Friction

The Prussian General Carl von Clausewitz first experienced war at the age of 12 as an ensign in the army of Fredrick the Great. He took part in the Siege of Mainz and the Prussian army’s deeper invasion of France during the French Revolution. Despite seeing active combat at such a young age he went on to have a long, distinguished military career that included stints in the Russian army and he fought in the Napoleonic wars of 1806 to 1815.

He would go on to write an opus titled “On War” where he takes a systems theory view on how and why war operates:?“Everything in war is very simple,” Clausewitz wrote, “but the simplest thing is difficult. The difficulties accumulate and end by producing a kind of friction that is inconceivable unless one has experienced war.”

You can apply this to your own life (as I advised you to in “Intentional”) or, as I will advise you to here, you can apply it to your business. Whether you see this as working within a larger organization or setting up a business and operating it, is immaterial.

What is true is that you will experience friction. The reason you will experience friction is because no business (just like no individual life) is operating in a larger system that is set up exclusively for it. Had this been the case things would automatically be much easier. But the world we experience is an emergent phenomenon that arises out of the operation of the many complex entities that make it up.

So “doing business” just like “living a life” actually requires specific operations, choices and decision that are designed to do one specific thing: reduce the amount of friction inherent in the operation I question. The way we achieve this objective is through the building of relationships. Mergers, partnerships, acquisitions, expansions, growth and, in the much smaller scale of a life, family, friends and acquaintances, are the means through which we scale what we do and reduce the friction we experience as we do it.

The formula for a successful business is simple: Find new customers. Retain the ones you have. But in order to do both these things we need to reduce the friction we experience as we expand our reach to a wider audience and reduce the friction those who are already our customers experience as they do business with us.

Pretty much everything you see and experience as part of business development and marketing is the result of friction experienced that needs to be overcome. Imagine a frictionless business, for a moment. It’s a business that has a product or a service everyone wants. It’s a business that makes that product or service available instantly the moment anyone wants it. It’s a business that offers a product or a service in such a way that everyone who uses it is totally happy with it.

That business, which does not exist, would fly high above all competitors, have zero need to advertise what it does, and will never have to worry about losing customers or not having a massive market share. Working backwards from this ideal business we realize that dropping market share, losing customers and a constant struggle against competitors is the result of the friction a business experiences which remains unaddressed.

Increasing advertising, for example, when a business loses customers and market share is throwing money (i.e. energy) that’s hard to come by in the first instance, at a problem to solve its symptoms but not its root cause. It might fix it for a while but it will persist. The success of that business will be subject to how good or bad its competitors are at solving the same problem for themselves.

Increasing advertising, increases customer acquisition costs and decreases profit margins. It introduces fresh pressure inside the business to ‘turn the corner’, increase productivity and reduce operating costs. And that pressure only adds to the friction of work inside the business. Some of that internal friction seeps outwards. Bad customer service, missed opportunities and poor decision-making are some of those symptoms. In larger businesses we talk about a “bad culture” that incentivizes competition and fails to reward cooperation. Lack of trust, loss of morale and a non-existent sense of purpose.

Frictionless Environments Inside and Out A Business

What all this suggests is that a business that succeeds in reducing friction in the way it operates is already enjoying a significant competitive advantage. Inside a business this ‘frictionless environment’ looks a little like this:

• Trust is explicit in all internal relationships.
• Everyone shares information and takes part in shaping the business’ mission.
• Everyone shares a common sense of purpose and works to achieve it in a blame-free culture.
• The growth of the business is tied explicitly to the growth and development of those working in it.

Outside a business the ‘frictionless environment’ looks a little like this:

• The business helps those who come to it achieve what they want even if it means losing a sale.
• There is perfect alignment between customer needs and customer satisfaction and the operation of the business.
• The business and its customers develop in tandem with the former constantly looking to improve the life and experience of the latter.
• The business sees itself as an embedded, indivisible part of its customers’ lives and the world.

For sure, there is no perfectly ‘frictionless environment’ any more than there can be a perfectly, friction-free system. The complexity of operations, the unforeseen events that occur and the general ambiguity that exists in most systems mean that some friction will always be present. But the difference between “some friction” and a constant accumulation of friction makes the difference between a business that’s struggling to survive in a tough business environment and one that simply has to adjust some of its operation.?