The Innovation Show

“Incorporating uncertainty into the way we think about our beliefs comes with many benefits. By expressing our level of confidence in what we believe, we are shifting our approach to how we view the world. Acknowledging uncertainty is the first step in measuring and narrowing it. Incorporating uncertainty in the way we think about what we believe creates open-mindedness, moving us closer to a more objective stance toward information that disagrees with us.” — Annie Duke, Thinking in Bets (https://amzn.to/3B6sH9U)

Incorporating uncertainty into the way we think about our beliefs comes with many benefits and as we will discover, it is a necessity. By expressing our level of confidence in what we believe, we shift our approach to viewing the world. Acknowledging uncertainty is the first step in measuring and narrowing it. When we incorporate uncertainty into our beliefs, we create open-mindedness, moving us closer to a more objective stance toward information that disagrees with us.

This open-mindedness is essential, especially in a world where knowledge is in constant flux. Samuel Arbesman refers to one important type of uncertainty as facts that change on a middle timescale, or mesofacts. Much of what we consider established knowledge fits this description. For instance, the number of known chemical elements is a mesofact. If you learned chemistry in the 1970s and never revisited it, you wouldn’t know that the periodic table has since grown to 118 elements, with 12 new discoveries. These slow but steady changes also extend to technology, where advancements in skyscraper heights or the speed of data processing are mesofacts, constantly updating.

The greater our knowledge increases, the more our ignorance unfolds.” — John F. Kennedy

By recognising mesofacts, we can anticipate change rather than being blindsided by it. As Arbesman says, “What we know today is a stepping stone, not a final truth.” Arbesman notes the rediscovery of the coelacanth, a fish thought to have been extinct for millions of years. Found alive off the coast of South Africa in 1938, the coelacanth showed that even when we think we know something with certainty, new data can disrupt our assumptions. The coelacanth is an example of what are known as Lazarus taxa: living things that are presumed long extinct until contrary evidence is discovered.

In preparing for a forthcoming episode with Byron Reese on his book, “We Are Agora” I stumbled upon the following passage. “In the 1940s, John Steinbeck joined marine biologist Ed Ricketts on a six-week expedition in the Gulf of California. Their journey, detailed in The Log from the Sea of Cortez, was more than just a scientific endeavour; it was a meditation on the nature of truth and the limits of human understanding. While collecting fish specimens, Steinbeck observed the ways in which scientific observation can capture certain facts while distorting others. He noted that when a fish is preserved in formalin, its colour, texture, and even its scent change, leading him to reflect: “The man with his pickled fish has set down one truth and has recorded in his experience many lies.”

This insight underscores a crucial point — what we perceive as truth is often a limited, incomplete version of reality. My understanding of Steinbeck’s observation is that when someone records a data point, It doesn’t mean that it is entirely accurate and B. that data point may expire.

The reason I share it in the context of this week’s Thursday Thought is that what we hold as sacred knowledge can gradually decay. How many times do elder statesmen and women dismiss the ideas of new recruits as folly or naivety? Worse still, in the realm of business, many people dismiss changemakers with the phrase, “We tried that before.” Nespresso’s story serves as a perfect example of how an idea that initially failed was later revived, transforming it into a massive success.

Nespresso was born out of a simple yet revolutionary idea in 1979: to allow anyone to create barista-quality espresso at home. However, its initial business model was deeply flawed. The company launched the product with a focus on the office market, primarily selling machines and pods as a system to businesses and restaurants. However, the machines suffered from performance issues, and Nestlé struggled with manufacturing quality control. The target market did not respond as expected — the cost of the pods was too high for offices, and restaurants rejected the system because it lacked the authenticity of traditional espresso-making, which customers associated with quality coffee.

By 1986, the project was on the verge of being shelved. However, rather than abandoning it, Nestlé restructured the company, installing a new CEO and shifting the focus from a B2B model to affluent households. This shift in strategy, along with the decision to outsource machine production to a specialist manufacturer, proved critical. Nestlé, traditionally a B2B company, lacked the consumer sales channels, and its initial reliance on third-party manufacturers failed to capture the attention needed to push the product forward.

Under new leadership, Nespresso not only changed its target market but also overhauled its business model. The key shift involved recognising the importance of separating the machine from the pods, a “razor and blades” model. In this model, consumers would purchase the machine and become locked into buying the pods for recurring revenue. This split alone didn’t trigger immediate growth, but once Nespresso expanded its machine distribution through a variety of retail channels and created its own direct-to-consumer sales channels for the pods, the business finally took off.

It wasn’t just the product that needed refinement; the business model was entirely wrong in its original conception. In its initial phase, Nespresso was a product without the right audience or infrastructure, but the later re-imagined model focused on consumers who appreciated luxury, convenience, and quality. The transformation was like a Lazarus taxa — a product that seemed dead in the market but re-emerged, fully adapted to thrive in a new environment.

Today, Nespresso is a multi-billion-dollar business, operating through its own branded stores and online platforms, locking in customers through the Nespresso Club, where they receive personalised service and can track their purchasing history. Nespresso created a new paradigm in the coffee industry with its direct-to-consumer model, handling machine sales separately through retail and only selling pods through its owned channels.

The story of Nespresso is a powerful reminder that when someone says “We tried that before,” it may not be the idea that failed, but the timing, the market, or the business model. With the right adjustments, what was once considered a failure could become an industry-defining success.

The Challenge is Human

“It takes 50 years to get a wrong idea out of medicine, and 100 years a right one into medicine.” — John Hughlings Jackson, British neurologist (1835–1911)

It is difficult for anyone to accept the concept that knowledge has a half-life. This means that what we once believed to be true might be proven incomplete or wrong. The challenge becomes more pronounced when we have fought hard to establish the knowledge in question. In business, science, or any field, the willingness to reassess and let go of outdated truths is essential for progress, yet it remains one of the most challenging intellectual hurdles.

This is where Richard Dawkins’ story about his Oxford Zoology professor is so powerful. Dawkins recounts an incident during his undergraduate years when a respected elder of the department had his favourite theory publicly disproven by an American visitor. Rather than reacting defensively, the professor strode to the front of the lecture hall, shook the visitor’s hand, and declared, “My dear fellow, I wish to thank you. I have been wrong these fifteen years.” The audience applauded, deeply moved by the professor’s grace and humility.

Dawkins’ story highlights how rare such admissions are, especially in today’s world. As he wryly notes, can you imagine a politician being cheered in Parliament for admitting they were wrong? “Resign, Resign” is the more likely response. Yet, in that moment, the professor embodied an essential truth: admitting you were wrong is not a sign of weakness but of intellectual strength and openness.

Acknowledging when something is no longer valid is crucial in both science and business, where knowledge is constantly evolving and ideas must be continuously tested. Just as Nespresso’s revival hinged on recognising that the initial business model was flawed, true progress relies on the willingness to accept when previously held beliefs — however deeply ingrained — no longer serve us. Only then can we pivot, adapt, and innovate in ways that propel us forward.

In our penultimate episode of “The Emergent Approach to Strategy,” Peter Compo highlights the prevalence of this theme in strategy.

“There’s no data from the future. Only models, only thought, only constructions that we make about it. And they’re going to be wrong, but the idea is to create a model that helps bring some coherence to thought that brings people together, that has a higher probability of getting somewhere that you think you want to go.” — Peter Compo, Episode 7 of Emergent Approach Series

In a world where facts change and strategies must evolve, the real strength lies not in stubbornly clinging to old truths but in embracing new ones as they emerge, even when it means admitting we’ve been wrong all along.

Next time, you think or utter “We Tried That Already”, take pause and think again.

For more on this kind of thinking check out the latest in our 9-part episode with Peter Compo, Find his book here: https://amzn.to/4etBkty

https://medium.com/media/7642ec41305e1bf964bce3c084597fc5/href

Find the book: https://amzn.to/4etBkty

Link to Peter’s website:

https://emergentapproach.com

Link to Peter’s Music: https://www.youtube.com/channel/UCJsn2zbnx8dwvHJrisdkAtg

The Fragility and Fleeting Nature of Facts was originally published in The Thursday Thought on Medium, where people are continuing the conversation by highlighting and responding to this story.