Defining a second curve with Canon

I recently presented at Einfach Digital! Which was an event hosted by the Canon Germany Team at their Customer Experience Center in Venlo. The principle of the event was for Canon to bring together a group of their leading customers to look at the future and focus on ‘invention, not convention’ and inspire us to move forward to continue to grow. The event was a great success and took place in a really inspiring atmosphere and context.

My presentation was about ‘Defining a new future with digital décor’ – and the start of the presentation we focused upon the theme of a ‘new future’ beginning with a focus on Charles Handy’s principle of the ‘second curve’ made famous by his book of the same name. In the second curve, Handy uses the example of the sigmoid curve. 

The principle of the second curve is simple and it is applicable to a person, a product, or a business. Life begins, you experience a dip to begin with because surviving is a struggle at the start. Then as humans we have a relatively (when compared with other animals) long period of dependency and learning before growth is achieved. We then mature and on our journey may experience success before inevitably we decline. Time catches up with us all, eventually. But we don’t have to accept premature decline in my opinion. 

Is it possible to reinvent ourselves at this point by launching a second curve?

This was the point of the talk. Trying something new, opening new possibilities and markets. Just like InPrint Show, which will run soon in Milan. This event is totally dedicated to new markets and possibilities and perfect for discovering your second curve

The point of Handy’s second curve is that he suggests that when we feel most comfortable, we should launch our next growth curve. This has some sense to it. Who really wants to feel they have peaked and that all they have to look forward to is inevitable decline? 

The weakness of success

In a success fixated economy none of us really make provisions for the fact that success has a downside. There is a problem with reaching the top of the arc, wherever that may be. This is due to human nature I think because when we reach a level of maturity, close to the particular peak we are focused on, we become comfortable. It is at this point that we feel least like changing, and, as a result most of us simply do not. Why would we risk being in this place by trying something risky and therefore experiencing the unpleasantness of discomfort?

The problem of success is that it creates a model which we comply to, and which makes us inflexible and therefore less likely to grow again.

When we mature, and when businesses grow beyond the first ‘start up’ phase, unseen problems begin to manifest themselves. And in this regard the issue of the expert is something I’d like to flag up.

Society does like experts. For example, it is reassuring to know that when you need to see a Dr, that this person has some experience, they will have been to the right medical school and they have a proven track record. It is equally useful that when you need an emergency plumber that this person knows the difference between a stop cock and a boiler.

But in a leadership, or entrepreneurial context, I would venture it is less useful. Indeed, anyone who has worked in a profession, excelled at a particular job, or remained at the top of their industry (sometimes just because they have stuck at it for a long enough) is often regarded a guru. An expert, and this isn’t always a good thing for anyone, especially within the constant whirl of change that we exist in today, when the rules seemingly get easily rewritten.

The soft underbelly of expertise

An expert is useful for many things, however, I think there is a ‘soft underbelly’ to being an expert.

In a business context, experts rarely launch anything new. They rarely create new value. If we are an entrepreneur who has become an expert – then we stop being an entrepreneur because experts tend to shy away from making mistakes. In contrast, entrepreneurs will make mistakes, not intentionally, but as an inevitable by-product of trying to create new value. Launching something new will require both creativity and risk. If you are an expert, you don’t want to do either of these things for the risk of losing your expert status. Being creative may reveal an idea that could be wrong and this risk may lead to failure. Our educational culture and society in general simply doesn’t allow those in authority (experts) to be wrong very often. And neither do experts as they tend to lose their jobs if they are!

With sustained success, where continual growth ensues, a culture is formed and this is inevitable. The people whom are deemed responsible for this success become lauded and recognised within the organisation, and sometimes by the industry in which they are active.

This level of status may not be completely justified, but nonetheless for those in the elite, it is well worth defending. Some people will also develop a sense of entitlement, which isn’t overly healthy as a paradigm is formed and this becomes ‘the norm’, or the prevailing culture, however you would like to describe it.

This convention is further compounded by biology. When a person is applauded for being correct and for succeeding, a blast of the chemical, dopamine, is injected into the brain and this makes the expert feel really good. 

Because it makes us feel good, we then crave more dopamine and we continue to crave this fix and the validation of our existence. This continues to reconfirm our thinking and justify our behaviour over and over and over again.  Craving the hit of dopamine and defending the status quo, the expert will then enter into a cycle of repetition, by reciting and relying on past success to reconfirm and justify future behaviour. Sometimes in the face of overwhelming evidence to the contrary! When in actual fact pivoting, adapting or changing direction entirely would make much more sense.

When a company reaches this stage, what the organisation really needs is fresh leadership, instead of relying on their existing expertise as this could suffocate progress, creativity and innovation. At this point leadership needs to launch their second curve.

Whilst this may seem shocking, some of the most formidable companies and greatest brands in the world have succumbed to this kind of paradigm, and worse still entered a suicidal phase called ‘hubris’.

A Case Study of Hubris at Nokia

One recent and somewhat surprising casualty of hubris is Nokia. As Nokia states on their website: ‘Few companies have Nokia’s storied capacity for transforming, developing new technologies and adapting to shifts in market conditions.’

Nonetheless Nokia totally missed out a chunk of their recent history which really doesn’t fit their ‘storied capacity for transforming’ theme on their website, as they completely missed the curve by simply failing to respond to the threat posed by ‘newbies’ (Apple and Samsung) and grasping the opportunity that Android had gifted them. Nokia’s response was too little, too late. And they became victims of their own success by continuing to do what they have always done with regards to mobile phone production. And as a result their customers abandoned them in their millions.

Nokia’s unfortunate and some would say unlucky CEO, Stephen Elop, at the press conference announcing the sale of their mobile phone business to Microsoft famously said. “We didn’t do anything wrong. But somehow we lost.”

It is what Nokia didn’t do. They became comfortable, closed their minds and as a result were not able to change quickly enough. They became experts, the market changed, and they didn’t.

It is understandable that this kind of thing happens, when you are seemingly untouchable, in a dominant, market leading position. One can easily become more focused on defending your own position by justifying inaction by thinking that competing with yourself is illogical. 

So here it is a very personal question. Do you think you could you abandon your comfort zone for more uncertain, less predictable but exciting times?

The answer may be no, in which case, you will face decline at some point.

But I would recommend that finding, and then launching a second curve could be well worth considering.