Value Geeks

What is The Geek Way? Andy McAfee has just released a book with that title, in which he writes about the organizational culture of modern business firms who have achieved extraordinary results in a short period of time. He’s taking about Netflix and amazon and Microsoft and Apple and their Silicon Valley neighbors. These are all tech firms, but McAfee is not focused on the technology behind their products and services, but on the culture and mental models of their organizational setup and their managerial practices.

He calls their approach to organization and business “The Geek Way” as a device to separate their thinking from that of the typical business school where it is believed that study and analysis by wise observers can deliver some general propositions about how to run a successful business. Geeks believe the opposite: that there are no generalizable propositions and that learning does not come from others but from within oneself and within the firm. It’s cultural.

Geeks focus on a narrowly defined subject matter, and then dig into it deeply with insatiable curiosity and love of experimentation. They’re not pre-committed to any outcome of their experiments and they certainly don’t concern themselves with conventional wisdom or majority opinion. They go wherever their inquiries take them

McAfee’s book is about management geeks. Discarding conventional business school teaching about how to manage firms, the geeks the author studies think from first principles about how to manage the new firms that have emerged in the digital era and which don’t seem to conform to industrial age thinking about command-and-control management structures, hierarchical organization and business planning. The new age companies flow. They’re not managed.

McAfee proposes that there are 4 guiding principles for management geeks: speed, ownership, science and openness. Speed refers to speed of iteration – the capacity to run lots of experiments that can be quickly mounted, analyzed, interpreted and used as design feedback for the next version, next step, or next move. Ownership refers to the removal of bureaucratic barriers to rapid decision making – distributing both authority and accountability so that the right individual can make – and own – a decision without running it up too many flagpoles or organizational hierarchies. Science refers to the determination of good and bad ideas through the scientific method of falsification. A good example is an A-B test: rather than making a decision about red versus blue as a color choice, run an A-B test with customers and let the response data point to the better choice. It’s better than HiPPO – the highest paid person’s opinion. Openness refers to bringing all opinions and arguments for and against any proposition to the table without any deference to hierarchy or supposed expertise. Argumentation rather than consensus is the method to get to agreement on how to proceed. Once the argument is resolved everyone moves on in unison.

The problem with the Geek Way that McAfee describes is its introversion. Geeks tend to be introverted, unconcerned with the opinions and preferences of others and entirely concerned with their own projects, their own firms, and their own technology platforms. But that won’t do for business success. 

The purpose of business is to create value for customers. Those who work at building and growing a healthy business need to be Value Geeks not management geeks. To do so requires an extroverted approach – always looking outwards to the customer and the market, listening to customers’ hopes and concerns, translating the signals that the market sends, and turning them into ideas and projects for new and better ways to provide value in response.

The algorithm for Value Geeks is different than the one for management geeks. The four guiding principles are:

Empathy – the number one mindset and most important skillset for value geeks is empathy, the ability to identify the customer’s mental model of a desired state compared to their current state, and to be able to think like they think when ideas and propositions are run through that mental model. Value geeks can’t feel what customer’s feel – that’s a false claim for empathy – but they can simulate how they think and the implied consequences for choices they will make in the future.

Creativity – via empathy, value geeks understand customer dissatisfactions, what customers are uneasy about in their current circumstances, what they think could be better in the future or under different circumstances. But customers can’t invent new solutions; they’re not the innovators. How do innovative businesses create new value and new solutions? It requires creativity, that magic, unpredictable leap of imagination to a place that no one’s gone before. Value geeks prize creativity above all, because it holds the promise of novelty and surprise, the keys to new value. Will every creative idea be a winner? Of course not, so value geeks test and probe and experiment to add more substance and certainty until one of them is ready for market. But it’s creativity that is the essential ingredient to get the value process started.

Value Propositions –  the form of the experiment to test for market acceptance is the value proposition, a promise to the customer that a product or service or experience proposed in a business offering will deliver a benefit that the customer will value. A value proposition incorporates the idea that the business listened to and understood the customer’s needs, creatively translated the customer’s signal into an innovation, and is humbly offering it for customer evaluation. A value proposition is an exquisite act of design and a persuasive act of communication, a promise that entices and a promise that is kept. Value propositions are creative art and delivery science, offered with the humility of hoping to get it right while ever-willing to improve.

Learning – value is a process, a learning process. For the customer, it’s the process of identifying, selecting, purchasing, using, experiencing and evaluating. The customer can’t know exactly what the experience will be in advance. They learn, and they evaluate by comparing actual with expected value. Similarly, the business making the value proposition is learning, too. They learned enough about needs to make a responsive design, and they subsequently learn from the customer’s evaluation of their experience how accurate the design turned out to be, and how to improve it if it’s off-target in any way. Learning is accomplished through open recursive feedback loops from the customer to the business. Value geeks welcome feedback and seek it out at every point in the process because they love to learn. Learning is fuel for value.

Empathy, creativity, value propositions, learning. These are the 4 guiding principles for that make up the value geek way. 

The Value Creators Podcast Episode #23. Moshik Temkin on Leadership By Warriors, Rebels, and Saints – Leadership Wisdom from the Pages of History

Moshik Temkin is a historian who offers an alternative perspective on leadership. He asks, do leaders make history or does history make leaders? Those two forces can’t be separated. While leaders contribute to shaping history, they are also molded by powerful historical forces. This nuanced perspective is evident in analyses of historical figures like FDR, Margaret Thatcher, Martin Luther King Jr., and Malcolm X, emphasizing the role of circumstances in leadership’s response to complex historical challenges, ultimately leading to significant changes in their respective nations. The conversation explores moral leadership in the civil rights movement, comparing the approaches of Martin Luther King Jr. and Malcolm X. Despite their distinct styles, both leaders shared a commitment to collective progress and justice, challenging the prevailing emphasis on individual success. Temkin addresses the ethical dilemmas leaders encounter during crises, prompting reflection on the justifiability of extreme measures for the sake of victory.

How does this discussion contribute to the question of leadership in business? Leadership is subjective. We look to those who we feel can guide us, whether in politics or business. There are principles that cross both fields.


Knowledge Capsule:

Leadership Perspectives:

  • Moshik Temkin explores the complex relationship between leaders and historical context, emphasizing that leaders both make history and are influenced by historical forces.
  • Rejecting a simplistic view of leadership, Temkin suggests that circumstances and historical momentum often shape the significance of individual leaders.

Individual Leaders in Historical Events:

  • Examining historical figures like FDR, Margaret Thatcher, Martin Luther King Jr., and Malcolm X, Temkin highlights how leaders interact with historical events and crises.
  • While acknowledging the impact of individuals, he emphasizes the role of historical circumstances in determining the success or failure of leadership.

Moral Leadership and Collective Progress:

  • Delving into the civil rights movement, Temkin discusses the contrasting leadership styles of Martin Luther King Jr. and Malcolm X.
  • Both leaders, despite their differences, shared a commitment to collective progress and justice, emphasizing the importance of leaders focusing on the well-being of the entire community rather than individual success.

Transformative Leadership:

  • Temkin underscores the concept of “transformational leadership” by citing examples such as FDR and Margaret Thatcher, leaders who brought significant changes to their respective nations during critical periods.
  • These leaders exhibited the ability to transform existing structures and navigate through complex historical challenges.

Leadership and Decision-Making in Crises:

  • Temkin explores the difficult decisions leaders face in times of crisis, referencing instances like the decision to drop atomic bombs on Japan during World War II.
  • The conversation touches on the ethical dilemmas leaders encounter, questioning the justifiability of extreme measures in the pursuit of victory in war.

Leadership’s Collective Impact:

  • Acknowledging that leaders play a role in shaping history, Temkin emphasizes the collective impact of historical forces and societal structures on the emergence and effectiveness of leadership.
  • The conversation prompts reflection on how understanding historical context is crucial for comprehending the complexities of leadership.

Let’s stop calling creative and innovative businesses “small”.

The government and business media and sideline observers want to call your business small. That categorization applies to more than 99% of business firms in the USA. So someone’s missing something about the nature of the business economy. Small business makes the biggest contribution.

The error lies in misunderstanding systems thinking. The reason why people start and nurture small businesses is that they have an imagined idea for a new and better future – a better product, a better service, a better membership club, a better environment for office workers, whatever it may be – and they work with other people to try to bring it about. The other people they work with may be customers, partners, supply chain elements or employees; the business owner figures out the best network. The network and the connections and the information flows are never small. Today, thanks to the internet and collaboration software and communications, the network is the whole world. Any so-called small business can link to and orchestrate the world’s resources, the world’s designers, and the world’s imagination to bring value to its customers. What’s small about that?

Cynthia Kaye is one small business owner and consultant who fully recognizes the implications of thinking about the scale of the network rather than the scale of one node. First, it requires big thinking. What is the best way to harness the global resources to which business has access? What is the best service for customers? What’s the best way to provide service to customers?

For example, in her own business of video production, she has defined many ways in which her company can be the best. For example, being the best at getting the most out of the client’s budget. That’s a compelling value proposition and a genuinely unique claim. To deliver requires knowledge, experience, imagination, creativity, relationships, control, and meticulous attention to detail – all of which can be combined in an unsurpassed combination recognized by clients as superior. 

Economic growth and value creation come from using imagination and experience to create new knowledge: a surprise, a revelation, an exceeding of expectations. Imagination is not a product of scale but of creativity. 

Cynthia translates this big thinking into big opportunity. Often, this comes from growing with a client. That growth can begin parallel with a small customer – growing together through co-creation and collaboration. It can also come from small business supplier serving big business so well that more and more revenue is directed their way. The resultant shared growth benefits both parties. Is that big or small? It’s actually unrestrained, unlimited, unbounded. 

From this collaborative networked co-creation process comes big success. We know from Hermann Simon’s database of Hidden Champions that so-called small business can outperform big business in many ways, including higher revenue per employee, higher profit margins, greater employee retention, longer and stronger customer relationships, and more innovation and investment in R&D and new projects and capital equipment. Hidden Champions is a better descriptive term than small business. 

Small business shouldn’t be hidden or ignored – it should be celebrated, lauded, cheered on and loved. Small business is the economic system that generates the prosperity we all enjoy. 

The Value Creators Podcast Episode #22 Cynthia Kay on Small Business, Big Success

We live in a video age, which opens up a vast array of entrepreneurial pathways. Video is a field for open-ended free creative expression, as well as for tightly managed business tools built for ROI. It’s the ideal field for creative entrepreneurial small business innovators. Cynthia Kay of CK and CO is both a business founder and CEO of a video production business, and a consultant and advisor to small businesses. She shared some of her insights and a preview of her 2024 book Small Business Big Success. 


CK’s business resources site:

Books you can buy now:

Cynthia Kay’s upcoming 2024 Book – Small Business, Big Success:

Knowledge Capsule:

Value Proposition:

  • Like any other entrepreneurial business, a video production business needs a compelling value proposition.
  • A value proposition is always about meeting customer needs – what need are they filling by paying for video production?
  • No matter how creative, video production must offer a customer value that exceeds perceived costs. It must make customers feel proud and fulfilled, and give them a sense of standing out from the crowd.
  • This often includes educating them on how to use a supplier’s services, e.g. the many different benefits and values available from one video shoot.

Operational Excellence:

  • High creativity does not in any way reduce the need for a video production business – or any small businesses –  to prioritise operational excellence.
  • Customer expectations of excellence are high, no matter the size of the supplier they choose.
  • CK advocates the use of top notch systems, procedures, and automation to enhance overall efficiency. Build the back room to be as strong and dependable as possible. Every business can deploy the best systems.
  • Owners must be in the operational trenches.

Return on Investment (ROI) Challenges:

  • Calculating  ROI in creative fields is a challenge – but must be done as part of the customer value proposition.
  • There’s such a thing as subjective calculation – e.g. recognizing the role of anecdotal evidence in demonstrating the value of creative services.
  • Focus ROI on the things that matter for customers.

Being the Best in Business:

  • Whatever business you are in, set out to be the best.
  • Making – and living up to – such a claim can be based on multifaceted performance.
  • Consider factors such as understanding client needs, building strong relationships, and optimising the utilisation of budgetary resources.
  • One of CK’s propositions is to be the best at getting the most of a client’s budget, whatever size it is. That’s an excellent “best” claim.

Small Business Success Strategies:

  • Pick your customers carefully – pick those who will love you and those you can grow with.
  • Commit to building relationships over time.
  • Build great teams that are right for the client, and turn them loose.

Supporting Small Businesses:

  • Cynthia Kay not only runs a small business,she plays a big role in helping others and in supporting small businesses in general.
  • She’s actively involved in associations and support groups, and urges other small businesses to do the same.
  • She gives her time to the facilitation of roundtable discussions, and offering advice on common challenges faced by small businesses, including scaling and team development. These kinds of discussions can yield enormous value for participants just by sharing experiences.
  • It’s good for small businesses to support other small businesses and build the business backbone of the neighbourhood, the town, the city, the state and the nation.

The Value Creators Podcast Episode #21. Forging New Relationships Between Entrepreneurs and Capital with LaSean Smith

LaSean Smith outlines a business investment partnership built on permanent capital, emphasizing long-term commitment and trust-building between an investor/source of capital and a business. The discussion covers disciplined methodologies, leadership transitions, and a unique compensation approach using Phantom Stock Shares. LaSean predicts a rise in smaller, values-based companies, and underscores the significance of audience and automation in acquiring and revitalizing brands. 

There can be a shift towards stable, smaller businesses connected to communities, challenging the trend of dominance by larger and larger corporations.

CAGR Investments:

Knowledge Capsule:

Permanent Capital Strategy:

  • There’s an investment strategy and a business strategy based permanent capital. It’s not widely used but has broad potential. It emphasizes the importance of long-term commitment by both the investor and the business. Short-term operational demands are entirely left to the business CEO.
  • LaSean Smith explains the advantages of having an investment structure that accommodates a longed shared journey, building a high degree of trust and confidence.

Operational Approach:

  • LaSean highlights a disciplined methodology to tighten business processes and leverage content-based marketing to assist companies. 
  • Small and mid-sized businesses often miss the great efficiencies available by automating processes. And they waste resources on direct sales and inappropriate marketing tactics.

Leadership Transition:

  • Permanent capital is a long-term investment; it works when there is a corresponding long-term commitment of current operators.
  • Some CEOs may want to avoid continuing in the business, especially in cases where technical founders find themselves dealing with aspects like sales and marketing, which they may not enjoy. Relieving them of that burden may extend their tenure.

Phantom Stock Shares:

  • Permanent capital embraces a unique approach to leadership compensation using Phantom Stock Shares – aligning incentives by granting bonus or dividend shares that compound in value until the leader leaves the company. This helps in providing a simple ownership structure and shared incentives without diluting ownership equity for the investor.

Cash Flow and Value Creation:

  • The conversation delves into the concept of cash flow and value creation, discussing how businesses can fade over time if not innovating. Lasean emphasizes the importance of adding technology and content marketing layers to ensure longevity.

Audience and Automation:

  • The concept of audience and automation is highlighted as a critical factor in the success of businesses, especially those acquiring old brands. Engaging content marketing towards a target audience allows for driving brands through existing supply chains, reducing customer acquisition costs.

The hybrid workplace is an excellent example of emergence in a complex evolving system.

Management thinking about business and how work gets done to generate value for customers requires radical revision. Happily, the understanding of complex evolving systems is improving, at least to the point that we can recognize and embrace the consequences of emergence – that property of evolving systems that results in new phenomena and new traits and new patterns that could never have been predicted based on our prior knowledge. We can’t predict future developments of our own systems. We can only observe emergent developments as they occur.

One example of an emergent pattern that no-one predicted is the hybrid workplace. This is the new condition of the office or factory in which the elements of where we do work and how we do work and how we synchronize work with each other have changed beyond recognition. Some people might be in physical proximity in a meeting or gathering, while others are remotely connected through technology from another physical location, and the tools and devices and machines and data we use are in yet another physical place and another digital dimension. Everything is in motion and the relationships between them are fluid.

How can the hybrid workplace be managed for value generation and productivity? Yesterday’s management techniques of hierarchical control no longer fit very well. Two of the best experts to address the challenges of the hybrid workplace are Julie Kantor and Felice Ekelman, authors of the book Thrive With A Hybrid Workplace. Here’s what they say.

First, focus on culture. Culture is a value proposition for employees. Some bosses have claimed that corporate culture can not survive the hybrid workplace without an office or factory where people spend extended periods of time together on a regular basis. But culture stems from intentionality – what kind of a culture do you intend to nurture? Culture is a function of the things that matter to employees, which can include learning and progressing, empowerment, shared vision, connection, collaboration and trust. These are all subjectively evaluated, and it is entirely possible to shape the appropriate value proposition when the right intent is employed and declared. Whether work is hybrid or 100% in-person and on-premise does not have to be the governing variable. Empathy – understanding the things that matter to individual employees – is the binding force.

Second, embrace change. Evolutionary biology suggests that humans prefer predictability and stability to change. But in the emergent upheaval that brought us the hybrid workplace, change came to the forefront. Changes in work habits and practices, changes in relationships and collaboration possibilities, changes in the very nature of work. Part of the new value proposition for employees is that we all are swimming in the river of change together, and we should all be open to the excitement and energy of the experience.

Third, redefine connection. In complex evolving systems, it is the connection and interaction between individuals that opens up new pathways to productivity and value generation. Julie Kantor calls this connection interpersonal glue. If there’s no glue, teams find it harder to work through challenges and conflicts. Julie urges us to find new ways of networking, new forms of “dropping by”, and new forms of mentoring, and new ways of connecting in general.

Communicating and collaboration  take new forms as well, when the medium of connection changes. We should be newly sensitive to the subjective interpretation of our communications when they come in new formats (e.g. e-mail and text compared to in-person). “How can I help” becomes the new expression of connection – making communication inbound and not just outbound, and declaring the intent to collaborate. 

Be a coach rather than a manager. Coaching is a commitment to help individuals evolve as the ecosystem changes. Coaching involves observation and active listening rather than giving instructions. Coaching provides resources, but doesn’t specify how to use the resources. Coaching facilitates but does not prescribe. Every individual should receive coaching.

With new mindsets, the hybrid workplace can be even more productive than its more restrictive predecessor workplace. Responsiveness to the real things that matter to employees can be tuned to any kind of workplace, including one that changes all the time.