By Scott Nelson |  Feb 17, 2021

“If you can’t explain your physics to a third grader, you don’t understand it.”

Dr. Cedarberg delivered this “advice” with the same wry smile and even tone he always used when explaining something “obvious.” Dr. James Cedarberg, one of my favorite physics professors, gave me this “life-advice” when I asked him “How in the world am I supposed to solve an electrostatics problem without calculus?” The previous night I had been mentoring high school physics students. One student was trying to solve a simple two-dimensional distributed electric charge problem. I looked at the figure and confidently told her “All we have to do is integrate the charge distribution over the region of interest.” She gave me one of those inquisitive “deer-in-the-headlights” looks and asked, “What’s an integral?” They hadn’t learned calculus yet. I was done.

This story came to mind recently when I read Valerie Gerard and Patricia Voorhees’s The equipment leasing company of the future. Gerard and Voorhees described how equipment finance will have to adapt to remote technology changing the way we work, digitization and data automating financing operations, and social networks impacting business mission. They described these technology trends in the form of Thomas Friedman’s “ages of acceleration” from his book Thank you for being late. Friedman described exponential technology growth from Moore’s law, software, and the cloud as one of the most pervasive accelerations to which society and business must adapt.

Exponential Growth

Growth of a system in which the amount being added to the system is proportional to the amount already present: the bigger the system is, the greater the increase.


Google X’s Astro Teller’s diagram shows human adaptability unable to keep up with exponential technology.

Exponential technology is intimidating, particularly for highly regulated industries like healthcare and finance that tend to change more slowly. As the curve Astro Teller drew for Friedman on technology change vs adoption curves shows, the complexity is outstripping our ability to understand and adapt – as individuals, society, and businesses. At this point every business reader should be asking “If we don’t adapt can we survive?” The answer, of course, is “Not for very long.”

Back to simple. An interesting thing about simple is that its value is inversely proportional to the complexity of the situation. Another is that those who can simplify the complex into easy to understand, actionable instructions can take advantage of complexity and are in a position to lead. Think of all the technology in the cycling image above – light-weight graphite materials, aerodynamic design, laminar flow attire, precision electronic gear shifting for maximum power conversion, and LTE connected biometrics all enable speed never seen in the sport. But I can explain to my grandson, a kindergartner, how less weight and less wind resistance makes the cyclist go faster. Not because he understands the Newtonian equations as I do, but because we share a simple personal experience with the picture – lighter and lower drag things go faster.

How does one deal with an accelerating technology ecosystem? Simplify. The first step to simplifying something complex is it to understand its value, or threat to value. When I worked in product development, designers saw complexity through three truths:

  1. Complexity adds risk to reliable function.
  2. Complexity is a perception. Perception is reality.
  3. Users hate complexity.

At the same time, engineers understood the technology and with the help of the created better experiences for the user. Complexity is an opportunity for innovators. It is not something to fear, it’s something we must simultaneously attack and leverage. As Peter Drucker said, “An innovation, to be effective, has to be simple and it has to be focused. It should do only one thing, otherwise it confuses. If it is not simple, it won't work.”

So, we must simplify in three ways:

  1. We must reduce our customers’ experience to “less weight and less drag.” Understand how they measure success and then find solutions, sometimes with new technology, that help them achieve those goals. Think of them as the cyclist. They do not need to understand the technology of the bike, they need to understand how it helps them win. And they need to love it.
  2. Likewise, simple metrics are more reliable and easier to communicate to an organization. Make sure you have simplified your business and process metrics down to what you know matters --and can measure. Simplify your business such that “you can explain it to third grader.” You can get experts to help with the technology, they understand it, but you must align and engage the organization if you are going to leverage the complexity.
  3. Finally, stay simple. Perhaps the most dangerous aspect of technology complexity is the ease with which a leader can defocus and engage resources in a technology application that does not serve the core mission of the company. Michael Porter said that “the essence of strategy is choosing what not to do.” Good business leaders, like good systems engineers, know when to build and when to buy. An exponential technology ecosystem is vast. Use it to stay simple.

Users and customers love simple. They also love reliable and effective. If the experience you provide has any complexity you can assume that it slows down sales and reduces customer satisfaction. When it comes to buying, even choice can be a complexity. Any more than three clicks and most online buyers give up. Find the complexity in your customers’ experiences and simplify. Simplify documentation. Automate credit analysis. Empower customers with easy-to-read and easy-to-understand contracts – anytime anyplace.

An “age of acceleration” can be intimidating. Exponential technology can be fatal. Just ask Blockbuster, Borders, and Sears. You may need help, but you shouldn’t fear technology. Make sure you understand the “the physics” of your business and your customers’ experience. Then explain to both employees and technology experts what needs to be done. If you can simplify while everyone else is engaging the complexity, you will be innovating and lifting the adaptation curve.

Hire the experts when you can tell them how to build simple.

 
Written by

Scott Nelson

Scott Nelson is the Chief Digital Officer of Tamarack Technology. He has more than 30 years of strategic technology development, deployment and design thinking experience working with both entrepreneurs and Fortune 500 companies.

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