Modularity enables small things to grow into large things. Solar cells become solar arrays that become solar power stations. Modularity also makes sense to understand living systems. It’s a central concept in evolutionary biology.
Yet, despite its importance, we don’t think enough about — or design for — modularity.
It’s a key point in a marvelous book released earlier this year: How Big Things Get Done.
WHY MODULARITY MATTERS
My story starts in 1984 on the factory floor of Mazda’s main assembly plant in Hiroshima. I was part of a small consulting team working for Ford.
The company’s executives wanted to know how Mazda was able to manufacture a small car at significantly lower cost than Ford.
They suspected the answer revolved around “macro policies” like currency manipulation. These factors did play a part, but their influence was far less than what Ford executives suspected.
What mattered more: modularity.
Mazda had a far simpler design.
A product tear down of the Mazda GLC and Ford’s Escort revealed that the GLC had far fewer parts. Modularity translated into faster, more agile assembly. Examples of modular design:
>> Different color seat subassemblies delivered directly to the assembly line, properly sequenced.
>> The instrument panel with simple wiring connects.
>> A rigid back on ceiling upholstery snapped into place in seconds.
DIG DEEPER: MODULAR INVESTMENTS IN COLLABORATION
Modularity is not only important for technical systems like automobiles.
We can apply the same logic to human systems.
In fact, Scott Hutcheson and I did that at Purdue. Our challenge: Deploy a federal investment of $15 million to transform a regional workforce development system.
Here’s how we used the idea of modularity.
We took a good portion of the $15 million and created an “Opportunity Fund”, a venture fund for early stage collaborations.
Then we requested proposals.
We invested in proposed collaborations that promised three characteristics: replicable, scalable, and sustainable.
Let’s explore each of these characteristics that defined our investment “modules”.
>> By replicable, we meant that the collaboration needed to rely on explicit knowledge. It had to be teachable.
>> Scalability focused on cost structures. How could you take the modular investment and multiply it. Could you create high operating leverage? If we could replicate ten collaborations, how would we do 100?
>> Finally, sustainability focused on value creation. How would your proposed collaboration create value and how do you propose capturing a portion of that value?
Of course, applicants to our fund did not have direct answers to these three questions, but we weren’t looking for definitive answers.
We were looking for pathways—hypotheses that could be validated through an experiment.
Using this approach, we designed modular investments in collaboration.
With 8% of the money awarded nationally, we delivered 40% of the national results.
The Founder of the Lab at UNA and co-author of Strategic Doing: 10 Skills for Agile Leadership, Ed’s work has focused on developing new models of strategy specifically designed to accelerate complex collaboration in networks and open innovation. He is the original developer of Strategic Doing.