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Creating Generational Legacies

Thursday, August 20, 2015

radical innovation cannot be measured by economics

great thought by David Nordfors 

I believe radical innovative entrepreneurship must be difficult in economics, almost per definition.

Economics does quantitive measurement of parts of a grander narrative, for example ‘number of active job seekers’ and ’the US labor market'. It has a model of the grander narrative where it puts in the measured numbers. Then it says how the grander narrative is doing.

But radical innovation entrepreneurship isn’t about changing the numbers. It’s about changing the narrative. Radical innovation is a new way of relating, rather than just relating more to something (or less). And the narrative is a scheme of how things relate. 

In order to be able to do that, economics must work with scenarios. Projections of how the existing narrative of how things relate will perform is not relevant if some entrepreneur came along and replaced it with another narrative. When Apple presented the iPhone and the app store, that changed the narrative. If you measure old indicators applying it to the old narrative you won’t get it right. You’d for example get the impression that people stopped listening to music, because the sales of music players has dropped drastically. You’d get the impression that people find it much more important to talk on the phone, because the sales of mobile phones went up. But what actually happened is that the old narrative of the “phone” was disrupted, and there came a new one. 

Aggregates don’t explain (radical) innovation. 

The introduction of new narrative is highly non-linear. Perhaps if one can construct lots of scenarios and do a Monte Carlo or something, I don’t know. 


Should remind a bit of tracing infectious diseases but much much wilder. 

Venture Capital in Australia: Do share prices move because of quarterly profits ...

Venture Capital in Australia: Do share prices move because of quarterly profits ...: SEEKs share dips - apparently on Executive decision to invest strongly in R&D and Long Term Strategies of accessing offshore markets ...

Sunday, August 16, 2015

Esko Kilpi on the power of networks and the changing nature of firms

Esko Kilpi beautifully described the power of networks in an essay on Medium, “The Future of Firms,” reflecting on economist Ronald Coase’s theory of 20th century business organization.

 He wrote:

“The existence of high transaction costs outside firms led to the emergence of the firm as we know it, and management as we know it….The reverse side of Coase’s argument is as important: If the (transaction) costs of exchanging value in the society at large go down drastically as is happening today, the form and logic of economic and organizational entities necessarily need to change! The core firm should now be small and agile, with a large network.
The mainstream firm, as we have known it, becomes the more expensive alternative. This is something that Ronald Coase did not see coming. Accordingly, a very different kind of management is needed when coordination can be performed without intermediaries with the help of new technologies. Apps can do now what managers used to do. 
Today, we stand on the threshold of an economy where the familiar economic entities are becoming increasingly irrelevant. The Internet, and new Internet-based firms, rather than the traditional organizations, are becoming the most efficient means to create and exchange value.”

Sunday, August 9, 2015

Singapore's Success

From Mei Lin Fung 


The opportunity for everyone to have a world class education, for students of low income families  to receive generous scholarships to study at the top universities in the world, is just one of many investments in social infrastructure that has given Singapore a competitive edge in growing and keeping unemployment low even as the the world economy goes up and down.

Today 1 in 6 Singaporeans is a millionaire - this is achieved through home ownership - and as the city state has become the residence of choice for the rich and famous in Asia - the value of humble residences which 40 years ago cost from under $10,000 to about $20,000 to purchase has multiplied 50-100 fold. - The Economist 2 minute video of this is here

The health system in Singapore has one of the best outcomes while spending 4% of GDP - compared to about 10% of GDP in most developed countries and 18% of GDP in the US.

Yet Singapore struggles with disparities - while no one is left behind to starve or die of sickness on the streets - there are those who are not enjoying as many fruits of the success as others - and the government of Singapore appears to be working out how to do more balancing. 

Singapore is just an early pioneer in the digital transformation - and one institution they set up is the one Sandeep mentions, the Institute of Employment and Employability   - e2i - https://e2i.com.sg/ 

Rather than just looking to replicate Singapore, which I do not think is a good way to go - I would like to see the pioneers from around the world to share learnings and exchange ideas - no single country, no single person can work out all the answers. 

I4J can be an incredible force for good to be a Trading Post for identifying those examples of Positive Deviance  which against the odds have found pathways to progress.

Innovation, Employability and Singapore

Today Singapore celebrates its 50 years anniversary. Amazing what this small nation has achieved in very short time. Congratulations to Mei Lin Fung (i4j light house) and all other Singaporeans.

Kishore Mahbubani, Dean of the Lee Kuan Yew School of Public Policy has written an article for Huffinton Post that sums up the reasons for the success: http://www.huffingtonpost.com/kishore-mahbubani/singapore-world-successful-society_b_7934988.html?utm_hp_ref=tw 

Many countries have been of inspiration to Singapore – now it might be useful for others to look at why/how Singapore's per capita income has increased from $500 to $55,000 today, the largest increase any newly independent nation has enjoyed.

In addition to strong leadership, Singapore's success is due to "MPH": Meritocracy, Pragmatism and Honesty, according to the nations leaders. 

Unemployment is almost non-existing and today the Prime Minister in his speech proudly stated: “We have left no one behind”. 90 percent of residents living in homes they own and Singapore has one of the best educated populations.

One success element I would like to add to the well written article is: Employability. Singapore has an “Institute for Employability”. Do you know of any other nations with this kind of foresight? 

Employability can be defined as “doing value creating work, getting paid for it – and learning at the same time, enhancing the ability to get work in the future”. Maybe check out this article that I have contributed to on Wikipedia: https://en.wikipedia.org/wiki/Employability 

The video about Employability by Johnny Boston is also relevant: https://www.youtube.com/watch?v=8kXdgrjHpyM 

Can i4j become the catalyst for some of the great ideas around employability?  Can we get corporations engaged in promoting employability solutions that works for the individual (and hence corporations and nations)?

Ideas, comments and questions are most welcome

Best regards

Sandeep

Sandeep SANDER, CEO
SanderMan Pte. Ltd. Singapore
Outperform Your Potential™. 

Wednesday, August 5, 2015

Innovation is a collective Genius - Linda Hill TedX

from Curt:- 
PS Here is a remarkably insightful talk from an ethnographer!  Go figure.  





From Ivan :- 

Linda spoke really well ... Some gems that I got on innovation from the talk:-
1. Innovation rarely happens unless there is disagreement and conflict 
2. Innovation is mostly a collaborative effort and rarely a solo effort 
 3. Innovation is more about experimenting than prototyping 
4. Innovation can happen everywhere 

From Curt:- 
I was just at the business section of a book store looking through all the new books.  One of the things I first do when I pick up a business book is go to the index and look up "customer, value, value proposition,  business model, and innovation."  If those words are not entered I usually put the book down because the entire direction of the book is likely misplaced.  Most business books pretty much ignore the only reason a company does business.  In my little experiment it was only about 1 out of 5.  Amazing, no?  Everyone should be required to read Peter Drucker before they are allowed to say or write one word about innovation!  


Curtis R. Carlson, Ph.D.
Founder and CEO, Practice of Innovation
Former President and CEO of SRI International, 1998-2014

For those who've never read Drucker on innovation, here's one of his classic HBR pieces on the subject:



From Rick:-

In it, he writes, "Because innovation is both conceptual and perceptual, would-be innovators must..go out and look, ask, and listen. Successful innovators use both the right and left sides of their brains. They work out analytically what the innovation has to be to satisfy an opportunity. Then they go out and look at potential users to study their expectations, their values, and their needs."

Rick Wartzman, Executive Director
Mobile 323-896-0626

HOW TO DISRUPT UNEMPLOYMENT


Vint Cerf, VP Google and David Nordfors, CEO IIIJ are the i4j Summit Chairs

Some say all jobs may be automated. Perhaps next thing consumption will be automated, too, and then we are really in trouble. Seriously, something does not make sense with this way of thinking.

Instead, innovation may disrupt unemployment. With a new mindset that appreciates the value of people, innovation can drive unemployment ‘out of business’. Everyone can have a good job.

It’s not that we are innovating too much. The problem is that we are trying to run the new economy in the old way. The old way is about doing more of the same, more efficiently. It’s about standardizing tasks, creating work manuals, and such things – many of them very tedious and non-rewarding. Well, that’s what machines are good at, so if this is only what the economy is about, yes – we will be losing more jobs all the time. And now we are worried, because we can’t imagine what people can do instead. So that’s what we are lacking: imagination.

It’s obvious: all people can create value for each other. There are no useless people. We ‘only’ need an economy that lets people create value. People are more enabled than ever before. The smartphone is such an amazing tool that we are surprised every day by people doing new things we just didn’t think of as something possible for people to do. Each unemployed person with a smartphone is in control of a super computer center packed with engineers, according to old norms. How can a sound economy of any sort avoid utilizing this amazing resource of empowered people? It’s not like there are too few problems for people to solve or that people stopped wanting more out of life. How about fixing the climate, eradicating disease and stopping wars, to start with? There are an infinite number of new things to do.

If we become as innovative in creating good jobs as we are in creating innovative products and services, then the innovation economy is sustainable. Today there is a product or service being developed for every possible need and desire. Can the economy develop valuable jobs for every person, letting them do something that fits them like a tailored suit, creating the highest possible value and satisfaction for everyone involved? Then there will be an infinite number of job possibilities for a limited amount of people. People will be the scarce resource, not jobs. Imagine instead of getting a job because you can do something that other people (or machines) can do, you get a job because you are special in a way that creates real value for other people. An attractive aim for the innovation economy, we think.

What could this look like? Imagine starting a company that recruits you to their service, let’s say it’s called Jobly just to give it a name. With smart technology Jobly scans your skills, your talents, your passions, your experiences, your values, your social network, and so on. Joibly finds ways of testing the market for things you can do. Perhaps you say “I would like to paint pictures but I don’t know how to earn money on it”. Well, there is a fair chance among all the billions of people on the planet there are some people who are willing to pay you. Perhaps you try that for a few weeks, then you try something else, until you decide to settle for something that feels really meaningful that you do together with people you work well with. Finding the right job is a bit like finding the right partner, isn’t it? Now, if Jobly takes a commission on what you earn, they have the incentive to make you as valuable as possible. Jobly will help you find the right courses so that you will earn better, increasing what they earn. Jobly may offer you health benefits, too, because if they have a few hundred million users, they can spread the risk, they will be your health insurance, too. You are the service they offer to their customers who buy work in order to create value. Jobly would be disrupting unemployment, tailoring jobs for the so called “unemployable”. It’s quite often that people carrying that label are among the best people we know, the ones that make us feel that something is seriously wrong with the labor market today. The ones that are amazing, only that they don’t fit the slots, so sorry, too bad.
A business model like this one is good for both the micro and the macro-economy. It is for-profit driven, maximizes the value of people and minimizes the cost of tasks. It distributes wealth, creating happier workers and wealthier customers. It seeks and creates diversification, enabling people in society to do as many different things as possible together, thereby strengthening the ability of society and economy to deal with all types of challenges. It is a model for nurturing a middle class society in the innovation economy.

The value proposition is attractive. Think about it, only a fraction of all human capacity is being used today. So many people hate their jobs, The market size for disrupting unemployment is the difference between the value created this way today and the value created by all living people, fitted with tailored jobs they are passionate about, giving one hundred percent of their capacity. This might be the greatest business opportunity ever.

So what about automation killing jobs, then? Innovation is actually a very good thing in the economy we have described, because it frees up people so that they can do other things. But it has to be combined with innovation in tools, making people able to do new things that they could NOT do before. Smartphones are great. So is software for creativity and productivity.

People with disabilities, or who have suffered severe social challenges or who have been ill, don’t have an easy time on the job market. But with the right tools they can be just as attractive as anyone else. They often have special skills that people with less challenging lives lack which can make them even more valuable. You won’t find these things in the job descriptions of listed jobs.
Or look at those who are unique in other, very special ways, for example those who say they can see auras around people. It’s not a recognized skill. A lot of scientists and other presumably rational people will say they are fakes. They are often into healing or alternative medicine which isn’t accepted by the healthcare systems. Insurance won’t cover it.

You won’t find a single job description saying “we are looking for people who can see auras”. There isn’t a big market for aura healers. In 2012 researchers found a possible explanation to seeing auras. It’s a condition called “synesthesia”, crossed wires between the senses. There are people who see colors when they hear music, often excellent musicians, such as Tori Amos or Leonard Cohen. Research suggests that people who seeauras have ‘emotional synesthesia’, their eyes see an augmented reality, colored by their feelings. This is a very valuable gift In a world where so many people are out of touch with themselves. People with emotional synesthesia will often be better at seeing when people are troubled, or spot when someone is lying, because they are emotional seismographs. They can excel in anything that requires gut feeling, which is quite a lot. They can be excellent neuropsychologists, work with improving human-computer interaction, or work with making video conferencing technology more efficient.

Almost no one knows about the 2012 research paper. Why should they? There is no incentive. Synesthesia is a very unusual gift and it’s not like aura healers are important for the economy today. You won’t see any job descriptions talking about it. This is a type of value that a company like Jobly can cultivate. Their intelligent system will be following the research and relevant discussions. They will know if you are a healer, because it’s obvious from your emails. They will notify you, saying something like “you can be very good at reading people, check out this 2012 paper and these other sources if you want to know more”. Jobly might go on asking “are you interested in working with something like building a new educational system in Country X?” because it turns out that country X, a place you like going to, is working on an anti-corruption program and are restructuring their educational system. They need people who are empathetic and can spot honest people that can be put to work with coaching kids. You already know people in country X that are involved in the project, it’s only you aren’t aware of it. They aren’t aware that you might solve their problem, and they definitely don’t know the 2012 research paper. Even if they know you are a healer, they won’t make the connection to their project. Jobly will not tell you all it knows, it needs to keep discretion, but links can be made in each case. Let’s say you are thrilled by the idea of spending some time in country X doing good work, and you are pretty excited about the 2012 paper which explained a bit more you who you are at the same time as suggesting how you might create value with it. So Jobly now gets in touch with your friends in country X, the ones working with the education system, presents them with the idea that people with emotional synesthesia might be relevant for building a corruption-free system. If they say this is something they would like to look into, Jobly lets you know, and then its up to you to get in touch. Jobly will let you know that some of your contacts might be good entry points. If you decide to go for a project together, Jobly will give you all the administrative tools you need to fix visas, taxes and so on. And 20% of the money goes to Jobly, for reinvestment in continued refinement of job and talent mining.

How big is the potential market for job innovation startups? Well, to start with, there is $100 billion in cash spent each year on unemployment insurance. Perhaps a part of that money can be used as incentive for job seekers and companies like Jobly to get going putting people’s most valuable talents into use.

But unemployment not only costs tax dollars. That’s the small part of it. Human capacity is probably the world’s most underutilized resource, the worlds largest potential market. Think about it: In an average western country, only about half of all people are in the work force. About a tenth of those are officially out of work. So there might be a doubling of GDP already there.

Next, consider this joke: A visitor is being shown around a large workplace. He asks “Who many people are working here?” His host answers “About fifty percent”. We all know it’s true. There is perhaps another doubling of GDP just there. The market for disrupting unemployment might, in principle, quadruple the GDP. Can we even imagine a larger market opportunity?


To be honest, we must also not forget: not all of the work we depend on is paid work. It’s a lot, spanning from being a good parent to community work, engaging in democracy, or developing Linux and Wikipedia. We DON’T even want this to be paid work. So disrupting unemployment means more than giving people paid jobs. It is about how we create wealth and wellbeing for everyone.