Antifragility and The Coca-Cola Company: Design to Grow with Scale and Agility

In Design to Grow, David Butler (@DavidRButler) and Linda Tischler (@LindaTischler) explore how The Coca-Cola Company (@CocaColaCo) uses design to grow — to “scale to over two hundred countries, build seventeen billion-dollar brands, partner with more than twenty million retail customers, and sell close to two billion products a day” as well as to “create agility”!

In Antifragile: Things That Gain from Disorder, Nassim Nicholas Taleb (@nntaleb) introduces the concept of antifragility.

First, Taleb distinguishes between the fragile, robust, and antifragile: “the fragile wants tranquility, the antifragile grows from disorder, and the robust doesn’t care too much.”

Some things benefit from shocks; they thrive and grow when exposed to volatility, randomness, disorder, and stressors and love adventure, risk, and uncertainty. Yet, in spite of the ubiquity of the phenomenon, there is no word for the exact opposite of fragile. Let us call it antifragile.

Next, Taleb advances that “by grasping the mechanisms of antifragility we can build a systematic and broad guide to non-predictive decision making under uncertainty in business, politics, medicine, and life in general.”

See Demystifying Antifragility for more!

How does The Coca-Cola Company achieve greater antifragility?

Two Essentials: Scale and Agility

In today’s volatile and rapidly changing world, these are the two essentials that every company needs to grow and remain relevant.

If you’re a big, established company, you’ve got scale . . . Your problem is agility — you must be smarter, faster, leaner, than the startup that’s got your industry in its crosshairs — targeted for disruption.

If you’re in a startup . . . you’ve got agility . . . Scale is your problem — doing what it takes to expand your startup into new geographies, including the land of profitability, is your challenge.

Agility is not the opposite of scale; it has a different purpose, and process, and it creates different results.

Butler and Tischler recognize that Scale and Agility are not opposites and are both needed to Grow! By not positioning Scale and Agility at odds (as opposites or as a paradox), the authors embrace a pragmatic (versus dogmatic) approach to growth.

Design for Scale and Agility

What if there were something that could help you create both scale and/or agility? There is — it’s called design.

Every company needs both scale and agility to win.

Scale — stabilizing your business model, so that you can move to the next stage and become a company.

Agility — how to meet expectations this quarter but also create the speed and flexibility your company needs to drive innovation and create the culture you need to remain relevant to the next generation.

Butler and Tischler recognize that Design offers an integrative perspective and approach to fostering Scale (“move to the next stage”) and Agility (“speed and flexibility”)!

Design can create both scale and agility.

When used strategically, design can help companies grow.

Design is powerful. Once you understand how design creates value, and decide to design on purpose, you can unlock the power of design to drive both scale and agility.

Butler and Tischler further acknowledge the power of purposeful Design!

Design

Design is about intentionally connecting things to solve problems.

Good design makes things less complicated. Bad design makes things more complicated.

A system is a set of elements and behaviors that connect to do one thing.

When you design the solution as a system, you can begin to solve many connected problems, across your business.

The critical thing to note is that no one thing was more important than the other; success came from how each element was designed to work with all the others.

Most companies focus on what they design. Companies that get the full value out of design start with why they design and then shape how they design — the process — around their purpose.

Design involves a holistic perspective that integrates the “why” with the “how” versus merely focusing on the “what”. Such an integrated perspective confronts (or solves) many connected aspects (or problems) where everything is balanced (and where no one thing is more important than another).

The emphasis on purpose fosters antifragility by cultivating an ethos of “soul in the game” versus mere “skin in the game” (robustness) or “no skin in the game” (fragility).

Scale: Simplify, Standardize, Integrate

To achieve scale, everything must be simplified and standardized to integrate with the least amount of friction.

Most of the time, great design means getting the details right.

When something is complicated, it’s difficult to understand. When something is complex, it has many different connected parts.

Integrated systems help create scale.

Fundamentally, scale is achieved by integrating things through simplification and standardization while minimizing friction.

Simplification or “skeptical, subtractive empiricism” fosters antifragility.

Integration through design, using a “common” (instructive) versus “statutory” (prescriptive) approach, fosters antifragility.

Agility: Build, Measure, Learn

By designing for agility, companies can learn faster and become smarter, which reduces the risk of being disrupted.

Every professional, company, and organization must learn how to continuously disrupt itself or someone else will.

Modular systems help create agility.

Fundamentally, agility is achieved by learning faster through building and measuring while confronting disruption.

Modularity with small, perhaps specialized, independent and decentralized parts fosters antifragility.

Building, measuring, and learning as “evidence-based tinkering” or “empiricism” fosters antifragility.

Learning or “convexity to errors” fosters antifragility.

Openness

Open systems allow others to play in your sandbox.

While it may seem counterintuitive, opening up, sharing, and allowing others to codesign, develop, and build your products actually makes you leaner.

When you’re designing an open system, the goal is to enable sharing.

Emergence is when individual elements interact or work together to create something new, something that couldn’t be created if each element acted along.

Emergence relies on self-organization. To create emergence, you have to deism in a way that creates order between diverse elements so lots of people can share lots of stuff.

The order must be spontaneous and decentralized, not directed or controlled by anyone. It must come from within the system and feel intuitive to everyone involved.

Fundamentally, openness fosters emergence and maximizes growth.

Openness fosters antifragility by maximizing the potential exposure to positive Black Swans.

Openness encourages “functional redundancy” and an “entrepreneurial” (versus “bureaucratic”) mindset and accommodates “reversible, small errors” (versus “irreversible, large errors”) with decentralized (vs centralized) power and control.

Design to Grow with Scale and Agility

Growth = Design (Scale + Agility) + Openness

If you are confronting the challenge of integrating Scale and Agility to achieve Growth, suggest you delve deeper into Design to Grow!

For more insights on antifragility and businesses, see Six Ways Whole Foods Market Stays Antifragile.

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