Tuesday, December 11, 2007
Edge Principles: Stuff Happens
You know, there's been a huge amount of discussion about the writers striking in Hollywood. But not a great deal of real insight as to what to do about it - how to fix the seemingly intractable problems they're arguing over.
Let me do a bit of a deeper post than usual, since this is a fun subject - which will illustrate a bit how we use Edge Principles in real-world sessions, to help boardrooms get to the economic truths that underpin real, durable strategies.
What does this particular principle - stuff happens - have to do with the strike? Everything.
The stuff, in this case, is a business model - YouTube is slowly but surely crafting a fundamental redefinition of how and why content creates value.
Brilliant - recommended reading. Not for what it is - the idea itself is fairly simple. Rather, because it makes us think about how and why Google is able to visit a seemingly infinite tsunami of disruption on a witless, hapless media industry.
It's because, instead of trying to force stuff into rigid, prdetermined, overplanned shapes and structures, Google lets stuff happen.
Think about it seriously.
While writers and networks have been crippling each other with a simplistic - and totally obsolete - game of mutually assured destruction, Google is slowly but surely reinventing a better way for content to create value: one which doesn't need exactly the rigid contractual lockstep writers and networks are squabbling over.
See the point? Google is solving exactly the problem that core-focused players are paralyzed by; that's suddenly brought the existing value chain to a crashing, creaking halt.
Like I said - brilliant. That's true mastery of edge strategy.
Think about it in a more intuitive way.
Stuff - raw economic stuff, like resources and value activities - in the edgeconomy is simply too plastic and liquid to be inertly forced any longer. No firm is strong enough to stop plastic and liquid stuff from flowing through the gaps, wrinkles, and holes in value chains and market space.
But some firms are smart enough to understand that when those gaps, wrinkles, and holes are exposed - stuff happens: plastic, liquid economic stuff naturally flows into them.
That's edge leverage - a fundamentally and radically different approach to creating value than at the (decaying) core.
Just last week I blogged briefly on this
. Not from the Google/YouTube perspective , but about the extreme makeover underway in Hollywood. Yep. The ball is certainly rolling and picking up mass.