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Using Backpack for nonlinear business planning

by Paula | 6 June 2009 | permalink | comments [1]
Tags: business planning, peak oil

Last fall, I published a blog post called Engineer your own soft landing? The nonlinear business plan which described a planning strategy that takes into account various decline scenarios. In a nutshell, the goal is to develop miniature business plans for each of a number of different scenarios, the pieces of which can be mixed and matched depending upon how events play out.

This is a followup to that post and describes how to use the free online tool Backpack to develop, and keep current with, a nonlinear business plan.

What is Backpack?

Backpack is one of a family of online business softwares engineered by a company called 37Signals, with which you are probably familiar if your work involves the web in almost any way.

From the Backpack website: “Backpack is an easy intranet for your business. Store, share, discuss, and archive everything that’s essential for your team. Safe and secure.” And that’s just what Backpack does — it allows you to keep notes, lists, write documents, keep a journal, and more; and, it allows you to collaborate and share all this with business partners, clients, or whomever you wish to invite.

The organizational features of Backpack make it a great choice for building a nonlinear business plan. It is also incredibly simple to use, and includes both a free version, which I’ve used to set up my example; a solo version for $7/mo that has some additional features; and a series of ever-larger versions for SMEs all the way up to global enterprise.

Getting Oriented

Backpack’s center of gravity is its “Pages.” Pages offer the ability to quickly add notes, lists, writeboards and dividers:

• Notes are brief snippets of information
• Lists are checklists used most frequently for to-do lists, which can be checked off as tasks are completed. They are useful for just plain lists too, however.
• Writeboards are full documents which are composed right in Backpack. What’s nice about these is that Backpack will save draft versions along the way rather than overwriting everything all the time.
• Dividers are simply page dividers that help keep your content sectioned off and more organized.

Pages can also be tagged just as a blog post, a link at De.licio.us, or a photo at Flickr would be tagged.

Each page is assigned its own email address so that users can email lists, notes and such to their pages; emailed content is added automatically, and can be re-arranged later.

Page content items can be dragged-and-dropped onto other pages. This is going to come in very handy for our purposes.

Getting Started

Backpack’s free account comes with five pages. I’ve set up the pages in my example account like so:

• Summary — Equivalent to the standard executive summary of an existing business plan
• Current — This page is set up with the subheadings of the Summary page, but is otherwise blank. It’ll be the repository for scenario planning items as they are needed.
• Scenario 1: Hyperinflation
• Unused
• Unused

The links above go to live, published Backpack pages. They aren’t interactive, but demonstrate pretty well what a Backpack page looks like.

Filling in the Pages

The “Summary” page describes where the business currently stands; this is important information to hang on to and shouldn’t change much. It provides an anchor for recalling where the business has been so that its owner can avoid repeating mistakes, and/or look back to see what worked in the past as the economy rides the bumpy plateau. The Journal feature of Backpack is also useful for keeping track of what gets changed and when, and can serve as a reference for the same purposes.

The “Current” page is where most of the action takes place. I’ll get back to this in a moment.

The “Scenario” pages are for developing actionable alternatives to current business practices. These are just like the Summary page, but the information included under each heading changes to suit whatever scenario requires alternative actions. Compare the section headings on both the Summary and Hyperinflation pages linked above; they are the same, but the Hyperinflation page content is changed to reflect potential actions.

The “Current” Page

The Current page remains empty until needed. This is a record of current maneuverings and will change as conditions change. Content here comes from the Scenario pages: any list, note, or other item added to the Scenario pages can be dragged-and-dropped into the Current page. This allows an entrepreneur to mix-and-match preplanned responses, and to have a nearly instantaneous document to refer to when dealing with investors, creditors, employees, and for personal organizational purposes.

For exmaple, say hyperinflation does set in and money becomes nearly worthless. Barter will become a necessity, but rather than scrambling to figure out how to make barter work, a small business owner has figured out ahead of time what she can offer and what she can accept in trade. She simply drags the relevant items from her Hyperinflation page to her Current page; the Current page can then be emailed to employees, partners, or whomever; it can be printed out; and it can be edited as needed.

When conditions change and these items are no longer effective, they can be dragged back onto the Hyperinflation page to be reused again later.

If you try it

If you give Backpack a whirl for nonlinear business planning, I’d love to hear back from you to know how it goes. I am in the process of developing my own nonlinear business plan in this way and would be interested in comparing notes.

If you need help

If you’d like to try this but need a hand I’d be happy to help. What I’ll do is this: I can meet with you on the phone and give you a tour of Backpack, and walk you through the process of setting up pages and the like. Then you can pay me whatever you think the value of my help is. No set price — if this turns out to be a service I’ll offer through my business I’ll set a price then, but in the meantime you get to decide. If you’re interested drop me an email and we’ll see what we can do.

De-industrial design

by Paula | 13 May 2009 | permalink | comments
Tags: design, business planning

By way of Adaptive Path, here’s a fascinating, if academic, survey of the role of design in economic theory: Creating Economic Value by Design, John Heskett, from the International Journal of Design. Heskett writes:

Obviously for some reason, the discipline of economics does not acknowledge design. To be fair it must also be acknowledged that the discipline of design is deficient in communicating its economic role. Some designers might ask: why bother? My answer to that would be that basically, design is a professional business activity practiced overwhelmingly within business contexts and if designers cannot argue the economic relevance of their practice in convincing terms, the views of the officials I met in Washington will be justified and they will remain what the American designer, George Nelson, long ago termed “exotic menials.”

The work of Herbert Simon, Nobel Laureate in Economics in 1978, is a rare exception of design being considered as a factor in economic theory. His starting point was acknowledging that the world we inhabit is increasingly artificial, created by human beings. For Simon (1981), design was not restricted to making material artefacts, but was a fundamental professional competence extending to policy-making and practices of many kinds and on many levels:

Everyone designs who devises courses of action aimed at changing existing situations into preferred ones. The intellectual activity that produces material artifacts is no different fundamentally from the one that prescribes remedies for a sick patient or the one that devises a new sales plan for a company or a social welfare policy for a state. Design, so construed, is the core of all professional training; it is the principal mark that distinguishes the professions from the sciences. (p.129)

Implicit in Simon’s reasoning is an emphasis on design as a thought-process underpinning all kinds of professional activities; yet the varied skills through which design is manifested are not discussed. He did indicate, however, why design is so rarely considered in economic theory. Economics, he stated, works on three levels, those of the individual; the market; and the entire economy (p. 31). The centre of interest in traditional economics, however, is markets and not individuals or businesses (p. 37). A serious problem is thereby raised at the outset: two important considerations relating to design — how goods and services are developed for the market place and how they are used — receive scant attention.

Emphasis mine.

That highlighted bit of text underscores the fundamental issue with which decline-era entrepreneurs — indeed, everyone who wishes to maintain something like economic security — must wrestle. What goods and services will be valuable in the midst of industrial decline, how can they be developed and manufactured, and how will they be used?

We can all envision a variety of futures which may or may not come to pass. And, if you’re like most entrepreneurs I know, you probably have a running list in your head of potentially profitable undertakings. Making these a reality is where the challenge lies. How does one get from the idea stage to physical reality?

This is where design comes in. Design is the intermediary step between ideation and realization. Certainly design is not limited to those arenas with which it is traditionally associated; as Heskell quotes Simon above, “Everyone designs who devises courses of action aimed at changing existing situations into preferred ones.”

For Simon, the importance of design is related to an increasingly artificial world. For us, design is crucial to navigating a rapidly de-industrializing world. As conditions deteriorate, “changing existing situations into preferred ones” will be everyone’s primary economic objective. Those who learn to design well will have a distinct advantage over those who don’t, because such persons will have the ability to help others achieve their preferred situations.

The obvious example that comes to mind is permaculture design. Self-sufficiency is the goal of many, and a perennial, edible garden is certainly a big step in that direction. But how does one go about creating a perennial, edible garden? Permaculture design offers the intermediary step between the ideation of individual-level food self-sufficiency and its realization.

Heskell goes on to offer examples of the importance of design in extreme competitive situations, noting particularly Germany’s success in the early 20th century:

Anton Jaumann (1907) observed that Germany’s competitive position was characterized by possession of few natural resources and dependence on imports of raw materials that had to be paid for by manufactured exports. How could it then survive the intense levels of international competition?

We must bring goods to the market that only we can manufacture. We cannot in the long run compete in cheap mass-production. Only quality is our deliverance. If we are able to deliver such excellent goods that can be imitated by no other people in the world and if these goods are so excellent that everyone wishes to buy them, then we have a winning hand. (Jaumann, 1907, p. 338)

Nothing, concluded Jaumann, injured the commercial reputation of a nation as much as the label, “cheap and nasty.” Many countries have faced this problem, the latest being China, which is looking to generate an image of their products based on design and innovation.

It’s pretty reasonable to imagine that in a world of increasingly scarce resources, buyers will be hard-pressed to part with their money (or goods & services in the case of barter) for something that is crappily built. “Bling” and “flash” at the expense of quality and longevity are forever consigned to the dustbin:

Nathan Rosenberg (1982), in examining the problems of technological innovation, points to “a frequent preoccupation with what is technologically spectacular rather than economically significant…” (p. 62) A parallel observation is possible about some problems of design innovation; in this case the preoccupation being with what is visually spectacular rather than economically significant.

As a designer myself, I can say with confidence that a resurgence of Arts & Crafts values would make me very happy indeed.

Heskell concludes:

A further level at which design research could be capable of articulating a role for design not currently articulated in any depth in economic theory is the context of use, of the role played by products, communications, environments, services and systems in the lives of people beyond the point at which most economic theory halts: the point-of-sale. It is in understanding this arena and its human problems, potential and challenges that design is of crucial significance in introducing change that is both meaningful in people’s lives and simultaneously capable of creating sources of competitiveness for firms.

In other words, the next stage of work needs to elaborate concepts of economics through the prism of design theory and practice.

I couldn’t agree more, and in fact, this is the central work of the disciplines of usability and experience design.

Even without the prospect of industrial decline, most conscious people (or even semi-conscious people) are aware that mass consumption and its attendant ecological footprint make for a rather shitty experience. The role of the designer in the midst of decline is to bridge the gap between the ideation of joyful experience in the absence of consumer culture, and its realization in the physical world. Whoever figures out ways to do this, even on small, individual scales, will not only have a much greater chance at hacking out some level of security for himself, he’ll also be laying the foundation for a more joyful, more simple world.

Engineer your own soft landing? The nonlinear business plan

by Paula | 17 October 2008 | permalink | comments
Tags: business planning,

This is an unformed idea I’ve been toying with for a little while. It originates from a disconnect I’ve long observed in the various existing relocalization agendas, which seem to be preparing for an “after” without recognizing that between now and “after” comes a process, potentially a rather lengthy one. Losing our homes and our jobs is a much bigger problem in the immediate than losing the entire electrical grid. What exactly are we to do between now and the day when flint knapping is actually necessary? Hang out in the park?

I personally am not content to spend the next 10-20 or more years waiting around for the low-tech renaissance while everything falls to shit. I intend to adapt and maneuver and evolve my way through — even to thrive — and my business will be the vehicle that makes such a thing possible. As I see it, the trick will be to have a range of options laid out in advance so I can adapt as quickly as possible. Of course, it’s impossible to plan for every single last contingency, but having a half-dozen or so options on hand means any one of them can be adapted much more rapidly than if adaptation had to occur completely on the fly.

So I cobbled together some insights primarily from three sources: Catherine Austin Fitts’ Navigate the Falling Dollar lecture; Seth Godin’s little book All Marketers are Liars; and a memory from childhood in my elementary school’s library.

From Fitts: scenario planning

In her lecture, Fitts introduces the audience to the concept of scenario planning. This entails identifying the future scenarios most likely to play out and developing a strategy for each.

From Godin: the narrative

Godin observes that all marketers are not really liars (the point is debatable, but I’ll let it go for the moment), they are storytellers. That is, the marketer’s job is to construct a narrative about the product, service, or brand he’s trying to sell. Harley-Davidson is a really obvious example of this narrative process. Harley-Davidson doesn’t sell motorcycles; it sells a narrative about freedom, individuality, underdog strength and bucking the system. People buy Harleys because they want to be part of that narrative. The bike itself is incidental.

From the Park Forest Elementary School library

Back in first grade, which would have been 1974 or so, my school’s library carried a series of books that were wildly popular because they did not read straight through like other books. Instead, the reader was faced with a choice at the end of each chapter: does the heroine choose X? If so, turn to page 92. Does the heroine choose Y? If so, turn to page 56. These books were nonlinear narratives.

Pulling the pieces together

We’re all well aware that in the near future, there are a few things we will almost certainly experience; a wider range of things that we may experience; and a plethora of things that may or may not happen. What we don’t know is when, how the cause-and-effects will play out, and what kinds of unknown variables may lie in store.

This makes business planning nearly impossible because a business plan is, at its heart, a linear narrative about how an organization intends to make money over a given span of time, usually 3-5 years, with a few broad brushstrokes describing the longer term.

But what if it was possible to write a business plan that followed the same structure as the nonlinear narratives that were so popular back in first grade? In the event of X, turn to page 101; in the event of Y, turn to page 87. Such a business plan would make the concepts “Plan B” and “Plan C” obsolete, because like Schroedinger’s cat, all options are equally valid until a particular one is called forth. It would also mean that a business could — theoretically anyway — swing back and forth between upticks and downturns much more easily, because the business owner isn’t fully banked on a single narrative requiring a particular set of economic conditions.

So for example, let’s say I pick six variables for which I want to create options:

• hyperinflation
• deflation
• martial law
• improvements such as stock & currency rallies
• shortages
• epidemic

What I do next, based on these variables, is to write six miniature business plans: one for each of the variables, in the traditional linear format, based on the assumptions that each variable requires. The end result is a catalogue of options covering all the aspects of my business, from which I can pick and choose as conditions require.

Say the government declares martial law. If I conduct business after dark — delivering pizza perhaps — this aspect of my business will be affected, but martial law isn’t necessarily going to have the same affect on my marketing. I can pull the “delivery” section out of the martial law plan and adapt my business to this variable much more rapidly than if I had to figure it out on the spot; additionally, I already know the impact on marketing is minimal, so I’m freed from having to even think about that part of it. All this gives me a huge competitive advantage and may even mean I’m the last pizza shop standing.

(In the case of the pizza shop, a martial law contingency plan might entail being prepared to deliver uncooked pizzas up until curfew so customers could cook them later. And if you have a healthy email announcement list or blog — something you’ll understand the importance of, along with other kinds of digital communications, if you’ve read Weblogs & New Media — you’ll be able to keep your customers as prepared as you are.)

So anyway, that’s the gist of my nonlinear business plan idea. Obviously it still needs much development, but I think it could be developed into something really useful for staying afloat as conditions deteriorate.