Last week, I wrote about the boundaries of complex systems. Essentially, they work like gears with ratchet teeth: the more consistent the direction of travel, the more efficient the system itself. Here’s the picture:

The book Built to Last, by Jim Collins and Jerry Porras, describes many fascinating characteristics of visionary companies, with the overall gist of the book being that companies that align themselves around a shared purpose and values outperform those that don’t. One of the more interesting of the authors’ observations is that it doesn’t seem to matter what that purpose and those values might be.

In particular, Built to Last uses as one of its reference companies Philip Morris. Regardless of your feelings about smoking, few people think the words ‘values-driven’ and ‘tobacco’ go hand in hand. But Collins and Porras describe a strongly adhered to and clearly articulated culture, passionate about freedom of choice.

While those values are consistent with the outside world, the company will flourish. While they are inconsistent, the company will suffer. Good/bad, healthy/unhealthy… these subjective concepts make no difference in this equation. What matters to company performance is what matters to the stakeholders, all of them: staff, shareholders, customers, community and society.

If the staff is passionate about their values, the shareholders are getting a good return on investment, the customers love the product, and community and society are supportive or not opposed, then the company will do well.

It is only in the past few decades that cigarettes began to be considered a vice—and the tobacco companies have paid for it. Increased PR expenses, litigation costs, decreased revenues… you can see the challenges that can be created in a company when it falls out of alignment with the society around it.

So this is the concept for today: self-alignment is not enough. Customer service is not enough. Taking care of relationships is not enough. Our companies—our lives—are governed by the totality of our focus.

Have you observed this in your own experience? I’d love to hear about it.

I am totally unique.

Nobody on this planet is exactly like me. Nobody thinks my thoughts, dreams my dreams, or lives my life. In so many ways, I am a snowflake: an utterly unique, totally individual, mold-breaking creature.

And yet, I am vastly predictable. For example, I am guaranteed to cry at any and all opportunities — and I mean ANY. An episode of The Simpsons where Homer feels bad about not being a good father. Lethal Weapon 4 where Joe Pesci talked about Froggy. This ad for New Zealand Post (I have to change the channel when it comes on, or risk breaking down into an incoherent sobbing mess).

I am guaranteed to cheer, loudly, at sporting and theatrical events. I am guaranteed to want to see the latest big-budget action flick. I am guaranteed, in short, to behave in certain ways, ways that can be tapped into and understood and used to identify me as a potential customer.

So am I unique or aren’t I? In Sunday’s Guardian, a variety of thinkers sounded off on the Pros and Cons of a Google World. Adam Curtis, the director of The Power of Nightmares (a TV documentary on terrorism), had this to say:

The millions of searches that engines like Google record and store reveal the shifting desires and fears of individuals. They’re leading to a new fragmented sensibility among millions of people in the way they see and experience the world. Machines like Google know something about us as human beings that we really don’t want to know - that we are not individuals: ‘If you like this then you will like that…’. So Google is a paradox. It gives us the feeling we are wild and free individuals, powerfully reinforcing an idea of us as heroic figures in the consumer age. Yet at the same time it is powerfully proving the opposite - that we are completely predictable. Out of that is going to come some very interesting political ideas of how to organise society and also new artistic ideas. The really interesting question is whether it is really a cult….

Here is the thing: if we were truly unique and truly unpredictable; if our actions were in no way interconnected and in no way integrated; if we didn’t have some means of anticipating, to some degree, the behavior of others — our lives would be ruined.

You wouldn’t have any idea whether your co-workers would show up or whether your spouse would be waiting at home. Events that require critical mass, like rock concerts and political movements, would be impossible. And none of the products that tap into the short head of the marketplace would exist.

In order to function, the complexity of our lives requires repetition, patterns, and short cuts. If we had to make a truly individualized decision for every action we take, we would become paralyzed. If we tried to assimilate all of the data available to us at any given moment, we would go insane.

And so we become hybrids. We are predictable to one degree and individual to another, and the combination of the two produces a unique result that nonetheless overlaps with millions of others.

Thank goodness. If we didn’t overlap, there would be no airlines, no iPhone, no Internet.

So are you happy to be one of the crowd? Or do you see yourself as a unique individual?

P.S. I haven’t forgotten the last post, and my promise of a post on Big Tobacco and complex systems… coming soon! Also hat tip to Brian Hayes for the link to the Guardian story.

Hello, my friends. My apologies for the delay since my last post. I’ve been on holiday—took a visit to Aoraki/Mt. Cook, New Zealand’s highest peak. If you are ever in this part of the world, it’s worth a visit. Incredible hikes, glacier skiing, and the Sir Edmund Hillary Alpine Centre: what more could you want?

Anyhoo, I’m back now, and noticing an uptick in the number of articles mentioning the word ‘bubble’ or sneaking around its edges. Take for example Adam Lashinsky’s piece in Fortune, describing his sense of deja-vu during his visit to the Twitter offices:

Facebook and YouTube have yet to gush profits - a fact that is the talk of Silicon Valley. Yet here I am again, in July 2008, listening to yet another boyish entrepreneur discuss a quirky, compelling - and nearly revenue-less - startup… Only in the tech business are companies born with neither a clear reason for being nor a clue as to how they’ll produce profits.

When it comes to economic activity, be it real estate, stock markets, or venture capitalism, there’s a universal tension between the “fear of losing” and the “fear of not winning”. Nobody wants to be in the market when it crashes, but nobody wants to be out of the market if it keeps going up.

These two fears do battle as markets rise and fall, transitioning through what I’m going to call the Five Stages of Twitter. And, if you’ll indulge my flight of fancy, I’d like to take a look at them through the eyes of a potential shareholder, in a parallel universe where Twitter’s already had its IPO.

Stage 1: Denial
The first few indicators begin to amass that a market is ready for a slowdown, but you are having so much fun on Twitter, you’re absolutely certain they’ll be able to monetize it somehow. They can’t provide a service this important to this many people without finding a way to extract value. When they do, you know it’ll be huge—and you’ve got a big fear of not winning. You buy more stock.

Stage 2: Anger
You get the Fail Whale for the fifth day in a row. “They can’t get away with this!” you fume. You start the Twitter, Fix Your Servers! group on Facebook, and garner 42,376 supporters in three days. The passionate cries of the Twitterers show you how much grassroots support the company has—and you don’t want to miss out on that kind of movement. You buy more stock.

Stage 3: Bargaining
You read that Twitter not only has no revenue model, they actually think it would be a mistake to come up with one. The Twitter CEO says they’ll monetize “when the time is right.” Somewhere else, a man tells his girlfriend he’ll leave his wife “when the time is right.” You decide that you’ll only keep your shares if the company gets support from the venture community. They get $15 million. You buy more stock.

Stage 4: Depression
Your tweets get shorter and shorter as your tenuous grasp on the English language slips away. Where once 140 characters seemed like an impossible restriction, now you struggle to fill the space. You realize that the more time you spend Twittering, the less you have to tweet about. To feed your gaping spiritual void, you buy more stock.

Stage 5: Acceptance
Twitter has yet to realize any revenue. Ebay writes off $900 million of its purchase of Skype, a figure Google seems destined to outdo with YouTube. Facebook downgrades its valuation from $15 billion to $3.75 billion.

You sell your Twitter stock, and buy shares in Plurk instead.

The above commentary is intended to be a bit of a giggle, and does not constitute investment advice. Follow me on http://twitter.com/kcolbin.

I thought it would be unfair to spend last week blogging about all the other presenters at WORLDCOMP’08 and OMMA Behavioral without sharing my own presentation with you! So I’ve recorded it, and I’m putting it together with the slide show so you can share in the love. Expect the video sometime tomorrow.

In the meantime, I’d like you to enjoy a delightful piece from Nicholas Carr at The Atlantic called, Is Google Making Us Stupid? Nicholas has written a long article about our growing inability to consume long articles.

Here is one of the many passages that should rekindle your ability to ponder:

For me, as for others, the Net is becoming a universal medium, the conduit for most of the information that flows through my eyes and ears and into my mind. The advantages of having immediate access to such an incredibly rich store of information are many, and they’ve been widely described and duly applauded. “The perfect recall of silicon memory,” Wired’s Clive Thompson has written, “can be an enormous boon to thinking.” But that boon comes at a price. As the media theorist Marshall McLuhan pointed out in the 1960s, media are not just passive channels of information. They supply the stuff of thought, but they also shape the process of thought. And what the Net seems to be doing is chipping away my capacity for concentration and contemplation. My mind now expects to take in information the way the Net distributes it: in a swiftly moving stream of particles. Once I was a scuba diver in the sea of words. Now I zip along the surface like a guy on a Jet Ski.

I too read less. These days, when I am inclined to pick up a “book” (a strange device with physical pages and black ink), I lean more towards Grisham than Goethe. I find that I have to force myself to read the sort of non-fiction that keeps my mind sharp and my thinking fresh.

So in the interest of keeping this post at a length commensurate with our newly shortened attention spans, I’ll stop here and turn it over to you. Have you found your thought processes changing with the use of the Interweb? Are you more in the market for ‘War and Peace’ or ‘Dilbert’? In short, has the Internet made you stupid?

Last week we talked about some of the features of complex systems: emergence and self-organization. The discussion got me thinking about the complex system created by human beings. If we accept that the human network is non-Euclidean, what does that mean for the mathematics of our interactions?

Euclidean Network Geometry

When I think of networks, I tend to imagine two-dimensional diagrams of nodes and connections, the stereotypical centralized, decentralized, and distributed versions:

When you look at the above networks, you can see immediately that they are finite: there’s a border to each one. And, yes, they are simplified and simplistic, but take another look at the image I posted last week, ostensibly a representation of the Internet:

This image looks spherical, but I’ve noticed something important: you’d actually have to cover its outer nodes with a membrane to make it form a sphere. It’s the difference between a soccer ball and a pom-pom.

Non-Euclidean Network Geometry

So here’s something else to think about: what about a network shaped like a soccer ball? One that doesn’t need a membrane to cover it and that doesn’t have any terminal nodes?

It may sound like an innocuous question, but consider this: Euclidean geometry is what we all learned in school; it includes some of the oldest known mathematics. But it took non-Euclidean geometry—not accepted until the 19th century—to allow for navigation of the globe and Einstein’s Special Theory of Relativity.

The basic difference here is straightforward: Euclidean geometry is based on a flat plane, which allows for things like parallel lines and right triangles. Non-Euclidean geometry, specifically the elliptical geometry that refers to spheres, does not allow for parallel lines and allows for triangles with two 90-degree angles.

So think for a moment about the network constructs above. Imagine that each node were a person, and each line a connection between people. Now imagine a network consisting of all the people on our planet. A simplistic model of it might look like this:

So here’s the ultimate question: what are the mathematical implications of a non-Euclidean human network?

I invite your ideas on the matter…

(Updated July 4 to correct a grammatical error I had made.)

I can’t remember where I heard that one. It’s from a parable or fable or anecdote or some such thing. You are asked to fill a jar with rocks and sand. If you put the sand in first, you won’t have room for the rocks. But if you put the rocks in first, the sand can fill in the spaces around the rocks.

It’s a great story because it is so universally applicable: at the highest levels of your life and at the lowest. Examples:

• What is the most important thing to you in the world? Put it first. Make time for it now, because by the time you finish filling the jar with all the minutiae that comprise our daily lives, you won’t have time for that big rock.
• Working on a project and worried about the ‘triple constraints’ of time, cost and quality? Work out the ‘big rocks’ in your deliverables and focus on those.
• Studying for a test? I recently took the test to become a Project Management Professional (hence the reference to the triple constraints). Some of my fellow students spent hours memorizing the 44 project management processes. It sounds good in theory, but here’s the thing: there were only one or two questions on them (out of two hundred), and all of the project managers we know look them up in books whenever they need them. So why spend so much time studying them? Why not spend that time with your parents or your significant other or your children or building houses for people in need?

Putting the rocks in first isn’t the same as saying that sand doesn’t matter, because it does. The willingness to take the time to get the small things right can be the difference between mediocrity and greatness. You can’t make an epic movie like Lord of the Rings if you ignore the sand. Seven-time Tour de France winner Lance Armstrong is famous for his attention to sand. But you can be sure those rocks were taken care of.

In every endeavor, there are some things you may be able to get away without and some things you just can’t ignore: those things you can’t ignore are the rocks.

Classical economics treats us as if we were rational creatures, performing explicit cost-benefit analyses for every action we take. We know the reality to be somewhat different: we do what we do, and then fabricate explanations afterwards. Putting the rocks in first is a reminder of our priorities in this precious life.

Do you put the rocks in first? Or do you have any other guiding principles to share with us?