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In the work that we've done we've basically ended up focusing on a contrast between push-based
approaches to business and pull-based approaches. Push-based approaches basically start with
the assumption that you can make a prediction or forecast and then make sure all the right
people and right resources are in the right place at the right time. And that's worked
very well. It created huge companies; a lot of wealth was generated.
The challenge is in a world that's more rapidly changing there's a need to adopt a different
set of practices that we call pull platform, scalable pull platforms, and platforms where
you can draw out people and resources when they're needed and where they're needed.
If you think about most traditional automobile companies in the assembly line operations
of their factories it was a highly scripted, tightly specified set of activities. Very
routine, very mundane.
And if you talk to most of the traditional auto companies they would say that workers
on these assembly lines it's unreasonable to expect them to be passionate or excited
about the work they're doing. That's a push-based model in terms of just do the job in a predictable
way. Don't deviate. Be reliable and clock in and clock out when you're expected to.
Interesting alternative model was really pioneered by Toyota. They said to the workers, "Look,
we understand that you're gonna have some routine activities that you have to perform
as part of your job. You're in a manufacturing operation. But your real job? Your real job
is problem solving, creative problem solving. We know that in an average day you run into
all kinds of unanticipated problems on that assembly line.
"Your job, number one, is to identify those problems, make sure they don't escape the
moment but in the moment identify the problem and solve the problem. If you can't solve
the problem we're gonna put a little pull cord next to your station at the assembly
line. You pull that cord and the entire assembly line is gonna come to a screeching halt. The
factory, in effect, will shut down. And at that moment you're gonna be swarmed by a team
of people who will come in and help you to solve that problem. And you're gonna be a
hero for having pulled that cord. It's not a bad thing. It's a great thing because you
found a problem and you acknowledged that you couldn't solve the problem and you got
help necessary to do it."
Well, it's really interesting. In that context you created, in effect, a pull platform. When
needed, where needed you brought in a team of experts to solve an unanticipated problem.
Passion levels on that front line went way up in terms of now there's a job where I'm
making a difference.
So I think it's an interesting illustration of moving from push to pull by creating that
platform where it was problem solving, number one. Number two because it was problem solving
that wasn't anticipated you couldn't possibly have all the resources in the right place
at the right time.
You had to create a platform where the resources could be pulled in as needed. When we talk
about pull platforms often people focus on one level of pull which is what we call access.
It's simply if I have a need I can make a request, get the resource or the information
I need when needed.
And that's a very useful form of pull. You can think about Google as a search engine
is a great scalable pull platform in that regard. But that's only the first level of
pull. There are actually two other levels that become more and more important. One level
has to do with the notion that in a more rapidly changing world where there's so much uncertainty
we don't even have much comfort that we frame the right question. What's the question? What
are we trying to answer?
And in that kind of environment a second form of pull that we call attraction. How do you
attract people in resources to you that you didn't even know existed but when you encounter
them you say, "My God, that was so helpful. They had an insight that I didn't even know
was there or that I could ask for and yet it helped me to solve a problem." That's,
in effect, a form of serendipity, unexpected encounters and creating pull platforms where
you enhance that opportunity for serendipity and attraction, that's very powerful.
One of the early implementations of this is a company called Innocentive, which was created
basically to help people in large corporations, particularly in the R&D function, Research
and Development. In essence what Innocentive does is it provides a platform where you can
post a really challenging problem and offer a reward to anybody who can come and provide
a solution. And it's been remarkably effective. People get very challenging problems and get
solutions to those problems.
It turns out that the significant majority of the answers that are posted and get rewards
on Innocentive's platform do not come from within the discipline that the problem was
posted. So if it was a problem in chemistry you're more than likely not to get the answer
from another chemist. You're likely to get the answer from somebody in a completely different
discipline who's just coming at this with a very different angle.
So it's that unexpected encounter. You wouldn't even know to go outside the discipline or
where to go outside the discipline to find the answer yet Innocentive creates that opportunity
where posting the problem attracts all kinds of innovative ideas and ultimately a solution
to the problem.
So there's a third level of pull which has to do with achieve which is all about learning
faster. I think one of the interesting early illustrations of this kind of pull platform
is a company in China that's not very well known here in the United States called Li
& Fung and they started as a very traditional trading company but essentially they've evolved
into a very sophisticated orchestrator of a global network of participants. They're
customers, Li & Fung's customers, are apparel designers. So think of Calvin Klein or Ann
Taylor.
Basically they take the designs that these designers come up with and then they take
care of everything from sourcing of the raw materials to dying of the fabric, weaving
of the fabric, assembly of the apparel and delivery to various distribution centers,
retail distribution centers around the world.
Li & Fung does none of this themselves. They rely on a global network of about 15,000 business
partners today - highly specialized that they bring in and they construct, in essence, customized
supply networks for not just an individual designer but down to the individual item of
apparel. So if it's a high end wool sweater it's gonna be a different set of participants
than if it's a low end wool sweater, different dying techniques, different weaving techniques,
etc.
But what's really interesting in this network is that if you go out and talk to the participants,
the partners that Li & Fung has brought together -- and we've interviewed a large number of
them to find out why are they part of this network. Interesting response without prompting
and top of mind is the reason we're part of this network is because we learn faster by
being part of this network than we could on our own or as part of another network.
What has happened is Li & Fung has spent a lot of time thinking about how can we help
our participants get better faster. So they've created real time performance feedback loops.
As a partner you can get a read on what kind of performance you have along many different
dimensions relative to analogous partners in the network. So you have very precise views
of where your performance gaps are.
But then Li & Fung goes further and doesn't just give them that information. They help
to bring together the right participants in the network who can help this particular partner
address that performance gap, learn new practices, new ways of operating their business. So there's
this constant effort to identify performance gaps and work together to try to address those
performance gaps and the result has been rather impressive in terms of the motivation that
people have to participate in the network and the performance improvement that comes
from it.