Do the doable: Be the hinge

September 4th, 2010

Alice Coles lived in Bayview, Virginia, one of the poorest places in the US – a place without indoor running water. When the US government decided to build a prison in her town, however, Coles decided to speak up – and won. That little victory enabled her and other citizens of Bayview to take their future into their hands and tackle the squalor in which they had been living for a long time. They dreamed of clean houses with air conditioning, modern kitchens with appliances and of course indoor plumbing with hot and cold water at a turn of the faucet. And they made it happen.

When 60 Minutes interviewed Alice Coles, Ed Bradley asked her whether one person could make the difference. Her reply: “Yes. They don’t make all of the difference. Just one little piece… you know, like big doors. They hang them on small hinges. And if I couldn’t be the door that opened… to a better life, I’ll be the hinge to hold the door. So, one person can make a difference. Yes.”

There is more than inspiration in Coles’ insight – there is practical wisdom. Moreover, it is the same kind of wisdom that builders of great companies and major social movements have acquired through experience. Consider the following instances that may appear to range from the sublime to the ridiculous:

  • During his stint as a lawyer working on a case in South Africa, Mahatma Gandhi encountered numerous racial injustices that led him to found the Natal Indian Congress. For over two decades, Gandhi lived in South Africa and fought for a better life for his compatriots and against their own divisions based on religion, language, caste and class. Each time he took any active step to protest each injustice he encountered, he learned to devise little details of techniques some of which worked and some did not. His experiments led him to construct an arsenal of non-violent protest models that he later used in his struggle for Indian independence and the fight against the caste system. A recent box-office hit, Invictus, chronicles a similar variety of innovative mechanisms that Nelson Mandela devised in getting his country to unite behind a rugby game even if only for a day.
  • In the mid ‘70s, Mohammed Yunus discovered that the small sum he gave to a handful of villagers in Bangladesh to rebuild their micro-businesses would be returned without his asking for it. That gave him the idea to ask a local bank to make micro-loans to the poor. When they could not or would not, he went on to make some on his own. Almost every time he lent to a woman, he got his money back – and then some. So he went back to the banks with his data. When they could still not be convinced, he began experimenting with specific policies and procedures that eventually became the 16 Decisions that helped fuel the microfinance industry. Today Grameen Bank has millions of borrowers and Yunus won a Nobel prize for his work.
  • About a decade earlier, in a completely different part of the world, in a Houston subdivision, goaded by fellow home owners complaining endlessly about their trash removal problems, Tom Fatjo bought a garbage truck and began waking up at 4 AM to collect his neighbors’ trash before he showered, changed into a suit and went to work at a big-six accounting firm. An entire year of this double life ended in the founding of waste management giant BFI.

Such examples are numerous and pervasive throughout the early histories of major accomplishments in entrepreneurship of every kind – from for-profit companies to NGOs to socio-political movements.

Yet most of us continue to live in a world of deep and dire difficulties that may overpower our verve and throttle even a vestige of hopefulness — billiions of people living on less than a dollar a day; children without food, shelter, education, or basic decencies; not to mention terrorism, climate change and a collapsing financial framework.

Even when we aspire to build a better future for ourselves and the world we are a part of, many of us are reluctant to do so because we believe such efforts call for heroes or martyrs. And sometimes the sheer scale and scope of the problems we are faced with can be too debilitating to even contemplate action. The temptation then is either to do nothing or to settle for well-worn paths and procedures that others have forged before us. However, these well-worn paths forged to tackle the problems of yesterday more often than not exacerbate rather than mitigate the problems we need to tackle today. Often they need imaginative modifications, tinkering of some kind that might require just a little bit of nerve and thick skin for trials-by-error in the early stages.  Not heroism or martyrdom, but a gentle and firm push with a tinge of courage and useful innovation.

Every instance of a real change for the better, every invention of a useful social technology, has at its beginning someone setting out to do something different, even if only slightly new. The key is neither to tackle the problem wholesale – nor to hunker down into the unthinking safety and comfort of the “normal” – but to take that one slightly unusual step, do that one unexpected thing, craft that one little mechanism, that is both doable and worth doing. When it is doable, it will likely bring a small victory. And because it was worth doing even if it could fail, that small success usually opens up a few more possibilities that we may or may not have imagined before it. And so forms the hinge on which the door to a new future begins to swing open.

In Bayview, as more residents move out of the dilapidated shacks into the new houses, Coles and her team are onto their next challenge. The New York Times recently reported: ”If we don’t create jobs here and people can’t pay the rent,” she asked, ”then where will they go?” But she remains confident. She has just applied for $2 million in aid from the Department of Housing and Urban Development, ”to help with the farm and economic opportunities,” she said. And her group is experimenting with hot peppers, both red and green, to make a hot sauce.

One of these days, the Bayviews of the world may yet wean themselves off the donor model and end up constructing markets in human hope. For that to happen, business students, entrepreneurs and effectuators need to become the hinge. Get your hard hats on. Let’s construct something doable and worth doing.

What is Control?

February 25th, 2010

A central aspect of effectuation is the notion of control. One way of thinking about effectuation as a theory is that it’s a set of heuristic elements that are connected with each other through the common bond of control. Hence, the “logic” of control in effectuation.
Effectuation’s control orientation is logical for another reason too – which is that although prediction can be used for control, in the unpredictable circumstances of venturing prediction can’t be trusted very much. Therefore, it’s logical to privilege other control techniques.

So really, effectual thinking seems to involve a significant emphasis on control. And this seems pretty reasonable from a couple of different standpoints:

- Practice, where a lot of research suggests that control is one of
the main attractions of entrepreneurship - maybe the main attraction (I’m thinking of Benz and Frey’s work: “Being independent is a great thing” because it creates higher satisfaction but also the argument that entrepreneurs get more bang for the buck from their human capital than workers do because they control how its applied).

- Theory, where from the standpoint of psychology, the non-role of
desire for personal control in entrepreneurship theory seems weird, since many researchers have argued that control is one of the most important drivers of human behavior (here, I’m thinking, among others, of work by Seligman since my read of the positive psychology movement is that it puts significant emphasis on the benefits of personal control).

So, it would seem to make sense that entrepreneurs’ control preferences would extend to the way they run their ventures – with the techniques and methods they use – since this would be consistent with their reasons for being an entrepreneur in the first place. Which brings me to a couple of questions:

First, though emphasizing use of your means (bird in the hand), affordable loss, partnering with self-selected stakeholders and leveraging contingency are all control mechanisms, I’m wondering if these cover most of the mechanism space or whether there are other frequently used control mechanisms out there that researchers have observed, that could be incorporated into effectuation theory; and -

Second, I’m wondering to what extent form follows function, i.e. whether affordable loss manifests itself in different ways in different environments. As we say in England, “there are lots of different ways to skin a cat” - but the underlying function is still to skin the cat.

(This post was created by Nick Dew, and uploaded by Stuart Read)