Design Principles for a More Resilient Economy

In his new book When More is Not Better: Overcoming America’s Obsession with Economic Efficiency, Roger Martin offers an antidote to our fragile democratic capitalism.

If you follow my work at all, you’d know that any book that focuses on less is right up my alley. I’ve made a career of advocating the subtractive approach to business, work, and life. And a book by Roger Martin, whom I consider a mentor, would be even more so.

Roger Martin is, above all, a master thinker. He’s maintained a podium position on the Thinkers50 list for years, and has penned many a book and article on the art of business thinking.

His latest tome, When More is Not Better: Overcoming America’s Obsession with Economic Efficiency, is arguably his most ambitious and far-reaching. In it, he ventures into the rather heady space of contemplating what he maintains may just be the imminent demise of America’s economy. In fact, Martin’s great hope for this book is that it will save democratic capitalism from itself.

Why, you might ask, is our economic model in need of saving, the COVID-related economic collapse aside?

Because the mental model framing our thinking – that of a machine whose performance can be optimized by decomposing it into its separate parts and optimizing each – is old and broken. Or perhaps more accurately, increasingly irrelevant and breaking down. For decades we have focused on a model based on the dogged pursuit of the perfectly efficient machine, the outcome of which has rendered the entire system far more fragile than it should be. Dangerously so, Martin argues, and with little in the way of designed-in resiliency.

A better and more robust way of thinking about our economic system, he maintains, would be to view it as a complex adaptive system. To do that, though, requires jettisoning nearly a century of economic dogma, and adopting a higher altitude of thought, one far more like nature, and far more integrative. Luckily, Martin guides us through the reframing exercise.

Complex adaptive systems are the defining feature of the natural world. A natural system is the antithesis of a machine: it is not the simple sum of its parts, the relationships between all the moving parts are not at all linear (think, “the butterfly effect”), and it is continuously adaptive.

“In a natural system,” Martin writes, “…one can’t just add up the parts and produce the whole. In fact, it is often hard to identify what the parts actually are. A family is a system. It is not possible to add up the individual features of a family and predict its functioning, because the interactions make it too hard to understand in advance how they will play out. The body is a system. One can’t really divorce the functioning of the liver from that of the kidneys or the heart or even the brain, though modern approaches to medicine often attempt to do just that.”

 The Design Principles

What makes When More is Not Better well worth the read is the solutions Martin offers, which comprise more than half the book. Framing those solutions are what I personally consider to be the most valuable part of the book, the design principles.

One of the things I learned from Roger Martin is the power of devising design principles before jumping into any ideation effort. Design principles are the requirements for any successful solution. They sit between the analysis of the problem and the ideas themselves. (Note: Based on my facilitation experience, most people have never heard of, much less use, design principles in solving difficult problems. I insist on them without waiver.)

Design principles are critical, because they provide the intelligent constraints that spark creativity and innovation. They guide the project. They provide a filter with which to evaluate competing alternatives.

As one might expect, Martin practices what he preaches and positions them appropriately in the book. There are just three, all focused on the overall theme of the book: balance.

1.   Design for complexity: balance pressure for more efficiency with friction to limit its damaging extremes.

“This will involve taking actions and establishing rules and practices that moderate and limit the amount of pressure that can be applied to a system,” writes Martin, “in order to protect against results that are both unpredictable and negative or even catastrophic in their consequences.”

Martin uses the example of restrictor plates on cars in NASCAR racing, which act as governors to reduce the car’s maximum speed on the fastest, highest-banked and thus most dangerous tracks. “The plates serve as a constraint on the inherent efficiency of the engine. Drivers don’t love them. But they save lives.”

2.   Design for adaptivity: balance the desire for perfection with the drive for improvement.

One of my favorite exercises to do with groups and teams illustrates how adaptive leadership and continuously adaptive systems actually work. Here’s the exercise. I gather the group (the bigger the better) in a large room and give them a simple assignment: “Pick two people at random. Without notifying them, and without any communication whatsoever, position yourself equal distance from them. It doesn’t have to be in a straight line…you can triangulate.”

What happens next is both fascinating and fun to watch. The group begins moving autonomously, each member silently adjust their position. The moving begins to slow as equilibrium sets in, usually well under thirty seconds. When the movement stops, I say, “take a step in any direction you wish.” The action begins again, often stopping in just a few seconds. Now I ask: “How long do you think that would have taken if I put one of you in charge?” Laughter all around. Point made!

3.   Design for systemic structure: balance connectedness with separation.

There’s no getting around the fact that the world is more connected than it has ever been. Connectedness is of course a good thing, like efficiency. Until it isn’t.

Right around the time I received my advance copy of When More is Not Better, I experienced the power of this principle in action. As an avid cyclist, I mount a small computer made by Garmin to my bike to track every ride. That device connects via Bluetooth to an app on my smartphone called Garmin Connect, which in turns automatically uploads my ride data once my ride is complete to yet another app, called Strava, which is a social app connecting athletes who follow each other and can virtually compete in a friendly way for the best times on designated segments.

This past July, Garmin got hit by randsomware, with the hackers demanding $10 million. Garmin users lost the ability to access any data in the Garmin Connect app. Fortunately for Garmin, they had not designed the Garmin Connect app to be the mechanism by which the hardware, the device itself, was set up. Users like me did not lose their data, and I was still able to track my rides, physically connect my Garmin cycling computer to my computer, and upload ride data manually to Strava. Garmin had balanced connectedness with separation.

Had Garmin’s top competitor, Wahoo Fitness, been hit by the randsomware, users would have lost everything — their computers would have been rendered totally useless, because their on-bike units are set up completely through Wahoo’s smartphone app. There is no physical interface. Wahoo, while generally considered to be a bit more efficient and tech savvy — “everything is controlled through the app, no need to fiddle with buttons on your device” — is far more fragile and thus vulnerable due to the lack of the balance between connectedness and separation.

The remainder of the book uses these principles to offer thoughtful, strategic agendas for business executives, political leaders, educators, and citizens. Moreover, these agendas are immediately actionable.

“Really, there is no excuse to not just get started,” Martin urges. “The downside of the status quo is staring Americans in the collective face. Our obsession with economic efficiency has … produced a dangerously unbalanced economy lacking resilience. But collectively, we can restore balance if we just get started, stay reflective, and tweak relentlessly.”