tion by going outside channels. In some sense, all the people knew that they had the ability to reach back and tell the commander directly what they felt was relevant information.”
Second, every high-performing unit had “work-arounds” of some kind. “Every staff has strengths and weaknesses,” says Joe. “I think the important thing was that high-performers were able to take advantage of the strengths and sort of avoid the weaknesses. It was very important in military organizations, because people do get killed or wounded.”
Third, high-performing units were aligned around a common pur- pose: “The biggest, greatest characteristic was the common approach to the problem that the units took—the commanders had trained their units to react the same to various situations prior to the exercise. A lot of the focus was on how you move information around and share information to help foster that common perspective.”
Drivers are not about to let go of the steering wheel, however. They still want the sense of control. But with the Global Positioning System able to pinpoint both position and movement, the world is moving steadily toward the self-driving car. “Combine GPS with radar-aided cruise con- trol,” says the editor of Car and Driver, “add a lane-changing system and throw in a transponder, or cameras, and pretty soon you could have a car that drives itself in a middle of a bunch of conventional cars.”
Organizations are still some distance from the self-driving plan, but are moving closer to assisted steering and the defensive crouch through the kinds of uncertainty-sensitive planning discussed in the previous chapter.
They are also installing organizational radar to anticipate impending acci- dents and opportunities for acceleration.
Adaptability involves more than just preparing for surprise, however.
It also involves efforts to stay ahead of the traffic through both continuous and disruptive maneuvering.
The mining industry provides a first example. According to a recent RAND report, the industry faces an unstable market, increased consolida- tion, an aging workforce, and heightened scrutiny of everything it does.
Given this future, the industry has adopted a profoundly defensive crouch, avoiding risks, struggling to boost paper-thin profit margins, and cutting back severely on technology and research development. Metaphorically speaking, the industry has closed the sunroof, deployed the airbags, and hit the brakes as it worries about what might happen next.
The industry is not a monolith, however. The metals industry is less concerned about big trucks and blasting technology, and more focused on high-precision drilling technologies and the acquisition of high-yield mines.
The coal industry is less concerned about productivity-enhancing technol- ogy and more concerned about regulations governing the use of high-sulfur fuels. The stone and aggregates industry is less concerned about finding new mines and more concerned about productivity increases.
Despite these differences, all segments of the industry are worried about declining investment in research and development. Because most firms do not have in-house R&D units, they have relied on incremental improvements to existing technology for most of their productivity gains.
If there is breakthrough around the corner, it will have to come from out- side the industry.
Not only does the industry need to think more aggressively about using new technologies such as the Global Positioning System to map and monitor its mines, it must prepare its workforce to deal with a very differ- ent future. Mine workers still carry lunch-pails to work, but they often eat
atop huge machines with high-tech-like dashboards. According to RAND’s research, workers are becoming more, not less, critical to high performance.
As mining equipment gets bigger and more technologically sophisticated, individual operators are playing a greater role in determining mine output.
They are also gaining unprecedented access to information and control over the equipment they are operating. Absent the multidisciplinary skills and freedom to fully utilize the new technology, the industry cannot generate the productivity gains needed to compete.
The U.S. military offers a second example. As the world’s strongest military, the U.S. would seem to have an absolute advantage in virtually any battle setting. But past revolutions in military affairs suggest otherwise. If current power had anything to do with future power, the French cavalry would still rule the world. As the French discovered in 1346, knights on horseback were particularly vulnerable to English longbows, which in turn were particularly vulnerable to artillery, and so forth down through history.
On the surface, RAND’s work on revolutions in military affairs con- firms the worst fears of built-to-last, good-to-great companies. After all, the dominant power is almost never the source of the revolution. However, as RAND also shows, most revolutions are almost always adopted and fully exploited by someone other than the inventor. The machine gun was invented by the U.S. but exploited by the English and Germans; the armored tank was invented by the British but exploited by the Germans; and the first aircraft carrier was built by the British but exploited by the Americans and Japanese.
Moreover, most revolutions involve combinations of technologies rather than a single great breakthrough. Thus, the blitzkrieg was enabled by the tank, two-way radio, and the dive bomber; while the Intercontinen- tal Ballistic Missile was a combination of long-range rockets, lightweight warheads, and accurate guidance systems. In addition, most revolutions take years, even decades, to achieve results. In other words, it is often creative reconstruction, not destruction, that produces the big impact.
Monsanto’s entry into biotechnology provides a final example. Con- vinced that the number of chemical solutions to crop management was lim- ited, Monsanto joined with Harvard University in 1972 to develop new chemicals for regulating plant growth and behavior. The Harvard collabo- ration was one of what would become many joint projects with universities and individual scientists, and reflected what RAND describes as Monsanto’s paradigm shift toward research-based product development, which led to an internal research group.
Like the revolutions in military affairs described above, Monsanto did not achieve results overnight, nor was the effort always linear. Its scientists
started their genetic engineering work on petunias and tobacco, for exam- ple, but eventually made their breakthrough on soybeans, which led to fur- ther breakthroughs in potatoes, tomatoes, and cotton, all of which were engineered to withstand herbicides and/or insects. The breakthroughs came almost 25 years after Monsanto’s initial investment in biology, more than 40 years after J. D. Watson and F. H. C. Crick described deoxyribonucleic acid (DNA) and 139 years after Gregor Mendel began his experiments.
According to Monsanto’s Law, which is modeled on Intel’s experience with integrated circuits, the amount of genetic information used in practical applications will double every year or two.
It is important to emphasize that all of this adaptability has been based on rigorous research and measurement. Although there have been mad sci- entists along the way, innovation is considered anything but accidental. To the contrary, it is the natural consequence of investment, research, and imagination. At least in these cases, adaptability depended on the kind of organization RAND researchers appear to like best—the innovative, entre- preneurial organization led by the honest, trusting, yet decisive leader.
If readers want a nearly perfect example of how that kind of research can work in other settings, they need read no further than RAND’s work on preventing crime through early childhood investment. RAND’s study was designed to compare four very different prevention strategies: (1) home vis- its during the first two years of childhood followed by four years of day care;
(2) parental training for parents with young school-age children who have shown aggressive behavior; (3) cash programs and other incentives to encour- age disadvantaged high school students to graduate; and (4) mentoring of high school students who have already exhibited delinquent behavior. Parental training was by far the least expensive of the four programs, averaging just
$3000 per participant, while home visits were the most expensive at $29,400.
The RAND research team was not interested in cost, however, but rate of return. As the team found, parent training and graduation incen- tives were far more cost-effective in preventing crime than either home vis- its or delinquent supervision. Parental training cost $6351 per crime averted, while graduation incentives cost only $3881. By comparison, the home visits/daycare option cost $89,035 per crime averted and delinquent supervision $13,899. Both options become even more attractive when com- pared with California’s three-strikes-and-you’re-out law, which mandates life in prison for the third felony conviction at a cost of $16,000 per crime averted.
The research is particularly important for understanding how orga- nizations allocate resources to any activity. Should they invest early or
late? What are the short-term costs versus the long-term costs? Where can they get added value through small investments? Unfortunately, as R AND’s research team argues, California’s state government is so balka- nized that there is no government agency with a primary interest in alter- native interventions. As a result, it may take some kind of interagency, boundary-spanning organization to actually test the more cost-effective interventions on a broader scale. Lacking such an organization, law- enforcement agencies will continue to support imprisonment as the answer, while health and human service agencies will continue to focus on early-childhood programs.