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The 20th century was all about hierarchies: if you want to create something, if you want to start a country, create a product, whatever it is. Your goal is to create a highly efficient hierarchical model, scale it, because that's what the competition's doing.

The 21st century is dominated by networks because the introduction of the information age, we can suddenly create, free flow these globally distributed, organic, shaped networks of individuals.

The Defense Department is prone to all of the 'traditional bureaucratic rules,' which is the same thing you'll find in most traditional government systems.

Special operations are small, highly specialized. They do amazing work when they're put into the fight, but it's a limited resource. And so if we become overly dependent on an organization that's designed for a very specific mission and expect them to solve all problems around the world, you're naturally going to overextend it.

As the insurgency in Iraq started to grow, we realized this is a connected network of individual actors that can move at light speed.

When we first met, I was probably six layers down in the military structure, but General McChrystal at that time was a soldier's leader, and he was part of the task force. So everyone developed close relationships.

As you move up a traditional, sort of bureaucratic structure, there's a certain point at which you realize, 'Well, I'm not really on the implementation or execution side - I'm not on the battlefield. I'm an operations person who's overseeing multiple units that are out on the ground doing the job.'

Bureaucratic advancement means fewer peers, more span of control, generally an increasing information-pump function, and increased distance from the actual implementation of whatever it is the organization does.

The reality, as the battlefield taught us, is that a 20th-century organizational system is simply insufficient for the speed of the information age.

How often are you really realigning yourselves on strategy? And does it need to be faster, based on how quickly your market actually changes? The answer is usually yes.

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