The United States of Europe

Crossing borders: business fluidity in the US vs. Europe

Spending a week in the United States has reinforced something I had already suspected: business in the US operates across state lines with a fluidity that Europe can’t quite match across its own national borders. It’s a striking contrast. While the US is a single country, its individual states have their own laws, tax structures, and even business regulations. Yet, companies seamlessly scale across multiple states in a way that European businesses struggle to replicate across countries.

Scott Galloway’s recent piece, Europe Becomes a Union, adds an insightful layer to this observation. He argues that the European Union has significant economic power but suffers from fragmentation, regulation-heavy environments, and slow decision-making. This is something I see reflected in the business world. In Europe, even with the EU as a governing framework, the reality remains that expanding across borders is not as straightforward as it is for a business in the US to move from, say, California to Texas.

Business across borders: US vs. EU

One of the main reasons for this difference is the deep integration of the American economy. Businesses in the US operate within a common language, a unified financial system, and a broadly similar legal landscape. While each state has variations in tax policies and labor laws, the differences are manageable compared to the complexities of crossing national borders in Europe.

Statistics to back up this assumption

Statistics back up this assumption. According to an International Monetary Fund (IMF) study, Europe’s GDP per capita is approximately 72% of that of the United States, with 70% of this gap attributed to lower productivity growth due to market fragmentation. The study highlights that European firms struggle to scale because of regulatory and trade barriers among the EU's 27 countries, making it harder to replicate the fluidity of business expansion seen in the US (source).

Additionally, the Digital Economy and Society Index (DESI) shows significant disparities in digital adoption across EU countries, further complicating seamless expansion (source). The Brexit effect has also exacerbated trade barriers, with UK food and drink exports to the EU falling by 34% since Brexit, illustrating the impact of new bureaucratic hurdles (source).

Europe’s opportunity to act like a true union

Galloway points out that the EU’s economic strength is undeniable, but its ability to act as a unified entity remains in question. His argument focuses on security and economic independence, but the same logic applies to business expansion. The US’s competitive advantage comes from its ability to scale businesses nationally without the friction that European companies face when expanding internationally.

If Europe is to compete with the US and China, it needs to make cross-border expansion as effortless as moving from New York to Florida. This means harmonizing tax codes, reducing bureaucratic hurdles, and fostering a more unified business culture. While Europe has made great strides with initiatives like the Digital Single Market, it still has a long way to go before it can offer businesses the same level of expansion efficiency as the US.

Galloway's post underscores that Europe has the potential to step up and function more as a true union. The question is whether it will seize the moment or continue operating as a patchwork of nations with barriers that slow its own progress. The world is moving fast—will Europe keep up?

Thoughts on the book: A Thousand Brains

Disclaimer: Writing this book review is a method for me to absorb the thinking presented in the book. Almost all elements and thoughts written below are taken from the book. 

Jeff Hawkins wrote a book on how the brain works. He is a neuroscientist with a track record because he decided in anticipation of his research to found 'Palm Computing'. For the love of God, he created one of the most popular companies in the 90s as a side-quest. 

Image Source: AImed.io

The static concept of the brain

The brain uses a model of the world. The word "model" used to imply a static set of facts. But it is not static, through experience it learns a rich and complicated model of the world. Experience is important, not knowledge. 

For many years, it was believed that the adult brain was fixed. Learning, it was believed, involved increasing or decreasing the strength of synapses. This is still how learning occurs in most artificial neural networks. But the only way for a brain to learn anything is via changes in its inputs. If the inputs to the brain were static, nothing could be learned. New synapses form and old ones disappear every day. 

The memory palace technique

Thinking turns out to be a form of movement. Thinking occurs when neurons invoke location after location in a reference frame, bringing to mind what was stored in each location. All knowledge is stored at locations relative to reference frames. 

This concept has fascinating implications for learning and education. Learning conceptual knowledge can be difficult. What reference frame can you use for concepts like democracy or maths? If I give you ten historical events related to democracy, how should you arrange them? Discovering a useful reference frame is the most difficult part of learning, even though most of the time we are not consciously aware of it. 

You learn by combining existing reference frames. A new reference frame stores the links to reference frames of previously learned things. This is a bit like using hyperlinks in a text document. 

A politician and a mathematician are not aware they are using reference frames to organise their knowledge. Just as you and I are not aware we use reference frames to understand smartphones. When asking for help, we should ask: "Can someone suggest a reference frame for organising these facts?". Being an expert in a subject matter is finding a good reference frame to arrange facts and observations. 

Where is knowledge stored in the brain? 

Knowledge in the brain is distributed. Nothing we know is stored in just one place. All models (reference frames) are constructed out of thousands of other models. This is why we call it the Thousand Brains Theory. Knowledge of any particular item is distributed among thousands of complementary models. 

Your brain decides on what combination of models to use by voting. All reference models (cortical columns) share their list of possible solutions. Using determination and voting among models, the most likely model is chosen. 

Source: numenta.com

AI doesn't possess knowledge

The author doesn't believe any kind of deep learning network will achieve the goal of Artificial Intelligence if the network doesn't model the world the way a brain does. Deep learnings work well, but not because they solve the knowledge representation problem. They work well because they bypass it completely, relying on statistics, predictions and lots of data instead.

Stacking a never-ending list of definitions and rules to represent knowledge is not an efficient attempt to represent knowledge. Your own brain learns via a model, not a list of facts and rules. 

What is learning? And when is a machine intelligent? 

• learning continuously. Most AI systems today do not learn continuously. They go through lengthy training and when it is complete, they are deployed. This is not flexible. Flexibility requires continuously adjusting to changing conditions and new knowledge.

• Learning via movement. We learn by moving. You cannot learn a model of a house without moving from room to room and you cannot learn a new app on your smartphone without interacting with it. (These movements don't have to be physical.) 

• Many models. You have to utilise many models and let them vote to discover new models. 

• Using reference frames to store knowledge. Thinking occurs as the brain activates one location at a time in a reference frame and the associated piece of knowledge is retrieved (memory palace)

Application of this knowledge 

I was personally hoping the author would talk more about the connection between this approach and learning or education. How should the use of reference frameworks and especially learning by movement impact our teaching methods? 

Edit: It turns out Numenta (the research organisation of the author) was wondering the same thing and published a series on the book in combination with pedagogy. I am going to read up on it.

Headless Strategy (Terminology idea)

Headless Strategy as a neutral design of digital business value

The term headless strategy comes from the software world when software can run without using a graphical user interface. The term headless is also used when content is run through a centralised system that holds on to the content regardless of where it needs to show it on the front-end.

Headless Strategy grounds itself in building digital assets. It enables us to provide direction (coherence) of all internal business departments and challenges. It looks for new digital value within a corporation on the one hand and new digital value in user behaviour or needs on the other.

But because headless strategy isn't working for any specific department or outcome (it is not marketing), it creates a place where all initiatives can find a home. A place where all business opportunities (for example partnerships) can be tied together.

Focussing your attention on creating one facade (a platform) for customers provides direction. A direction that turns the potential internal chaos of scattered projects into growth opportunities.

Headless Strategy

A neutral design of digital business value

Handelaars willen dan toch niet dat mensen lokaal kopen

Volgens een recent onderzoek aan de universiteit van Antwerpen door Joris Beckers en Ann Verhetsel zien veel lokale handelaars hun webshop - die ze tijdens de lockdowns opzetten - als iets tijdelijk.

Dat is een verrassende bevinding wanneer we bedenken dat handelaars gelijktijdig oproepen om meer lokaal te kopen. De reden dat buitenlandse webwinkels zoveel succes hebben, is net omdat zij wel voluit gaan voor een digitale aanwezigheid in hun waaier aan verkoopkanalen.

Consumenten willen graag online lokaal shoppen

Bedankt om bij ons (online) te shoppen!

Het goede nieuws uit het onderzoek is dat consumenten ook voor hun lokale aankopen graag online shoppen. Mensen zijn bereid lokaal te kopen. Blijkbaar is het aandeel van lokale online bestellingen (tijdens deze lockdowns) in de totale omzet gestegen met een gemiddelde van 15% tot boven de 70%.

Lokale handelaars laten geld liggen.

Het is dus opmerkelijk dat lokale handelaars hun digitale activiteiten - volgens het onderzoek - niet serieus nemen. Ze weigeren om er een lange termijn succes van te maken. Het is de bedoeling om de webshop en/of digitale activiteiten terug te schroeven wanneer de lockdowns voorbij zijn.

Een hallucinante 70% van handelaars ziet de webwinkel niet als een belangrijk verkoopkanaal in de toekomst. Handelaars die zoiets zeggen, hebben het echt nog niet begrepen.

“70% van de handelaars zien hun webwinkel niet als een verkoopskanaal in de toekomst”

Misschien is één van de redenen waarom handelaars het nut niet inzien van digitale activiteiten, dat maar 25% van de winkeliers professionele ondersteuning heeft gevraagd. Ze knutselen, volgens het onderzoek, liever zelf iets in elkaar. Het beperkte digitale potentieel (of succes) wordt op deze manier natuurlijk een self-fulfilling prophecy. Wat kan je er van verwachten als je het zelf niet serieus neemt?

Een klassiek voorbeeld van digitale kansen die men laat liggen, is de lokale slager die een geweldig performant kassasysteem heeft geïnstalleerd. Voortaan worden zelfs automatisch stickers voorzien die ze op de verschillende verpakkingen kunnen kleven: 150 gram salami, dit is ossevlees en dit is kaas. Een geweldige digitalisering van de oude manier van werken. Wat ze vergeten zijn, is om datzelfde systeem te gebruiken als digitale order systeem. Ze gebruiken daarvoor een andere tool, die op zijn beurt op nog een andere website geplaatst wordt. Nu, dat is niet zo belangrijk, want de meeste vragen worden toch beantwoord op Facebook. Een digitale visie zou er voor zorgen dat lokale handelaars veel efficiënter kunnen werken en zo veel meer zouden kunnen verkopen.

Consumenten moeten wel de mogelijkheid krijgen om lokaal te shoppen

Lokaal shoppen in de zetel

De resultaten in dit onderzoek tonen aan dat handelaars nog steeds krampachtig vasthouden aan een achterhaalde realiteit. Ze blazen warm en koud tegelijk. Langs de ene kant is er de oproep om lokaal te kopen (winkelhier) en langs de andere kant willen ze hun klanten niet de mogelijkheid bieden om (lokaal) online te shoppen.

Het is net omdat we de lokale consumenten de mogelijkheid ontzeggen om lokaal te shoppen, dat de buitenlandse webshops het zo goed doen. Zij gaan volledig voor de digitale klantervaring.

Dat betekent niet dat ze geen offline verkoopkanalen aanbieden maar het betekent wel dat ze een balans zoeken tussen wat ze online en wat ze offline kunnen aanbieden. Als lokale handelaars een alternatief willen bieden aan internationale spelers, gaan ze hun eigen digitale inspanningen serieus moeten nemen. Het is tegenwoordig gelukkig echt niet meer moeilijk - als je je goed laat bijstaan - om digitaal meer omzet te generen.

Handelaars, geef uw klanten alsjeblieft de mogelijkheid om lokaal te kopen en te winkelhieren. Of klik hierboven op “Get in touch” en vul het contactformulier in.

Colruyt kan veel beter dan Collishop sluiten

Originally published in the financial newspaper of Belgium (De Tijd) in Dutch on 11th of September 2020.

Colruyt sluit zijn non-foodwebsite Collishop, maar dit lost het probleem niet op. Zolang het bedrijf de offline retailervaring online probeert door te trekken, zal dat zijn handicap blijven.

Terwijl ik sta te wachten om mijn boodschappen op te halen aan de Collect&Go-ingang van mijn lokale Colruyt, kan ik me wel voor de kop slaan. Ik bedenk dat ik die andere producten op mijn boodschappenlijst misschien op Collishop had kunnen vinden. ‘Dat is stom, waarom dacht ik daar niet eerder aan?’, denk ik bij mezelf.

De vraag is eigenlijk: waarom heeft Colruyt me daar niet aan doen denken? Waarom gaven ze me geen kleine nudge tijdens mijn online-zoektocht gisterenavond? Of nog beter, waarom kreeg ik dat Collishop-product niet te zien in mijn Collect&Go-account? Tijdens het bezoek aan de winkel waar ik sowieso naartoe moet, had ik gemakkelijk twee vliegen in een klap kunnen slaan. Collishop was relevanter voor mij dan ik als klant besefte.

Of die periode dat we - nog meer dan anders - een beroep deden op Collect&Go vlak na de geboorte van onze dochter. Als Dreambaby-klant moesten we zelf in de gaten houden wanneer een product (van onze geboortelijst) geleverd zou zijn in onze lokale Colruyt, om het vervolgens manueel aan te moeten geven bij onze eerstvolgende Collect&Go-bestelling. Dat de interne logistiek een uitdaging is, neem ik aan. Dat je onnodig te koop loopt met interne halfslachtige organisatie, is mij een raadsel.  

Als buitenstaander is het hallucinant te zien hoe sterk Colruyt in silo’s blijft denken. Wij zien allemaal jullie inefficiënte interne werking, Colruyt. De verschillende merken in de groep zouden net zo goed op verschillende continenten gevestigd kunnen zijn. Synergie in de portfolio is nergens te bespeuren. Sterker nog. Ik lees dat zelfs in de post-rationalisatie/zelfanalyse van hun concurrentiepositie en de beslissing om de Collishop webshop te sluiten, Colruyt alleen vanuit de Collishop-silo redeneert.

One-stop

Amazon of Coolblue zijn namelijk helemaal geen onoverkomelijke concurrenten van Collishop. Integendeel, Colruyt (Group) kan een indrukwekkende concurrent zijn voor bol.com en zelfs Amazon, net wegens hun merkenportfolio. Colruyt heeft een geweldig voordeel tegenover die andere e-commerce-webshops dat het nooit heeft uitgespeeld. Zo is er de combinatie van non-food en food in één aanbod. De mogelijkheid van een one-stop Colruyt-webshop (over alle silo’s of merken heen) is iets waar anderen van dromen.

Jullie beslissing heeft niets te maken met e-commerce. Jullie houden geen rekening met de digitale realiteit. In e-commerce moet je helemaal anders redeneren.

Kijk, Colruyt, ik begrijp jullie beslissing wel vanuit een klassieke offline retailbenadering. Zeker vanuit jullie sterke focus op kostenbesparingen is deze beslissing zelfs logisch. Maar jullie beslissing heeft niets te maken met e-commerce. Jullie houden geen rekening met de digitale realiteit. In e-commerce moet je helemaal anders redeneren. De succesvolle e-commerce-bedrijven werken van de klantervaring naar binnen toe. Ze starten bij de gebruikerservaring om vervolgens zo goed mogelijk aan die verwachtingen te voldoen met hun interne organisatie, desnoods alleen digitaal.

Overkoepelend platform

Zodra je de consument centraal stelt, over de historisch opgebouwde interne ‘merkensilo’s’ heen, stap je vanzelf in het potentieel van Colruyt als te duchten speler op de markt. Je start met de informatie van de Xtra-kaart (lidkaart voor Colruytklanten) over de merken heen te gebruiken. Vanuit journeys of scenario’s bekijk je daarna welke digitale functionaliteiten er nodig zijn. Intern organiseer je je met journey owners die redeneren vanuit het perspectief van de klanten in de plaats van de vertegenwoordigers van de departementen. Je creëert een overkoepelend Colruyt-platform waar bijvoorbeeld een gezin met één dochter alle producten vindt die het nodig heeft. Een plaats waar het items van Dreambaby, ZEB, Dreamland, Bioplanet, Newpharma, Colruyt … in hetzelfde digitale winkelmandje kan leggen. Een Colruyt e-commerce-platform dat wel de concurrentie aankan met Amazon, bol.com en Coolblue.

Zodra je de consument centraal stelt, over de historisch opgebouwde interne merkensilo’s heen, stap je vanzelf in het potentieel van Colruyt als te duchten speler op de markt.

Jullie besloten om de stekker uit Collishop te trekken, maar dit zal het probleem niet oplossen. Zolang jullie de offline retailervaring online proberen door te trekken, zal dat jullie handicap blijven. Door aparte (online)winkels te blijven bouwen, duw je jouw klanten in de armen van de concurrentie. Je stuurt ze letterlijk de winkel uit, alleen met de boodschap: ‘Dat verkopen wij niet in deze winkel.’ Dus ook jullie strategie om te focussen op gespecialiseerde non-foodtakken is nu al gedoemd om te mislukken. Als je alleen vanuit een digitale niche en silo’s blijft redenen, zal - om er een voorbeeld uit te halen - de Dreamland-webshop dezelfde problemen ondervinden als Collishop.

Jullie digitale kracht zit niet in de merken als aparte eilandjes te beschouwen. De digitale kans voor Colruyt (Group) ligt in het gezamenlijk uitspelen van het geweldige vermogen en potentieel van jullie volledige portfolio.

De kans bestaat natuurlijk ook dat het altijd al jullie geheime agenda is geweest om jullie hele portfolio compleet vanuit het standpunt van de klant te integreren in een nieuwe Colruyt Group e-commerce-webshop (en het kind dus toch niet met het badwater weg te gooien). In dat geval: Amazon, wees gewaarschuwd.

Stefan Jenart

Head of strategy bij digital agency Duke & Grace

Link: https://www.tijd.be/opinie/algemeen/colruyt-kan-veel-beter-dan-collishop-sluiten/10250623.html

Why mediation is useful for Strategists.

“Strategy Consulting is all about asking the right questions. ”

— Stefan Jenart

How are you able to consult people even when you're not an expert in the specific sector of your client? And why did you study so many broad and different subjects?

A common misconception (or maybe even illusion) of strategy is that an outsider swoops in and explains you what you should be doing based on outside mystical knowledge only a few people posses.

Well, since there is no secret organisation that holds all knowledge, this is what really happens when you hire a consultant:

knowledge lies within

In its pure essence, strategy is asking questions. Asking you the right questions. Asking your employees the right questions. Asking customers the right questions. Insights are never new. There is no magical framework of new elements that works for everyone. Strategy merely sheds a different light on the same problem. 

Art Markman puts it well: "In fact, most people who come up with creative solutions to problems rely on a relatively straightforward method: finding a solution inside the collective memory of the people working on the problem. That is, someone working to solve the problem knows something that will help them find a solution — they just haven’t realized yet that they know it."

"In order to generate a variety of possible solutions to a problem, then, the problem solver (or group) can change the description of the problem in ways that lead new information to be drawn from memory."

That is why mediation is such a useful tool for Strategy. In mediation we call these type of questions: "thought provoking". When asked, they stimulate the thinking process. 

Some examples:

• Questions aimed at attaining information, the who, what, where and when: 
  How do you make money? What is your businessmodel?

• Stimulating questions are those that ask you to view the problem at hand from a different perspective:
  What does your customer think at this point? What is your customer doing at the same time? Why would they care about you?
   
• Hypothetical questions ask for imagination to picture a non-existent situation:
  If you received €100.000, how would you use it? What are the subjects you would like to share with potential customers? 
   
• Circular questions are questions which focus on reciprocity: 
  What can you offer so that someone would consider your brand?

So, instead of thinking about consultancy as someone telling you what to do, imagine consultants as people finding more descriptions of the problem in order for you to discover what it makes you remember. 

---

Reference: "How You Define the Problem Determines Whether You Solve It", Art Markman. 

The ability to create a Consumer Need is an illusion.

A view on the role of creative concepts in tomorrow's advertising mindset. If you want to be able to continue reading, you will have to let go of the following notion, though:

““The creation of a consumer need is an illusion.””

— Stefan Jenart

Even when you don't believe this or feel some sort of resistance, indulge me for the purpose of this piece. Yes, I mean exactly the one thing you fear I would. The premise on which an entire industry still bases itself today: "Nobody is capable of generating needs in consumers' minds.". 

Digital is not interested in creating needs, it wants to fulfill them. Your clients are starting to realise this. A public secret, very well know among advertisers: we are not able to craft needs or desires out of thin-air. We are not the magical wizards often described in award acceptance speech. 

To simplify things, let us use only three major phases in a consumer journey. There is a awareness phase, a consideration phase and a buy phase. (Again, if you feel resistance at this point, go wait in line.) Advertising attributes people buying products or even considering it, to their effort. 

“Nobody buys something because they saw a commercial”

Nobody buys something because they saw a commercial. People who consider buying a product will take an interests in your product if they happen to see it at the right time. In that case, the ad only reminded them of your product they were already considering to buy. Advertising doesn't generate people who buy products. 

Digital advertising has no ambition to create needs. It accepts that awareness isn't the first step in the customer journey.

And even if we were possible to bring a product to someones attention out of the blue. That power is only as strong as the medium through which the attention is bought. Because that reach is evolving, your limitations become visible. Those limitations have always existed. Up till today we attributed the difference levels of succes to genius creativity. 

Understanding digital advertising from a traditional stance means realising you can no longer take credit for results. Digital creativity doesn't promise the impossible. It will create a concept that only speaks to your real audience. The part of the population that is considering (might be in 5 years) to buy your product. We only create concepts, campagnes, tag lines and content for people interested in your solution. 

How can you recognise creative concepts that will flourish within a digital context?

• Their target audience won't be people that need to discover a new product. So the message adreses people already considering the product/service.
• Concepts based on data insights.
• The concept should place the consumer in the driving seat. In some way or form, the concept should make the product or service functional. It should be possible to interact with the product. Yes, an interactive page that allows you to drive a car is digital advertising.

So, what should advertising companies do? They should do whatever they want to. Why should they have to change? As long as they are able to find clients that are willing to pay a lot of money for a black box solution. Even when traditional advertising keeps ignoring the digital reality, there is still a place for old-school advertising. It still remains a business. If a client insists on talking to an audience that will never consider them. And is willing to pay a lot of money for that with no return on investment, then by all means.

““It is amazing how complete is the delusion that beauty
is goodness.””

— Tolstoy

Only prestige will legitimise that ludicrous heap of money. Traditional advertising is a luxury product. If somebody wants to buy an expensive painting, they should be allowed to do so. The painting will impress their date, it won't make someone fall in love with them. And if the stars where to align by some divine intervention, a clever or funny ad might make someone consider. Nothing more. You lose the right to claim effectiveness, attribute sales or the fact that your date spent the night based on 1 painting.

We do not want to throw out the champagne with the cork. The art of creative concepts will still have a purpose. A different one none the less. We still need to decorate specific webpages with entertainment, emotion and storytelling. We still need to find clever hooks to use in our Adwords Campagne. We still need to find brilliant uses of digital capabilities (think simulators, but cooler). The difference is that digital creative concepts loose their shackles. No longer are they restricted to the limitations of the media that carries them. No longer restricted by the damning burden of having to create a consumer need. Creativity will become part of the core of communication. The core of every (brand) experience.

If you still feel like it, challenge yourself with the following exercise:

“How would you make advertising that nobody is forced to look at? What would your idea look like if people would have to want to find it. ”

— Your challenge

Have fun. 

And welcome to digital creativity.