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Malcolm Gladwell on Understanding The Importance Of All-New Everything

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If you work in marketing, occasional testing of what your brand is in the business of delivering is a useful and powerful exercise.   

Here’s what I mean: your company may well manufacture well-engineered tires, for example, but people may buy them because they believe that installing your tires on their cars will keep them and their families the safest out of all available tires.  To your customers, you are actually in the safety business.  Perhaps you build incredibly advanced laundry machinery but your customers love that your machines gently and effectively help to keep their clothes clean and beautiful, and so on.

Understanding what you ultimately deliver for people helps you to market to them more easily and builds a more meaningful connection between your brand and customers.  

Earlier this week I attended a keynote by Malcolm Gladwell who shared a compelling parable which illustrates the power of the above exercise while gently reinforcing the postulation of his latest book, David and Goliath.  It is the story of a truck driver named Malcom McLean.

rsz_malcolm_mclean_at_railing_port_newark_1957_7312751706Unless you happen to be in the intermodal freight business, there is almost no chance that you have reason to have heard of this fiery contrarian.  Nonetheless, it is fair to say that McLean’s vision for a complete re-framing of the shipping business has become the backbone for globalization of production and distribution of consumer goods.  You see, McLean was a hustler who grew impatient and hostile whenever any of his time was wasted.  One day as he sat in his truck for twenty four straight hours waiting to be offloaded at the Newark seaport, he channeled that frustration into a new way of thinking about the shipping business.

The idea of driving a trailer straight onto a ship and then dropping it right in the hold was not new, but all who had experimented with it in the past (most notably the US Army) had determined that for many reasons it was not viable.  McLean himself had experimented with dropping a trailer onto a ship bound for London UK in order to save time at port, only to realize that his company could not make sense of having their equipment off the road for so long while the steamship line could not make sense of having the extra weight aboard.

Disruption Of An Industry

But McLean knew he was on to something.  Another experiment, this time with 50 custom-purposed containers lifted off the backs of his fleet of trucks and placed straight into the hold of the cargo ship, sealed the deal.  On April 26, 1956, the SS Ideal-X set sail from the Port Newark-Elizabeth Marine Terminal for the Port of Houston.  McLean flew to Houston in order to oversee the docking of the Ideal-X and as the ship put in to port, McLean found himself overcome by emotion; awestruck with the realization of the monumental amount of leverage he had discovered.

shs1221At the time, the longshoremen’s union charged $5.86/ton to offload cargo from trucks and load it onto ships by hand.  The process was also incredibly time intensive - a truck could wait twenty-four hours just to get unloaded and it might be a full month before the cargo was loaded onto the ship itself.  

Loading a container onto a ship, by contrast, could happen in less than eight hours and at a rate of just sixteen cents per ton.  Not only were the trucks back on the road sooner, but the ships were back on the water much faster too.  The new efficiencies were hugely significant and they were everywhere.   The challenge was that McLean was the only person who saw it this way.  He was David.  

Understand, McLean had no supporters - no other shipping companies wanted any part of it and the unions were violently opposed to this threat to their way of life.  Even his own sales force could not comprehend the magnitude of the change that McLean was willing to work through.  What McLean had was a powerful vision, a burning desire to make it happen quickly and boundless contempt for the word “impossible.”

rsz_port_of_singapore_keppel_terminalOf course, we know how the story ends: intermodal containerized freight is now the standard for shipping: it’s everywhere.  McLean overcame what must have seemed like insurmountable obstacles to make it happen - standardizing of all shipping containers, everywhere.   The manufacturing and installation of specialized cranes that could handle the shape and weight of this new mode.  But by far the biggest obstacle he had to overcome was that nobody could else could understand how McLean had completely re-framed every freight and shipping-related business.

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The steamship captains wanted to keep being captains of the steamship business.  The trucking industry magnates wanted to keep being the kingpins of the trucking industry.   Likewise with the railroad people.  The entrenched industries were Goliath.  

McLean had come to realize that they were all now simply “in the stuff-moving business.”  That was their new work.  That was what they offered to their customers.

Gladwell says that if we look at a list of top-performing shipping companies in the early 1950’s versus now, there is no overlap at all.  Companies who were in love with their previous success and hubris which focused more on the mode than the actual outcome fell away with time as new McLean and his intermodal “stuff-moving” methods took to the roads, rails and sea.  They are all gone because they could not accept the re-frame.

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