Report 103

Your newsletter on applied creativity, imagination, ideas and innovation in business.

Wednesday 7 December 2011
Issue 199

Hello and welcome to another issue of Report 103, your twice-monthly (or thereabouts) newsletter on creativity, imagination, ideas and innovation in business.

As always, if you have news about creativity, imagination, ideas, or innovation please feel free to forward it to me for potential inclusion in Report103. Your comments and feedback are also always welcome.

Information on unsubscribing, archives, reprinting articles, etc can be found at the end of this newsletter.

YOUR FUTURE DEPENDS ON YOUR CREATIVE MIND

Your future, and your children's future, depends on your being able to add value where computer software cannot. This means that you and your children need to be creative thinkers and, even more importantly, recognise the potential value of creative ideas. The biggest threat to your job and your working future is not outsourcing to China or India. It is not reckless bankers. It is not even idiot politicians (though they come close!) Rather, the biggest threat is innovative new technologies that can do ever more of the tasks that people like you do – but at significantly less cost.

A Brief History of Technological Advancement
For the past 200 years, technology has been replacing jobs. First, agricultural machinery allowed fewer people to complete more farming work in less time. This resulted in many workers losing jobs in the agricultural industry. However, they soon found new jobs in the factories that made agricultural equipment. Better still, they often earned better wages. This enabled them to buy more goods, which fed the economy, allowing factories to make more goods and provide more jobs.

Of course, technology also improved the efficiency of factories. Sophisticated machine tools allowed factories to turn out more products with less employee time required for each product. Fortunately, this boosted productivity, so factories continued to grow and employ workers, albeit they would be operating machines rather than manually assembling products. Moreover, the factories that made machine tools also needed employees. Thus technology did not destroy jobs – it just changed them.

As long as productivity generally grows along with technological development, this works just fine. Moreover, farm labourers and factory workers, even those with basic educations, can quickly be trained to operate new machines or perform new tasks in factories.

To put it in a nutshell, technology has been replacing jobs relentlessly for two centuries. However, this has not resulted in global unemployment, because that technology has increased productivity, creating new jobs and more income which buys products which keeps the factories profitable. It is a virtuous circle. However, this virtuous circle has depended on two things:

The the jobs replaced by technology have not been intellectually demanding, so that labourers, who typically do not have higher educations, can quickly learn new tasks.
That the rate of technological advancement does not remove jobs faster than increased productivity can replace them.

A Quick Note About Offshoring
When it comes to lost jobs in the manufacturing sector, there is a tendency to believe, in the West, that we a losing too many jobs to low wage countries such as China, Bangladesh and so on. While it is true that low labour costs in these countries has encouraged many business either to build factories there or to source products and components from such countries, the number of jobs actually lost to offshoring is trivial compared to those lost from technology. In a few generations, those offshore factories will be be like the most modern factories in Japan: almost devoid of human beings. Machines will do most of the work.

Software Is the New Technology
Until relatively recently, jobs have been taken over by mechanical devices: tractors, large farming machinery, production lines, machine tools, robots and so on. This trend is continuing. But another one is also growing: more and more jobs are being replaced by software. And these jobs are often intellectually demanding ones that require higher education, experience and specialised training.

Software that analyses huge databases and on-line resources can review far more information than can human beings and increasingly sophisticated algorithms can even identify trends and generate recommendations. What once required a highly trained and knowledgeable consultant days or weeks to complete can often now be performed by computers in hours or even minutes.

For instance, legal discovery software can scan far more case law and legislation than can experienced paralegals. More importantly, it can identify relevant laws and cases and compile everything into a nifty report. Automated accounting software can replace innumerable accountants crunching numbers. Moreover, the software does the work far faster and makes fewer mistakes.

The combination of highly sophisticated software, masses of data on various networks and ever more powerful computer processors will only increase this trend. Pattern recognition software, will allow computers to perform even more tasks that once required humans.

There Is No Turning Back
Doubtless, many people would like to see this progress stop or even have it rolled backwards. But what would they have the world do? Would they make technological advancement illegal? Would they put in place laws that require companies to hire humans to do work less efficiently and more expensively than technology?

Let us face facts: this is not going to happen. If the USA, for instance, were to outlaw replacing jobs with humans, business’s operational costs would sky-rocket, making their products more expensive than those produced in other countries. As a result, Americans would either buy imports or be obliged to buy very expensive American products. This would not help the country’s massive budget deficit. It would also kill technological innovation. Is that something we want? I doubt it.

As for rolling back technology, I can only ask how far. Shall we go back to the 1950s when factory workers in the USA and Europe were relatively highly paid? Shall we make it illegal for businesses to use robots, sophisticated production equipment, computerised design software and all subsequent technological innovation? Would consumers be willing to pay more for the less sophisticated products that would result from such an action?

Should we mandate how many people must work in every factory, even if that will vastly increase the cost and reduce the quantity of goods made in those factories?

Should we bring textile jobs from Bangladesh back to Europe, putting the Bangladeshi workers out of jobs and ensuring that even a pair of cheap bluejeans cost nearly as much as designer trousers made in Italy?

On first sight, some of these proposals might seem attractive, but reversing technological progress will also reverse productivity. That means people will not be able to buy as many nice things as they can do now. That, in turn, will mean less money in the economy which will cost us jobs. In short, going backwards is not a solution. And it is certainly not innovative!

The Times They Are A Changin’
Like it or not, these changes are happening. Moreover, global economics is a complex beast. We cannot undo these changes nor legislate against them unless we want to see innovation and jobs go to other countries that embrace innovation, even if it threatens jobs.

For the foreseeable future, there are a few things computers cannot do very well. One of these is to recognise creative ideas. Do note, however, that computers can generate ideas. This is so easy, even I could make a program to do it – and I am not a programmer (though I have taught myself programming). However, and fortunately for us humans, computers cannot identify which ideas are truly creative and which are nonsense. So most computerised idea generation programmes just spew out a lot of silly ideas, possibly with a few good ones hidden among them.

This ability to generate and analyse creative ideas separates us from machines for the time being. Thus, although software can review case law, and find relevant legislation far faster than can a human, we still need a creative lawyer to weave that information into a compelling story in order to make an argument before a judge and jury. And only a creative lawyer can read the expressions and gestures of the judge and jury in order to change her argument to suit changing moods in the courthouse. For instance, if jury members are looking bored, the lawyer might change the tone of her voice or jump ahead to a compelling point in order to regain the jury’s attention.

Likewise, accounting and financial software can do much of the work that once required humans. But ultimately, creative accountants and financial experts are needed to interpret those numbers in order to make decisions about how to manage budget, taxes, investments and other factors.

Indeed, this is one other key thing computer software cannot yet do, and is unlikely to be able to do for some time: make major decisions and take responsibility for them. Creative senior managers will be needed to interpret a growing mountain of computer generated reports, consider ideas, use their insight and make decisions that keep their companies ahead of their competitors.

What This Means to You
The ability to be creative and, more importantly, to recognise creative ideas is something computers will not be able to do for the foreseeable future. So, you should hone your creative skills as much as you can. More importantly, if you have young children, do all that you can to encourage and promote creative thinking in them. Sadly, as your children grow older, schools and employers will discourage creativity in favour of teaching analytical skills. Analytical skills are important, of course, but as we have seen, computers are increasingly better than us humans at many analytical tasks. And computers will continue to improve – very possibly at an ever faster pace!

If you are responsible for a company, on the other hand, you want to ensure that you are hiring the most creative people you can find as well as ensure you retain and encourage them. As more and more of your business processes are being managed by machines, you will need creativity to retain your competitive edge. And that creativity will have to come from your employees or contractors for some time to come.

Where Is It All Going?
My personal belief, which is controversial, is that in two or three generations, capitalism will need to change in a very fundamental way, perhaps paving the road for a new kind of economy. Computers will be able to produce all that we need to live – making humans largely unessential to the economy. Once there is no need for people to work and machines can produce anything we need, money could easily become obsolete. Perhaps people will no longer have to work, unless they want to do so. Surely, creative thinkers such as scientists, artist, writers and musicians will want to work even if they do not need to in order to live well.

What do you think?

Reference
This article reflects thoughts I have been developing for a long time now. However, writing it was inspired by the article cited below – and some of the examples I’ve used come from the article.

“Difference Engine: Luddite legacy” (4 November 2011) The Economist, http://www.economist.com/node/21536460

HIRE JEFFREY!

If you want to ensure you and your colleagues are using your full creative thinking potential, give me a call or send me an email. I offer a number of workshops and talks to help you think more creatively and understand how the creative process works. Learn more about my offerings and check out the video clips at http://www.creativejeffrey.com/services/

In addition to the creativity and innovation based workshops, I also offer a workshop on good manners in business. This is not so much about creativity and innovation. However, I have noticed that many customers and supplier facing people in business today lack good manners. They are rude and discourteous. That reflects badly on your business, can lose you sales and can result in reduced quality relationships with suppliers. If your people are not polite when dealing with colleagues and outsiders, your business suffers. Fortunately, in addition to creativity and innovation, I know a thing or three about etiquette and am happy to share it. Contact me to discuss!

OBSERVATIONAL INNOVATION

Recycling the world’s must abundant natural resource, stupidity, as a source of innovation

By Peter Greenwall

“Two things are infinite: the universe and human stupidity; and I'm not sure about the universe.” - Albert Einstein

What if we could recycle the world’s most abundant natural resource, stupidity, as a fuel for innovation? I believe we can.

The 5 step ‘Observational Innovation’ formula is so called because it works on similar principles of observational comedy, where it’s up to you to notice the annoying shared experience into existence by asking: ‘What’s the deal with X?’

Problem: Identify your area of stupidity / mystery by giving it a name. For example, Seinfeld in his popular television series, asked: ‘What’s the deal with airplane peanuts? Why do they make it so difficult to open the bag?’ The innovator picks up on this and goes one step further by designing a solution, such as a ziplock bag.

What’s the deal with unobservant waiters? Why do we end up doing the scribbling-hand waiter wave, the universal sign for ‘cheque please’?
Question: Fire rhetorical questions at the problem to further describe your symptoms: why is this waiter ignoring me? Can’t he see me? What’s he doing? Why does this always happen when I need to leave urgently?
OsKNOWsis: Transfer of information from what you know to what you don’t. Draw a metaphor - What does it make you think of? Only you, with your special powers of connective intelligence (‘stupidity’ to other people) can compare this event to a previously unrelated event, for example: when my table was ready they buzzed me with one of those pocket vibrator thingies. What if I give it back to the waiter so I can buzz him instead?
Build something or suggest a better way of doing it (process innovation). This is where you move from comedian into inventor to build a new product or innovation that takes care of the problem. I propose: ‘Buzz your waiter with a Wuzza™ - a wireless buzzing device to get your waiter’s attention
Failure: the Wuzza fails in a number of ways and you have go back to step 1, but this time you’re a little wiser than the level of stupidity you started with. You have learned that just buzzing the waiter is bit pointless - he still has to come over to you so you can tell him what you want. It would be much better if you could use an app on your cellphone to send the waiter a message telling him exactly what you need such as more wasabi and ginger or the cheque.

Here are a few more examples.

Example One

Problem: What’s up with old people and new technology? Why can’t they get it?
Question to drill it down further: ever notice how your parents have to have the latest cellphone but don’t have a clue how to use it?
OsKNOWsis: connect info from what you know about large print books, bigger keypad buttons and bigger text on screens.
Build: IBM has tapped into this market by designing senior friendly cellphones with bigger buttons, emergency features and the like.

Example Two

Problem: What’s up with internet dating?
Question to drill it down further: ever notice how none of the profile pictures of your fantasy partner look anything like the person you meet?
Osknowis: connect info from what you know about age progression software, the software that is used to find missing children and fugitives
Build: FutureFoto™ is the essential software for all dating sites. It works out the average of all profile pictures and then adds on five years to give a forecast photo of what you can expect when you meet your date in person.
Failure: it is only 70% accurate. Rethink by going back to step 1 and asking further questions to add new features, like adding mother and father-in-law photos to the mix increases accuracy to 98%.

Look for Stupidity in Rules

Look for stupidity in rules. Which ones can be broken with a smarter innovation so that the rule doesn’t have to apply any more?

Stupid rule: a sign saying ‘All dogs must be kept on a leash’
Question based on what you don’t get: why must the dog be on a leash? I get why the dog cannot run around making a nuisance of itself but isn’t there another way to keep your dog close to you?
OsKNOWsis : connect info from what you know about wireless pet containment devices used in yards without fences, and apply to a dog collar.
Build: PAVLOV™ the leashless dog collar. A mild 12v shock, triggered every time the dog steps outside a prescribed zone, trains the dog to stay close to you.
Failure: The Society for the Prevention of Cruelty to Animals (SPCA) says that it is cruel to modify animal behaviour with shock treatment. Rethink by going back to step 1 - why does it have to be a shock? What about an audio frequency only audible to a dog and that keeps the animal to a confined area?

Name the Problem

The first stage of identifying your area of stupidity / unknown force / mystery is more than half the problem solved in all fields of innovation. This is mostly because the name helps others to connect with a common experience, but which they could not, because it had until then not been named.

Scientist: ‘Ouch @#$%^!! An apple just fell on my head. I will call this force ‘Gravity‘ - Isaac Newton. Problem solved? Not yet, but force identified.

Theologist: why is this bush on fire? It must be our leader trying to talk to us. I will translate what the bush says and call it ‘Religion’. - source unknown

Comedian: why does my penis shrivel up when I go swimming? Not sure, but for now I will call this ‘shrinkage’ - Jerry Seinfeld

Psychologist: I feel depressed. I will call this ‘Depression’. Only now do we stand a chance of inventing Prozac.

‘I feel bored at work. That will be ‘Boreout’, by psychologist Peter Werder

‘I feel anxious when I’ve been disconnected from the internet for longer than 6 hours’ - ‘Discomgoogolation’ - by David Lewis

Do you see what’s going on here? You connect with the experience but you don’t think of naming the problem into existence. Why not? What’s stopping you? Innovation starts with the naming of an unknown force that has been around for a while, but just never had a name. So before you can look at the ‘first-to-market’ race, you first have to look at the ‘first-to-identify-the-issue’ race. Put another way:

“Many of the great businesses of the next decade will be about making information about our behaviours more visible” - Evan Williams, co-founder of Twitter

So ask yourself this: What strange behaviours, that are happening around you right now, simply need to be named into existence? What it is about them that makes you feel stupid? What don’t you get? What, to you makes, Absolutely No Sense Whatso Ev R? Get inside this question and the ANSWER will magically appear.

About the Author

Peter Greenwall has a radically different take on innovation, probably becuase in addition to being an entrepreneur he's also a songwriter who's scores have featured in multimedia stage shows for corporate events. His comedy musical presentations are based on his book, ‘Logical Stupidity – Innovation by Navigating Through Nonsense’, and deals with psychology of the creative process/ innovation /PIFYAFFING: Pulling Ideas From Your Asspirations For Financial Gain. Peter's navigation through nonsense is loads of fun and full of laughs but it's also a lightbulb moment in creativity. It teaches how to access the creative soul within each of us.

Click here to download a free version of the book. Click here For bookings.

Youtube videos: Frustration For Sale (about creating businesses based on your frustrations with what you see going on around you), Black Note (about breaking the rules responsibly), How to Capitalise on any crisis, About innovation in internet dating.

POWERFULLY BAD DECISIONS

A critical element of any innovation process is making a decision to go ahead with an idea; to kill an idea or to change aspects of an idea before implementation. It is a relatively small act, but one that is necessary to turn a creative idea into an innovation. Unfortunately, it seems that such decisions are often flawed.

Big decisions are normally made by top managers. Unfortunately, the more powerful these managers are, or at least believe themselves to be, the more likely it is that their decisions will be flawed, that they will be unreceptive to advice from others and that they will be swayed by personal prejudice!

Considering that most innovations involve change, understanding new ideas and risk, this suggests that decision making with respect to highly creative ideas, those that have the potential to become breakthrough innovations, is likely to be flawed.

Recent research has demonstrated “...a link between having a sense of power and having a propensity to give short shrift to a crucial part of the decision-making process: listening to advice. Power increases confidence... which can lead to an excessive belief in one’s own judgement and ultimately to flawed decisions.”

In a nutshell, the researchers found that as the subjects in their tests felt themselves to be more powerful and self-confident, they became less likely to listen to, let alone take into account, the opinions of others. This is at least partly because powerful people see seeking the advice of others as a weakness.

One suggestion in the research paper is that “...organizations could formally include advice gathering at the earliest stages of the decision-making process, before powerful individuals have a chance to form their own opinions. Encouraging leaders to refrain from commenting on decisions publicly could also keep them from feeling wedded to a particular point of view.”

Incidentally, the researchers also found that women are more likely than men to be receptive to advice and even seek advice. So, another suggestion might be to put women in positions of senior management, particularly during times of change.

Reference

Kelly E. See, Elizabeth W. Morrison, Naomi B. Rothman, Jack B. Soll, The detrimental effects of power on confidence, advice taking, and accuracy, Organizational Behavior and Human Decision Processes, Volume 116, Issue 2, November 2011, Pages 272-285, ISSN 0749-5978, 10.1016/j.obhdp.2011.07.006.
(http://www.sciencedirect.com/science/article/pii/S0749597811000975)

INTERACT WITH JEFFREY

I am on the social networks and would love to connect with you.

Facebook
My professional page on Facebook is http://www.facebook.com/pages/Wonderful-World-of-Jeffrey-Baumgartner/123423697738417 – I am trying to get some conversations about creativity and innovation going on this page and would love for you to join us. My ego would also appreciate your liking the page!

LinkedIn
You can also connect with me on LinkedIn at http://www.linkedin.com/profile/view?id=8967&trk=tab_pro

Twitter
And you can follow me on Twitter. I’m @creativejeffrey – http://twitter.com/creativejeffrey

THE WAY OF THE INNOVATION MASTER

If you enjoy Report 103, you’ll love my book The Way of the Innovation Master, which explains everything you need to know in order to launch an innovation initiative in your company. Not only is it a great read, but it makes for a wonderful Christmas present! Learn more and order yours in print or digital versions from http://www.creativejeffrey.com/books/ – or ask for it at your favourite bookshop.

Happy thinking!

Jeffrey Baumgartner

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Report 103 is edited by Jeffrey Baumgartner (jeffreyb@jpb.com) and is published on a monthly basis.

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