This Fall I am teaching two courses at FIU in the Honors College:
The Fourth Industrial Revolution This course is for two semesters. The course starts with an introduction to industrial revolutions and the writings of Carlota Perez. I used to start with Thomas Kuhn, but that was heavy going for undergraduates. Then we read Complexity: A Guided Tour by Melanie Mitchell, a researcher at Santa Fe Institute. Stephen Hawking said that complexity will be the science of the 21st century. We finish the semester reading The Nature of Technology by W. Brian Arthur. One of my students, an engineering major, said that every engineer should read this book the first week of engineering school. The book reading is supplemented by several current articles, which are included in this first-semester reading list, Download 4IR Reading List F2018. After setting the stage with Perez' writings, the course moves into an exploration of the technologies of the 4IR--artificial intelligence (AI), Blockchain, gaming, bio-sensors--to name a few. Much to my surprise, last year the students admitted that they did not know much about the technologies. This year we go deeper into the technologies. 2nd semester we explore the social, economic, political and environmental issues of the 4IR, which the students need to understand to fully function as citizens. Income inequality and the environment are two recurring themes, as I see these topics as the two critical issues of the 21st century. Course project will be to propose what the government will be in 2050. Students work in teams to perfect their collaboration skills.
Thinking, Design and Impossible Problems This course is for two semesters. For several years I have been teaching a course on thinking disguised as an entrepreneurship course. What I realized is that better thinkers produce better entrepreneurs. This year I am just unabashedly teaching a course on thinking and the real objective is to help the students think like a genius. The readings, the authors, everything except the professor, is about the mental frameworks of genius level people.In part, the course was inspired by the first reading in the course, The Evangelist of Molecular Biology. This article is about James Watson, who won a Noble Prize for his work on DNA, and how he almost became an ornithologist. One day he realized that he would make no real contribution to humanity in ornithology, looked for a new field of study, and found molecular biology and genetics. From this article, I realized that high potential students need to be immersed in the thinking and writings of geniuses in order to better understand their alternatives. First book in the class is Melanie Mitchell's book on complexity (described above). One of the best frameworks for thinking about problems is to model them as a complex system. The second book is Ray Dalio's Principles: Life and Work. Dalio is a legendary hedge fund manager and a well-known advocate for the use of mental frameworks to address problems. Similar thinking and approach to another legend--Charlie Munger. The first-semester reading list Download TDIP READING LIST F2018 also includes several articles. Many of the articles focus on inter-disciplinary approaches to problems and new fields where modeling is being used for the first time, such as mathematics, computer science and neuroscience. Each weekly class the students present their analysis of a different impossible problem and the course project will probably be to explain why art and science will converge in the 21st century. Students can work on all the problems in teams or individually.
For the last five years most of my thinking and teaching has revolved around three major areas:
Entrepreneurship
Creativity and learning
Complexity science
Today on Medium I published an essay on these subjects and how they explain many of the large market opportunities that consistently have repeated throughout history:
NEXUS: Small Worlds and the Groundbreaking Science of Networks, Mark Buchanan
From Material to Life, Sara Imari Walker et al (quantum mechanics, evolution and information theory)
Your Next Government, Tom W. Bell
Elinor Ostrom: An Intellectual Biography, Vlad Tarko (only woman Nobel Laureate in economics)
Best book was definitely From Material to Life, which I am going to teach in my Entrepreneurship, Design and Thinkingcourse this spring.. Fantastic demonstration of how to approach an impossible problem--how did life emerge.
Elinor Ostrom is a manual for how to live in a Blockchain directed government less world, although she researched for much less aggressive purposes.
Everyone interested in social problems should read about agent-based modeling. I believe we are on the verge of modeling social problems to derive real insight.
Not a year for much light reading, but a great year for learning.
This morning somebody asked me for a list of talks and workshops that I do. A current list is below.
The Secret to Successful Entrepreneurship. 4 hours, 8 hours, or 3 days. Entrepreneurship is a popular topic in the media, schools and the workplace. It is also critically important to individuals looking to manage their economic well-being in this new century. However, there are three key concepts in entrepreneurship that get little attention: fear, assumptions and opportunity. Fear holds one back but where does this fear come from. Assumptions are the land mInes that blow up most companies. Picking the opportunity is where one lays the foundation for the scalable business. These topics can be presented individually in half-day or full-day seminars or all together in a comprehensive 3-day workshop. Everyone will need to be an entrepreneur to successfully function in the new era of the 21st Century. This talk is where one can learn the fundamentals.
The Five Step Process to Convert Passions into Innovation. 4 hours, 8 hours, or 3 days. Innovation is perhaps the most popular word that no one defines correctly and consistently creating innovative solutions is always more challenging than it should be. Using the five step approach taught in this program, anyone can create innovations. This approach is not based on design thinking or the other traditional approaches to creativity, but rather draws its inspiration from early childhood development—1-Passion, 2-Discovery, 3-Creativity, 4-Invention, 5-Innovation. Depending on the depth of understanding desired, this topic can be presented in half-day or full-day seminars or in a comprehensive 3-day workshop. If you are interested to learn the lessons every genius throughout history has taught us, this is the event for you.
The Five Themes of the Fourth Industrial Revolution. 4 hours, 8 hours, or 3 days. Klaus Schwab, Chairman of the World Economic Forum, coined the phrase the “Fourth Industrial Revolution” to describe the current period of technological innovation and the resultant massive social, economical and political changes we can expect. While it is important to understand the underlying technologies, the social consequences are more dramatic than any period in history. Whether in half-day or full-day seminar or a 3-day workshop format, this presentation explores the technologies and five major themes that explain the Fourth Industrial Revolution. Anyone trying to prepare and educate people for the 21st Century should attend this event.
Social Entrepreneurship: Capitalism Redefined. 4 hours, 8 hours, or 3 days. Capitalism came under attack on many fronts as a result of the Financial Crisis of 2007-2008. In simple terms it might be said that the corporates forgot their responsibility to society. On the other hand capitalism is the most efficient way to address social issues at scale, as evidenced by the over 1.5 billion people who have escaped poverty in recent times. To blend this efficiency of capitalism with an integrated approach to solve the most pressing social problems, that challenge is what gave rise to social entrepreneurship. Whether in half-day or full-day seminar or a 3-day workshop format, this presentation defines social entrepreneurship, outlines the special features of its business model and showcases how existing companies can use social entrepreneurship and how non-profit organizations can convert to social entrepreneurship. How to start a social entrepreneurship venture is covered in the 3-day format.
Much of the content for these talks has been put together over the last 12-18 months from lectures I have given at various universities. Many people have heard me teach or speak on these topics at StartUP FIU. Many of my colleagues at StartUP FIU can also speak on these topics, if you wish.
I have just finished my third book, tentatively titled "The Foundation of Entrepreneurship: Large Market Opportunities that have Repeated for 40,000 Years". Book deals with large market opportunities that have repeated throughout history. For example, every time money changes form, there is a new large market opportunity. Title suggestions welcome. If you would like to read the latest draft, email me.
I have started thinking about my fourth book, which will be on assumptions or maybe assumptions and boundaries and how they affect the way we think about problems. Thinking about assumptions reminded me of this post I wrote in 2010, "Why can I not Timeshare a Dog". Sometimes it takes awhile to figure things out and some times I get distracted by other issues. The delay in getting back to assumptions I will blame on a multi-year study of complexity, which resulted in four chapters in book three.
I have been reading a fascinating book which I will use next semester in at least one course I teach--How We Got to Now by Steve Johnson. On the surface, the book deals with six inventions that changed the modern world. Perhaps more interesting is the insights about the inventors and in particular the mental frameworks that led to the breakthroughs. Equally interesting is how the book helps to illustrate the seminal work of Thomas Kuhn on paradigm shifts and their impact.
One particular story about the AT&T telephone monopoly illustrates the power of open source technology. Almost from the birth of telephony, AT&T had a monopoly in the U.S. The company worked very hard to maintain the monopoly. In 1956 AT&T agreed to license all the technology of its subsidiary Bell Labs for free to American companies in return for keeping the telephone monopoly. Bell Labs went on to create and advance technologies such as transistors, computers and cell phones, all of which were licensed to other companies. The quality of the technology and its subsequent adoption and impact demonstrate to me the power of the open source model. Wikipedia defines open source as "a decentralized development model that encourages open collaboration."
Perhaps this example from AT&T will help people to remember the alternative of open source.
In the latest book that I am writing, on how to find the business opportunities that have repeated multiple times over the last 40,000 years, I draw on insights from complexity science. Think of complexity science as an alternative to chemistry to explain the relationship between physics and biology. Two different languages and ways of thinking to explain the same events.
A fundamental part of complexity science is the concept of a network. Examples of networks are the Internet, Facebook and every "community". In a chapter on organizations in the book I make the point that great organizations are a stack of networks. For example, if we look at a great university like Harvard or MIT, we can understand them by their networks: students, faculty, alumni, institutes of learning, research partners, etc. These networks process information separately but compliment the whole of information. Fail to create a strong network in any one of these categories, and the university probably fails to achieve greatness.
This morning I was reading an article by Ray Kurweil, futurist and authoity on AI who trained at MIT with the late Marvin Minsky. Kurweil tells the story that multi-layer neural nets were proposed in the 1960s but were rejected by Minsky and his associates. Such networks are commonly used in AI today. The point of the story--multi-layer neural nets look an awful lot like stacked networks in great organizations.
Patterns that repeat in nature and in computer science are the basis for powerful thinking frameworks. Keep your eyes open for stacked networks.
This is a chapter from a new book that is almost finished. Comments are most welcome.
The book explores ten large market opportunities that have repeated throughout the last 40,000 years of human history. Every methodology for entrepreneurship that I have studied or taught always assumes an opportunity. I thought it was time to address how to find the opportunity beyond the usual advice to follow your passion.
This year's reading list is shaped in part by a new course I want to teach, "Cognition, Neuroscience and Artificial Intelligence". Also, I am still trying to answer some questions for a new book on market opportunities. All of this is increasingly tied together by my growing interest in evolution and biology. For several years I have told my students to think like ants. Now I have enough background to defend the position.
The recommended readings are:
"The Master Algorithm" by Pedro Domingos The book is a history of artificial intelligence with a focus on machine learning (no math). The notion of a master algorithm that can create all knowledge is a very interesting idea.
"Money Changes Everything" by William Goetzmann A history of money. Should be the first reading in every introductory finance class.
"Our Mathematical Universe" by Max Tegmark Reconsiders the age old question of what is reality.
"The Invention of Nature"by Andrea Wulf A biography of the first naturalist scientist--Alexander von Humboldt
"The Evolution of Everything"by Matt Ridley Questions many traditional explanations of issues and shows that evolution is a better explanation
"The Pre-history of the Mind" by Steven Mithen Scholarly work on the cognitive origins of art, religion and science.
I am starting to put together the content resources to help the teams in the new incubator at FIU--Startup FIU. Everybody has their favorite book, article or SlideShare deck on pitching to investors. I just reviewed a book from HBR, "Get Backed: Craft Your Story, Build the Perfect Pitch Deck and Launch the Venture of Your Dreams". The book is very well done. Filled with 10-15 examples of good pitch decks, all of which raised money. Also a lot of advice on content, format and design. I have not seen such a comprehensive (and correct) collection of useful advice anywhere else.
We will be accepting applications to Startup FIU hopefully within two weeks and throughout the summer. Students, faculty, FIU alums and the community are all invited to apply. More on this here at SF shortly. A graduating student from Morocco asked if his team could Skype in from Rabat. A meaningful number of team members need to be physically present in Miami to attend weekly events at the incubator. At an event last week we had everybody from high school students to post-docs come to hear the speakers. We welcome applications from local high school students.
Much has been written about entrepreneurship, but the beginning of the process is the least explored and described. In fact, little has been written to describe how one identifies the business opportunity, which sets the theoretical size for the business. I have been thinking quite a lot about opportunities in what will be my third book on entrepreneurship and have identified ten types of opportunities that have repeated throughout history and have always been large "new" markets. The overall framework of such market opportunities falls into three categories:
Human values
Neuroscience (think Kahneman)
Complexity
The reader should note that each category of opportunity represents a basic, almost primitive, understanding of human beings.
What follows is an early draft of a chapter on networks that comes from the section on complexity. I would appreciate any comments, including by email.
"Chapter IX—Networks
“So in the future, ideas will be the real scarce inputs in the world - scarcer than both labor and capital - and the few who provide good ideas will reap huge reward”
The Second Machine Age Brynjolfsson and McAfee
In the last chapter we learned that complex human systems, such as social and economic systems, are non-deterministic, adaptive, self-organizing systems that process and store information. The dynamic tension between exploration and exploitation makes a complex system adaptive. The behavior that cannot be ascribed to any individual part of the leaderless system is the emergent quality of complex systems, which is more easily understood in the context of networks, which are the subject of this chapter.
One classic example of complex systems in both biological and human systems is networks. The term network refers to the framework of routes within a system of nodes. A route is a single link that can be tangible or intangible between two nodes. Networks can be physically constrained, such as transportation systems, or non-spatial, such as certain social and economic systems.
Examples of networks and their role in the history of economic development is shown in this quote from Jean-Paul Rodrigue and Cesar Ducruet’s article, “The Geography of Transportation Networks”:
“Transportation networks have always been a tool for spatial cohesion and occupation. The Roman and Chinese empires relied on transportation networks to control their respective territories, mainly to collect taxes and move commodities and military forces. During the colonial era, maritime networks became a significant tool of trade, exploitation and political control, which was later on expanded by the development of modern transportation networks within colonies. In the 19th century, transportation networks also became a tool of nation building and political control. For instance, the extension of railways in the American hinterland had the purpose to organize the territory, extend settlements and distribute resources to new markets. In the 20th century, road and highways systems (such as the Interstate system in the United States and the autobahn in Germany) were built to reinforce this purpose. In the later part of the 20th century, air transportation networks played a significant role in weaving the global economy. For the early 21st century, telecommunication networks have become means of spatial cohesion and interactions abiding well to the requirements of global supply chains.”
Carlota Perez is a history of economics scholar who has devoted much of her research and analysis to understanding paradigm shifts or more simply put—technological revolutions. In a paper in 2004, “Finance and Technical Change: A-Neo-Schumpeterian Perspective”, she includes a graphic, shown below, that traces each of the major technological revolutions, starting with the Industrial Revolution in 1771. [graphic omitted]
If one examines each example of the “New or Redefined Infrastructures” (Column 3 above), almost every example is a network. If one accepts Perez’s analysis, this graphic clearly demonstrates the role of networks in the history of economic development and by extension in entrepreneurship. (Perez’s analysis shows all the network examples as infrastructure. The other common form of economic or social networks is a marketplace, which we discuss in the next Chapter.)
When one considers an explanation for the close link between paradigm shifts and networks, traditional economic considerations of production, distribution and consumption provide me with no insight. However, if we return to the insights of Ronald Coase, we see economic activity in a less traditional way as a combination of property rights [information], arrangements for collective choice [collaboration/feedback] and contracts for motivating managers and employees [social exchange/signaling]. [Footnote: Coase paper] Stepping back, what one realizes about economic networks is the efficiency a network provides. Networks provide connectivity, communication, operations and management, all in a self-organizing mechanism for information. Networks are nature’s answer to the Swiss Army knife.
Networks are such a “popular” and versatile mechanism for four reasons:
Networks lower the cost of searching for information
Networks lower the cost of verifying information
Networks lower the cost of processing and storing information
Networks lower the friction in exchanging information
Economic and social networks achieve these benefits in part through trust amongst participants, which we discussed in Chapter I. The further disclosure and transfer of information within the network builds the trust and fosters the organizing, processing and archiving of information. Trust also lowers transaction costs, thereby facilitating the construction of larger networks.
Herbert Simon writing on hierarchies [networks] cites three reasons why they are so common [Footnote: Simon 1962]:
Networks facilitate the formation of complex systems (see Metcalf’e’s Law below)
Networks have direct channels of communication (connectivity)
Networks are naturally redundant (lower transaction cost)
Strengthening the versatility of networks is Metcalfe’s Law, which says that networks follow a scale-free power-law distribution. (Every additional node in a network increases the value of the network.) As Albert-L´aszl´o Barab´asi explains it, “This feature [power law] was found to be a consequence of two generic mechanisms: (i) networks expand continuously by the addition of new vertices [nodes], and (ii) new vertices attach preferentially to sites that are already well connected. A model based on these two ingredients reproduces the observed stationary scale-free distributions, which indicates that the development of large networks is governed by robust self-organizing phenomena that go beyond the particulars of the individual systems.” [Footnote: “Emergence of Scaling in Random Networks”]
Mitchell makes an interesting point about the size of networks:
“Self-regulation in complex adaptive systems continually adjusts probabilities of where the components should move, what actions they should take, and, as a result, how deeply to explore particular pathways in these large spaces.” [Footnote: Mitchell, Melanie (2009-03-02). Complexity: A Guided Tour (Kindle Locations 2952-2953). Oxford University Press. Kindle Edition]
Mitchell’s probabilities, what might in the vernacular be called uncertainties, are discussed in more detail by JK Galbraith:
"the greater the uncertainty of the task, the greater the amount of information that must be processed between decision makers during the execution of the task to get a given level of performance".
This rather simple observation explains the evolution of “organizations”, which is the subject of the next chapter, and leads to two observations:
In small, resource constrained networks there is usually a large node or organization that dominates
In large networks the need for a large, dominant node is reduced (because of the distributed information processing power)
This relationship between network and the number of organizations [node] explains why early U.S. colonies required a federal government. Conversely, with today’s large, global, interconnected networks, perhaps we can downsize federal government in the U.S.
The relationship between networks and entrepreneurship is only now emerging, mostly due to the growing fields of information theory and complexity economics. However, in some ways the practitioners are ahead of the academics in their understanding of this relationship. Notable venture capitalist Fred Wilson of Union Square Ventures sees the establishment of a network as a competitive advantage that prevents competition from entering a market. Peter Thiel of PayPal fame recommends that startups go after small markets where dense networks can be created. (Giulio Tononi’s Integrated Information Theory uses “dense network” as a measure of how much more a system is than the union of its parts.) Thiel sees networks as a mechanism to achieve monopoly, his preferred position in any market. Facebook’s eclipse of MySpace shows, however, that networks are not a panacea or invincible business model, An even better example of the network model is Google. Google’s search algorithm targeted nodes with a large number of connecting links, just what Barab´asi explained about networks when he said, “new vertices attach preferentially to sites that are already well connected”. The insight here is that the Google algorithm followed the pure theory of power laws and networks and the opportunity proved to be quite large. Google’s approach also used autocatalysis, a characteristic of some complex systems, where the product of the search reinforced the importance of the information in future searches
Academic research has shown that companies using the network business model create more shareholder value. In an HBR article, “What Airbnb, Uber and Alibaba have in Common” [Footnote: https://hbr.org/2014/11/what-airbnb-uber-and-alibaba-have-in-common], the authors analyzed companies in the S&P 500 over a forty-year period starting in 1972. Companies were categorized as one of four types:
Asset Builders
Service Providers
Technology Creators
Network Orchestrators
Companies that were network orchestrators showed “higher valuations relative to their revenue, faster growth, and larger profit margins”. The researchers also discovered that only five percent of S&P companies are network orchestrators. The authors explain the value creation, “We believe this occurs because the value creation performed by the network on behalf of the organization reduces the company’s marginal cost, as described in Jeremy Rifkin’s The Zero Marginal Cost Society.” Looking for a more network-oriented explanation, I would think that the scarcity of network operators perhaps shows the challenge of successfully building and sustaining a network model. The efficiency of network value creation perhaps demonstrates Michael Porter’s findings that the competitive advantage [in successfully building and sustaining a network] is a key requirement for extraordinary value creation.
As we look to the future and the market opportunity offered from our understanding of networks, “The Second Machine Age” perhaps provides some guidance:
“The winners are no longer those able to compete solely based on cheap labor or ordinary capital, both of which are being squeezed by automation. … Fortune will instead favor a third group: those who can innovate and create new products, services, and business models. … So in the future, ideas will be the real scarce inputs in the world - scarcer than both labor and capital - and the few who provide good ideas will reap huge rewards.”
The Manifesto 15 Handbook discusses a new pedagogy, but I believe it can be generalized to show a type of market opportunity:
“Our traversals across networks are our pathways to learning, and as the network expands, so does our learning. In connectivist approaches to learning, we connect our individual knowledges together to create new understandings. We share our experiences, and create new (social) knowledge as a result. We must center on the ability of individuals to navigate this space and make connections on their own, discovering how their unique knowledge and talents can be contextualized to solve new problems.”
Scientists have long believed in the power of networks to foster research and learning. The Royal Society in England was founded in 1660 to support understanding in science. My point here is not to foster the further development of learned societies but rather to show that scientists have viewed the world in a similar way to The Second Machine Age since 1660. The opportunities suggested to me by this expanded networking include increased outsourcing, more hands-on learning between masters and apprentices and more tools for curating information.
One of the most interesting and difficult to understand parts of complex systems is that all complex systems are emergent. Before proceeding further, we should heed Melanie Mitchell’s warning that what do not understand about a complex system is not necessarily an emergent characteristic. Emergent properties are characteristics or behaviors that cannot be explained by the leaderless system of independent variables. Some scholars explain consciousness as an emergent property. Others explain sexual desire as an emergent property. Facebook perhaps demonstrates an interesting emergent property of some networks. A report by the international audit and consulting firm Deloitteestimates that the economic impact of Facebook on a global basis in 2014 was [Footnote:http://www2.deloitte.com/content/dam/Deloitte/uk/Documents/technology-media-telecommunications/deloitte-uk-global-economic-impact-of-facebook.pdf] $227 billion, of which $29 billion was attributable to “platform effect”—third party apps and services that attached to the Facebook infrastructure. I believe that “platform effect” is an emergent quality that enriches both the original network and the third party extension. Another example of an emergent characteristic might be many authors joining a network of book readers where they can interact directly with the readers. Readmill, acquired by Dropbox in 2014, offered this feature. Perhaps the advertising revenue model of Google search is another example of a successful network with an identifiable emergent characteristic. Perhaps a greater focus on the emergent characteristic would have enabled Readmill to survive as a standalone company. Building networks to foster symbiotic emergent characteristics such as platform effect may be a large market opportunity. The platform effect at both Google and Facebook was an after thought, as would be expected based on complexity theory, but in fact a key to success in both cases. At Google it provided the means to monetize search and at Facebook it accelerated the network effect for Facebook (and probably drew the world’s attention to social media). A business based on a network without an emergent characteristic is by definition a failure as a network. Fostering emergent qualities in networks should be a big opportunity given that the number of potential networks will only increase with the proliferation of digital technology. Such opportunities could involve network design or perhaps services to encourage the emergent characteristic.
Another interesting opportunity related to the network effect is Bitcoin and the underlying Blockchain infrastructure. Originally I was totally enamored of the idea that Bitcoin would replace government as the monetary authority by eliminating the need for government–issued currency. (The notion of eliminating government control of monetary affairs is almost irresistible.) With more thought on the subject I think Blockchain is a potentially bigger opportunity. Blockchain allows the members of a network to collectively authenticate data, replacing the role of a central authority. The MIT Media Lab Enigma project, according to Fast Company, uses the Blockchain technology to “enable a marketplace where users can sell the rights to use encrypted data in bulk computations and statistics without giving raw access to the underlying data itself”. For example, personal health record data could be shared without revealing individual identities. Effectively the Blockchain technology creates trust, verifies the data and reduces the cost to a network of processing information. With the increased size, versatility and resources of current networks with support from Blockchain, perhaps the biggest opportunity should be to use the newfound power of networks to replace government.
Note: The Edward Snowden affair may demonstrate that we have more confidence in Google than the U.S. government, these two being the largest collectors in the world of personal information. Now if we could only convince the Communist party in China and the Republicans and Democrats in the U.S. to go along, we could let individuals combined with network and AI technology manage global affairs. Ever the idealist!
The last opportunity that may emerge is in services to networks. For example, a university wants to start offering educational tours in Africa to alumni as a means to add value to the alumni network (and hopefully increase donations). The university will need a wide range of services to execute a strategy outside classroom education. Another example comes from Blackrock, the asset management behemoth. Any company that Blackrock invests in can purchase travel through Blackrock’s travel supplier[s] and take advantage of the volume discounts. An interesting example comes from my hometown Miami Marlins. They have created a network to share business between their corporate ticket holders. Both Blackrock and the Marlins need services for the network to exploit this additional opportunity to create value. As network becomes a better understood method to add value to an existing business model, the need for network services should increase."
On the off chance that you are pondering your own sanity over a more leisurely holiday period, I would like to tell you that you are not alone in considering such matters. I have started a new book, "Genius At Play: The Curious Mind of John Horton Conway" by Siobhan Roberts.
This is a great book for holiday reading if you enjoy:
Reading about crazy eccentric people
Learning how a genius mathematician thinks about problems
Wrestling with the relationship between philosophy, mathematics and physics
Don't be afraid. Very few equations. Excerpt follows.
"So I had this great idea of using the notion of “double parallax” to see 4 dimensions. Your left eye’s picture and your right eye’s picture theoretically could differ not only by horizontal parallax but also by vertical parallax. That makes 4 positions, which would give your eyes the input they need to see in 4 dimensions. And what generated the vertical parallax was the helmet. I made it out of a crash helmet, cut various bits off, bolted on a visor, and put these army surplus periscopes in place. One of them moved my left eye diagonally downward to the middle of my chin, and the other moved my right eye diagonally up to the middle of my forehead. The net effect was that my eyes were displaced vertically, and to rather more than the usual horizontal displacement, about twice as much."
Roberts, Siobhan (2015-07-14). Genius At Play: The Curious Mind of John Horton Conway (Kindle Locations 1246-1253). Bloomsbury Publishing. Kindle Edition.
I have been teaching social entrepreneurship for five years at FIU in the Honors College and at MIT Sloan, which was made possible in part by my 3+ years as CFO of One Laptop per Child (OLPC). OLPC was started by Nicholas Negroponte and faculty at the MIT Media Labs to provide every child in the developing world with a connected laptop. OLPC started as a donative non-profit but converted to a social entrepreneurship model in 2009. I joined to carry out this change in business model at OLPC.
Steven Weinberg, Nobel laureate physicist, says he teaches a new course to learn a subject. I do the same thing, but courses are better for organizing conceptual thinking and writing books I think is a better method to organize practical thinking. So when I think I understand the practical side of a subject, I write a book to confirm it to myself.
Social entrepreneurship is a better model to solve social problems than the traditional ways and increasing in popularity
Properly taught and modeled, over time entrepreneurship should not need the modifier "social" and the debate about the morality of capitalism can be put to rest
Organizing a social project is not particularly challenging, but organizing something that can scale to multi-country or Google scale is very challenging. In attempting such an effort one has to plan for worldwide coverage from the beginning. In traditional entrepreneurship, one gradually reaches the point of scaling after product/market fit and commercialization. In social entrepreneurship, early on one needs to find the model because lower operating returns and less startup capital do not give you the flexibility to iterate. This fact is even more true if you operate as a non-profit.
The second half of the book is devoted to the business model to scale a social venture. I strongly recommend in favor of for-profit companies in order to have better access to capital markets. I believe evaluation needs to be baked in from the beginning because access to social impact funds is becoming increasingly competitive. I advocate that one try to establish a movement to support the social objective, something akin to Gandhi, Mandela and King. That may look like a difficult undertaking, but OLPC achieved that objective--worldwide 1:1 computing for children. Lastly, I cannot say enough about the importance of partners to a social entrepreneurship venture and I recommend private sector partners.
The book is available in both paperback and Kindle versions on Amazon. I would be happy to sign a copy of the book that you give as a gift. I also think it makes a fine introduction to social entrepreneurship for a corporation looking to transform its corporate responsibility program into something more substantive.
This quote from FA Hayek on the Cafe Hayek blog reminds me of a book that I recommend highly.
Hayek quote from 1954 essay “History and Politics”:
"The complexity of social events in particular is such that, without the tools of analysis which a systematic theory provides, one is almost bound to misinterpret them; and those who eschew the conscious use of an explicit and tested logical argument usually merely become the victims of the popular beliefs of their time."
The book I recommend is Complexity and the Economy by W. Brian Arthur. Insightful examination of economics in a way that I have not seen before. Amongst other interesting observations, he advocates that technology precedes the need(s) that it satisfies. The discussion of just the concept of "formation" within economics makes the book worthwhile.
Found the book through a friend's FB post about meeting Arthur at Santa Fe Institute.
"Perhaps Fukuyama’s most interesting section is his discussion of the United States, which is used to illustrate the interaction of democracy and state building. Up through the 19th century, he notes, the United States had a weak, corrupt and patrimonial state. From the end of the 19th to the middle of the 20th century, however, the American state was transformed into a strong and effective independent actor, first by the Progressives and then by the New Deal. This change was driven by “a social revolution brought about by industrialization, which mobilized a host of new political actors with no interest in the old clientelist system. The American example shows that democracies can indeed build strong states, but that doing so, Fukuyama argues, requires a lot of effort over a long time by powerful players not tied to the older order.” [My emphasis in bold.]
Industrialization and the corporate actors pursuing their self-interest through the political process changed the concept of government in the U.S. for the better for about 50 years. This contribution appears to be overlooked recently when some criticize capitalism. However, the industrial complex is now accused of overdoing its involvement in the political process much the same as the system it helped to change at the end of the 19th century. The question then becomes who is the group or organization that can again rebalance the U.S. political system if corporate America is now the culprit. This kind of change would be particularly difficult because of the massive amounts of capital controlled by corporate America. Do not despair.
Many of history's most important social/political changes, such as the Protestant Reformation and the French Revolution, were facilitated by significant new changes in social media. Maybe it is just a coincidence, but perhaps all of this new Internet-based networking, community building and content generation is the type of change in social media that can facilitate a significant change in the U.S. political system. Perhaps we are preparing to re-balance political power and move to a healthier balance between corporations and other interested parties. This robust infrastructure of social media may be the vehicle. Ever the optimist.
I spend quite a bit of time considering the future. This practice started in Indonesia where I had to consider the future in order to mitigate risk. Since Indonesia I have tried to predict the future in order to better understand technology. This thinking has led me as well to take a serious interest in the nature of the customer experience and how it will evolve. All of this thinking about the future hopefully also has some positive impact on my teaching of entrepreneurship.
Steve Jobs once asked his former boss, Nolan Bushnell, “How in the world do you figure out what the next big thing is?" Bushnell answered:
"You’ve got to figure out how to put yourself into the future and ask what you want your computers to be able to do"
I rarely think about the future of technology this way but the technique looks imminently reasonable after Bushnell points it out. Excellent advice for an aspiring entrepreneur.
Lately I have been reading Our Mathematical Universe: My Quest for the Ultimate Nature of Reality by Max Tegmark. While the book largely deals with cosmology, the origin and development of the universe, the part I find more fascinating is the scientific methods used by the scientists. Given that the universe began around 14 billion years ago, many of the problems are very complex. One technique is the reverse of Bushnell's approach. The scientists know the status of the universe today from observations. Therefore, they assume what had to happen 14 billion years ago according to quantum mechanics to explain today's universe. Then they look for empirical eveidence to support their assumptions about the start of the universe. A lot of math later, if the empirical observation matches the assumption about the beginning of the universe, then the assumption is correct. If the assumption is proven wrong, it may actually mean that the question asked in making the assumption was wrong. Another example of the importance of asking the right question.
Bushnell says to assume the future you want. The cosmologists assume the past to prove their theories. No guessing about the future or the past. Assume what you need and then develop it.
I recently heard a story first hand where HBS staff visited a high school in Mexico to evaluate how effective the case method was for younger students. To evaluate the students' learning, the HBS staff first question to the students was "what is the difference between leadership and management?" I wonder how many of the MBAs in the U.S. could provide as good an answer as the Mexican high schoolers who had been using HBS cases with their non-business teachers for five years.
Leadership is "about setting a direction. It's about creating a vision, empowering and inspiring people to want to achieve the vision, and enabling them to do so with energy and speed through an effective strategy." Vision-Empowering-Strategic
Management is "a set of well-known processes that help organizations produce reliable, efficient, and predictable results. Really good management helps us do well what we more or less know how to do regardless of the size, complexity, or geographic reach of an enterprise. These processes include planning, budgeting, structuring jobs, staffing jobs, giving people time-tested policies and procedures to guide their actions, measuring their results, and problem solving when results do not fit the plan. Process-Scale-Results
The theme of Kotter's book is that we have perfected management over the last century, but that leadership has not kept up with the changes in technology, information, globalization, etc. The vision and mission of organizations need to be update by the leaders to recognize the new environment.
How do leaders deal with complex problems might have been a better theme. Management has advanced sufficiently to deal with simple and complicated problems, but it is not suited for complex problems. That is one reason that scenario planning and design thinking have emerrged as "new" processes. A comprehensive presentation of the various techniques and processes to deal with complex problems would have been interesting contribution to the leadership literature.
For the difference between complex and complicated problems, see this post.
With the semester finishing in a few weeks, I am thinking ahead to what course(s) need to be revamped for the fall semester. Definitely considering my newest course, Entrepreneurship, Design and Thinking (EDT), for some serious re-work.
The e-book "Art of Design". My students were blown away by this book as much as I was.
The Shell "New Lens Scenarios" stimulated a lot of original thinking from the students about the future
Willian Duggan's book "Strategic Intuition" was a book I really liked, but the students seem to have missed the point.
Someone has suggested that I make EDT a pre-requisite for my course in social entrepreneurship. I like this idea because the work on thinking and design thinking is excellent preparation before one tackles worldwide social problems. I also like the idea of having two years to teach some fairly complex subjects.
Thinking the course project might be to explain how plants identify familial offspring and "share" with them without a brain or processor. Definitely a complex question suitable for design thinking and it ties in nicely with two topics--neuroscience and AI--that I plan to expand in the seminar. May be too tough a question for under graduates. Might be a good example to learn about how to approach impossible problems :)
Nancy Duarte is one of the premier presentation story tellers in the world. For example, she did Al Gore's Ted Talk on the environment. Coincident with this week being Ted 2014, she has released a web-based guide for effective presentations that have the ability to "change the world".
The guide is called Resonate. One could easily teach a whole course on presentation, storytelling or screenwriting from Resonate. Nice discussions of creativity, emotional engagement, empowerment and the ancient Greek's view on all these subjects.
