Most organizations would be happy to last for centuries, as the Venetian Republic did. From 697 to 1797 AD, Venice’s technological acumen, geographic position, and unconventionality were interlocking advantages that allowed the Most Serene Republic to flourish. But when change comes suddenly, it can turn strengths into weaknesses and sweep away even thousand-year success stories.
Venice’s military technology and the city’s pivotal location on the main trade routes of the time gave Venice several strong, mutually reinforcing advantages.
The Arsenal, an advanced naval munitions factory that anticipated by several centuries the production-line method of manufacture, was the beating heart of the Venetian naval industry. From the thirteenth century on, the Arsenal nurtured creativity and spurred innovation and entrepreneurship in the construction of its galleys.
The city’s geographic location helped it to defend itself from both land- and sea-based invaders. This location, consisting of a series of islands in a marshy lagoon, also pushed it to develop a (then unusual) trading and moneylending economy, since there was little land to support agriculture. And its position at the top of the Adriatic Sea allowed it to become a vital trading hub, connecting the East with the West via the Mediterranean.
If, as Michael Porter wrote, competitive advantage stems from how “activities fit and reinforce one another….creating a chain that is as strong as its strongest link,” then strategic fit is something that the Venetian Republic had in spades.
But, like a lot of successful entities, Venice reached a point where it focused more on exploitation than exploration: Venetian traders followed existing paths to success.
Tag Archives: HBR
Executives love dashboards, and why wouldn’t they? Single-screen “snapshots” of operational processes, marketing metrics, and key performance indicators (KPIs) can be visually elegant and intuitive. They show just-in-time views of what’s working and what isn’t — no need to wait for weekly or monthly reports from a centralized data center. A quick scan of a dashboard gives frontline managers transparency and, ideally, the opportunity to make rapid adjustments.
But dashboards aren’t the magic view some managers treat them as. Although they can convey snapshots of important measures, dashboards are poor at providing the nuance and context that effective data-driven decision making demands.
Data analytics typically does a few things:
- describes existing or past phenomena
- predicts future events based on past data
- prescribes a course of action
Most dashboards, though, only cover the first — describing what has happened. Moving from description to prediction to action requires knowledge of how the underlying data was generated, a deep understanding of the business context, and exceptional critical thinking skills on the part of the user to understand what the data does (and doesn’t) mean. Dashboards don’t provide any of this. Worse, the allure of the dashboard, that feeling that all the answers are there in real time, can be harmful. The simplicity and elegance can tempt managers to forget about the all-important nuances of data-driven decision making.