Sunday, October 26, 2008

Business and Brunelleschi’s Dome: A Modern Management Analysis of Renaissance Competition

This is a paper I wrote last year for my "Creating and Managing an Enterprise" class. It's really good I think, but it only includes some aspects of all the things we learned up to that point in the semester. The focus is on Porter's Five Forces which are well represented though. The book that this is based on though is very very interesting I think. Lot's of business related content and lots of cool history. Did you know that sometimes it could take a century or more to build a cathedral?


Ross King’s Brunelleschi’s Dome paints a picture of Renaissance Italy, in a time when technology and knowledge were developing rapidly, the world was changing, and many scientific and artistic minds were coming to prominence. It specifically focuses on the life story of Renaissance Man Filippo Brunelleschi - scientist, artist, architect, and inventor - and on the construction of the Dome of Santa Maria Del Fiore, in which he had such a dramatic influence. We can find in these stories many common situations, challenges, and principles which are just as relevant to our current realities of business, innovation, and accomplishment, as they were when Brunelleschi’s dome was rising over the busy streets of Florence. Throughout the stories, we see dramatic cases of jealous competition, spectacular successes and failures, creative utilization of resources, innovative solutions to business and technical problems, and carefully crafted strategic maneuvers designed to at once outpace the competition, and prove one’s principles true. In this paper, these aspects will be considered through the lens of competition and rivalry, and explored with modern management concepts in order to both show the drama and complexity of business, and to reflect upon how timeless and universal these situations, challenges, and principles may be.


Communication and Competition
Differences in communication and personality, together with similar interests and skills often lead to competition and rivalry. This can be readily observed from early in the book as the rivalry between Brunelleschi and Lorenzo Ghiberti began to take shape. When discussing the contest for the Baptistery doors, the book notes that they both went about preparing their entries differently – Lorenzo choosing a very social method, soliciting feedback from potential judges, while Filippo proceeded in solitude and secrecy. This difference in approach and personality likely came between them, causing mutual disrespect for each other’s methods and products. One may note that they were asked to collaborate on what would have been the first big commission for both of them. It’s realistic to consider that, rival or not, it might be worthwhile to get this big commission in any case. Faced with that prospect, however, Fillipo instead opted to move away to Rome. This could suggest on one hand a self-confident and stubborn personality, unwilling to cooperate, though on the other he may have simply deemed the extrinsic rewards not worthy of the intrinsic costs.
Some years later after Brunelleschi returned from Rome, both he and Ghiberti were again competing, this time for the design of the dome of Santa Maria Del Fiore, when they were presented with the same crucial decision by the sponsoring body. On this occasion, however, Brunelleschi chose differently and accepted collaboration with Ghiberti. While we may concede that he has grown older and wiser, his personality doesn’t seem to have changed much, and if anything, the rivalry has only grown greater.


Understanding the Context: Porter’s 5 Forces
To get a better sense of what might have driven his decision to accept the commission this time, we can use Porter’s 5 Forces to consider the competitive environment he faced, and perhaps see why pursuing this particular opportunity might now be worthwhile.


Force: Suppliers
First, we can consider the power of the buyers. In this case, it is the Opera Del Duomo, the body in charge of constructing the cathedral that represents the buyers. Their power is very high, suggesting initially that one might not want to pursue an opportunity subject to such tight regulation and close scrutiny. Over time, however, Brunelleschi managed to win them over with his innovative plan for the dome. It is likely that his confident personality expected this from the very beginning. This confidence in one’s own technology is common among entrepreneurs today, and an important driver of entrance into the market, sometimes with dramatic success or failure. The same successes and failures can be seen in many of Brunelleschi’s projects throughout the book. In his most prominent project, the design and construction of the dome itself (as with many projects in the modern day) this struggle to introduce and gain acceptance for a new technology was long and arduous. Despite the initial skepticism of the buyers however, the benefits that his design could provide won its acceptance.


Force: Rivals
Next, we can examine the power of rivals. There was limited expertise in the area of dome building on this scale, so Brunelleschi had only a small number of direct and indirect competitors in the contest. Direct competition again came from Ghiberti, who himself had little architecture experience. Though the strength of each of their characters to the Opera was essentially equal in this contest, it is certain that Brunelleschi regarded Ghiberti as inferior in skill. Paradoxically, it is for this reason that Filippo would be willing to share the commission, since he was confident that he would be able to outpace his rival, and in fact he did so early on. This time instead of walking away from his rival, he took a look at his resources, and decided to face him head on.
The choice of the Opera, like the choice of many venture capital firms today, was not based solely, nor perhaps even primarily on the technology or design itself, as much as on the people involved in the project. Ghiberti was seen to be more established, but Brunelleschi seemed to be more innovative, thus the Opera split the commission between them.


Force: Substitutes
After considering rivals, we examine the power of substitutes. In this case, substitutes might be considered a change in design, for example, eliminating the dome altogether. Alternatively, different dome building techniques could be considered substitutes. A change in design was not a strong possibility, since the Opera Del Duomo pledged their allegiance to the original model on New Year’s Day each year. Firm in this understanding Brunelleschi could feel comfortable that the problem could only be solved through the construction of a dome. The other substitute possibility, a different construction method for the dome, was a very real one, but in Brunelleschi’s eyes, not as viable as his own. Since design and construction using existing methods had so far proved exceedingly difficult, his design looked to address those challenges in an innovative way that was not being utilized at the time. If his design could work, as Brunelleschi must have believed it would, it would have a distinct advantage over all the substitutes presented. This again is a similar assessment that many new companies make when looking to solve a certain problem, and a risk they take when they assess their offering to be superior to any of the substitutes.


Force: Suppliers
After this, we consider the power of suppliers. This was not an issue that played into Brunelleschi’s own decision strongly since it was clear that his success was not primarily dependent on suppliers – he only needed standard materials, and most of the responsibilities for acquiring those were borne by the Opera itself. Interestingly enough, it may have been the power of suppliers that gave Brunelleschi’s design for the dome such an advantage. Traditional dome and arch building called for the creation of wooden support frameworks known as centering. The availability of lumber in the enormous sizes and quantities needed was very limited, so there were problems designing a centering system that could realistically be built given the resources. Since Brunelleschi’s design did not require centering it sidestepped this challenge and solved a problem that was holding back the construction of the dome. Often, a radical innovation, as presented here, will arise from a situation of necessity.


Force: Potential Entrants
Finally, we examine the power of other potential entrants. Since this was a competition, the possibility of potential entrants after the fact was low and once the project began, the cost of getting involved became higher and higher. Of course there was always the possibility for others to get involved, and sometimes they did, especially as new problems needed to be solved, and new contests were released by the Opera. Take the case of Giovanni, whose designs were not chosen, but maintained a role in the process by constantly criticizing and submitting designs. He did not secure too much influence in the process, but in other situations it is conceivable to think that new challenges may arise. For example, if an unknown competitor were to come up with a design that was even more innovative than Brunelleschi’s, the new design could take over. This possibility was certainly a concern for Brunelleschi, and despite his confidence, likely was cause for his strategy of obfuscating tactics, and secrecy.


Five Forces Assessment
In the end we can see that since Brunelleschi ultimately accepted the commission to work together with his chief rival, and since it is doubtful that he wanted to share the responsibilities and limelight, he must have felt it possible to overtake Ghiberti in the process of designing and constructing the dome. Admittedly, Brunelleschi probably relied more on his gut instincts, and his own self-confidence in his designs and strategies, than any type of formal analysis, though it is certain that in his own ways he took these factors into consideration.
The Five Forces are a convenient way to organize and assess his competitive environment though. We can see how given his talents and ideas, it was a good opportunity for him to pursue. In the areas of buyers, rivals, and potential entrants, his position was neutral. While he did not hold a distinct advantage in these areas, he was not at a disadvantage since he could, to some extent at least, charm the buyers in the opera; outdesign, outplan, and outposition himself in relation to his competition of Ghiberti and the others; and since the process itself kept the threat of new entrants low. At the same time, however, there were two distinct areas in which he held a competitive advantage: the area of substitutes, and the area of suppliers. Mostly due to his innovative design, and the way it solved the important problem of centering, the substitute designs were rendered inferior, and oppressive downward force of wood supply was removed from his equation.
Based on this analysis (and admittedly with somewhat of a hindsight bias) we come to the conclusion that it was a worthwhile opportunity to pursue, since he would have a strong chance of his design being realized, and of reaping the intrinsic and extrinsic rewards associated. In fact, in the end he did manage to overtake Ghiberti and assume primary control of the project based on his innovative design, together with some delicate strategy, together with the influential position in the eyes of the Opera that he succeeded in earning through this innovation and strategy.

Conclusions
Looking at the stories surrounding the construction of Brunelleschi’s Dome through the lens of competition, and utilizing modern business concepts and tools, we have seen numerous examples of how the same issues of rivalry, technological change, and strategy have played out for years, and continue to play out today. Further, we have gained a conception of these common situations outside of our normal understanding of business, allowing us to draw conclusions that might not be evident if we were trying to pull them from the pages of the Wall Street Journal or elsewhere. It is through this synthesis of history together with modern concepts and knowledge that we can continue to advance our own learning, and the study of business.

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