Monthly Archives: September 2010

Attitude Adjustment

A Twitter mate wrote me that the “Collapse” meme was strong on the internet today. “Collapse of what?” Of the US empire, of course. I myself had fed the meme earlier in the day by ReTweeting a reference to Otto Scharmer’s blog post from earlier this month where he wrote how stark the decline in the US appears after returning from a summer of visiting more vibrant nations overseas. (Otto Scharmer is a Senior Lecturer at MIT.) Scharmer also referenced the arguments of Johan Galtung, who predicts the fall of the US empire by 2020.

I think the evidence is pretty clear that the US is in a period of economic decline relative to much of the world–we’re just not growing as fast as they are. The US, which accounted for 50% of the world GDP immediately after WWII, accounts for something like 20% today, and as long as other, very large economies such as India, China, and Brazil continue to grow at 2 to 3 times the US rate, our share of the world economy will decline further. The Congressional Research Service in 2007 cited statistics that by 2025, the Chinese GDP would be 50% bigger than that of the US, although its per capita income would still only be about 40% of the US level.

This need not have any significant impact on US prosperity; in fact, overall growth in the world economy, if we manage it responsibly and sustainably, should be a good thing for everyone.  But it will change the dynamics of the world economy in ways we cannot fully anticipate today. World capital flows will change, US foreign investment patterns will change, other economies will become centers of world-class innovation and education, human talent will flow in different directions, and world investors will have many more stable options to park their long-term funds.

It’s harder to tease out exactly how these changes will alter US ability to project power, but the strong sense is that they will, even if, and this is important, countries such as China, India, and Brazil never have a bad word to say about the US. Leaner defense budgets are in our future. And I also suspect that, as these other countries emerge as world economic engines, the mantle of economic and diplomatic leadership will at first imperceptibly but eventually steadily slip off US shoulders. As China becomes the EU’s largest trading partner, for example, it will only be natural for Bonn and Paris to worry more about what Beijing thinks. Again, this need not be a horrible thing.

But we can certainly turn it into a horrible thing. That’s the problem with all this “collapse of empire” talk. It tends to feed the tendency of Americans to think we’re on the road to ruin and that therefore drastic measures are necessary to reverse the dynamic. Now that would indeed be unfortunate, because it is exactly this kind of overreacting that could lead to a messy denouement. Grandstanding and puffing out our depleted pectorals will only divert us from what we need to do, which is to begin to shift money away from military-oriented spending to investments in human and societal development that will allow us to compete effectively in a more balanced world. (And by the way, I don’t think it’s up to government to do all the investing.)

Generally I’m bullish about the US capability to do well in this competition. But one not so small thing gives me pause. America’s mental shortcuts for thinking about the rest of the world are not very helpful, and these shortcuts unfortunately spring from our founding legends and myths. So as Americans we learn that:

  • We were founded by people who wanted to escape the messy ways of bickering nation-states and it’s best to remain independent from them and Self-Sufficient.
  • Almost all problems scale to individual solutions. At worst, maybe every once in a while Americans have to voluntarily form a small group to tackle something difficult. (The only real exception to this is the military) So essentially we believe Complexity is Un-American.

So let’s stop writing about the collapsing empire–and please don’t bring in the comparison to Rome, which after all occured like 2000 years ago. I’m tired of it already and it’s just applying old vocabulary and concepts to describe a world dynamic that will be new, different, and exciting. And let’s concentrate on what really matters–a long overdue Attitude Adjustment.

Advertisements

Lessons from a CIA Heretic

Last week I told a story at the Business Innovation Factory Summit, a wonderful event that I was blessed to attend. The storytellers were awesome. (Let me also give a big shout-out to my friends and reverse mentors Tony and Jen Silbert of Innovation Partners, who were the kind folk who connected me to Saul Kaplan and all the wonderful people at the Business Innovation Factory.) I was talking to a friend last night about all the interesting people I met and I couldn’t talk fast enough to keep up with my memories.

Anyway, even as a retired CIA person, I still need to get public or published comments approved if they deal with subjects pertaining to my CIA employment. And so this forced me to actually write out a draft of my extemporaneous comments to submit to the publications review board. You can catch the differences (not that significant) between what I wrote and what I said here, where you can download the MP-3 file of my remarks. So I thought I would post that text below. I think particularly toward the last half there are some ideas I rushed through or omitted that might be of some interest. I’m sorry it’s so long…

TALK BEGINS

My hope is that 15 minutes from now you will have developed your own answers to the following three questions or at least be provoked to think about them.

The questions are:

1.  Is the perception of the CIA in the popular media accurate, distorted, and/or useful to the organization and US national security?

2.  What is the motor that runs the world? Is it the secret agreements and machinations of men (and historically it’s been men) getting together in smoke-filled rooms generally up to no good; or, Is it the large dynamic and trends that emerge on the planet from God knows where and set in motion events that elude our attempts at prediction and manipulation.

And

3.  Are we the world?

So question 1. The perception of the CIA. Now first I have to tell you that I hate spy fiction and spy films and I even dislike nonfiction about the topic, so I’m not the best person to have an opinion as to whether the common perception out there is accurate. But I can tell you a little bit about my early days at the Agency. That’s a start.

Unlike many young people I’ve met over the years, I never dreamt of working for the CIA. As the first person in my extended family to graduate from college, I of course had no idea what I was supposed to do with the degree I was earning but because I was a college debater I’d always assumed I would be a lawyer. Until at Catholic University I started meeting law school students and went “OOOO….I don’t want to end up anything like them.” At that point I was at a loss. The only thing I was really interested in was the world, and so I thought well, I’ll go to Georgetown for graduate school. And so I did and the first semester there was a CIA recruiter on campus and I said sounds good. That’s the sum total of the story.

Now when I first joined the Agency, in 1978, it wasn’t what we would call a very diverse environment. (and even today Agency leaders are not satisfied with the level of diversity in the organization.) In later years I would tell people that I used to wander the halls searching for another Latino or Latina, because someone had told me there was another Puerto Rican working in the Agency and I was determined to find that person. Now that story is not specifically true, but it is generally accurate, if you get my drift. I used to get strange comments, like people in a conversation suddenly volunteering, in a culinary non sequiter,  how much they liked Mexican food or assuming that I would only want to work on Latin America. But for the most part, the Agency environment was a meritocracy, specifically I can say that about the analytic directorate where I worked, and I can’t point to any particular issues. In fact, when I would speak on college campuses kids were always asking me to comment on how being a woman and Latina affected my career, and I always told them the truth, that neither had as near the effect as being a different type of thinker—but I’ll talk more about that later.

I soon learned that most of the work at the Agency was, well, like the work at any other knowledge organization, although of course we didn’t use that term then. (By the way, given the malodor in which managers and management are generally held, I just don’t understand why consultants banded together and decided they could make a lot of money pitching organizations on Knowledge Management, but I digress.) True, the CIA is by law responsible for carrying out covert actions, an activity that, for my taste, assumed a heck of a lot about the planning abilities and foresight of the average American, whatever, but for some time now great powers (another term I rather dislike) have assumed they needed the ability to do some things secretly to make their way around this big, blue planet and, rather endearingly, the US decided to give this activity a legal structure. But much, most of what most Agency employees do has very little to do with covert action. It has to do with trying to make sense of the world, and trying to gather information about the world that others would rather us not know, so it’s a bit like trying to figure out what Steve Jobs is going to do next at Apple. But for the press the CIA is like the Lindsay Lohan of government. No matter what we do, how insignificant or banal really, it makes headlines and it’s always bad. “CIA uses solar-powered lawn mowers!!” Ridiculous!! I guess stories about the CIA sell newspapers, if anyone bought them anymore. I had a colleague at the Agency, wonderful fellow, who started every morning reading multiple newspapers (and he also has his office decorated with Brooklyn Dodgers memorabilia, so you know the type—salt of the earth.) And for the last six or seven years, I would stick my head into his office and say, “You know, newspapers are dying.” It was really mean of me.

So this is a good point to start making the segue to the second question, which as you recall has two parts. So I’ll repeat them.

What do you think is the motor that runs the world?

Is it the secret agreements and machinations of men (and historically it’s been men) getting together in smoke-filled rooms generally up to no good or

Is it the large dynamic and trends that emerge on the planet from God knows where and set in motion events that elude our attempts at prediction and manipulation.

So right about now, I’m going to start connecting my comments to the topic of innovation, which will be very exciting, I think.

So my point in asking you to think about this question is that how you choose and/or what reality is tells you a lot about what kind of intelligence organization you’ll need. If you think that the world is driven mostly by the secret deals and aspirations of powerful people—the Hitlers, the Communist Party of the Soviet Unon, Mao Tse Tung, Idi Amin, Saddam Hussein, Osama bin Laden, I’m desperately trying to think of a likely woman here—then you will conclude that you need some kind of capability to figure out what these people are doing, to ferret out their secrets. To protect our nation from some very nasty ideas these individuals cook up. And you may also want an organization that can impede their plans, cross your fingers.

But if you think that most of the forces the US will need to navigate are not specifically man-made, or at least not specifically made by one man or a small group of them–then you need a different kind of organization. If what matters is that the US understand the trends in the world, like globalization or the emergence of new economies such as India and China and Brazil (which clearly no one is like trying to keep a big secret) than spending a lot of time digging out secrets seems not as important, and what you really want is to have your hand on the pulse of the world, to be out there sensing and in many ways just being part of the whole big ride.

Now of course the question is a false dichotomy, because it is not either/or, and both dynamics can exist at the same time. But what is critical for understanding the CIA and why I spent my last 20 years there as a frustrated innovator, is that much of the Agency’s theology and modus operandi are built on the first assumption. This was the driving principle in the Cold War—countries hostile to us are planning to destroy us and do us harm and we’ve got to get out there and figure out what they’re up to. And of course it’s a Mad Magazine Spy vs. Spy world and the bad guys are trying to figure out what you know, so you have to be secret about everything, be very, very quiet, and trust no one.

It’s all very tiring but it was all very important up until about 1990 or so, which curiously, now that I reflect back on it, was when I published my first article in Studies in Intelligence arguing that we needed to do analysis in new and different ways. We needed to recognize that policymakers often knew as much about the open world as we did and that these newfangled operations like CNN were providing news faster than we could and well we needed to adjust. And then the internet came along and the Agency was really thrown for a loop. One has to understand that for intelligence organizations how one handles information is not a secondary or enabling activity. Handling information is the essence of our mission so that changes here are doctrinal and theological. Well, of course, we had a really hard time figuring out what to do, and I would argue we are still having a hard time.

This period, the 90s, ended up being the most difficult of my Agency career because it just became harder and harder for me to reconcile what I believed needed to be done with what the Agency was actually doing. There was a small group of us that I in any case referred to as the Rebel Alliance. We tried to raise the Agency’s awareness of how the world was changing around it, we would bring in guest speakers to talk about Change—how naïve it all seems in retrospect. During this time, and I’m afraid this is a danger all innovators run, I began to get the reputation of being cynical and negative…positive thinking has its limits, you know. During a reception up in NYC around then, I was approached by someone who had been watching me, I remember she worked for DuPont, who said. “I can see you are a heretic in your organization. And I just want to tell you that you need to learn to live with the feeling of discomfort all heretics get. In fact you need to learn to be comfortable with these feelings of discomfort. Not just comfortable, you need to learn to like, love them, because when you get those feelings then you can be sure you are being true to your convictions.” I never spoke to this person again and I’m convinced she was one of the two guardian angels I’ve encountered in my life. (If you want to know the other one, catch me later!!)

Despite all this doom and gloom, I spent the last ten years or so of my Agency career as a senior executive—and ended up in positions of increasing responsibility. I wish I could tell you exactly how I as a heretic innovator managed to succeed in the system anyway, but part of it was just sticking to it, many good friends and mentors—especially reverse mentors, and that extremely important variable in all plans—luck. By 2005 I was part of the executive team that led the analytic Directorate, the Directorate of Intelligence. Very soon after I assumed that position, a young man and his manager approached me about an idea they had at that time to use the media wiki software to create an Iraqipedia so that analysts throughout the Intelligence Community could collaborate and work together on the problem set. I thought what a great idea but did they know that the Agency was OK with using collaboration software as long as you only collaborated with people within the Agency. No, they didn’t, they said. And I said that was OK because I doubted anyone in the bureaucracy realized any longer this stricture existed so let’s proceed, full speed ahead. (It never ceases to amaze me how bureaucracies create rules at a rate no human can ever remember, not even bureaucrats.)

So that was my small role in getting Intellipedia started, which is still viewed by many as the most important adjustment the intelligence community has made to the Internet Age. Nothing came easily and I remember Sean and Don, the two heroes who ended up pushing the concept throughout the intelligence community and winning last year one of the Service to America awards given to outstanding civil servants, often asking in frustration if we couldn’t just MAKE everyone use Intellipedia. To which I said, wrongly or rightly, no, we can’t. I happen to believe organizational change is a lie—organizations don’t change, people do, and each person changes for particular reasons of their own. You can’t make people think differently. You can create an environment where they can have a Eureka moment. You can MANIPULATE them into thinking differently. But you can’t FORCE the issue.

Not only that, many in the intelligence community then, and perhaps now, didn’t think ideas such as Intellipedia were such good ideas in the first place. Virtues of Intellipedia such as transparency don’t sound too hot to intelligence professionals accustomed to clandestinity. The CIA and Intelligence Community also were hung up on the concept of authoritative views. National Security intelligence is just too important to be handled through collaborative processes, they would argue. During this period I came to the exact opposite view. Making sense of the world is so hard and so important that it demands collaboration with as broad a network as possible. It was around this time that this thought entered my mind: The CIA will end up being the last secret organization in the world. And being the last of anything is never a good thing.

And so back to the question. I actually think the answer to it is very complicated. But I do believe that more of what will be important to US prosperity in the future will lie in the second dynamic and our success will depend on how well we understand these large shift changes underway and are able to engage them. Here’s where the imbalance of the Intelligence Community really can hurt us. To deal with the first circumstance it’s important to be a closed network. But to understand and prosper in the second dynamic it’s best to be an open network.  What we have here is a real innovator’s dilemma.

Which brings me to the last question: Are we the world? In the immediate aftermath of WWII, the US was 50% of the world economy. We also make a big deal of how we led the world in innovation, but of course most of that was probably just a function of our size. So during the Cold War we dealt with the world as if we were the world. We called the shots. And that is the world our intelligence community learned to function in. Of course individuals were ready to share secrets with the US government because we were after all where the action was.

That world is ending very rapidly. The world to follow will be a good world too. A world in which the US will remain very influential and prosperous. But once the US represents, let’s say 10% of the world economy, which could happen in most of our lifetimes, the arithmetic of dealing with the world from a position of absolute strength sort of falls apart. Much of the American public, from what I can tell, doesn’t appear ready for this turn of events. We learn, as kids, that America owes its prosperity to its independence from the rest of the world. It is part of our founding myth. We also believe that the world and its problems scale to the capabilities of individuals or small groups of individuals, freely associating. So in a very real sense, Complexity is Un-American!

That’s why one of my passions now that I’ve retired from the Agency is to do what little I can to help Americans think about connecting, about working in open networks, about transparency. I believe as a successful multicultural society the US is poised to be innovative in this new world, and this time perhaps all out of proportion to our size. I love all social networks and in particular Twitter because of its power to spread ideas faster than the speed of light. Just think of it. One thought can reach a thousand people much faster than a single beam of light could physically touch those same individuals. I found myself a few weeks ago teaching a group of 20-somethings my Twitter secrets. This is nuts, I thought, but what a blast.

So there you have it. My last lesson: All organizations, no matter how reactionary or conservative, always have people in them thinking how we can be better.  All organizations need to find better ways to tap into what these individuals have to offer, because they often have an orientation to the outside environment that you may be lacking.

And for you frustrated innovators out there, form a Rebel Alliance. But remember, that optimism is the greatest act of rebellion.

Thank you.

On Work, Consumption, Economy and the Whole

Saul Kaplan, the founder of the Business Innovation Factory–where incidentally I will be a storyteller on 16 September–writes a Labor Day post on his blog listing what he calls 20 random thoughts on the Future of Work. (They’re not so random, really, but it’s a really good list.) Naturally agreeing with points such as

Projects are more important than jobs; and

Free agent nation becomes a reality,

I got to thinking that change of this scale will have GINORMOUS downstream effects (I’ve been told by some very reliable sources that ginormous is now officially a word!). Because if we change how we work, don’t we in fact CHANGE EVERYTHING? Saul touches on some of these broader implications when he notes that

Workforce and economic development are transformed and become indistinguishable; and

Work and social become indistinguishable

but what I’d like to do in my Labor Day post is draw these points out even more.

We cannot underestimate how important steady 9 to 5 work is to the American economy; it is that steady, predictable income that has allowed US consumers to become the BEASTS that we are. (It was part of Henry Ford’s genius to realize the connection between his profits and the wages he paid.) The US consumer has been the engine behind world economic growth since WWII. I wasn’t able to easily find a statistic on what percentage of the world economy is ingested by the US consumer–the closest I could get is the oft-cited data point on how we account for about a quarter of world energy consumption despite being in low single digits in percentage of world population. But you get some indication of the importance of US consumption to the world economy from the website of the Worldwatch Institute, which in its press release for its 2004 monograph on world consumption noted that “the 12 percent of the world’s population that lives in North America and Western Europe accounts for 60 percent of private consumption spending, while the one-third living in South Asia and sub-Saharan Africa accounts for only 3.2 percent.” It’s safe to assume the US consumer accounted for more than half of that 60 percent.

So let’s get in that trusty Time Travel Apparatus and fast forward let’s say 50 years. If the predictions about how work will change are true, then one of the implications–unless we come up with interesting new methods of compensation, question mark?–is that the steady income that drives American consumer consumption will dissipate, to be replaced with more aperiodic payouts. Presumably these payouts will average out to meet our needs and sustain roughly approximate standards of living, but not without some important adjustments. I would imagine, for example, that the average individual’s willingness to accept large revolving debt balances will weaken once she cannot rely on a regular, stable income. Similarly, companies and business models that are based on consumers handing over huge amounts of money on a regular basis, like the cable companies, may have to retool.

Many industries in fact will have to rethink. Agreeing to five years of car payments? I don’t think so!! The 30-year mortgage? Perhaps not!! It’s interesting that already in the car industry companies such as Zip Cars are introducing new ways to acquire the services of a car on a pay-as-you-go basis. And the shambles in the mortgage industry have led people to question the inviolability of the American dream of home ownership. Finally, the emergence of Cloud Everything probably will allow consumers to dispense with the need to own important consumer goods such as music, videos, books, etc.

So my hunch–a sophisticated analytical term–is that a redefinition of work will be the prelude to a redefinition of economic prosperity. Prosperity and economic growth would no longer be synonymous. I don’t know yet whether this will be a net plus or minus, although the optimist in me believes of course it will be a net plus. Certainly the world’s ecology could tolerate a break from constant growth, particularly growth dependent on mass utilization of finite resources. Again from the Worldwatch Institute, “WWF’s Living Planet Index, which measures the health of forests, oceans, freshwater, and other natural systems, shows a 35 percent decline in Earth’s ecological health since 1970.”

Nevertheless, there’s also a part of me that senses the wisdom of the view that the opposite of growth is death. Without economic growth, can we advance as a species and improve the lot of those who live and die without ever getting a chance to explore their human potential? I know many have conceptualized what they argue are more equitable economic models, but these always seem to ignore the demonstrable quirks of human nature.

Clearly, there’s still a lot of work to be done.