Oh, Canada!

I was lucky enough to sit at dinner tonight with a group of Canadians, including a very talented woman who works in the Canadian health care system.
A few interesting questions and comments:
"Why do Americans think we don't have MRIs in Canada? We've got all the technology you have!"
"Why do Americans think we don't get to choose our own doctors in Canada? Who tells you this stuff?"
"Why do Americans think it's ok to be the richest country in the world and leave 30 or 40 million of your own people without health care or health insurance?"
The questions weren't antagonistic. Or hostile.
They were asked in the spirit of genuine concern. Concern for the mis-perceptions that continue to cloud the US understanding of how health care actually works in Canada, and concern for a system in the US that the Canadians genuinely think is, well, unthinkable.
Here's what we came to agree on.
Canada's system treats everyone equally. Rich and poor alike. This is, perhaps, fair, but only guarantees that wealthy Canadians game the system.
America's system has incredible highs--if you're wealthy--and incredible lows--if you're poor.
Both systems would benefit from meeting somewhere in the middle: letting wealthy people pay more for faster access to health care, or better quality health care, if they want it, while guaranteeing at least a standard of health care for all, even the poorest citizens.
Kind of like Germany, it turns out, where, once you reach a certain level of wealth, you have to move into a private system, and your higher costs go to subsidize the care of the poorest citizens. The wealthy get what they want, and they have to pay for it. The poor get what they need, and while it isn't as good or fast or accessible as what they wealthy get, it is provided to them as a public good.
Oh, Canada!
There's a lot to be learned on both sides when we sit down to talk as friends!

Aetna Welcomes You To The Grand Canyon!

Last summer as my wife and I hiked from rim to rim in the Grand Canyon, I found myself thinking about the powerful experience of walking through mile after mile of natural history. It turns out, I should have been thinking about health insurance. Here's why.
In the early days the Grand Canyon was pretty much private property. If you wanted to go down into it you had to buy a ticket from a tour operator who controlled access to it. If you couldn't afford a ticket you couldn't go down. Kind of like a toll bridge. Or, come to think of it, health insurance.
Then along came Teddy Roosevelt and the whole notion of national parks and the rest, as they say, is history.
Today if you want to see the Grand Canyon you can even stay in an incredible structure on the north rim that was originally built as part of Franklin Roosevelt's program to put people back to work at the time of the Great Depression. The CCC, the WPA, and other projects created by FDR resulted in work for the unemployed--and also the creation of some spectacular structures and works of art.
I thought about that legacy as I drove home from the Grand Canyon--on a freeway that was built as part of the National Defense Highway Act, a measure created under President Eisenhower.
What if, instead of having a federal highway administration, we'd just let private companies build the roads? They could lay them out as they wanted, and then we'd pay for the privilege of driving on them? Of course, they might not all match up. And some might be more expensive than others. But, hey, that's capitalism!
There'd been a bunch of tourists from Germany, France, Japan, even the Middle East at the Grand Canyon. I was betting they'd flown there.
What if we had competing private sector airports, each with its own privately held control towers? I wonder how safe that would be? At least it would open things up to competition! And if there were accidents, well, isn't that how the free market works?
Apparently we want national parks, and we want one highway system that is uniform, and we'd just as soon have a coordinated system for air safety.
But not for health. Or health care.
That's why we've got large insurance companies, like, say, Aetna, whose CEO, Ronald A. Williams, made $24.3 million in compensation last year. And $23 million the year before. For selling insurance.
Or Cigna's H. Edward Hanway, who made $12.2 million last year, and $25.8 million the year before that. For selling insurance.
Can you imagine what Mr. Williams could have made if, say, he ran the Grand Canyon? Or administered the free market in freeways?
He could have pulled down some really big bucks!
So remind me again: Why is there no public option for health insurance? And why is this industry, which is so fundamental to each American's health and well-being, allowed to operate with this kind of impunity?
I guess it's time for another hike in the Grand Canyon, and a chance to think some of these things over.

What If The Pilgrims Had Landed in California?

I know. It sounds like a frivolous question. Like trying to imagine the Salem Witch Trials as a giant LA surfing party. Or the first Thanksgiving as a celebration at the Ferry Building one Saturday morning in San Francisco, with 20 varieties of lettuces and artisanal cheeses.
But there's a serious side to my question. Because I have the deep and disturbing feeling that many of the attitudes one group of Americans have toward their fellow Americans is some kind of a nasty carry over of those dark, cold, depressing New England winters, a cultural vestigial remain of a period of hard scrabble times and close brushes with societal extinction.
How else to explain the data on American attitudes on poverty and the poor as reported by William Julius Williams in "More Than Just Race"?
What Wilson says is deeply disturbing; it's fundamentally a "blame the victim" national mindset: ". . . the popular view is that people are poor or on welfare because of their own personal shortcomings."
Wilson cites three different surveys conducted in 1969, 1980, and 1990. Analysts looking at the first two surveys found that most Americans believe that ". . . in general economic inequality is fair." That's right. Economic inequality is fair.
In all three surveys, Wilson reports, ". . . more than nine out of ten American adults felt that lack of effort was either very or somewhat important in terms of causing poverty."
In 2007 the Pew Research Center did another survey. That one revealed that "fully two-thirds of all Americans believe that personal factors, rather than racial discrimination, explain sy many African Americans have difficulty getting ahead in life. . ."
The kicker comes when Wilson compares these results to a 2007 survey of the EU. Only 20% of EU respondents agreed that poverty is a result of "laziness and lack of will power." 37% attributed poverty to "injustice in society."
No wonder Kentucky Senator Jim Bunning said, "Tough shit" when confronted with the impact his filibuster had on poor people. After all, it's their own fault!
No wonder there's even a debate about whether it's alright for America to be a nation where 40 million people don't have health insurance. If they'd go out and work their way out of poverty, they'd have the same lousy health insurance the rest of us have! It's their own fault!
Of course, if there were a terrible earthquake, or a natural disaster--something outside the control of each of us as individuals--and 40 million of our fellow citizens were suddenly homeless, needing medical attention, shelter, food, clothes, and a fair shot at a job, I'd like to think Americans would grab their cell phones and text millions of dollars of emergency aid to those in need. I'd like to think we wouldn't shrug and say, "Tough shit." Or blame those who got hit worst for being in the wrong place at the wrong time. Or deserving it.
At times like that, I like to think that if the Pilgrims had only landed in California, we might all be a little more generous of spirit, a little less morally judgmental, a little less likely to blame the victim, a little more likely to see that we're all in this together.

The Two Adam Smiths

Most people who even know who Adam Smith was tend to associate him with The Wealth of Nations. In it Smith described the evolution of capitalism and the power of the invisible hand of the market to take self-interest in business and convert it into something that served the common interest.
Few people associate Smith with his other great book: The Theory of Moral Sentiments. In this book Smith asserts that no matter how self-interested even the hardest person is, there is something within all of us, something in human nature, that feels sorrow at the sorrow of others and sympathy for those who are suffering or in pain.
What Smith was trying to figure out was how capitalism worked (of course the word "capitalism" hadn't been invented yet, but even though the word didn't exist, that's the problem Smith set his mind to.)
It clearly wasn't as simple as today's free-marketeers would like to believe. Smith wrestled with the power of the invisible hand and with the deep-seated psychological force of sympathetic human nature encountering a moral dilemma.
Which is exactly where we are in the US in the debate over health care.
Think of it at first as a four box matrix--the kind they teach at the Harvard Business School.
Let's use Smith's two books to frame the matrix.
On one axis we've got the invisible hand of the free market at one end, government control at the other.
On the second axis we've got human compassion, empathy, moral right at one end, pure self-interest, cold-hearted Scrooge-ism.
The Obama administration is trying to convince us all that the administration has a solution that's win-win! It works in economic terms, cuts back on the rising costs of health care, preserves the insurance industry's right to make money, helps with the federal deficit--all terrific economic outcomes!--and offers health care coverage to the tens of millions of Americans who can't get it or can't afford it. It's economic and moral!
The Republicans tend to see the world more in terms of the Wealth of Nations, and less in terms of the Theory of Moral Sentiments. They want the government out of health care--it should be about the free market. Beyond that, their view of moral sentiments was best expressed by Kentucky Senator Jim Bunning who, when informed that his filibuster would cut off COBRA benefits for millions of poor and unemployed Americans said, "Tough shit."
So in a four box matrix formed by the two Adam Smiths, we know where the Obama administration would put itself and where the Republicans would wind up.
Now let's make it more interesting.
What if the economic promises of the Obama adminstration were shown to be flat out wrong.
What if the Obama plan won't curb rising medical costs, won't benefit the federal budget deficit, and actually will represent a government intrusion into the operation of the free market in a significant way?
What if it comes down to a fundamental choice between a strict interpretation of The Wealth of Nations and The Theory of Moral Sentiments on the matter of health care?
Here's what Smith wrote: "How selfish soever man may be supposed, there are evidently some principles in his nature, which interest him in the fortunes of others, and render their happiness necessary to him, though he derives nothing from it, except the pleasure of seeing it."
When it comes to health care for our fellow Americans, what could be clearly a matter of moral sentiment?
Ultimately it turns on an argument that is less about the kind of economics we want to practice, and more about the kind of country we want to be.
In a balancing of the Two Adam Smiths, when it comes to a matter as fundamentally human as health care, the moral sentiment has to be the book that offers the right instruction, for the right reason.

On Icebergs and Ducks

It sounds like a bad riddle: What do icebergs and ducks have in common?
But it's a serious question--or, maybe more accurately, a serious answer to a serious question.
The question is: How does change happen? And I find myself asking it at a time when more and more people are holding out less and less hope for the prospect of meaningful change coming from the political leaders in Washington, DC. We can argue about who's fault it is; or whether it's worse than it used to be; or if it's simply the case that Washington, DC is "broken." There's lots to be said about the influence of money on politics, and the role of the media in promoting a sound-bite culture with the attention span of a tweet. Lots of ways to get worked up and bummed out.
So let me instead offer the notion of the iceberg and the duck.
And let me use it to suggest that we're looking for change in all the wrong places.
So: what do icebergs and ducks have in common?
Ever since the sinking of the Titanic, we've all been taught that you only see the tip of the iceberg above the surface of the water; 80% or more of the iceberg is below the surface, so if you want to see the true shape of the thing, you've got to look beneath the surface.
And ducks? Well, coaches and cheerleaders have long used the swimming duck as a source of encouragement for scrappy athletes: be calm on the surface and paddle like hell with your feet under water!
Here's what I'm concluding about change in America.
It's all going on under the surface--and there's a lot of it happening.
If you put down the daily newspapers, stop surfing the web, step away from cable TV news, give talk radio a rest, and just go out into your own community--and I mean any community in any city in any country any where in the world--you will be thrilled, delighted, amazed, and profoundly moved at the kinds of changes going on all around us.
Below the surface, like icebergs and ducks, out of sight of the traditional media and traditional politics, there is a movement gaining force.
It is micro-change. It is entrepreneurial and vibrant. The projects are often small. Think of them as Petri-dish size experiments.
They involve small groups of like-minded individuals who want to make a difference, have some impact.
I'm not talking about angry shouters. I'm talking about do-something-abouters.
This is how change happens. Far from the corridors of power.
It happens when the people who decide they want to contribute start paddling like hell below the surface.
When I find myself troubled about political gridlock, narcissism, and posturing, I change where I'm looking.
Instead of paying attention to what's above the surface, what gets all the coverage, I look under the surface, at all the great work that's being ignored by the media but embraced by real people making real change happen.
It's not grass roots change.
It's under the water change. And if we keep it up, it's going to make all the difference in the world.

The Age of Innovation

When this period we're in right now passes and whatever comes next arrives, we'll look back fondly on this current time and call it, quite rightly The Age of Innovation. Beset as we are by serious and pressing problems, we run the risk of failing to appreciate one of the most incredible periods of creative output in world history. Take a look around you and make your own list of the remarkable stream of innovation that is going on all around us.
It's been almost a decade since "innovation" became a business buzz word. Frankly I thought it was just the flavor of the month; I suspected we'd see companies trumpet their "innovative spirit" and then move on to something else when the marketing message got old.
Instead, innovation has become a sustained business element. It's not a fad, it's a requirement, a new component in every company's way of doing business. It's become an accepted part of "what we do here," in company's around the world in every industry.
Why?
Here's a partial list--feel free to add to it or make your own!
1. Global competition. The heat is on. If you want to compete, you've simply got to innovate. There are too many new entrants, too many rivals popping up all over the world. Years ago Ted Levitt wrote that "you can de-commoditize anything." Global competition has become the powerful prod to drive constant de-commoditization--which is all about innovation.
2. The web. The web does, in fact, change everything. It's part of the global economy, but it's also part of economic transparency. No more secrets--everyone can know what everyone else is doing. When that happens, when we shift to a knowledge economy, then innovation is the only way to stay ahead of the game. Innovate or die. Even for slow companies, that's an easy choice.
3. Technology. Computing power makes it faster, cheaper, and easier to test out new ideas. The mantra of "fail faster to succeed sooner" is all about the speed with which new ideas can be tried and tried again, before being brought to market. Modeling, sampling, revising--all are staples of the innovation economy.
4. Science. Think of all the innovations that are a direct product of science--from new construction techniques to food, health care, clothing, medicine, furniture, you name it. Materials science, chemistry, biology, earth sciences are only some of the categories where new discoveries are driving new innovations. Science is undergoing its own innovative revolution; new fields are being created at the intersections of what used to be compartmentalized categories. Out of those new fields we're seeing brilliant new insights leading to amazing new innovations.
5. Business model innovation. The mandate to compete is driving companies to go beyond product and service innovation to meta-innovation--competing on new business models. If you want to challenge your rivals, you don't simply out-produce them, you out-think them with a business model that undercuts their whole way of doing business. Innovation has gone meta.
6. Education. The spread of learning makes innovation a global phenomenon; at the same time, young, bright, technologically-savvy students are able to test their ideas and creativity without waiting for traditional jobs in traditional companies to give them permission to innovate. Education not only makes people smarter; it makes them eager to use what they've learned to do new things.
7. Design thinking. We've got new tools and new disciplines that are teaching us how to apply all those right-brain notions. Design gives shape to instinct; technology makes it possible to model design; the need for differentiation in the market provides big rewards for outstanding design. It's a system that works, producing design-driven innovation, differentiated products and services, and competitive rewards.
8. Natural imperatives. We're waking up to the idea that if we don't make major changes in how we produce, what we produce, and how we consume what we produce, we may not have the luxury to keep doing all this stuff. Sustainability is a powerful driver for innovation; the need for companies to do a better job of greening their operations is more than a temporary marketing ploy. Economics are changing, requirements are changing, and process and product innovations are resulting.
9. Social innovation. A lot of our social habits, structures, and behaviors are reaching the end of their shelf lives; people all over the world who've been overlooked are demanding new practices that take their needs into account. As we try to balance the needs and rights of a global population, social innovation is becoming the most rapidly evolving field for new ideas, business models, practices, and developments.

Take a look around you.
What are the shapes, forms, and practices that tell you we're living through the Age of Innovation?
What are you doing to be part of it?
One thing's sure: You don't want to miss it--you don't want to fail to appreciate it or fail to participate. Years from now we'll look back and think, for innovators and for innovation, this was the golden age.

Thinking the Unthinkable

It may be the hardest thing in the world to make yourself do.
It may also be the one thing that saves your project, rescues your company, lifts your career, changes the trajectory of your community.
Try thinking the unthinkable.
What if?
What if the web were to completely undermine your industry's business model?
What if a massive natural disaster were to level your city?
What if a foreign competitor were suddenly to obsolete your product line?
What if your company were acquired and your job became redundant?
What's the most unthinkable thing you can force yourself to consider? Now go beyond that one thing to something more unthinkable.
Can't think of anything?
That's what books are for.
Pick up Seth Godin's "Linchpin." Take notes.
Read Dan Pink's "Drive." Do his exercises.
Get out of your comfort zone. Volunteer at a food bank, a homeless shelter, a hospice.
What we don't let ourselves think is the one thing that can cause a catastrophe. So make yourself think the unthinkable.