Another Lego IC model: A Specialty Contractor

With the Google model, we told the story of how the company developed and built its knowledge factory starting with human capital.

But to model the IC of an established business, it often helps to start with how a company gets paid. This gets the focus directly on the value creation process and also ensures that the model is of maximum usefulness—making that direct link between IC and financial results. Read more

Lessons in Structural Capital: The Checklist Manifesto

There are two levels to the story of The Checklist Manifesto, a great new book by physician Atul Gawande.

The first level is about checklists: how to make them, how to use them and the extraordinary results that come from using them. The examples include hospitals that virtually eliminate hospital-acquired infections through the use of a simple checklist used in the operating room just prior to cutting the patient open. Other great examples are provided from the field of aviation. He explains that airline pilots not only have pre-flight checklists, they also have notebooks with sets of check lists to guide them through different kinds of crises. Construction provides another set of examples: how to assemble a complex skyscraper  by coordinating the work of dozens of subcontractors. There’s even an example about the rock bank Van Halen’s inclusion of a clause requiring a bowl of M&M’s with all the brown candies removed as a way of the band ensuring that the other requirements in their contracts related to the safety of the staging were also read and followed. Read more

Enormous Opportunities in the Construction Business

There is a really good video story from the New York Times called The Greening of the American Hard Hat.

The creation of jobs is a critical issue for the U.S., not just because of the recession but because we outsourced and downsized so many of our industries in recent decades. Green building is an enormous opportunity to create jobs. And it’s not just about construction, it’s about “how we design, build and sustain a building.”

According to this report, 40% of our carbon dioxide emissions and 70% of our electricity are consumed by buildings. We need to rethink existing as well as new buildings. This will require leveraging and innovating based on our strong national intellectual capital.