huge waves while racing off Rhode Island Sound. The systems will be tested. The weakest links on the boat will be found out. The ability of the crew to make running repairs will be relied upon time and time again.

In “heavy mode” your crew needs a robust and reliable platform. They need every part of your boat to be the very best it can be. They need it to have redundancy built-in everywhere.

In these conditions being on your Big Red Boat is something akin to resting on a bobbing piece of kelp in an angry sea.

There are three modes in your Big Red Boat organisation because you need three. There would be five or six or ten if you needed five or six or ten.

But on most boats and in most organisations there is only ever one mode. That single mode is either base on “people led systems” or “systems led people”. The problem is one mode is not enough when the conditions or the environment changes. As the conditions begin to change your boat or organisation is destined to be changed, restructured, reconfigured, etc. It will therefore begin to drift into an Intermediate Mode.

“Systems led people” will eventually have you jammed into Intermediate One while “people led systems” will get you jammed into Intermediate Two. As you know from your own experience neither of those is a happy place.

If you read the contemporary management literature, blogs, magazines, ebooks, etc. you will soon discover a raging war between those who advocate “people led systems” and those who prefer “systems led people”. People-led-systems tend to be decentralized with devolved power where people are the asset. Systems-led-people tend to be centralized with hierarchical power structures where systems, processes, and machines are the assets.

In your Big Red Boat organistion these two views of the world are both catered for. “Systems led people” crew the “heavy mode” while “people led systems” crew the “light mode”. Between those two extremes is a balanced approach for your “medium mode”.

Your Big Red Boat has three “purpose built” modes. More importantly it has three “purpose built” modes at all times. One that is operational and two that are virtual.

This means there are always two alternative boats ready to sail when the environs change.

Think about that for a moment.

When the environs change a decision is made to switch from say from “medium mode” to “heavy mode”. Later it may be to switch from “heavy mode” down to “light mode”. You imagine just how difficult such a transition would be to pull off in most organistions. As you know from your own experiences most organisations, whether centralized or decentralized, find it difficult to switch modes. Indeed most get stuck in an Intermediate Mode.

However within your Big Red Boat the switch is made with a minimum of fuss.

Why?

First and foremost your three “purpose built” modes are not based on the latest management fads and fashions. Big Red Boat organisation is not the direct result of your CEO's vision, strategy, leadership qualities, experience, etc. rather it is the result of matching your purpose to a revenue model.

Second you have a clear and present purpose and that is to be "the best you can be in all environs – heavy, medium, and light”.

Third your revenue models are matched to those configurations. When you change modes, for example from heavy to light, your purpose is the same but the revenue models change dramatically simply because they have to.

For example, you have “a clear and present purpose when the winds are strong” - that is to be the best you can possibly be at adapting to and fully exploiting the advantages of scale, size, growth, etc as customers come “storming” at you. Your revenue model is simple but robust. In heavy mode you have robust systems that can be scaled quickly. You also have the best experts available to fix those systems if and when they develop faults.

But when the winds are light you confgure differently. You need “the talent” to go find customers and serve them with new ideas, products, prototypes, innovations, etc. In this situation there is no avalanche of revenue being hurtled at you so you need revenue models that are quick to innovate, prototype, change, and even disappear. In this mode the issue is discontinuity of cash flow not continuity. Here the talent is focused on new ideas, innovations, niche markets, high use value, big margins, rapid speeds to market, etc.

Are you stuck in Intermediate Two?

Signs that you are stuck in Intermediate Two are easy to detect and will include some of the following. Governance and security systems are stretched to the limit – most communications are treated as “in confidence”, “urgent”, “classified”, etc. Meetings are packed with people eager to swap information and rumours. The grapevine information is reliable and accurate. “People power not systems power” is being chanted by “the talent” – current systems are under siege.

Legacy systems are being worked around, ignored, or switched off. Small flexible systems are being installed everywhere. Scale, size, and volume is out and high margin, quality, and specialist products or services are in – but their revenue models are weak. The latest fads are everywhere.

Collaboration is difficult between revenue streams. Budgets are biased heavily towards recurrent not capital spending. The “systems-orientated” talent is frustrated and most of it is looking elsewhere for a future career.

Bottom-up change is the order of the day.

Management is over-extended dealing with a complex mix of inter-related issues including. The malaise of constant systems failure. Poor productivity. Reduced return on capital. Stalled revenue growth. High cost of transactions. Slow take up of new product and service. Slow product and service development cycles. “Snail's pace” speed to market. Products and services being extended past their design limits. Increased market competition. Poor customer service. High cost help desk systems. Slow internal communications. Excessive security on within and beyond the organisation. Lack of focus and direction from managers who are failing to cope with the combined impact of all these issues.

The recurring issue here is the “under-performance” of assets. Return on investment is low. Cost of sales is high. Administrative costs are high. Economies of scale have been lost. Supply chains are often stretched unnecessarily by manual processes.

Manual processes are stretched and are thus unreliable. More people are hired. More complex management issues arise. Less work is being done by more and more people.

What can you do to get your colleagues and yourself unstuck?

Focus on your revenue models. Work hard to improve your processes to streamline your revenue. Look to increase your revenue with low cost products and services that interest your competitors' users or customers. Look for new products and services that can be delivered efficiently and effectively through automated and self-service systems. Look to offer “free” whatever your competitors value.

Use “the talent” to develop master processes. Hire systems-orientated talent. Reduce workshop activities. Run meetings that start/end on time and are always on the set agenda. Shut down all “stand alone non-scalable systems”. Ruthlessly automate internal processes. Increase customer access to information. Lean to love messiness. Learn to love change.

Focus on performance indicators including – the productivity of labour, costs per $ revenue, revenue per employee, systems efficiency and reliability, and ability to scale your operations.

Downgrade the importance of vision, leadership, strategy, talent, marketing, and moral. Upgrade the importance of purpose, revenue models, cash flow, customer satisfaction, niche markets, and cost-efficient innovation.

Seek a comfortable balance between people delivered value and systems delivered value.

Budget for more capital spending on business processes and systems.

Are you stuck in Intermediate One?

Signs that you are stuck in Intermediate One are easy to detect and will include some of the following. Staff moral is low. Recruitment of new talent is slow. Talent is leaving. Most new talent belongs to a consulting firm, a vendor, comes through an outsourcing agreement, etc.

Top down change is the order of the day. Centralisation is the management mantra. Vision, strategy, corporate planning, mergers, etc. are fashion items. You are asked to parrot the vision, understand each new version of the strategy/corporate plan, support plans for growth at all costs, and sit through hours and hours of non-productive workshops and meetings.

The legacy systems including IT infrastructures are plagued by intermittent faults and fail under pressure. Disaster recovery processes are inadequate. Pressure is mounting because the volume of transactions is growing rapidly.

Manual over-ride procedures are required daily to “load shift” work. Rework is increasing in volume and complexity. Stress leave is common and the numbers on leave in “peak load” periods are increasing. There is a mounting sense of frustration, anger, and angst within staff and consumers.

Each day more and more consultants, contractors, and vendor hired staff arrive “unannounced” and proceed to work in their “exclusive cocoons”. Sharing information within this workplace is like pulling teeth with a door knob and a string – it is both unreliable and painful.

You have a major transformation program underway. This program is way over budget and the perception around the place is it has not and will not deliver much.

What can you do to help get yourself and your colleagues unstuck?

You should retreat from most of the high powered attempts to “upgrade” the systems needed to meet contemporary standards.

Concentrate on your revenue model rather than systems or people. Your revenue model is the key to getting back to your “medium mode”.

Concentrate all your activities and those of your immediate colleagues on optimizing your revenue flows. Wherever your revenue flow is threatened by systems or people issues build a simple yet smart “work around”. Sure this is a holding pattern and it is only temporary but it will enable you to “mix and match systems and people solutions” rather than stay with the push for full digital, networked, VoiP, voice recognition, one touch real time processing, bundled applications, and fully integrated automation. Stay well clear of those types of conversations.

How does one ultimately shift out of Intermediate One mode?

Reduce your rework with easy “work arounds”. Adopt a mental model, mindset, way of thinking, etc that makes you want an equal part system and part people solution to your revenue model issues.

Work with your Corporate Planning Team on any suggestion to merge your assets into another organisation. Prepare for that merger by ensuring that every solution you have for revenue model issues is transferable into the new entity.

Prepare to be bought. Welcome any suggestion that your organisation could be purchased by another or even by an Private Equity buyout. Be conscious of your cost of capital and just how efficiently your working capital is being used in your part of the revenue model.

At budget time seek to reduce not increase your outlays on capital and recurrent spending. Be spartan when it comes to upgrading systems, talent, offices, etc. Be frugal in all budget related matters

I urge you not to get stuck in an Intermediate Mode.

Being stuck in an Intermediate Mode is like being stuck in third gear on an autobahn. It is not a good place to be and it is very difficult to shift into a better place. But if you are ever stuck in this situation you should try to get into the slow lane and shift gears down not up – yeah down to second not up to fourth.

In Big Red Boat organisation terms you must move back into “medium mode” rather than trying to press on and into “heavy mode” or “light mode” even though one of those modes is where you ultimately need to be.

Problem is you can not get from an Intermediate Mode directly into “heavy mode” or “light mode” unless and until you move back into “medium mode”.

Big Red Boat organisation is new, exciting, and different – oh so different.

It has three modes, three networks, and three themes. Heavy, medium, and light modes. Experiential, purpose-driven, and facilitated networks. Relevant, remarkable, and influential themes. The glue that sticks these all together is “serve others”.

In heavy mode you will automate your network. Size, scale, and volume are assets here. Your organisation builds communities. Local, national, and global communities are all the same for this mode because they are all aggregated into a many-to-one experience for each user of your products and services. Indeed you connect with your users through experiential networks because you are all about networking a good user experience. You will maintain your connections with your users because you meet their needs and that is because all your networks are relevant.

In medium mode you will network your groups into clusters and then into galaxies. Your groups are purpose-driven – these groups form into cooperative networks. Your networks are the system. They depend on flexible systems that can accommodate people working in small groups. Modern software developments are making this type of workplace more and more reliable. These networks have a great mix of virtual and tangible assets. But such cooperative networks are only sustainable if they are remarkable – they live off “word of mouth” recognition of their deeds.

In light mode you will network your talent. In this mode you rely first and foremost on your talent. The systems are extremely light and sometimes even flimsy. In this mode everything is shared. Everyone is close and connected – they share values, purpose, and motivations. The key ingredient is disciplined talent. Discipline is required here because this is a facilitated network. This means the key nodes within this network are the facilitators. Facilitation grows the network and the lack of it shrink it. These networks peddle influence – they live off influence. They are informal networks and thus influence not power is the authority here.

Big Red Boat organisation is full of intangible and virtual assets that make the tangibles work harder longer and so much more productively.

Your Big Red Boat organisation has three modes – heavy, medium, and light.

In the heavy mode your emphasis is on “the system” - automation, self-service, etc.

In the medium mode your emphasis is on “the balance” between systems and talent – too few talented people means too much system and vice versa.

In the light mode your emphasis is on “the talent” - ideas, innovation, rapid prototypes, etc.

The biggest danger however is that your Big Red Boat will assume an intermediate mode rather than a dedicated mode. One intermediate exists between heavy and medium and the other between medium and light.

“Intermediate one” will see more and more conflict between “the talent” and “the system” as a bias towards automation and self-service begins to shine through in your organisation.

If you live in a large organisation today you know what I am talking about here because you are living with the nightmare of “Intermediate One”. You know from experience that it is almost impossible to shift out of this configuration. Change or transformation programs take years while their advocates waste millions, sometimes hundreds of millions, on new visions, strategies, plans, systems, recruitment of talent, etc and fail to move an inch.

Why do they fail? They fail because they lack a clear and present purpose that would have them move dramatically into a Big Red Boat heavy mode. They lack the political nous needed to sell automation, self-service, networked utilities, etc. They fail because they are stuck with legacy systems that are no longer viable. They fail because they are stuck with the legacy talent needed to maintain these failing systems.

Invariably the answer to all these recurring problems is to merge with another large entity. This is why the mergers and acquisitions amongst large organisations can be expected to gain pace not to recede as some commentators suggest. If you do not merge swiftly enough you will be bought out by a Private Equity firm that will do a restructuring job for you. They will be ruthless in cutting costs.

“Intermediate One” situations are everywhere. Here is one personal example from my life that shows how they might affect each and every one of us over the next few years.

“I went to an airport with my mother the other day.  We got there with plenty of time to spare before her flight because she needs a wheelchair to move about the airport.  She can walk but not for long distances and then only very slowly.  It is difficult for her to move around a vast space like an airport.  Her wheelchair was “booked” when her ticket was purchased.  But there was no wheelchair at the check-in.

Two weeks earlier she had flown in to this airport with this carrier.  Everything was sweet on that occasion.  The compliments were coming “thick and fast” from the aircrew and the ground crew about my mother.  My mother had nothing but praise for them in reply.

This time around the essential glue was missing.  The ground crew did not know the process for booking the wheelchair.  There was no wheelchair and there was no process for me to attend to my mother’s need.

To be fair to the ground staff they are in limbo.  Why?  Well until recently they had a clear and present purpose.  They were employed specifically to serve others.  But a new  “self-serve” machine has taken away most of their traditional role.  Travellers around the world are learning to deal with automatic machines, rather than airline staff, for their seat allocation at the check-in.  There are fewer staff members.  The staff members who are left are trapped inside a partially automated process.  Their duty of care is minimal.  They are glorified baggage handlers. 

I realise all this now.  At the time I was getting “the run around” from these people who seem to serve no useful purpose I was frustrated, then annoyed, and finally angry.  I lost my purpose (which was to serve my mother’s needs).  I lost my cool.   

In a digitised world we can expect more and more automation.  We can expect to become more and more isolated from other people.  We can expect to lose some sense of community.   We can expect that those who design, construct, and operate automated systems that truly “serve others” will shine.

If you are prepared, willing, and able to “serve others” you will do well in all aspects of life because you will always have “a clear and present purpose”.”

“Intermediate Two” problems occur within small to medium sized organisations and trust me they are just as acute but that is a story for another day.

“Clear Space Thinking” is all about re-framing your mental models, mindsets, and most of all about setting out “a framework for action”. This type of thinking is needed in each of the three modes of your Big Red Boat but it is especially needed in “the talent” or “the people dominant” or “the light and fluky winds” mode.

"Clear Space Thinking" gives you “a context” for action or inaction. Sometimes it is as important not to act as it is to act. To decide not to act in a preconceived and predictable way when the environs are fluky and unpredictable can be critical to your success. With Clear Space Thinking you are always preparing to sail your own boat no matter what the prevailing or the predicted socio-economic conditions might be. The key advantage you gain from this type of thinking is your decisions are based on your purpose not your vision. You may or you may not have a vision but you must always have a clear and present purpose. Thus any change is directed from the “inside out” not the “outside in”.

“Disrupt with Purpose” is all about moving swiftly onto new ways of thinking, behaving, and doing so that you are a much better fit with your prevailing environs. This is change with a purpose not mandated change, vision-lead change, values-based change, regime change, etc.

“Disrupt with Purpose” is the perfect tool for managing the constant changes needed to balance the impact of your people and your systems. Getting this balance right is one of the elements in sustaining any organisation. A practical and workable balance between people and systems is critical in the “medium weather mode” of your Big Red Boat. If you are not able to move quickly to adjust the emerging dominance of “the system” or “the people” then you will drift into a intermediate state where these two influences struggle for control. These intermediate states are common in both large and small organisations today. They produce malaise and discontent within people and simple inefficiencies within processes and systems. These intermediate states are the hardest to change because the people are difficult to motivate and the systems are prone to intermittent faults and failures. There is rarely a useful baseline for change. There is rarely a clear and present purpose to pursue.

When you achieve a dynamic homeostasis between people and systems you find you are easily able to disrupt your existing patterns of thinking, behaving, and doing things because you have a context and a framework for change.  You are working from the “inside out” when you change but you are doing it because there are new pressures coming from the “outside in”.

“21 New Ways” is my simple tool for thinking about the type of inside out changes you might consider when your Big Red Boat is in “heavy weather mode”. In this mode your systems are dominant. In this format growth can appear to be permanent or endless. Automation, efficiency, cost reductions, and networking are at the forefront of your mind.

“21 New Ways” is a prompt to remind you that change will be required in this mode too. To remind you that your change agents are your people and so to suggest that you gather the very best and brightest people you can around yourself.

You have to make sure that your “21 New Ways” are innovative and exciting because you have to keep your people engaged and focused on your future possibilities. Your people can be proactive in conceiving, designing, and prototyping new networking business/revenue models. They can be across new developments in self-service and automated process. They can become innovators in delivering “use value” to your users so they become paying customers. They can evolve new connectors for your networks. But whatever changes they work on they too will be looking to improve or to change your Big Red Boat from the “inside out” not the “outside in”.

Big Red Boat configurations are totally different to traditional designs and models.

On board your Big Red Boat you have two virtual modes built-in. The organisation you have has two sisters “locked away inside”. – for example at the flick of a switch you can adopt either the “people dominant” or the “system dominant” configuration.

So whenever your environs permit or dictate you can switch into a more appropriate mode swiftly and smoothly. Your Big Red Boat can be in one mode for years and yet switch to another mode within days, weeks, or months. Think about that for a moment.

How is this possible?

It is possible because your Big Red Boat is hard-wired to operate in any one of three modes. Furthermore each configuration is adopted as “the mode” unless and until you decide to “Disrupt with Purpose” and thereby switch modes.

The huge advantage you will always enjoy over your competition is that your Big Red Boat will never simply lurch into “intermediate states” (where people battle with systems for control or vice versa).. When the competition lurches into one of those non-specific states it compromises its revenue model. Once its revenue model is compromised then the intermediate state becomes the “automatic” default option and thus difficult to over-ride, change, re-set, etc.

What is so different for a Big Red Boat organisation?

Each configuration of your Big Red Boat has a clear and present purpose supported by a simple revenue model. This means that your purpose and your revenue model are joined at the hip. When one changes so too does the other. This means your Big Red Boat has an efficient and an effective revenue model in all modes or configurations.

These revenue models are usually different from those of your competitors in four ways.

First revenue is gained by providing “use value” not “value adding” products or services. Second revenue is based on the “inclusion principle” not the “exclusion principle”. Third revenue is gained by networking products and services. Finally your revenue base is often clustered around a set of “free” products and services.

How does one actually switch modes?

As stated above you switch modes whenever you “Disrupt with Purpose”.

Remember your purpose and your revenue model is joined at the hip for three different modes. So when boom times hit your organisation your new purpose is to best handle volume, size, and scale.

You will disrupt your Big Red Boat configuration by switching it from your “system and people homeostasis mode” to your “systems dominant” mode. The emphasis you had previously on balancing people and systems will desist as you become obsessive about “automated and self-service” systems.

Your purpose and your revenue model is automatically aligned to this mode as soon as you discern that your environs have changed in ways that demands your switch into this configuration.

This configuration may last for weeks, months, or decades. The longer it lasts the better you are at handling its needs. But all the time you will be preparing the other two modes for an inevitable “switch” back to one of them.

Whenever you choose to configure or reconfigure your Big Red Boat you have one key asset and one key liability. It turns out those two are the same – your revenue model.

Show me your revenue model and I will show you how to configure your Big Red Boat. Show me how you have configured your Big Red Boat and I’ll show you what you think is your revenue model.

It turns our that how you configure your Big Red Boat organisation has little to do with prevailing socio-economic conditions and everything to do with how, where, and why you think you can make money.

This sense you have about how, where, and why you can make money is what establishes your “framework for action” or your “context” whenever you configure or reconfigure your Big Red Boat organisation.

If you could walk in and order a Big Red Boat organisation they might just ask you and how would you like that – well done, medium, or raw?

How would you answer?

“Well done!” is one of five common answers.  With this request you have opted for heavy weather mode (here systems are dominant)…. 

“Medium to well done!” is another.   With this answer you have settled for an in between state (here systems and people fight for control)....

“Medium thanks!” is a no risk answer.   With this answer you have opted for a middle of the road version (here systems and people struggle for homeostasis) ….

“Medium to rare!” is another half-way house type of answer.  With this answer you have settled for an in between state again (here people fight the system for control)….

“Raw!” is a risk loaded answer.   With this answer you have opted for the “light, fluky, or fluffy” weather mode (here people are dominant)….

So just how would you prefer that configured?

How is your organisation configured right now?   Is it in the best mode for the context and environs you face?   How difficult would it be to shift from this mode or configuration to another?  Do you have the requisite capability within your organisation to handle an alternative mode or configuration?  Which mode or configuration was your organisation in before the last major change program, restructure, etc.?  Which mode or configuration is the best fit with your organizational vision, mission, or values statement?   Who would lead the transformation of your organisation to another mode or configuration?  Who will decide when and if your organisation has to shift modes?

One boat and three modes stuck together by “new ways”, “purpose”, and “frameworks”.

Boat one is for heavy weather…  I mean when the wind blows strongly and the waves are huge…..  In yachting and business terms these times are often “as good as it gets” because they are the most predictable conditions…

Predictable conditions are made for automated systems….  In these conditions you need a “big beam” and “a strong hull” on your boat….  In business terms this means “backed up systems” with redundancy built-in but it also means being ruthless about automating processes to save costs ….  Everything must be put on automatic pilot when the winds are blowing a gale and the revenue is simply streaming into your bank accounts…..  In these conditions employees are “redundant” unless or until you need to manually over-ride “the system” - then you must have the very best people you can possibly get…..

Problem is in this mode your best people get bored when the system does all the work so you will constantly need to come up with “new ways” of doing what the system does.  Fortunately in C21st networked economy you have the advantage of a huge tail wind provided by new technologies so there are things that your best people can constantly tinker with to get it right.  Networked economies thrive on ideas and new ways of thinking that are focused on the delights of ever-increasing scale and size.

Boat two is for medium weather….  This is what most boats and most organisations are designed, build, and managed for…  Thus most boats and organisations are “built to last” on the “false premise” that these conditions will prevail…  Thus sailing a boat that is designed and built for medium conditions is the hardest gig of all…..  The trick here is to correctly match the configuration of your boat to the prevailing weather conditions not the envisioned conditions of the designer, builder, or current skipper and crew….

The same is true for all organisations - large or small….  The large organisations tend to be configured with a bias towards the “heavy weather mode” whereas the small organisations tend to be configured with a bias for the “light and fluffy weather mode”…..  The former is too dependent on “the system” – the big beam and strong hull…   The latter is too dependent on “the talent” – the sailors and their ability to spot the zephyrs of wind that are puffing around them…

Those who sail on a medium weather boat must always have “a clear and present purpose”…  When they seek to alter their organizational configurations with a new bias toward either systems or talent they need to be sure they “Disrupt with Purpose”….

Too often the new Skipper on your boat suddenly has a new Vision of the seascape and thus a totally different view of the emerging weather patterns….  Based on this new Vision he/she opts to move into an unstable state with either too much emphasis on people or systems….   When you are in the medium mode you often have to change to one of the other two modes…  If this happens to you make sure that you have “a clear and present purpose” before you make your move….  Change with your purpose in mind…..  Bring changes that suit your clear and present purpose….

If you decide that you should move to a "system dominated" configuration move their swiftly – the same is true if you decide to move to a "talent dominated" configuration….   But always – yeah always – be ready, willing, and able to move back into a medium mode if required….  Be ready and able to restore the balance between systems and people or people and systems.

Boat three is for “light and fluffy” weather conditions…..  This is what most small boats and smaller organisations are configured for.  Here it is all about “the talent” on the boat….  The talent is here to sail something that has maximized its sail area and minimized its sailing systems….   These are agile boats with very talented crews….   They are quick to alter course and to take up a new heading whenever a slight puff of wind is detected elsewhere….  They have an “established framework for action” and it is modified to suit any new context.

On this boat you can pretty much do whatever you like so long as it is within your guiding “framework for action” and it suits the context you find yourself in….  Here invention, innovation, and adaptation are routine….  Here new ideas and prototypes are second nature….  Here yesterday’s success might no longer work but yesterday’s failure could be an instant success…..  Here mindsets must be able to change quickly and yet fixate on a “framework for action” that will work longer term.

In a networked economy people play three distinctive roles.  First, they are an important adjunct to the system.  Second, they fit neatly into the system.  Third, they are the system.

Big Red Boat organisation is designed to cater for these three roles as follows:

In mode one - people support automated systems.  In this mode employees and customers support their self-service delivery systems.  Employees and users cooperate to make the system work as efficiently and effectively as humanly possible.  You see this marriage of employee and user at major events around the world.  There is a system that should work seamlessly and so when it is stretched, mal-functioning, or otherwise not performing to its potential the employees and their users combine to sort it out and to make it work.

Microsoft has in the past proven very good at this cooperative effort – today is poor and getting worse.  For example, try as I have recently to get your entitlement to a free upgrade to Vista because I purchased a new Toshiba computer.  It is an unfriendly and unnecessarily complicated process.  Try to do it a second time because, due to no fault of your own, the first attempt had a snafu in the payment process.

In this mode the aim is to have excellent automated systems backed by competent, responsible, and switched on employees.

In mode two – people fit neatly into “the system”.  This is where most people live and work.  This is where the system is well developed but not fully automated.  There is ample need for people-based skills to augment the performance of these systems.

In this mode the system ultimately shapes the organisation but here employees are more important than users.  Employees are the problem solvers.  They fix the problems that the system can not or that the system creates.  Employees extend the system’s capabilities.  They provide the flexibility within “the system” that is needed to meet changing conditions.  Employees provide the continuity and the change with “the system”.   They provide continuity with their talent and skills and they provide the change with their ability to reshape “the system” capabilities as and when required.

Qantas is a successful airline with proven systems for “air safety”, profitability, and Brand extension – recently they launched a no-fills airline called “Jetstar”.  But each and every day Qantas employees make sure “the system” works as it has to work if this airline is to get the job done.  Employees make the difference for this organisation as conditions keep changing in the airline industry.  Cost pressure is an ever-present issue so change is a constant within this industry.  Employees handle change issues.  They do it because they have “a clear and present purpose” in their determination to maintain their impeccable “air safety record”. 

In this mode the aim is to have competent systems backed by quality, innovative, and reliable employees.

In mode three – people are the system.  This is where few people live and work.  In this mode the system is almost invisible.  In this mode “the talent” is the key to success.  In this mode “the talent” is expected to be creative and flexible.  In this mode “the talent” has to contend with ambiguity, uncertainty, and discontinuity.

NASA is the best long-term example of this mode of organisation.  It has developed a space program that has met all the challenges set for it by Presidents, Congress, NASA’s charter to explore outer space, etc.  There are others most notably start-ups, research and development laboratories, academic research institutes, etc.  All these organisations rely on “the talent” to prototype, test, and deliver new ideas, products, and services. 

In this mode the aim is to have talented people backed by minimal systems.