Thursday, December 16, 2010
The Art of Significance
"Mr. Li, the overseer of the Chinese renewable energy industry, publicly exhorted the leaders of the nation’s biggest wind turbine makers at the China Wind Power conference, a three-day event that drew hundreds of executives from around the world.
“You cannot be called a winner if you are the leader for three or five years,” Mr. Li told the Chinese executives. “You can only stand on the top line if you are the leader for 100 or 200 years.”
The Chinese presidents sat quietly and respectfully, chins down. Senior executives from the foreign manufacturers — including Vestas, G.E. and Gamesa — sat alongside them, staring straight ahead in stony silence."
Link. Ask yourself: can you imagine similar words being said in any corporate boardroom, policy wonk powwow, Senate committee meeting, or trading floor in America?
It's difficult--if not downright impossible--to. Because far from seeking superiority for, well, the next century, American institutions are myopic, opportunistic, rigid, sclerotic. They barely seek superiority for the next nanosecond--in those rare, ragged instances that they have the courage, wisdom, or perseverance to seek meaningful superiority at all. They're geared to create thin value--not thick value.
What Li's demanding from Chinese C-suites is, above all, significance. He's redefining success, kicking the bar not just into the stratosphere--but into the next galaxy. America's still pursuing yesterday's tired old notion of near-term competitive advantage. But competitive superiority in the 21st century is a function of mattering radically more--focusing with a lethal intensity on achievements so significant, for example, that they endure a century or more.
That's the art of significance--and my guess is that most boardrooms, obsessively, delusionally, pathologically fixated on the near-term bottom line, just don't (and won't) get it. Until, that is, all of a sudden--next to an institution working furiously on stuff so significant it matters, endures, and perseveres for a century or two--they just don't matter anymore.
Are you really writing and posting this fantastic stuff around the corner from me at Chalk Farm at 5.00 a.m.? Do check out, if you have time, http://bit.ly/ePCJte I'd be interested to know what you make of it. How have some people already read your book? And what are we to make and do about Amazon, PayPal etc?
I'll quibble with the use of the word "significance", if only because significance need not be tied to time.
But can't argue with the deep, misleading, long-term ramifications of pursuing short-term strategies tied to short-sighted incentives. That's one of the big changes capitalism has to tackle.
Looking forward to reading the book!
So So true. When that myopia extends through the ranks to divisional and even personal P/L year by year outcomes the rot permeates even deeper.
I think that you took the quote slightly out of context. Although I can see your point of view to exhort long-term significance (next century) vs. short-term/nanosecond edge, I don't think the backstory quite fits.
The backstory of the article for those that didn't read it is that Western companies are vying to gain access to the mainland Chinese market, and in so doing are bending over backwards to comply with Chinese "local manufacturing" quotas while transferring hard-won knowledge to Chinese companies.
Although the article refers to the renewable (wind) energy industry, I felt the underlying premise was that the Chinese are co-opting the same old tired, 20th century practices on a larger scale. This feeling is influenced in large part from reading your numerous past commentaries on what 21st significance means.
Most of your posts hit a resonant chord with me as you strive to provide examples of 21st century, meaningful and significant companies and business models.
I fear I missed the connection you're making in this particular post based on the article in question.
I like this, but your approach often seems to be: shame them into change; or, scare them into change. You present the case, the either/or choice, and then force them to answer to it. This is interesting, but I'm thinking that many of the older, entrenched players will simply ignore your advice. (I'm assuming they will be case studies in the future editions....)
Plus, your approach seems to be one method to motivate change -- on the basis of that very short-term, self-interested fulcrum which, paradoxically, is being attacked. In other words:
1. If 100-200 years from now is the real goal (so they might think), then what's in it for me NOW, since I won't be around in 100-200 years? So, they stick w/ the short term gains they believe they will be able to enjoy now.
2. If, on the other hand, not planning for 100-200 year significance is going to hurt me NOW, then by golly I should start planning for such long-term significance! --So this become merely a short-term, short-sighted business-as-usual strategy, albeit one with the potential to leave these people with some legacy that those living 100-200 years from now can attribute to them.
I'm not saying that self-interest should play no role, of course. The thirst for legacy has always been a difficult root to pull and historically has motivated plenty of entrepreneurs to develop systems with long term vision.
it assumes that they know enough about future to do the "right" thing and i dont beleive you can. its an interesting point though