What is beyond the Scene
Western civilization was founded on the powerful idea of ideality, part of the meaning of which is to convert the material world into the spiritual one. The history of the development of Western material civilization displays a constant movement in that direction. The main engine that has driven technological, business and social progress during last 2000 years, has been humans? desire to create material substitutions for the spiritual world.
What the spiritual world has naturally (the abilities to communicate at distance, to move fast, to have easy information access, to have a virtual environment, etc.) the material world?s businesses have to create and produce as goods and services (cars, aircraft, phones, wireless solutions, the Internet, and etc.). Thus, the most powerful solutions in business and technology are created when they do not contradict this main tendency: to transform the material world into the spiritual one (including human nature).
We will call this approach Business Ideality, the purpose of which is to help people make their deepest dreams to come true?to reach the same freedom that they have in spiritual world and to become free from restrictions of our material world.
Business Ideality is not dry religious conjecture and is not something that contradicts regular business practice. The direct applications of Business Ideality (even if their inventors do not realize that their management solutions subscribe to the Business Ideality) create the most successful and stable businesses and strategies in the world. (To make sure that it is true we can just look at the top of ?The Fortune 500 List?.) These strategies are implemented under different banners, like ?solution delivery?, ?be direct?, ?connect anywhere and anytime?, ?Consumer first?, etc. But probably few executives realize the origin of all those business solutions and the importance of the systematic application of Business Ideality (and not only when the company is in trouble). In this article we will discuss Ideal Consumer and Ideal Solution Concepts as parts of this approach.
The methodological and heuristic power of Business Ideality is so universal that it allows us to use its principles on all levels of business and technological development, from strategic planning to product design and improvement. Instead of thinking with what we call ?common sense?, this approach allows us to create highly effective integrated solutions based on systematic use of Business Ideality Principles. There is nothing wrong with common sense, result-oriented, or context ways of thinking. They are all good for duplicating and maintaining current business operations, yet they are also good for incremental improvements. However, for any strategic breaking and technological challenges one more way of thinking is required.
What should Business Ideality deal with
The material environment can cause people to draw closer to spiritual reality, or to drift farther from it. Whether executives or front-end employees realize this fact or not, their activity greatly influences people?s spiritual development or regress. All objects created by humans from the material world can draw us closer to God, or separate us from Him. In other words, our material activity can draw people closer to Ideality, or separate them from it (technically such words as ?ideality?, ?spiritual world?, and ?God? are about the same subject, but for practical article the word ?ideality? is just more agreeable).
For instance, some researchers found that for a certain group of people, word processors would be more comfortable if text on the computer screen would look like a real book with flip pages instead of one long scrolling page (1). An in-depth, sophisticated analysis brought the next results: in the hierarchy of human values, one of the most important values of an Ideal Consumer is to be a part of humanity, to belong to people, to love them and to receive love. Books give us these values, because they connect us to human knowledge, culture, or experience that is shared and passed on to generations. As far as we know, this value is still not taken into account by anyone who produces word processors. This impressive example shows that products may have some superior values (like The Ten Commandments, for instance) that are much higher than usual marketing properties, such as color, weight, or cost. Business Ideality, part of which is the Ideal Consumer Concept, is the approach that can and should handle such issues.
Business Ideality has so many aspects that it is impossible to cover even a small part of them in one article. Nevertheless, some basic principles are intuitively clear and applicable to all aspects of our life, including what we do for a living and how we keep our spiritual integrity. In the remainder of this article, we will discuss a couple of Business Ideality concepts that can guide business professionals in their everyday activity. Several examples will demonstrate the implementation of Business Ideality at different levels.
An Ideal Solution Approach ? the high scaled applications
One of those concepts is that of the Ideal Business Solution. The concept of ideality is not new at all. It is a very fruitful concept in natural science and technology. But the business community has yet to realize the power of Ideal Solutions in its business operations.
To understand the principles of Ideal Solutions better, let us consider the Ideal System in technology. It sounds paradoxical, but the ideal system in technology is the one that performs its functions without any system (2). Although the ideal system exists as a goal and not as an actuality, there can be a sequence of systems approaching ideality. For instance, one can observe the sequence of increasing ideality in the telecommunications industry: stagecoach delivery, mail service, telegraph, telephone, cordless telephone, cell phone, satellite phone, video-conferencing, etc.
Note that there is a big difference between an Ideal Solution and a Perfect Solution. There is no such thing as a Perfect Solution in our world. Instead, we can create a chain of solutions with as high degree of Ideality as we can reach at this time. Every step towards an Ideal Solution generates a new technological and business system, which creates another system or ideal solution for the previous one. For instance, when food industry generated a new idea of Fast Food, it was supported by new business system ? a wide chain of standardized restaurants ? which in their turn created a new Fast Food industry. The next step to ideality in Fast Food industry was so called Drive-Through solution, which was supported by several new technological and organizational solutions.
Definition One: An Ideal Business Solution is an approach that increases local or general ideality of business systems (companies, industries, and societies).
This definition does not make any sense without an understanding of ?local or general ideality of a system?. We will try to explain this by two examples.
About thirty years ago, Apple Computer correctly anticipated the PC market development as a general increase of information accessibility. Consequently, it improved the general ideality of the information environment compared with a main-frame computing approach. If a company is going to pursue this line of ideality--information accessibility--it is necessary to plan and consider several next steps in that direction, like universal wireless access to the Internet, decreasing cost for information access, miniaturization solutions, etc. One way that Apple improved the local ideality of computer usage was replacing DOS with a Graphic User Interface. According to an Ideal Solution approach, the next step with this particular line of ideality might be further drastic simplification of business applications and developing of a 3D graphical user interface.
After several years of successful development, Apple made a shift in its strategy, which can be interpreted as a deviation from Ideality. When Apple tried to protect its technology from cloning, it objectively decreased information accessibility and, accordingly, general ideality. In contrast, IBM and Microsoft Corporation followed up both of these idealities by developing its open PC architecture and Windows environment and even allowing a non-licensed (read ?free?) distribution of its products in some markets. On another hand, since the Windows is a closed Operating System, it will limit Microsoft in its development in a future.
The examples with Apple, IBM and Microsoft illustrate the effect of acceptance or rejection of Ideality on a company?s long term results. What will happen next? Probably the next ?New-Apple? will take the next steps toward Ideality and the next ?New-IBM-Microsoft? will support these solutions, if older ones (?Apple-IBM-Microsoft?) are unable to generate the next strategic Ideality approach. In such a way we will get a post-PC industry and market with the integrated ideal solutions around computing, nets, wirelessness, advanced circuit packaging, etc.
How to handle the problem of competitors
The Apple-IBM-Microsoft example above might also be considered from the Business Ideality standpoint as an example of how to handle the problem of competitors. The deviation from ideality we mentioned above was dictated by market share or competitive issues. Competition with another business is a result of limited resources. Whatever is announced in a company Mission Statement, the stress to be profitable, to be market valuable, to be innovative, to be successful, etc. ? are just another side of limited resources.
Since there are no limits on resources in the spiritual world, neither is there any competition (or business!) for resources out there. Nevertheless, a competition of another nature probably exists due to the hierarchical structure of spiritual world (see, for instance, 3). This is a competition for Function. The more, the better, and the more effective the functions performed by an entity, the higher the rank and the higher the responsibility it has.
If a company can create, design, and plan new and related each together markets and alliances for its ?competitors,? it means that the strategic power, rank, and Ideality of that company is much higher than that of its ?competitors.? It is not a so-called strategic alliance against something (another competitor). On the contrary, it is a strategic alliance for something (Ideal Solution). From this point of view, Intel?s decision to leave the memory chips market several years ago was an example of how a leading company could generate an Ideal Solution for its market share and that of its competitors, and still be the highest-ranked company in its industry.
There is nothing wrong with creating markets for the ?competitors?. In fact, almost all innovative start-up companies create new markets for Big Players. However, even this process itself is not ideal. Ventures, start-ups, and other players categorize their businesses as hopefully successful and profitable in a space of predictable future. But due to the resources? limits, including limits on such intellectual resource as predictable future, we have so low effectiveness in this trial-and-error method. In fact, every one of us pay for any ?competitor?s failure? with higher investment risk, lower product quality, and finally with missing or delayed Ideal Solutions. Probably only few companies consider the ?competitor? problem as a functional competition -- a partnership in creating and design ideal solutions for market development.
Nevertheless, what about resources? Corporations are created for shareholders? profit and this is the base for resources? battles. But not only for that, otherwise the best businesses we would end up with could be drugs and wars, which are the most profitable ?businesses? ever. We believe that the functional approach solves the resource problem, because the resources are subordinated to the functions.
A low scaled Ideality and End-of-Quarter issue
Let us consider an Ideal Business Solution approach at the other end of the scale. If a manufacturing company is going to improve quality and yield, an Ideal Solution analysis would be very useful to undertake before applying any sort of sophisticated management tools, like SQC (statistical quality control). According to the Ideal Solution approach, there is no such thing as quality or yield improvement in an Ideal manufacturing flow. Quality and yield are supposed to be 100%, so any deviation from that is just a manifestation of non-Ideality.
Consider this point in the context of manufacturing Printed Circuit Boards. The usual production of Printed Circuit Boards produces defects all along the manufacturing flow. A traditional quality and yield enhancement approach assumes catching and fixing the process deviations and defective boards on the fly. Quality improvement feedback is supposed to be strong enough to reduce the rework process to zero. But in fact, any strong feedback can diminish the entire productivity of the manufacturing line, which finally negatively affects the commercial performance of the company. Therefore the real production flow of Printed Circuit Boards is trapped and balanced between the manufacturing process and rework/test expenses .
When Xerox attempted to implement a similar quality improvement approach, it was enjoying the dominant position in the copier market. Having quality problems, Xerox expanded its Consumer and repair service to support its quality improvement solution. Ultimately, Xerox lost market share when Japanese producers left it behind with more ideal solutions and higher quality copiers.
Applying an Ideal Solution approach to the Printed Circuit Board quality problem, we can hypothesize other effective solutions. For instance, one of the solutions might be a total separation of commercial (ideal) and defective technological (non-ideal) flows by using, for instance, modular or cluster PCB designs (4). Another conceptual way of increasing general ideality is to create a re-programmable interconnection, which would transfer Printed Circuit Board production to a modular assembly similar to current Personal Computer assembly (5).
Another interesting problem, which is related to quality improvement, is the so-called End-of-Quarter issue. Almost all American companies suffer from this periodic increase in product flow at the end of each quarter, which negatively impacts quality. Because the pressure for this increase comes from the stock market (and not the manufacturing process), the Ideal Solution for the End-of-Quarter problem could be found in the financial area, as well (and not in manufacturing quality improvement attempts). For example, a company can make soften its End-of-Quarter problem by reducing the growth rate of its stock value. How can it work? Technically it can be any sort of financial credit mechanism with a feedback that starts to work for Consumer in the beginning of each quarter. Again, the ideal solution here is not technological one. It should be a mechanism that can compensate financial deviations from ideality.
An ideal food chain has no chain at all
Let us consider another definition of Ideal Business Solution, which is closer to the Ideal System definition in technology, mentioned above:
Definition Two: The Ideal Business Solution is the one that performs business functions without business systems (companies).
Dell Computer Corporation illustrates this paradoxical definition of the Ideal Business Solution. Dell?s direct business model eliminated several intermediates (dealerships) and made the company one of the fastest growing in computer industry. The Ideality of the whole system--like a food chain in the computer industry--was improved just by eliminating one or two components. Why is that more ideal than a regular supply chain? Most likely because any distribution system reduces the ideality of its superordinate system.
Note that the distribution system still plays its role when country has insufficient infrastructure. Let us say this Dell?s direct model would not be so successful in such big countries, like Russia or China, which have poor telecommunication and delivery industry.
Ironically, according to the Ideal Solution approach, the next step in this line of Ideality in the computer industry might be eliminating Personal Computer makers entirely. The next step with this particular chain of ideality can be unexpected and can come from different directions ? PC architecture, Net, Circuit Design and Packaging, etc. The supply chain and Personal Computer itself would look different, but creating this new segment of the market might be much more promising than current one. Now Dell successfully develops this particular line of Ideality (unfortunately, only one) by creating web-based system of placing and tracking of Consumer?s orders.
Again, this idea of increasing the general ideality of any business system is not new at all. For instance, the same principle was implemented by Wal-Mart founder Sam Walton with huge success. Now we have an exponential growth of so called e-commerce or Internet based businesses. This growth is based on this particular Dell / Wal-Mart line of Ideality. Note that the supply chain solution remains about the same and once the big players, like Wal-Mart with the highly developed infrastructure and supply chain, will decide to get into e-commerce they will win the Internet battle with no doubt. The point is that e-commerce (as a traditional one) would better have several more Ideal solutions, but not only one, to have a good future.
An Ideal Consumer consumes nothing
The next effect of the Business Ideality approach is what we call an Ideal Consumer Concept, which was mentioned above in the Word Processor example.
Definition Three: The Ideal Consumer is the one who aspires, generates, and moves to Ideality. In other words, The Ideal Consumer looks for the Ideal Solution. Another (paradoxical) definition for this concept might be as follows: The Ideal Consumer is the one who does not consume any resources.
For instance, the Ideal Consumer can not surf the Internet and spend hours getting information he or she needs. Instead, the Ideal Consumer would create a better Yahoo portal to the Internet to get access to convenient and powerful directory and search engine.
From a retailer?s point of view, the Ideal Consumer automatically adjusts her consumer and product profiles every time she makes any transaction. Thus, the mutual process of Consumers searching for goods and retailers searching for Consumers automatically matches their profiles to each together. Hence, the concepts of ?Consumer satisfaction? or ?Consumer solutions? are other phrases for searching for ideal market solutions. It means that commercial markets (which are far from ideality now) should be totally effective from both the manufacturer?s and the Consumer?s points of view.
One of such ideal market solutions, which was invented many years ago, was so called Brand Name or Trademark. It was an ideal solution for both traders and buyers when there were tens of Brands in a market. It allowed to reduce market uncertainty and to generate almost ?automatic? trade-buy process. (?Automatic? is the word that reflects one of the essential properties of the ideal solution.). The only problem was that that solution was expensive and very slow (it takes years to create a good Brand).
But now, when there might be thousands of Brands and Contractor Manufacturers in a market, this solution is not beneficial anymore. Yet Brand Names are still effective marketing solutions (for instance, according to ?Consumer Reports? 1999 survey Toyota Corporation has one of the worst dealership in the US among other car makers, nevertheless it had the top-selling Camry in 1998).
The second definition of the Ideal Consumer can be illustrated with the pairs of terms such as ?business trip ? teleconferencing,? ?regular food ? food supplements,? ?regular printed circuit boards ? multichip packages,? etc. Do these examples mean that, for example, American Airlines or General Motors should consider the teleconferencing business as part of their diversification programs? It looks strange now, but this chain of ideality can generate such phenomena as ?an instant business trip?, which can be a symbioses of robots, nets, and wireless solutions for creating virtual business trips.
The image of the powerful Ideal Consumer, who can create almost everything he needs to get closer to ideality, is very useful in articulating a company?s purposes and strategies, even in non-consumer industries. The Ideal Consumer creates new markets or fails to accept new products or services. Consequently, companies and venture capital will just follow the Ideal Consumer?s way, and any deviation from this way will cost performance and resources.
Note that the Ideal Consumer is not identified by traditional marketing research (focus groups, etc.). It is a conceptual vision of ?what the Consumer is going to be.? Any failure in correctly intuiting the Ideal Consumer costs our society, company or capital too much now. The bigger the company, the bigger the losses. The trial-and-error method, even for start-up companies, affects the general performance in any industry. Business Ideality and its associated methods can prevent wrong decisions and provide a guide to effective and clear conceptual management.
A middle scaled Business Ideality
In the last discussion of this article, we will demonstrate Business Ideality analysis on a middle scale. Let us consider the problem of so-called outsourcing in the modern electronics industry. In general, Contract Manufacturing increases local ideality for the Original Electronics Manufacturer because it shortens the production chain and improves technological specialization, logistics, and supply-chain solutions. On the other hand, when the Original Manufacturer transfers its product to the Contractor, it can not increase the product?s degree of ideality anymore, because it is much more difficult to change something outside the system (The Contractor is outside the Original Manufacturer?s system). Thus, outsourcing is the Ideal Solution for the Original Manufacturer only when it believes that technology is stable and will not change in the near future.
From the Contractor?s point of view, the Ideal Solution is to get as many uniform orders from the Original Manufacturer as possible in order to stabilize and to advance from the mature technology. The Ideal Solution for the Contractor here is to win all the Original Manufacturer?s orders for only one technological operation. Thus, a cascade of increasingly specialized subcontractors is the Ideal Solution for outsourcing and for Contractors.
If this is so, why should the whole electronics industry not be maintained by Contract Manufacturers? The only reason is that this solution does not allow the Original Manufacturer to advance to the next level of ideality in the future. From the Ideal point of view, the Original Manufacturer and its Contractors should estimate the possibility and risks of outsourcing due to any possible shifts in technology. The higher the level of ideality change, the higher the risk of missing of that possibility due to outsourcing.
For the Original Manufacturer, that risk can make it impossible to be in sync with new technology. On the other hand, for the Contractor that risk can be high expenses due to technology replacement in the near future. Therefore, the current market ration of Original to Contract Manufacturers (about 85% to 15%) reflects the probability of technological shift to the next Ideal Solution (or it can just reflect still high cost of outsourcing). In other words, the electronics industry estimates the probability of technological change in the near future to be 85% and the probability of technological stability as 15%. Yet, for those Original Manufacturers who transfer 15% of their assets to Contractors, doing so might be a way to replace its old technology with the new one. On another hand, Contractor Manufacturer may have a chance to acquire still good assets, if the technological shift is estimated as slow enough.
Thus, from Business Ideality standpoint the main concern for both sides in outsourcing process is keeping the ability to shift towards to the next Ideal Technological Solution. By the way, the previous technological shift ? Surface Mount Technology ? was made about twenty years ago in Japan and was driven by Ideal Consumer approach. It allowed Japanese electronics industry to make a big spurt in American and world markets. Who is the next?
Instead of conclusion
We have tried to illustrate from different levels of business operations the importance and the power of Business Ideality, Ideal Business Solution, and Ideal Consumer approaches. We have not provided readers with any sort of ?five best decision-making steps?, because there is a plenty of sophisticated decision-support, forecasting, risk analysis, and optimization (even using Monte Carlo simulation!) methods and software in the management market. In modern stressful environment with such banners as ?time-to-market? (sometimes it looks more like ?time-to-plan-to-quarter?), time-based competition, strategic intent, etc. it is difficult to implant any new and sophisticated idea in overwhelmed managers? minds. Probably it is even harder to implement any new idea in real business practice. Instead, the Business Ideality Ideas are not something totally different and new. They all belong to us as a birthright.
We have simply tried to point out a spiritual resource that is usually not taken into account or is treated as a pure intuition in the decision-making process. Business Ideality is neither a pure intuition nor formal statistical methods for calculating weighted probabilities or risks. How can it work? Technically it can be a couple of internal questions, such as ?Whether this solution moves our system towards Ideality??, or ? What would Ideal Consumer create in this situation??. Several criteria of ideality might be taken into account such as automatism, simplicity, and integrity.
If senior managers will just keep in mind the Business Ideality approach, it can help protect their companies from making wrong decisions, or from not making right decisions.
One of the best news about the Business Ideality is that it helps us to keep the integrity on all levels of business operations ? from any frontline employee to the top manager and from any company to society. This integrity is not only about better communication between strategic planners, market analysts, product developers, sales, and top management. Everyone wants their lives to be counted no matter what material results are already achieved or expected. Thus, the integrity is very important, because it allows us to overcome the deepest contradiction between material and spiritual parts of us. The integrity brings one more additional and powerful economical resource for any company -- an employee emotional involvement in company?s business.
A lifetime of an average company is less than 20 years. It means, that a fundamental money making idea is failed and dissipated even quicker than human generation change. We are supposing that those lifetime-dissipation factors for senior managers are even more frustrating (something like 3-5 years?). Fortunately, we have other good examples. For more than the whole century Thomas Edison and Henry Ford have been greatly influencing our world to this day (they brought light and time in our life). They both have deeply incorporated Business Ideality or similar approaches in their businesses and had a very high level of personal integrity. Their companies General Electric and Ford Motor are still among 5 top in ?The Fortune 500 List?. Therefore, our Creator gives us excellent examples and encourages us in ?doing the stuff?.
Thanks to Ted Smith for his comments and edits.
Austin, Texas
4/25/1999
References:
(1) ?Reading On-line versus paper documents? by K. O?Hara and A. Sellen, 1997, Xerox
Research Center Europe,
http://www.rxrc.xerox.com/research/affordances/updates/reading/paperonline/paperonline.html
(2) ?The Innovation Algorithm: TRIZ, Systematic Innovation and Technical Creativity?
by Genrich Altshuller, 1999, ISBN: 0964074044
(see also: The Wall Street Journal, Feb.12, 1996; The Industrial Physicist, March 1996)
(3) ?The Rose of the World? by Daniil Andreev, 1997, ISBN: 0940262835
(4) ?The Clustering approach for In-Circuit and Functional Testing ? S. Ligai, ?Circuits Assembly Magazine?, August, 2001
(5) ?Optimized Quality with related Technological and Business Processes?, S. Ligai, submitted ?Quality Magazine?, 2001