Effort-Result Model and concept of multisigmoid curve
The distinguishing feature of the biological system in the universe is that they perform one activity or other. This activity leads to results, which can be either negative or positive. The activity is against the inertia in the universe which requires effort. When the intensity of effort in x axis is plotted against the result in y axis, universally, curve follows the sigmoid shape.
The sigmoid graph has 3 segments, say p, q and r. The first segment, p, is the initial phase where the results increase slowly. After it reaches a critical point, (point k, the intra-sigmoid resistant point), with increasing effort the results increase dramatically/ disproportionately in the mid-portion, the segment q. In the third segment, any further increase in effort improves the result marginally, and after a certain point, any increase in effort will not improve the outcome. The phase of resistance is r. (Fig AB1).
Let this resistance point be r1 marked in a circle in Fig. AB2.
This phenomenon also holds good for growth of an organism or an organization. The growth for an organization stagnates at the point of r unless the environment for the organization changes with reinforcement in organizational bio-ecology. If a additional strategy supporting the original concept is introduced in the organization at his r point, it acts as a fresh rallying point and then growth starts climbing again slowly, reaches a critical point and starts growing rapidly again. Then growth reaches a resistance phase at the second level. If pa, qa and ra are the segments of first sigmoid curve and r1is the first inter-sigmoid resistant point; then pb, qb and rb are the segments of the second sigmoid curve and r2is the second resistant point (Fig. AB3).
Another significant addition in the organizational strategy can cause a spurt in third phase of sigmoid growth and pc, qc and rc are the segments of third phase of the organizational expansion and r3 will be the third resistant point. (Fig. AB4).
Confluent of all these organizational growth phases can thus be represented by multi-sigmoid curve. This will go on depending on the organizational ability to incorporate additional strategies at the right time (even if the original concept remains the same) – represented by growth arrow g in Fig. AB5.
It is also to be noted that r2is of higher resistance than r1; and r3 is of higher resistance than r2 (r3>r2>r1) represented in the figure by the size of circles (Fig AB4).
On the other hand, if we have to represent the organization with declining fortunes the reverse events take place as represented in the fig. AB6. The difference is that for a failing growth resistance is least at higher level and resistance increases with each drop in the performance as represented by increasing size of the circles (r3<r2<r1). This pattern is typically seen in the share value fluctuations. In a “falling knife” share market behaviour usually has a maximum resistance at about the third level, r1, when it comes down from the peak of rc (multi-sigmoid share market model: Figs. AB5 and AB6).
Importance of point k
Point k is a point in the sigmoid graph where curve takes immediate upward trend with increasing effort or input. Literally, it is point where as if the weight is lifted of the situation. Even if the input is terminated at this point the upward trend continues for some time before taking a downward dip. Below this point the result ceases the moment effort ceases.
Point k (fig AB1a) plays a very important point in the evolution of an organization. This is an inherent intrinsic resistant point for taking off. It is the first hurdle in the unwavering growth. This is the point of entering biological space as the events break from the inertia of the universe. The inertia of the universe acts up to this point in any biological action. After the point k the events are influenced by the biological gravity like entering the lunar atmosphere. The representative graph is dragged down up to this point before being released for the upward trend. Any organization destined for total failure just gets flatted out at this point. There will not be significant profit for the organization till the point k. If the organization depends on returns for its sustenance below point k, then it needs to be closed down. If the growth is immaterial for the sustenance of the organization at this point then the organization goes into flat trajectory and just exists until it comes across the point k. It is usually at the level of 3 – 5% of the expected growth. Once this 3 to 5% of the expected growth is crossed, organization goes into an upward spiral. The next point of reckoning is the inter-sigmoid resistance segment r.
This is the point described as “crossing the chasm” by Geoffry Moore (1991) [from Guide to managing growth, Rupert Merson, published by The Economist, First Asian Edition 2012, page 46]. Before this point, there will be enthusiasts and early adopters for the innovations. The chasm is bridged when early majority pragmatists enter the fray and then the k point is crossed.
If you represent the above phenomenon with a bell graph, (Fig AB 1b) the k point can be represented as a k level. When the graph peaks above this level it means that the organization has come out of the woods. Below this level is like background noise. To be noticed, it should peak above this 3 to 5% inertia level. And when noticed, there will be a sudden jump in that organizations utility, living behind the others vying for the same space. When the growth encounters r, the intersigmoid resistance level, the performance gets flattened out. It can continue to be at this level as long as the utility lasts and then ebb away. Mean time, if the another strategy is adopted to overcome this resistance then the organization will see the second spurt of wave beating the second k level matching the second sigmoid curve of the multi-sigmoid graph.
Importance of Point r (to be continued..)