“A More Beautiful Question”

For some time, I have been interested in how this quote can seamlessly translate into thoughtful conversations with friends, family, colleagues, and clients. Fortunately, A More Beautiful Question by Warren Berger was published about a decade ago. I am in the process of re-reading the book, in part because it came up in a couple of recent conversations. Most recently, with colleagues as part of a discussion on business development and client conversations, and earlier last year with Daniel Benitez, a friend and colleague in the world of water.

My conversation with Daniel was on the process of water tech innovation and why there is a view that water technologies are slow to scale. There is a prevailing narrative that the water sector (let’s assume this is confined to water utilities) is slow to innovate because water is a public health issue, and de-risking technologies take time. This is a valid point, but perhaps there is an opportunity to ask a “more beautiful question(s).”

Daniel did ask a more beautiful question, which I believe catalyzed his thinking for his recent article, The Efficiency Trap: Why Most Companies Pick the Wrong Innovation Bets. His article explains that companies fail at innovation not from poor execution, but by applying efficiency-focused governance (like NPV/DCF) to search-based uncertainty, meaning they use tools for known outcomes on unknown future opportunities, leading to bad bets by over-relying on existing models, killing disruptive ideas, and ignoring the need for learning governance and deliberate inefficiency to discover what truly works. The core problem is funding learning with execution logic — funding “imaginary cash flows” instead of buying crucial information.

This thinking led to Daniel’s findings and conclusions.

Why Companies Fall into the Trap

• Confusing uncertainty types: They treat search uncertainty (don’t know what works) like scale uncertainty (know what works, just need to scale it).

• Misaligned governance: Using financial metrics (DCF/NPV) meant for efficiency to evaluate truly novel, high-risk ventures where cash flows are speculative.

• Over-reliance on core strengths: The systems that make a company great at its current business become the very tools that prevent it from seeing or investing in a new future.

• “Illusion of innovation”: Trying to repurpose existing operating systems (built for execution) to learn, which just reinforces the status quo, explains LeadershipNow and www.alloypartners.com.

The Solution: Learning Governance

• Invest in information, not just earnings: In the search phase, money buys information and learning, not immediate returns.

• Embrace deliberate inefficiency: Successful innovation requires a degree of inefficiency and systematic experimentation to explore the unknown.

• Differentiate between execution & learning challenges: Pursue execution challenges (know what to do) internally but spin off learning challenges (high ambiguity) externally, like a startup, suggests LeadershipNow.

In essence, to win the future, companies must intentionally create separate systems for exploring the unknown, rather than trying to force learning into the rigid, efficiency-driven structure of their core business.

For me, this is one example of the power of asking “a more beautiful question.”

Onward.