Rebundling

Even Billionaires Should Insource to Their Home

There is an old parable about sticks. The father shows his sons some sticks. Take one and break it, he says. They do. The sticks snap. Now take the remaining sticks and bundle them, he says. They do. Try to break them, he says. They cannot. Be bundled, my sons, he tells them.

@owenbroadcast has a thread about using a modern minivan. His basic argument: It has no coherence. It has no inherent logic. The makers are trying to hid that there is a there there.

https://twitter.com/owenbroadcast/status/1686199990782214144#m

how the car i rented today illustrates why the world is no longer cool, liquid modernity, ergonomic shunyata (being devoid of an instrinsic nature)

the minivan is fully encased in digital-ness: it is designed to be as modern as possible.

…

this is a great illustration of how modern design and technology is dehumanizing. we often use this word, but here we can see what it really means clearly: it strips out the human element.

that basically means: it sucks and is not cool. lets quickly go over our case study here:

1. you don’t put the keys into the car.

what is the most immediate, cool, tactile part of getting in a car?

the keys. starting the engine. well, don’t worry, that’s gone now.

has anyone on earth ever complained about gripping the keys, inserting them, and revving the engine? no, because it’s awesome and feels cool.

this is now replaced by the “keys” (functionally, a remote), simple existing. they just need to be there, and the car can start.

now instead of stabbing a piece of cool steel and cranking a machine i barely understand into violent animation, i get to look around for a metal box, to ensure i am proximate to it - or worse, i just know its there, and do nothing.

robbed. emasculated. dehumanized.

…

every feature in the car is like this.

3. all gauges are digital

wow i really hated seeing actual meters turn to tell me how fast i was going and how much fuel i have. i hated being directly visually enmeshed with the analog nature of the machine im trusting my life to

just kidding that rules.

at least now its way cooler to receive the information “you are going 85 mph” from an interface that looks like it could also tell me “you have seven unread emails”

oh wait that actually sucks

that actually is not cool in any way, at all

good thing this is at least cheaper

actually its way more expensive

…

every aspect of life is rapidly undergoing the exact process outlined here

humans are tool creatures. our tools are part of us. we live through the tools

i am the liquid modernity minivan. i have no “minivan nature”. i am a car without the things that make a car a car

They are abstracting and unbundling the experience of driving a car.

Many things are like this. Whether you agree with the minivan complaints or not, the process of making the experience less bodily and less interactive and the elements more customizable (i.e., arbitrary, less tied to each other) is going on in all areas of life. Production and participation becomes services and consumption.

It makes no sense to treat anything you care about and want to last this way.

Look around you. You see the consequences of the unbundled corporation, the unbundled nation, and the unbundled family playing out before you. It is not pretty.

Reversing the abstraction and rebundling the bundle is the topic of this week’s transmission.

For practical purposes, most of our steaders are family founders.  The meat of this transmission will therefore be on family rebundling  We won’t judge you if you decide to skip down to those sections below. Sometimes good enough has to be good enough. What you are missing, though, is not just us impressing you with how smart we are with all our stylish references. You are missing a thick reading experience where a wide variety of contexts allow the central idea to sink further into your mind at the level where it makes connections for you that you may not even rationally be aware of.

A number of you by nature are  natural contrarians.  Your superpower is the ability to question received wisdom, analyze things by breaking them down into their components, and then do something more rational or more efficient that what is commonly done.  You in particular must pay close attention to this transmission.    Metaphorically speaking: There are risks in taking out the appendix if you don't know what it is for.  But some of you will do it anyway.  So in this transmission we tell you what the appendix is for.

Unbundled corporation

Ronald Coase won the Nobel Prize in Economics in part for a paper he wrote called The Theory of the Firm. He pointed out that no business did 100% of everything internally. They get raw materials and tools from elsewhere, they pay accountants and lawyers, they hire consultants, they might have an ad agency or an IT contract. He theorized that the boundary of what was inside the firm and what was outside the firm related to efficiency and transaction costs. If the boss works very closely with the secretary and needs a lot of time from the secretary, it might make the relationship less efficient if he just had a contract with a secretarial firm that sent a new person over every day.

Around the same time, property lawyers made a similar theoretical move. Although most of us think of our property as one thing—my house, my land—the lawyers argued that it could be treated as a bundle of different rights.

While breaking concepts apart into their component functions or subsystems is a powerful intellectual tool, the real intellectual power come from putting the pieces back together once separating them has allowed for greater understanding of the parts. The danger is when the intellectual decomposition is held to be a fact about the real world or a goal to which the real world should be made to conform.

The subsequent history of corporate unbundling is already familiar to the reader from many excellent sources.  We summarize here to remind the reader of what he already knows.  Whether or not Coase was responsible (likely he wasn't), the 70s and 80s saw an unbundling of the American firm. Firms began to focus on *core functions*, which meant cutting less profitable product lines and research. Of the remaining functions, more and more functions were contracted out. Employees became less permanent. So did owners, increasingly abstracted into stockholders. Manufacturing went overseas. Another firm did the janitorial. Another provided security. An agency marketed.     With internet retail, even retail outlets started to be eliminated. The platonic ideal of this process, sometimes achieved, was a very profitable firm which consisted only of a headquarters office. The essential work of the firm being essentially just management and coordination. Perhaps the advent of effective AI tools will allow the management team itself to be unbundled.

Intellectual process of abstracting and separating the firm "bundle" in order to understand it became a real life process of abstracting and separating the firm bundle into different parts.

We do not condemn this process entirely. Efficiency is not a bad thing for a business concern to aim at. A general atmosphere of efficiency and productivity enable many sorts of thick, bundled groupings. It is not necessary that any one business be built to last for generations. Further, business unbundling reflects a mature market with healthy rule of law, which is itself desirable.

At the same time, it can't be a coincidence that corporate unbundling is one of the many Things That Happened In 1970, most of them bad. 

Unbundling has made American corporations much more vulnerable to supply chain disruption and much more reliant on continued smooth functioning of markets.  It has led to a reduction in research and therefore of innovations successfully brought to market.  It has made them much more dependent on regulators and financial markets, and more.  Clayton Christensen has shown that the focus on only the most profitable lines makes corporations vulnerable to disruption.

It is hard to say that the game was worth the candle.

Unbundled Nation

Society and State in modern countries is increasingly unbundled from the citizen.  The "thick" intermediary institutions are disappearing into distant, illegible centralization.  More and more swaths of life are professionalized, credentialized, and regulated.  (Again, these are arguments that have been successfully made elsewhere.  We are here reminding the reader of what he already knows and experiences.)  On the ground, the rampant voluntary self-organization of classic America has given way to Bowling Alone.

As the nation-state experience becomes more totalizing, the experience also becomes less thick. It is increasingly distant, increasingly alien, increasingly incomprehensible.  Much like the digital controls on the minivan, instead of a participatory experience that the citizen is enmeshed in, the citizen's experience is selecting arbitrary options determined by processes beyond his ken or control.
Indeed, the very concept of a citizen is vestigial.  The actual role is that of resource (through payment of taxes and other forms of extraction) and consumer of products, entertainment, and government services.

Towards a rigorous definition of consumerism: Consumerism has two different apparently contradictory modes.  In the first mode, the consumer is entirely passive.  There is no agency or will.  You watch the TV.  You eat the packaged meal.  The second mode of consumerism is pure choice without effort or feedback from reality.  You select features based purely on what you want.  The less you alter your preferences in reference to real world facts, the more consumer it is. Similarly a consumer experience is when you are offered choices that have been selected by a remote and unknown corporate process without apparent reference to real world facts.  You design your avatar for an online game.  You pick a bewildering variety of fruit from who knows where based solely on what you want that day.  Is it in season?  Does it have a season?  Does it matter?  Real experiences are experiences in which you are an agent but in which the world responds to you, affecting and limiting your choices.  In consumer experiences you are unbundled from the engagement with the world.  You either passively take an end product or arbitrarily select options.

Government and society is now mostly something that is done to the average person, not something they do.  The citizen has been unbundled  The results are increasingly ineffective governments that are increasingly hated by their own citizens

The unbundled vs. the bundled neighborhood
Do you and other men cut and stack wood for the widows on your street?  Is there an expectation that the old will be hiring teenagers to mow lawns and wash cars, and that teenagers will be eager to do it?  Do you look out for each other's houses when someone is gone?  Who brings you meals when there is a hospitalization or other type of tragedy?  Do you celebrate things together?

The old American myth of the "small town" is essentially a dream of a bundled community.  Like many myths, it is sometimes true.

Unbundled family

Let's say you as your household CEO are taking a look at your family functions.  You need

Shelter. 

Utilities. 

Maintenance. 

Cleaning. 

Some kind of lawn care. 

Food and food preparation. 

Meal cleanup.

Clothing. 

Laundry. 

Transportation.

Child bearing. 

Child rearing. 

Child education. 

Entertainment.

The normal family will provide these by some mix of outside employment that they use to buy these things, and personal services.  The clothing is purchased but maybe a few hand-me-downs from older siblings or cousins, the washing machine is purchased and probably repaired by a service but maybe Dad did fixed it, so is the laundry soap is also purchased, but Mom does the washing and maybe the kids help fold.

At one extreme you would have the autarchic family that probably never quite existed nor could where the family was sheltered using logs that Dad and sons cut using a stone axe they chipped themselves, heated by their fire, fed by their hunting, Mom roasting the meat over the spit and doctoring wounds with herbs she gathered.  For entertainment they told each other stories.

What about the other extreme?  The house is purchased.  There is a service that maintains it.  There is a service that cleans it.  They eat out at restaurants or, if poorer, eat prepackaged meals from the freezer aisle or, if wealthier, have a subscription to a kind of box service.    They drop off laundry at the cleaners.  Their kids go to school.  They rented a womb, even.  They subscribe to Disney+.  If a kid has a problem, they hire a counselor or a life coach.  Dad and Mom leave every day (or bury themselves in a home office) and also when the family wants stuff they present a card from the wallet and the children could be quite old before they realize there is a connection between the two activities.

You might, as CEO, look at these functions and decide that some of what you are doing on your own is inefficient.  My time is valuable, you might say.  Why should I mow the lawn when I can have a service do it for half the cost of what I could earn during that same hour?    Which is a fair point.  You should ask yourself these types of questions.  But far enough down that road you end up with a family that has nothing in its bundle and the family effectively ceases to exist.  And well before that point, the family has become thin and weak.  The weaker the bundle, the weaker the family.

Rebundling

So you should also, as family CEO, review your family functions to find places where you can rebundle.  Where can you bring in the supply chain?  Where are the wins for increasing the degree to which you, spouse, and children experience your home as a place of production and engagement, not just as a place of consumption?

Look for thick, tactile experiences.  Thick experiences are ones that involve multiple steps and multiple connections.  If heating a packaged meal is thin, then cooking a meal for shipped and preassembled ingredients is slightly thicker.  Cooking it from scratch is slightly thicker.  Having the kids help you cook is slightly thicker.  Eating the meal together is thicker.  Growing some of the ingredients is thicker.  Having the kids weed that herb garden is thicker.  Having the whole family weed together is even thicker.  Telling stories where you reminisce about that one time you saw a monster centipede in the garden is thicker.

There are trade-offs but in general you should probably prefer to have a few thick areas in your bundle instead of more shallow ones.  It is probably better to have a service do your laundry and your family really get into doing the cooking and growing than it would be to wash and fold your own laundry and cook meals from a box.  But there are trade-offs, the important thing is that you are asking the question and looking for wins.

Tactile experiences are ones that involve material objects and the human body.  We literally mean "tactile."  Something you can and do touch.  In the parable that opened this transmission, the father was treating family unity primarily as a mental commitment,w hich of course it is.  But if it is only a mental commitment it is extremely shallow and will easily dry up.  The family bundle needs to be felt and experienced.  Having someone pick up a laundry bag at your front door is less tactile than driving it yourself is less tactile than walking it to the laundromat with you and your kids taking turns pulling the wagon is less tactile than the group of you hanging clothes on the line.  The snap of the clothespins, the wet hang of the clothes, the grass underfoot, the sun.

For the very wealthy it may seem odd to think that they should bring some basic family supply chains in-house, but they should.  For them in particular it is important.  This was the style of the old WASP elite until they were shamed out of it.

If you can’t quite get over the dollars and cents, reorient your thinking this way. A meal hand prepared by a millionaire is clearly worth something quite out of the ordinary, isn’t it so? You aren’t wasting your time by insourcing. You are offering gifts of absurdly high value.

For all, look for ways to get help that don't unbundle.  Your own child or a neighborhood boy is a better source of lawncare than a service you found on a ratings app.  Perhaps there is someone in your church who does cleaning or laundry? 

For the very wealthy, in-source via servants.  Handled right, they almost become part of the family and therefore certainly do become part of the household.

Finally, as always, be sure to explicitly highlight your bundle so that everyone becomes consciously aware of it.  "There's just a different feel to these sun-dried clothes.  Imagine only ever wearing dryer clothes!"

Case Studies

Peaches

Here's one of those thick experiences like we talked about.  We all took off work one day to drive over.  I think we got 200 lbs of peaches.  We shared some, we are doing family time cutting them up, we canned some.  They taste so good frozen with cream.

To add to the picture, this family had one member read a book they like aloud while cutting the peaches, and the father helped plant the peach trees himself when he was a teen.  The family has a book of family memories where one of the daughters wrote about the expedition and drew a picture.

Dresser

Here's a dad who has a knack for carpentry.  His daughter helped him design a bedside stand, then he made it for her.  The result is beautiful, solid, tactile, useful, unique, and will a living repository of memories for years to come

This is the same steader whose work was featured in our 4th of July transmission.  He recently made the intelligent decision to offer his work.  You can get your own rustic dresser very much like the one he made for his daughter.

Rockwell Timberworks

Another steader writes in response

That reminds me, we have an heirloom like that.  We thought it was just trash furniture from my aunt until we took the paint off.  Underneath we discovered my grandpa had made it, he and my grandma had both burned their brands into it.  We get a lot of comments about that.