Optimizing vs. Transforming

What is the purpose of your business, optimization or transformation?

This is a valid question to explore because optimization and transformation mean two different strategic narratives. One is not better than the other, but they mean different implications.

Optimizing

If you are leaning towards optimization, you build a business on a pre-established narrative. I also call these "institutionalized" narratives because they are common wisdom, how we've always done something and sometimes promoted by some of our institutions. This type of narrative has been around for a while. We forgot what it was like before they existed.

Pre-established narratives are how we imitate. It's how we learn norms. They help us figure out how to belong to the group, how language gets learned, and how culture gets transmitted in our society. They are handy frameworks that we can quickly pick up and use in this context. Narratives are shortcuts, or heuristics, if you will. They help us accelerate adaptation and fit into the mold. Thanks to them, we can reproduce what has worked before. Some narratives are based on the belief that we can make things great again.

In business, "best practices" are helpful pre-established narratives.

Rodwell is a company that makes it easier to recycle. The purpose of Rodwell is to optimize a process based on the pre-established narrative that you can recycle anything. They are in the business of optimizing. It's interesting to see how, on their website, their members describe the value they bring. Comments like "A no brainer" or "Makes it easy" illustrate the optimized path that the company offers.

Transforming

If best practices are beneficial narratives, they can also be dangerous. They make us redo what is accepted as usual without questioning the basis for why we are doing it.

Because best practices make us veer towards stability and deja vu, they also steer us from differentiation. They are meant to reassure us, but they also lead us to commoditization in doing so. If you are selling a best practice, it means that someone else uses it. Otherwise, it would not be a best practice. The best practice is likely available through another vendor for cheaper.

What if you built a business on a transformative approach instead?

On the opposite end of the optimization-vs.-transformation spectrum is Wasteless Pantry. This company is all about helping you live a fuller yet waste-free lifestyle. Their strategic narrative is based on the belief that we should waste less instead of recycling. This isn't a practice that is "best" yet, but it promotes a different point of view, a more transformative one. They operate on the assumption that you are willing to change your consumption habits more deeply.

Transformation means that you look a bit like an anomaly in your market in the beginning. You have to take risks and literally stick your neck outside of the cycle of the pre-established narrative.

As I mentioned before, Common wisdom appears to be a safe bet. Being an anomaly is scary. The idea of being rejected is uncomfortable. However, what stands out and comes across as a bit crazy is always exciting and gets noticed.

Pick the correct narrative for you.

Humanity is also about progress, innovation, and transformation. What we are about also creates tension because we are naturally inclined to steer away from best practices.

Transformation means that the new narrative we're telling ourselves also comes with an emotional charge that sounds a bit like this:

"OK, we're going to test a practice that is not best yet. The new thing we are trying might not work right away. It will probably suck. We're going to fail. Everyone is going to give us dirty looks and tell us that we are losers."

Then, you have an opportunity to shift your internal chatter to something that could sound more like this:

"Wait, our new idea also means that we may end up with something cool, interesting, and constructive. It will generate a lot of wealth and possibilities for others. We are so excited about transforming the way we consume and respect the resources available on this planet."

If you claim to be about transformation and foster innovation, this is the kind of narrative you will need to foster inside and outside your organization.