Bacterial finance

September 24th, 2009

Now such a title could bring to the surface all kinds of ideas, some of them not very pleasant, however, Harvey Rubin argues that financial institutions have a great deal to learn from nature,

Whether you call the current financial situation a setback, a crisis or a meltdown, it has had at least one positive effect: financiers are searching for new ways to deal with complex risk. I have a suggestion for them. Look to nature, where analogous problems have already been solved by engineers and computer scientists.

Bacteria, for example, have a robust, adaptive regulatory system that optimises the growth of the colony under any set of conditions. They adapt to the composition of their growth medium, the acidity, temperature and salinity of their environment, attack by other organisms and many other threats. Adaptation depends on regulatory systems built into the system itself, and yet this regulation does not constrain growth or innovation.

As we argue @ SMLXL Our world of business, media, and communications is evolving from the straight-lines of an industrial era to the more complex and networked world that mimics the inter-connective ecology of nature. This interactive networked world isn’t about vertical silos, traditional notions of product and service creation, mass-production and mass media and marketing. It is about the massive flows of people, who are connecting, collaborating, organising and creating in a manner that has nothing to do with a linear approach too much at all. This is truly an engaged and participatory culture.

For over 150 years our economies, culture and society have been shaped by a straight-line logic producing considerable economic success. However, in the dawn of the Networked-Society, a straight-line logic of getting stuff done becomes a barrier to progress. Why? Because, the change wrought by the networked society is structural – challenging how markets and organisations have co-evolved over the last 150 years.

This creates a dilemma. And the dilemma is this – How can firms and the people that work in those firms, develop coherent marketing strategies/products and services that are premised upon No-Straight-Line principles – when they have been versed only in Straight-Line thinking – at least for the over 35’s – from birth?

Bookmarks: