We spend our lives looking for a revolution. But the more I learn about the world, the more I realize that everything is evolutionary. Our lives are lived through a million tweaks here and there, pushing the world ahead a little bit at a time.
The difference between success and failure in evolutionary change comes down to something I call the Rate of Tweaking (giving us the unfortunate and misleading acronym ROT). Some of us have a high rate of tweaking, and for some of us, our ROT is almost zero. The same is true for companies. Some are constantly tweaking. Others do everything in their power to discourage tweaking. In fact, as a rule of thumb, the bigger the company, the slower the Rate of Tweaking.
Four Factors determine ROT….
If we don’t care about something, there is little motivation to tweak it. Tweaking comes when we can’t leave well enough alone – and I mean that in a good way. Tweaking requires an unwillingness to settle for the status quo, a drive to make it “just a little bit better.”
I could care less about the storage room in our basement. In the 10 years I’ve lived in the house, I’ve spent a sum total of 2 hours improving this room, consisting of putting some cupboards up after a prolonged persuasion campaign on the part of my wife. For me, this is a room that, under drastic circumstances, I go to, seeking some obscure possession that we suddenly have need of, with the goal of spending as little time possible in the room. My strategy is seek – secure or surrender – scramble. My motivation to tweak this room = zero.
But our yard is a different matter. for the first 6 years we lived in the house, it benefited from minimal tweaking. But in the last 4 years, once I started to invest in it, landscaping has suddenly become a passion. I have a picture of the ideal yard in my head and I won’t rest until it’s realized. I hate winters, primarily because it keeps me out of the yard. From late March to October, I’m constantly outside, digging, trimming, pruning, building or cutting (although I’ve yet to develop a passion for weeding). I’m not saying I’m good at it, but I am passionate. The result? Our neighbours are considering dropping the petition to have us driven off the block.
Being Willing to Make Mistakes
One of the biggest obstacles to tweaking is a fear that the tweak will be a mistake, that it will move you backwards rather than forward.
This fear is not irrational. The odds for successful tweaking is less than 50/50. I suspect it’s closer to 1 in 3 or 4. So, for every success, you will have at least 2 or 3 failures.
The biggest mistake most people make, however, is in reducing the rate of tweaking. They believe by spending more time thinking about each tweak, they can improve their success rate. However, when factoring in time, you quickly realize their math is faulty.
Company ABC decides that they will carefully deliberate each tweak, which because of the resources required and control systems in place means their ROT drops to 4 tweaks per month. However, through deliberation, they achieve a 60% success rate on their tweaks.
4 x .6 = 2.4 successful tweaks
Tweaking Scenario B – Aggressive Tweaking
Company XYZ takes a different strategy. They endorse wholesale tweaking throughout the company (it’s not, however, a free-for-all, due to point #3 below) and achieve 25 tweaks per month, a not unreasonable number when the restrictions and bottlenecks are removed. The success rate, however, drops to 33%.
25 X .33 = 8.33 successful tweaks
By being willing to make mistakes, Company XYZ out tweaks Company ABC by a 4 to 1 margin. But, you counter, what is the cost of failure? Good question.
Ability to Learn from Mistakes
In the scenario above, Company XYZ had 4 times as many successful tweaks, but they also had almost 12 times as many failures (1.4 vs 16.33). Surely, these mistakes come at a cost. They do, but the ROM (Return On Mistakes) is far greater than the investment, if you’re smart about making mistakes.
If a company is going to increase it’s ROT, it has to build a process for dealing with failure, and the fact is, failure can be tremendously valuable. In fact, it might be more valuable than success. Why? Because you learn more from failure than success. Failure dictates your future direction.
I’ve been doing market research in one form or another now for almost a quarter of a century. And one thing has never changed in all that time. You always learn more from the negative results than the positive results. Positive results don’t cause you to change direction. Negative results do. They allow you to adjust course, or, in extreme cases, do a 180 and head in an entirely new direction. In a Darwinian contest, without losers there can be no winners. That’s why the words “winnowed” and “winners” share the same etymological roots. And everything (EVERYTHING!) in life is a Darwinian contest.
Course correction through failure has three fundamental requirements:
- The ability to quickly tell when you’ve made a mistake
- The determination not to let mistakes slow down your ROT
- A process to make sure you don’t make the same mistake twice
For the ultimate case study on how these three requirements can make being mistaken your best investment ever, let’s turn to the ultimate arbitrator of winners and losers, evolution.
There’s a pretty clear judge of winners and losers in Nature – it’s called differential reproduction. Winners have more offspring, generation after generation. Losers don’t. Winners thrive in the population. Losers die out. The judgement is brutally effective, if somewhat long in duration. To introduce effective evolution in an organization, you have to be just a brutal. You need a crystal clear metric to measure success or failure by, similar to differential reproduction and you have to be brutal about holding your efforts up to this metric, cutting the losers, then taking your lessons learned and investing that in your winners.
Don’t Slow Down your ROT
Nature doesn’t deliberate about evolution. Evolution happens by chance. Richard Dawkins called Evolution the Blind Watchmaker. There is not master plan or blueprint. And so, there is no predetermined timeline for evolution. Mutations and adaptions just happen, allowing the very few successful ones to thrive and the far greater number of failures to be winnowed out. But the incredibly high ratio of failures in evolution does nothing to slow down the overall rate. It grinds on relentlessly, paying no attention the scoreboard of winners and losers. The ROT in nature remains constant.
You have to adopt a similar approach in your organization. Create a mandate for experimentation and tweaking. Embrace failure and make it clear there’s no repercussions for it. Find ways to reward all tweaking, good and bad. Separate the judging of winners and losers from the motivation to try in the first place. In nature, we have the comfort of having, at a minimum, years or even generations in between the initial tweak and the ultimate determination of success or failure. We don’t have the same luxury of time in our corporations, but we can build organizational buffer zones between the initiation of tweaking and the judgement of effectiveness.
Don’t Make the Same Mistake Twice
I said above there’s no blueprint for evolution. Actually, that’s not entirely true. There is a blueprint. The difference is, the blueprint is not planned out in advance. It’s created “on the fly” through constant tweaking and then passed on for further rounds of tweaking. When it is passed on for more tweaking, at least in some species, half the blueprint is arbitrarily thrown away and then remaining half is “mashed up” with another blueprint, just to see what might happen. If there is a time in evolution where there is an opportunity for what would be a tweak that would represent a relative “leap forward”, it’s during these mash ups. I’m speaking, of course, about DNA and sexual reproduction. The point, however, evolutions successes and failures are tallied in our DNA, reducing the odds of making the same mistakes over and over. Success is, over time, coded into the DNA that’s passed on.
Organizations need corporate DNA. They need a way to tally success and failure and save it for further reference. Here is where we have an advantage over evolution. Evolution has no intelligent agent to review all the DNA prior to a mutation or a reproductive combination to make sure that this particular genetic tweak hasn’t been tried before. We do. Once we embed our history of success or failure in some form of corporate DNA, whether it’s procedures, documented process, product specs or corporate culture, we have the luxury of being able to review prior to future tweaks, keeping us from making the same tweak over and over again.
The final element that dictates our Rate of Tweaking is the environment we’re in. In nature, environmental factors have a direct correlations with the ROT. The pace of evolution has been found to pick up dramatically in environments that require rapid adaptation. Here, we can learn a lesson in corporate survival from Galapagonian finches.
Peter and Rosemary Grant have spent a good part of their lives since 1973 on a tiny speck of volcanic rock in the Galapagos called Daphne Major. They’ve spent that time catching and measuring birds and recording their diets. The payoff is that they’ve seen evolution happen before their eyes. In 1977, a severe drought on Daphne Major forever changed the nature of food available there. The vegetation withered and the seeds of that vegetation, the primary source of food for the native population of finches, became much scarcer. The softer seeds were quickly eaten by the finches, which left only the harder seeds. Finches typically didn’t have beaks powerful enough to crack these seeds. On Daphne Major, nature was going to be an incredibly harsh judge of tweaking.
When our environment becomes adverse, as on Daphne Major, it’s not the initial rate of tweaking that changes. Evolutionary changes happen at random. What happens is the pace at which the losers are winnowed from the winners picks up dramatically. The Grants found that on Daphne Major, the finches with less powerful beaks died off in a generation, quickly altering the nature of the Galapagonian finch population.
The lesson we can learn here is that adverse environments force a harsher judgement of tweaking. While that might seem like a drawback, it actually speeds up evolution. For example, the adoption of digital marketing has been accelerated because of the adverse economic conditions over the past two years.
The Tweaking Reading List
If you approach corporate management from a Darwinian perspective, you’ll find evidence of the success of the approach in all of the best books, from Drucker to Peters to Collins. But three books in particular have focused on the benefits of evolutionary tweaking:
The author of Crossing the Chasm tackles the question: How do great companies retain their appetite for innovation throughout their life cycle? The evidence shows that start ups, by their nature, realize the importance of constant tweaking but the Rate of Tweaking drops dramatically as companies mature. Moore shows how to fight this tendency.
Godin directly applies the logic of evolutionary biology to the corporate arena, borrowing from notables including Richard Dawkins, Jared Diamond and others. This is one of the lesser known of Godin’s works, and that’s a shame.
My friend Mr. Moran does a great job of applying the benefits of tweaking to digital marketing, a niche where the pace of change has accelerated so dramatically, winners and losers are determined in a fraction of the time typical in the offline world. Call digital the Daphne Major of marketing.