Taming Complexity –The Magnum Ice Cream

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The Magnum: As Simple as Possible

Giacomo, in his "Cremeria Castiglione", explains to me how he is able to make one of the best gelatos in Bologna, and possibly in Italy. This means, for Italians at least, one of the best ice creams in the world. "Making gelato is like baking pizza," he says. "You wouldn't try to sell a pizza hours after it's baked. The same goes for the gelato –it must be eaten fresh. Only when I realize I’m running out of a flavour do I take all the necessary ingredients, pasteurize them at high temperature, blend them at low temperature and sell it immediately after".

Italians love gelato. On hot summer afternoons, cities fill up with families strolling around, each member with a gelato in hand. I have always been part of this collective passion: when I was a teenager, my friends and I preferred to meet outside gelaterias and indulge in huge ice cream cones, rather than get drunk in bars

In a country where the gelato is sold soon after preparation, and where teenagers prefer it to alcoholic beverages, you may wonder how packaged ice creams can possibly sell at all. But they do, and account for 30 percent of the Italian ice cream market thanks to heavy marketing and widespread distribution. Of the 30 percent, half is in the hands of Anglo-Dutch multinational Unilever, under the brand Algida.

For decades, Algida's strongest seller was the Cornetto, an imitation of the artisanal ice cream cone, which was launched in 1959, the same year Fellini produced La Dolce Vita. Thirty years later, the country was miles away from the economic boom described by Fellini, but the Cornetto hung around and was joined by a considerable number of competitors.

The 1980s  were a time of consumerist excess, with brands offering cherry, amaretto, chocolate and biscuit all in the same ice cream. It was in this environment that Unilever, in 1989, launched Magnum, the simplest ice cream bar ever –vanilla with a chocolate coating.

As an apocryphal quotation of Albert Einstein goes, "things should be as simple as possible, but not simpler"[1]. The Magnum was simple, but not straightforward. Most ice creams had vanilla filling, but only few of them had good quality vanilla, and not one that was covered by thick, good, real chocolate.  To produce good quality coating, Unilever asked Belgian Callebaut to develop a chocolate that could go down to -40 degrees without breaking, something did not exist before.

The Magnum stood out from the crowd because it was simple, yet sophisticated. According to Unilever, it was already in 1992 "Europe’s most popular chocolate ice cream bar"[2]

Simplicity, though, did not last for long with the Magnum. With time, the Magnum evolved from the original ice cream to an ecosystem of elaborated ice creams: Almond, Mint, Caramel and Nuts, Yogurt; bigger and smaller Magnums; even Magnums without sticks. The original Magnum, in this new fauna of Magnum Ice Creams, was renamed Magnum Classic.

 

The Magnum Syndrome

 

When this process of differentiation started, and the promise of simplicity was broken, I got upset. When Unilever came out with Moments, small ice creams stuffed with caramel and hazelnut, I decided the company had reached the limit, and prophesied Magnum's fall from greatness to dust. In conversations, whenever dealing with something unnecessarily complex, I would refer to what I called the Magnum Syndrome: "Things start nice and simple, but with time they accumulate complexity. This is when they lose their strength, like in the Magnum's case: it is not the delicacy it used to be, there’s too much noise around."

I could find plenty that had fallen victim to the Magnum Syndrome. One of these was, in my opinion, elementary particle physics, my field of research. CERN, the European Laboratory for Nuclear Physics in Geneva where I started working in 1994, was setting up the Large Hadron Collider. For the first time, thousands of physicists, engineers, software developers were working together on a single experiment, and most scientists only had a very limited view of the experiment they were working on. Scientific articles were signed by hundreds of people, and a few names were still attributed authorship long after they had left the institution. This was a far cry from the physics of the pioneers I studied –and idealised– at university. There, a few great minds created theories and ran experiments in the isolation of their university offices and labs. Everyone involved in an experiment knew everything about it, and in case of a discovery there was never more than three people accounting for the idea –possibly because the Nobel can at most be awarded to three people for the same discovery. In those good old days, particle physics skyrocketed. During my research times in the 1990s, although we still have thousands of scientists working on huge investments, particle physics practically grounded to a halt, with no major discoveries made or in sight for the 2000s.

My explanation was that physics had lost its original "hippy", relaxed atmosphere. Its simplicity. At CERN, there were fewer people strolling around the campus, smoking, wearing shorts and sandals, and more people in suits talking loudly into mobile phones. The way CERN's management reacted to the "invention" of the World Wide Web by Tim Berners-Lee, was a clear sign of a bureaucratic hierarchy paralysing new initiatives. Not only did they not show any interest in Berners-Lee's project during the R&D phase[3], but even after the Web exploded into something undeniably huge[4].

Perhaps as a result of the dire state of information technology at CERN, I became highly pessimistic about computer science in general. In the 1970s, a few programmers had been able to create huge amounts of "free software", isolated in their dormitory room. Now, software development was becoming too complex to be managed by a single developer, and in the future only big corporations would have been able to produce high quality software. According to friends working on 20-year old software used by big banks, the complexity of the code –multiple intricate layers written by generations of programmers– was so high they couldn’t understand how banks could possibly run without major problems.

My small world of particle physics and software seemed irretrievably doomed and as far as I was concerned the real world was not doing much better. A few self-appointed "developed countries" took on the task of saving the world using harsh economic policies imposed to the "developing countries". But these policies appeared, at best, useless. According to Nobel prize Joseph Stiglitz, they were actually worsening the situation. Financial crashes in Asia, Brazil and, finally, Argentina –with people starving to death because of the financial default– did not paint a happy picture for the future of the planet.

In sum, everything was a huge... complex mess.

When Cherry Guevara was launched, together with other terrible Magnum flavours like the John Lemon, the Wood Choc, and the Jami Hendrix, I considered them the four Horsemen of the Apocalypse. The Magnum ecosystem will collapse soon, I was thinking while biting into my Classic. And global capitalism will surely follow.

Taming Complexity

I might have thought that particle physics had become too complex, but I did still believe it to be a good candidate to understand the continuous increase of complexity in the real world. Even today I continue to be convinced that physics is an extremely successful tool with which to tame complexity.

Examples of physics successfully taming complexity abound. Take statistical mechanics. During 19th century, physicists studied the statistical properties of the motion of molecules in a gas and discovered that despite their seeming randomness, properties like temperature, pressure, and even the obscure concept of entropy were all explainable in terms of probability: the behaviour of billions of molecules could be described by just a few variables linked to each other. Then there is chaos theory, whose formulas, the strange attractors, could reproduce the formation of complex structures like snowflakes, or the elegance behind a fern's branch.

How did physics reach these successes in the past? When dealing with complexity, physics creates ideal worlds, stripping away as many variables as possible from the system to be studied. In statistical mechanics for instance, this meant pretending that particles in a gas have no volume, and bounce between each other in a perfectly elastic way. Focusing on this artificial system –the perfect gas– physics was able to come up with models that could explain with good approximation the behaviour of real gases. With time, particles in the perfect gas became less ideal. They got volume, different mass and shape, and physics created new, more complex models to account for this increased complexity.

A similar thing had happened for chaos theory. It was born to model the motion of three point-like bodies interacting through gravity, and, growing in complexity, it ended up being used in meteorology and finance.

This idealisation method is key to physics. But how can one possibly find an ideal system with which to describe the behaviour of the stock market, human societies or the marketing strategy of Unilever?

The Network Revolution

With perfect timing, a new branch of physics was officially born together with the fauna of Magnum ice creams: network theory. Network theory was the illegitimate child of the World Wide Web. With the Web, it finally became possible to obtain data with which to study how networks evolve. Physicists and mathematicians threw themselves into data analysis and modelling, and with new results on social topics too: networks of people exchanging email messages, web sites referring to each other, blog feeds, all produced an abundance of digital data. Results were so original that stern journals like the Physical Review begun to publish articles on social networks –a social topic, for the first time ever.

What is great about network theory, is that thanks to it physicists abandoned the ivory tower in which they had isolated themselves. For a century, after the arrival of quantum mechanics and relativity, physicists focused on questions very few people were asking. The experiment I worked on at CERN still today studies how the "beauty quark" breaks cp-symmetry, which is like asking: "How different is the world of elementary particles when looked at in the mirror?" It is a fascinating topic in physics. However, it is perhaps a little bit preposterous to invest huge amounts of money, not to mention the work of thousands of scientists, to try to define a few more digits of a parameter that describes the behaviour of a quark observed through a mirror. To say the least, it is extremely loosely connected with the “real world”.

Finally at last, though, with network theory, physicists were entering the arena, and facing the complexity of the "real world" – just like biologist, economists, sociologists, and anthropologists had been doing for a while.

The power of networks is that everything can be reduced to a network and studied, even the Magnum ecosystem. As soon as we can connect two ice creams because they have in common a particular ingredient, like caramel or dark chocolate, or are part of the same offer, like the "Seven Deadly Sins", we have a network.

As will be dutifully explained in an upcoming chapter, we can even build a "Magnum directed network", similar to the Web network. Just as in the Web, one page leads to other pages; here, one ice cream leads to others. For instance, the first Magnum Classic leads to the first four Magnum variations (Double Caramel, Dark, Double Chocolate, and Almond) that followed it a few years later while the Double Caramel leads to Taste (in the Five Senses) and Sloth (in the Seven Sins), which are similar ice creams that were subsequently launched.  With the Magnum network, we can use the same formula Google uses to compute the influence that each web page has in the Web to arrive at the influence that each ice cream has on the Magnum ecosystem.

In this way, we can draw a graphical representation of the increase in complexity of the Magnum system over time. From the simple "star" at the beginning of the 1990s with one central ice cream and four peripheral ones, to the intricate network arrived at post 2000.

If we traced the evolution of the Web over the same period, we would get similar figures. We would see complexity emerge from the first 30 webpages published by Berners-Lee in 1990 to the billion pages in 2000.

The very concept of network is very pervasive. Once you start thinking in terms of network, you see networks everywhere because... well, because everything can be connected with everything. Like Tim Berners-Lee, the creator of the World Wide Web, says: "In an extreme view, the world can be seen as only connections, nothing else". And Lazlo Barabasi, one of the founding fathers of network theory, adds: "Even language ... is a network, made up of words connected by syntactic relationships."

Life and The Magnum Strategy

One of the first scientists to analyse the emergence of complexity in networks was polymath Herbert Simon, in 1962 –although he refers to networks as "systems". In his enlightening essay "The Architecture of Complexity", Simon writes: "We find cells organized into tissues, tissues into organs, organs into [physiological] system." We are part of bigger networks (life on earth, the solar system, the Milky Way galaxy, the universe) and are made of smaller networks like organs and cells.

Crucially, in this essay, Simon shows that living systems necessarily evolve towards greater complexity, because through complexity life increases its chance of survival. Be life a cell, an organism, or a corporation, any system will grow increasingly complex in order to survive.

In complex, organised, networks, "the whole is more than the sum of its parts", writes Simon. This "more", this emergent property of the system, is what makes different elements get together in a network and cooperate. The cells in our body, for instance, get together because, when organised in a human organism, they can outlive cells that exist in isolation. One neuron, isolated, would die in a matter of days. Ninety billion of them, connected, can survive for a century.

When Simon wrote the article, the idea that there could be self-organisation processes in complex systems was taking ground –and not just in science either. Politically, after the disaster of World War Two, most European countries finally decided to allow every citizen to participate in political life rather than limiting decision making to a few "aristocratic" male individuals. Financially, companies like Intel in California –and many more around the world– were showing that a large degree of hierarchical organisation was not necessary, and with just a minimal amount, success was possible.

Simon was right. I, on the other hand, had been completely missing the big picture when criticising complexity.

What if we thought of the Magnum Ice Creams as an organism? Being sold under the same brand, Magnums form a collaborating community: each Magnum tell us something about the other Magnums –something good – with all Magnums starting with the most excellent of reputations, based on the original Classic's. A customer will expect, and find, good quality ingredients in any Magnum because she knows that the original Magnum's strength was good quality vanilla, and thick Belgian chocolate. In this sense the Classic has a link with all other Magnums collaborating with them in a ‘virtuous circle’: the Classic's reputation gets stronger as it "recommends" other high quality ice creams, which in turn, being actually decent, "recommend" the original Classic. This potential circle can exist for Magnums other than the classic. Now under the area of influence of the Caramel are the "Caramel and Nuts" and "Sloth" Magnums, which Unilever introduced after its success.

With its fast growing reputation, Unilever would continue to introduce new Magnums at a fast pace, making the Magnum "empire" more complex, but also… bigger. Thanks to this strategy –complexity with high quality and strong connections– the Magnum became in 2000 the largest single ice cream brand in Europe[5].

This success was not possible if all twenty-plus Magnums were sold by different companies, with different brands. We would see a situation similar to the one before the Magnum arrived: many over-complicated ice creams, where it is difficult to make a choice. The stronger the connection between the elements of a system, the bigger the possible success. No connections between the elements, no success.

Simon shows that Magnum's evolution towards complexity was not just a potential syndrome, but a powerful strategy –the Magnum Strategy.

A strategy which can be summarised as:

  1. Start simple. Like Einstein said, "Avoid complexity whenever possible, but only then". Complexity should increase if, and only if, there are opportunities.
  2. Maximise collaboration. The creation of an organised structure is possible only when the members of the network collaborate: if one member discovers a new opportunity, other members should be able to learn from it.

The Magnum system, in reality, is no different from any other system fighting for survival –i.e. any living system. And indeed, life itself has used the Magnum strategy over the past four billion years, from the creation of amino acids to successful human societies.

Biological cells are "vanilla" life. They are the Magnum Classic of life. They are the first, simplest and most successful form of life ever: single-cell organisms comprise more than half of the total biomass on earth.

With time, these single-cell organisms differentiated themselves –just as the Classic metamorphosed into Double Caramel, Dark etc, there are now thousands of different types of single-cell organisms, each one specialised on a certain task.

Importantly, just as Magnum introduced new ice creams as part of the same "offers" –the Seven Sins, the Five Senses and so on, a few cells joined forces to create the first multicellular organisms. These first organisms, compared to today's organisms were very simple: a kind of "vanilla organism", where all cells have the same task.

And then the same strategy was applied all over again to obtain a very familiar landscape: the first vanilla organisms became increasingly complex until, 400 million years ago, a few organisms joined forces and created social animals.

There is no end to the story. The first colonies of social animals were very simple until the late arrival  of the homo, whose skills in cooperation were boosted by an amazing ability in communicating. Three million years ago, homo existed in small, simple communities of less than 100 individuals. Now the homo lives in huge communities of millions of individuals, continuously increasing its communication and cooperation ability.

All forms of life, biological cells, human societies, and even ice cream brands, share numerous characteristics. But first and foremost, they are smart networks –they learn and over time increase their chances of survival through collaboration and communication.

  • [1] Like most Einstein's quotations, the quotation is indeed apocryphal. The original one is: "It can scarcely be denied that the supreme goal of all theories is to make the irreducible basic elements as simple and as few as possible without having to surrender the adequate representation of a single datum of experience". Given that Einstein's writing style rarely follows the precepts of the apocryphal one, I believe the use of the latter is justified.
  • [2] Floris A. Maljers, "Inside Unilever: The Evolving Transnational Company", Harvard Business Review, September 1992
  • [3] Berners-Lee, T., Fischetti, M., & Foreword By-Dertouzos, M. L. (2000). Weaving the Web: The original design and ultimate destiny of the World Wide Web by its inventor. Harper Information.
  • [4] The funniest proposal I heard was that CERN should have charged a tiny amount of money –say one millionth of dollar– whenever a Web page (any page, not just CERN's pages) was visited by someone surfing the web. Interestingly, the University of Minnesota applied this business model to Gopher, an hypertext protocol which challenged the Web at its birth. Soon after the announcement, "industry dropped Gopher like a hot potato",  as Tim Berners-Lee said.
  • [5] Clarke, C. (2012). "The science of ice cream". Royal Society of Chemistry.
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