Barriers to Innovation

My last post was an optimistic ode to the endless innovation currently possible, due to the state of technology, entrepreneurship and related support systems. But that doesn’t mean it’s easy. Today, I want to discuss some sobering limitations that thwart the introduction and uptake of new things.

Several broad categories of barriers to innovation spring to mind:

  • regulation
  • fitting into existing infrastructure
  • consumer habits
  • figuring out who is going to pay
  • short term vs long term thinking
  • benefit twice removed

To illustrate these, I’ll discuss barriers in a couple of hypothetical situations where delivering a solution seems easy.

Consider the challenges to providing real-time transit information. This was inspired by a comment I overheard: “in X,Y and Z city, you know exactly when the next bus will arrive; why can’t we have that here?”

Why indeed?

The technology exists to track a vehicle, create algorithms to integrate the traffic flow, rate of bus progress, passenger demand and weather conditions to estimate and adjust time of arrival for buses and trains. Multiple options exists for providing this information to transit customers, such as pixel boards at stops, a downloadable app or text message service. The information is useful to customers to plan their commutes and use their time wisely. Providing real time updates enhances the customer experience, because it’s more satisfying knowing that your bus will arrive in 14 minutes than not knowing and having it appear after you have fretted and peered into the traffic for 6 (much longer) minutes. Happier customers are repeat customers. So, there’s value to be shared between provider and customer.

Why can’t they have it everywhere?

I can think of a bunch of (hypothetical) reasons.

1. Perhaps the current fleet of vehicles aren’t GPS enabled. Perhaps there is no way of announcing the information at the stops, since all that currently exists are metal signs. (infrastructure issues)

2. The bus drivers union may object to such a system because it tracks driver performance in an unfair way. Or the legal team could be concerned about liability of promising something not under the control of the transit authority. (regulations)

3. How will the new infrastructure be paid for? Through fare increases, increased bank loans, or decreased dividends to shareholders? Although the value can be seen, is it enough to make people reach into their pockets? (who will pay?)

4. The cost to implement this new system will have to be paid long before rider retention can be proven. (short term vs. long term thinking).

To illustrate the other two barriers, I’ll use plastic utensils, especially straws. Much has been made of the earth- and ocean-clogging features of these implements of consumption lately. We need an alternative. Why do we use straws to consume beverages? (This is customer habit.) Innovations that replace the straw must overcome habit. And why do we have plastic utensils, food containers and other disposable, polluting conveniences? Because they are convenient. Eating your meal and cleaning up afterwards are things you will enjoy right now. Pollution of the oceans may only come to your attention years later. And you’re not sure how plastic in the waters effects the environment. It’s difficult to understand the vastness of the consequences of disposables in the sea when you put a single straw in your bubble tea. (benefit twice removed)

Yes, there can be significant barriers to implementing a genius idea that is good for people, business and society as a whole.

And yet, the answer is innovation. Business innovation. Get around the regulations or change them. Show stakeholders short and long term benefits. If there is value in an innovation, someone will be willing to pay. People only cling to their habits if they don’t see the benefit of changing.

Innovation is possible, if you understand the barriers and come up with ways to get over, under or around them.

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What’s New in Innovation?

How cool is a conference that opens with a humanoid robot (Sophia) and a hologram of her creator (Dr. David Hanson) discussing artificial intelligence?

They were okay, but the real revelation I got from this year’s OCE Discovery wasn’t flashy, revolutionary or disruptive. I wasn’t transported to a new reality. Instead, I looked around and realized: we’re here. Here, at a place where innovation has few limits.

Technology is not limiting.

Data is not limiting.

Knowledge is not limiting.

Being an entrepreneur is not limiting.

What’s left is to ask the right questions, choose the problems to tackle, the needs to fulfill.

Let me explain. First though, let me say this post tumbled out of my brain1 after listening to many inspiring presentations by David Hanson, Megan Smith, speakers in the Keynote panel on Transformative Technologies, and panels on Artificial Intelligence and Smart Cities at the 2018 OCE Discovery, an annual, award-winning innovation-commercialization conference.

Technology. There are several waves breaking onto the beach of everyday life: Artificial intelligence. Machine learning. Big data. The internet of things. Robotics. The capacity to use information is immense, because of increased transfer rates (5G), increased availability (social media, GPS) or increased monitoring (sensors on everything). It goes beyond what humans are capable of by combining the storage power of machines with the processing power of machines. Sure, there are still technical challenges, but there is capacity to write algorithms, apply principles, reduce to practice. We are on the cusp of autonomous cars, SMART homes, apps to help us do everything from planting vegetables to grocery shopping to putting out the garbage.

Data. We have reams of data. We have reams of accessible data. Accessible both because it’s been collected and because some of it is public. Our phones and search engines probably know more about us than we do ourselves. Watson, the super-intelligent computer, knows more about medical studies than doctors2. Is Shakespeare is available in Klingon or which of his plays have been performed most often? This data3 is available.

Knowledge. Don’t know how to do something you want to do? Search. If that doesn’t work, ask. See above for accessibility of technology and data. Seriously, you can learn how to do just about anything on the internet, or at least find someone to teach you. The sharing economy has not only brought us cheaper rides and accommodation, it has shifting thinking to collaboration and partnerships so people are willing to share their expertise.

Entrepreneurship is best defined by what it no longer is. Entrepreneurship is an acceptable career choice. Starting your own business is cool now, although there was a time it was considered nasty capitalism by some. While starting your own business isn’t trivial, it’s better supported in Canada than it ever has been, with incubators, accelerators, educational programs, and accessible resources. What works and what doesn’t in entrepreneurship is understood better than it was 10 years ago. Due to the technology, data availability, and knowledge sharing, developing an idea into a business has never been easier. The challenge now is how to encourage and support people to do it.

That’s what struck me. We can do any number of things. We only have to decide what we want to do. Do we need to curate traffic so here are no more jams? Should we understand weather patterns to predict umbrella demand? Can we make a difference by diagnosing a disease before it is symptomatic? How do we reduce energy consumption? Waste less. Care for more.

From the miraculous to the mundane4, we have the technology, data and knowledge. We can build it, better, stronger, faster, for less than millions of dollars.

Combining creative risk-taking (entrepreneurship) and utilization of available resources (technology, data and knowledge), we can solve an enormous number of problems.

All we need is to just do it5.

——-

1Being inspired by interesting people was even better than not realizing David Hanson was a hologram until his talk was almost over.

4 Which is which may depend on your perspective – consider bringing entire populations out of poverty with microloans or being able to recharge your phone anywhere.

5 There are barriers and challenges to developing any idea into a tangible solution but I hate to be pessimistic. The Discovery conference was uplifting. We have so much potential. In my next post, I’ll take a critical look at common barriers to solving problems.

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How Smart do you Want your Things to Be?

In the not too distant future, all things will be smart. All inanimate objects will have sensors that collect information, and artificial intelligence to analyze and react to the information.

A first generation example is motion sensors that have the sense to turn on lights when people, or your rottweiler, enter the room. Getting a little more sophisticated, there are devices like the Nest that learn from your habits and adjust the heating or a/c to create the most comfort in the most economical way. In the future (like next week), you may have a fridge that records the comings and goings of food over time and after it’s learned enough, places an order to the local food deliverer [probably Amazon] to restock all your staple foods, and suggest a few new offerings that it has calculated you might like based on your love of strawberries, mustard and corn chips. [shudder]

Everything, absolutely everything, will be smart. And helpful, in an artificially intelligent kind of way. In the spirit of embracing the future and getting the most out of it, I have a question for you:

What things do you most want to be smart and which do you least want to be smart?

Sure, I want world peace, cures for all hideous diseases, healthy, cheap food for everyone, but even AI is unlike to make those things something Amazon can deliver. And on the big picture down side, I don’t want my vacuum cleaner to take over ventilators at the hospital, the power grid to decide what temperature it should be in my home, or robots to terminate all human life because there isn’t enough calcium in the compost.

Smart stuff is likely to be more mundane in the near future (like next week and the one after that), so my expectations are lower.

Here are my smart wants:

I most want my electronic devices (which will be all things, including those we don’t consider to be electronic devices right now, like a hairbrush) to be smart enough to recognize me so I don’t have to remember 1,750 different user names and passwords. Of course, I expect perfect accuracy (the hair brush can tell the difference between me and my daughter, who likes to use it on the dog) and that they won’t let someone who has replicated my fingerprints, retinal pattern, voice or heartbeat to have access to my apps (especially my daughter, who is a likely candidate for trying to hack my stuff).

I want smart things to take away some of the pain I now have obtaining secure access to everything.

I least want something interfering in my learning process. I fiddle. I explore. I figure things out by taking a few steps and then pondering how it might work. After several rounds of this, if I complete a task I haven’t done before, I’m proud. This is how life happens for me, whether it’s setting up a website, doing home repairs or starting a company. The last thing I want is an AI chiming in to tell me how to do it at the first sign I’m stumped, or worse, 5 minutes before I realize I’m stumped.

To the average smart thing of the future, my message is: ‘if I want your help, I’ll ask for it’. What I don’t want is a smart-ass thing. A know-it-all thing. Any number of things could provide too much information. A hammer could disapprove of your the choice of nail. A pot could have opinions on the temperature applied or the nutritional content of the food it’s required to cook. Your CRM might remind you to call a particular client or that you’ve called one excessively, ignoring your personal ‘feel’ for how to deal with people.

Overall, I’d like smart things that see the difference between challenges that are annoying because they demand unnecessary attention (like where you put down your phone) but appreciate when a challenge is a good thing so you give it some thought (like understanding how to manage  privacy settings).

Of course, what annoys me may be a learning experience you want. Maybe you want instructions the second you pick up something because you’d rather spend your time watching videos. Or you’re a security buff and don’t want an AI to remember your passwords.

We’re all different, so it will take very smart things to please us all.

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Great Networking Events

Is networking a skill required by established entrepreneurs? Apparently it is1, even though many entrepreneurs consider themselves too busy doing exactly what they need to do to build their business for the random unplanness of networking.

There are zillions of blogs with advice for attendees on how to navigate the social and logistic challenges of networking. Here, I ponder what differentiates a great event from a mediocre one, inspired because I’ve discovered PitchitTO/York/Durham/etc 2. The Pitchits are 3 for 3, as far as I’m concerned. Being the analytical type, I need to dissect to find the ingredients that makes them so good.

I recommend networking to entrepreneurs for three reasons: learning, community, and building the business. Controlled serendipity is a rush. There’s magic when you bump into the person who:

1. can explain something you’ve been trying to figure out (or you’re the explainer and help someone else), [learning]

2. has the same challenges you do, [community]

3. wants to hire you to do a project you know exactly how to do [business].

Recent examples I experienced from each category:

1. On marketing. Do you find it hard to speak convincingly about your own abilities – key if you provide knowledge-based services? Someone said to me: ‘Consider it a natural ability that you should share.’ Wow! That sounded so much more palatable than pushing services. It turned ‘I’m selling this thing and I think you should buy it’ into ‘Let me help you because I know how’. [learning]

2. Sleepless nights. Even though I do a lot of speaking in front of (sometimes) critical audiences, it makes me nervous. Sometimes, so nervous I can’t sleep. Hearing someone else, a successful, public-speaking someone else, recount the same experience, only worse, gave me great comfort that even when it looks easy, it isn’t. [community]

3. Clients. Yes, I’ve found clients at networking events. [business]

A good networking event makes it easy for every attendee to find people to learn from, share with, and do business with. And this happens how? I won’t pretend to have the perfect recipe, but can make a few observations based on years of attending everything from the dullest events where no one moved from their front-of-the-room-facing seats, to ones that were so high energy I needed several hours to calm down afterward.

Here’s what I think makes a good event:

  1. The right physical space. Find an interesting, quirky setting. Maybe it has natural beauty, sunlight, water, or a forbidden quality. Make it somewhere people feel good. If they have to sit down, have them do it at large tables. Small ones form hard-to-enter cliques. Treat the attendees like house guests. Give them food, drink, bacon even.
  2. Invite well. We all know the marketing rules about reaching the right audience – publicize to find unconnected but like-minded people and those with a breadth of experience from seasoned to fresh out of school. Stack the deck of attendees with people you know will mingle and be inclusive. It’s a numbers thing3 – if enough of the attendees are determined to talk to everyone, then everyone will talk to everyone.
  3. Awesome leadership. It works in large corporations and small, and networking events. Good leadership – vision, coaching and walking the talk, will set the tone. The message should be loud and clear that everyone is there to help each other and learn from each other and do business together (see above three principles).
  4. The Program. Putting effort into crafting a stimulating program will get people talking. Inciting excitement gets the room riled up and ready to chatter.
  5. Fun. The culmination of all of the above, the atmosphere, the attendees, the leadership, and the event schedule, should be fun – enjoying life while making things happen.

Finding networking events that deliver all these things won’t happen all the time. And there is an element of personal fit. Not every venue, topic, or style energizes everyone in the same way. My latest find – the Pitchit events – have all the right elements – atmosphere, appropriate crowd, supportive message from the organizers, presentations every entrepreneur can related to, and serious fun.

Go find the perfect event for you. There will be people there you should know.

——

1For example, this academic study suggests so:  Morris, M., Webb, J., Fu, J., Singhal, S. (2013) A Competency-Based Perspective on Entrepreneurship Education: Conceptual and Empirical Insights. Journal of Small Business Management 51(3), pp. 352–369.

2 Pitchit is a new GTA thing where several startups are given ten-ish minutes to present their business to the crowd which contains a variety of potential investors and fellow entrepreneurs.

3There’s a mathematic model here somewhere, but let’s settle for: if there are three people, one of whom is determined to talk to everyone, and the other two who are cliquing, everyone will talk to everyone because the outgoing one will intervene with the other two. To get the idea of how many zealous networkers you should invite: multiple by one third of the number of expected attendees after subtracting the people who look like they are networking but are really running the event. Divide the program time by the time it takes for a good networker to have a conversation. Combine these factors. Do this in hexadecimal and it should predict the logarithm of the number of new dollars invested because of the event. 🙂

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What I Discovered at Discovery 2016 – Business with a Social Agenda

It’s that time of the year. Time to find out who has new ideas about turning which emerging technology into business at the annual OCE Discovery showcase.  With 3,000 other people, I spent a couple days networking, listening to keynote speakers from companies like Tesla, engaging with clever entrepreneurs, and hobnobbing with all the other folks who make innovation happen in Ontario.

I go to Discovery to learn: about what my colleagues are doing, new trends in business and technology, and new words1. There are always surprises.

Automobiles, obviously not new business but full of new technology, were big this year. In addition to a keynote speaker from Tesla, a panel with representatives from GM, Ford, Hyundai and IBM talked cars. First surprise – artificial intelligence is a driving force in the auto industry. I’ve been so focused on the philosophical aspects of how AI will impact humanity I forgot it would be soon be deployed in an everyday task. To drive cars.

A bigger surprise – the extent of the discussion on ethical issues related to electrical vehicles and autonomous driving vehicles. I can’t remember another instance at a business-focused conference where there was such thorough forethought (i.e. the opposite of afterthought) and time spent on considering the consequences to society and the environment related to a popular consumer product.

For the electric vehicles, the driving force behind the innovation is to cut carbon emissions and reduce global warming. But discussion didn’t stop there. Concern was expressed about the impact of the lithium in the batteries. This was countered by the responsible practices used in lithium mining, and the that the batteries are (almost) infinitely renewable, unlike fossil fuels that are burned and exhausted into the atmosphere. Of course, the source of energy for electric cars is electricity, the batteries are only the conduit, so the overall environmental foot print depends on the source of the electricity.

For autonomous or self-driving cars, there are many positives, including decreasing human suffering by eliminating human error as a cause of car accidents, and increased efficiency in route selection, leading to lower emissions (decreased driving times and less idling) and costs to maintain the roads. Cars that can drive themselves will be more convenient for human passengers, dropping them off at their destination and going to park themselves, saving fuel and decreasing human frustration.

Considerable concern lingers about the types of decisions the AI in an autonomous vehicle might make. In an emergency situation, it may be necessary to make a choice of who to protect from harm. If a collision between a pedestrian can only be averted by the car steering into a pole, which would be done? Does it matter how many people are in the car, how old each is, what their occupation, education or criminal record is? This is a truly scary thing to contemplate. But, encouragingly, auto- and AI-makers have thought about it.

Continuing on the theme of cars, Zipcar  is a company with a model for decreasing the impact to the environment of our transportation systems. Zipcar allows people to share cars owned by the company, in a very user friendly way. This should decrease the overall number of cars on the planet and therefore the energy and waste associated with manufacturing and recycling the vehicles. Robin Chase, cofounder of Zipcar, gave a keynote address where she elaborated on her idea2 that a solution to global warming lies in applying Zipcar principles to many other aspects of life: by using unused capacity we can decrease the world’s overall consumption of stuff. Her ideas are rooted in social change, but refreshingly embrace big business.

I found additional social innovation on the Discovery show floor, there were aisles dedicated to initiatives with accessibility-providing-technology, such as accessto.ca that lists restaurants, bars and cafes, describing how accessible their physical space is. There was also an area highlighting social enterprises.

Was the OCE Discovery program socially focused this year? I’m not sure I want to delve into motives. I’ll just enjoy the well-rounded perspective I discovered at Discovery on how tech business is developing.

1I learned the word fintech this year. This means new technological approaches to finance. Stuff like bitcoin.

2This is the subject of a book she is currently promoting, http://www.peersincorporated.com .

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So Close and Yet so Far: Contrast between Advanced Technology and Everyday Life.

In this era of lightening-fast technological advancement, new, astonishing developments emerge every day, like virtual reality goggles or driverless cars. With all of our awesome gadgets, apps and information, what has advanced technology done for us?

For the love of paradox, I catalogued a few instances of bleeding-edge technology and readily available solutions in similar areas. In no particular order:

Advanced Technology Current ‘State of the Art’

Medicine – Assistive Devices

Assistive and prosthetic devices that restore arm functionality by sensing the brain’s intention to move and moving the limb by brain command1. Stainless steel artificial hips to replace worn out joints and make recipients pain-free and able to carry out everyday activities like walking2 – certain models subject to recall3.
Google glass and other augmented reality visual aids. Meant to provide computing power through visual display and hand motions. Information about the visual field presented to the wearer, such as historical background, competitive pricing, communication history. (Privacy issues being worked out but the technology exists.) ‘Progressive lenses’. Corrective glasses allow distances, mid-range and close to be focused on, within a single lens. Works if you are vertical and the things you want to see close up are at chest height. Doesn’t work for close work above the head, like wiring a ceiling fixture or fixing the plumbing under the kitchen sink. Nor for reading while lying on your side.

Robots or other automation to do routine tasks.

Automation of jobs, such as taking your order at the fast food restaurant, sweeping the floor or delivering your take out order, through touch screens, robotic devices and drones. Youth unemployment. Many young people feel threatened by automation – that it will take away entry level jobs. There are many useful lessons people can learn working at a fast food restaurant or clothing store.
The super power of artificial intelligence has the capacity to control complex systems that include the power grid, water supply and energy production. Arguably will have the ability to dictate all human life support systems. (And lead to our control and possible demise.) Autocorrect is hysterical. Really – we fear the likes of this has the capability to rule the world? What is is a donkey ferris, anyway?

The Environment

Technology reduces an individual’s carbon footprint (electric cars, home lighting control, more efficient heating, more secure, faster electronic devices). Throw out the old version to become more environmentally efficient. Reduce, reuse, recycle. But the life cycle of many current consumer products has decreased, and most are unrepairable, unrefurbishable and apparently outdated. It’s cheaper and easier to buy the new. Into the landfill with the old!
Genetically engineered crops. Whatever you think about GMO’s, the purpose in their creation was to engineer plants that were more cost effective to grow, either due to insect, climate or pesticide resistance (allowing more efficient use of the land). Distrust of GMO’s. Concerns about toxins. Conspiracy theories about big business controlling the food supply. (The food supply is big business.)

Communication

Vast amounts of information is available to anyone with an internet connections. Misinformation about everything runs rampant. Massive amount of personal bandwidth is directed into subjects such as the black/blue vs gold/white dress question, cat videos, and conspiracy theories about big business.

Don’t get me wrong, I am glad of the technology we have access to. If I lived in primitive times, I’d been eaten by a bear or other hungry predator before I hit puberty because I can’t see well enough to avoid things more than two feet away. I’m privileged to have a longer lifespan than my ancestors, and that I don’t have to churn my own butter, make candles or go down to the river to do the laundry, where I’d likely be eaten by alligators I couldn’t see. And I have this platform to air my views and watch videos about plumbing repair, creativity, and cats.

The moral of this post is that the time from introduction of a novel technology to when we all can use it depends on:

  • the scientists and business people getting together to decide what the technology might be useful for,
  • the business people determining where the market is and how to communicate to people who might find the technology useful,
  • the engineers figuring out how to make mass quantities of the new thingie,
  • the business people getting it into stores or similar distribution points so that people can buy the new thingie.

This assumes that the business people made the price reasonable and the engineers and scientists got the thingie right so it does what it’s supposed to.

I didn’t mean to make this an infomercial for the commercialization process. Technology is advancing in quantum leaps and bounds, but it takes time to make it work consistently and safely. Maybe our children will put going into space on their bucket list, along with 3D printing their dream home.

1for example http://www.nytimes.com/2015/05/21/technology/a-bionic-approach-to-prosthetics-controlled-by-thought.html?_r=0

2http://www.niams.nih.gov/health_info/hip_replacement/hip_replacement_ff.asp

3http://www.depuysynthes.com/asrrecall/asrcanadaenglish.html

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Look at Tech, It’s Growing Up.

I don’t like being called a geek, but being thrilled to attend the Toronto Tech Summit where I was titillated by the frontiers of new technology is pretty geeky, isn’t it?

Friday’s event (April 8, 2106) was a well organized and thought out conference, with high quality speakers and good breadth to the program. The event claims a focus on customer experience or ‘crafting experiences through technology’¹. Not too long into the first session, it hit me:

Tech² is growing up. Leaving that awkward teenage phrase of ‘no, I’m totally different’, to resemble a young adult who want to make good in the world, but have their own ideas about how to achieve it.

One of the speakers³ asked ‘how do we business in Canada?’. Business as a verb. Yes. The conference was about the business made possible by technology, not how to turn technology into business.

Maybe everything I see looks like a business strategy lesson right now, but I was blown away how each talk could illustrate a concept from a quintessential strategic management textbook.

Tech has grown into an enabling component of every product and service, so it’s not surprising that I imagined writing a different chapter of a strategy manual with each presentation at the Tech Summit. All the better because every story was about a cutting edge business. How exciting… tech is no longer separate, it’s integral. Not renegade and unruly, but maverick and enlightened. Less Sex Pistols and more U2.

Here are the business lessons I took from some of the presentations at the Toronto Tech Summit:

No business conference is complete without a presentation about the Internet of Things. Sachin Mahajan from Telus eloquently laid out evidence that this is an industry entering the growth phase following its introduction. Large companies, like Google, IBM and Apple are investing heavily in the area, as are venture capitalists. The business is nascent, so there are few industry standards – another hallmark of an early growth stage industry, as is knowing little about the verticals that will serve the industry.

FreshBooks – a general audience pause while we all roll our eyes because its accounting software – is in a more mature industry – enterprise software. Avrum Laurie described their process for agile design. Process innovation, the textbook says, is a hallmark of a maturing industry. Yup, integrating real-time design innovation and customer feedback may be new tech, but process innovation, to decrease waste and remain competitive, is old school, cost-focused strategy.

Classic diversification strategy was presented by Bowie Cheung of UberEats. Lots of great strategic moves here. Uber’s mission is to deliver everything to people – I’m paraphrasing and may not have got the words exactly right but clearly she was talking about new business units. What does a company do to grow? Build on its existing knowledge base. Use what it knows in new ways. In Uber’s case, deliver food to people instead of giving them a ride using essentially the same driver and car base they’ve established. Makes sense, so far. But delivering food from restaurants isn’t a new thing. Can Uber make it better? The roster of restaurants is UberEats’ differentiating factor, allowing them to realize economies of scale in making their dishes for a wider customer base, with distribution enabled by the Uber app and quick delivery. I particularly liked the idea of being able to track delivery through the app. How many times have you paced, ravenous, wondering where the heck your pizza was? Uber answers. This could be a key success factor.

The customer experience/care panel asked traditional questions about client demographics. I had to wonder when the talk turned to the use of chatbots in retail. The essence of the concept was that instead of lifting a finger to click on opinions or pull down menus, the AI would ask which option the customer preferred. Could we all become so lazy? But I can see it being the new normal or industry standard.

Other delicious morsels of business strategy I heard:

  • The requirement for organizational structure, especially as a startup grows, was attest to by Paul Grey of KiK. KiK is a social media platform used by a particular demographic.
  • Differences in new entry costs between hardware and software was a theme from Wesley Yun from GroPro.
  • Diversity in all businesses has value for the organization and is not just good corporate social responsibility, said Nada Basir from the U of Waterloo business school.
  • Another example of cost focus strategy from the mature business of online auctions, methods to reduce costs by changing currency offering.
  • And the importance of corporate culture for delivering anything in business.

As an old person, always excited about new technology, I felt right at home with the new generation. Because they’re practicing business just the way we did when I was young.

——

¹ http://www.torontotechsummit.com

²I’ve always defined technology as inclusively as possible, encompassing software, hardware and the combination, and newly engineered physical and biological things. I was glad to hear one of the speakers say the same.

³here http://www.torontotechsummit.com is the list of speakers. apologies in advance if I don’t attribute every phrase I heard correctly.

 

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It is really in your DNA?

Corporations might be legal persons but they don’t have DNA.

This expression ‘in our DNA’ is a thorn in the eye of my scientist’s sensibilities when it’s used to describe organizations. I know, it’s just an expression that means something fundamental to behaviour, beliefs or actions. Fair enough as a metaphor.

But, I don’t like it. Because of my propensity to analyze seemingly factual statements to determine if they indeed are factual – a propensity likely influenced by both my genes and my environment.

These are the top hits I found in a google search for ‘in our DNA’:

A company that develops marketing campaigns, has ‘innovation is in our DNA’ as a tagline1

They’re not the only ones who claim innovation is in their DNA. The University of Waterloo says the same.2

Boston University’s claim of what’s in their DNA: “It’s in our DNA: an inherent desire in each of our students, faculty, and staff to vigorously and dauntlessly pursue knowledge—and embrace the unlimited possibilities that come with it.”3

At Princess Margaret Hospital, a cancer-focused treatment and research facility, there’s a ‘why’ gene in their DNA4 while at the Texas A&M University School of Law success is in their DNA5.

Recent news stories suggest that fear of spiders is in human DNA6, while others speculate that space travel is in DNA7, or that our DNA is made of collapsing stars8.

Perhaps the reason ‘in our DNA’ grates on me is that no one completely understands what’s in our DNA.

The genome project has made tremendous inroads into sequencing and mapping human DNA. We have identified all 25,000 odd human genes and given them names and can classify them into functional groups9, but that’s sort of like taking apart a house and being able to classify its parts into nails, pipes, wires and 2’x4’s – useful information but still lacking an explanation of how it all fits together and what it does when it’s assembled.

As far as gene function goes, information is sparse: a few mutant human genes causes diseases such as cystic fibrosis or sudden cardiac death. Another handful are for simple traits, such as eye colour or tongue rolling. Generally, there is no linear map between a complex process, like innovation, and a gene or set of genes.

We are far from understanding how most human behaviours are influenced by genes. Studies on identical twins [genetically identical by definition] investigated the genetic basis to behaviour10 and found about half of any given behavioural response is determined by what’s ‘in our DNA’ and the other half a result of our environment. However, studies to link specific genes to specific behaviours haven’t been as illuminating as hoped, according to Psychology Today11. A thoughtful article on this topic, which considers studies on the propensity of a human populations to explore and migrate to new areas, the so-called restless or explorer genes, is here12. My crude summation is: there’s a tendency, it probably has a genetic component but that doesn’t fully explain the behaviour.

Might innovation be in DNA? Since there’s an on-going controversy in the business literature13 over whether entrepreneurs are born or made, I’m willing to add ‘don’t know’ the behaviour influences of all genes to ‘don’t know’ what makes entrepreneurs and surmise maybe entrepreneurship is in some people’s DNA. But not organizations.

Is it fair for me to object to ‘in our DNA’ when I don’t have an  explanation to offer? We don’t know if innovation or entrepreneurship or the ability to choose killer marketing approaches is in our genes. That’s a joy of human nature – there’s mystery in what people will come up with, given the chance.

Perhaps we should leave the mystery of what’s in our DNA for artificial intelligence to discover, much to its dismay.

——

10for example Wright, W. (1998) Born That Way. Genes. Behavior. Personality. Knopf. New York or Steen, R. G. (1996) DNA & Destiny. Nature and Nurture in Human Behavior Plenum Trade New York.

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On Drugs: Emerging Business Models (an update)

Remember the pharmaceutical company(s) that started an avalanche of public outcry for snowballing costs (hundreds of fold increase in months) of certain generic drugs? Well, Imprisis Pharmaceuticals has come up with a solution to get reasonably priced versions of said drugs to patients.

Brilliant,” I thought, on reading how they are going to do it.

Then I chewed my lower lip for a while trying to poke a hole in the concept.

But couldn’t.

Finally, in awe of the simplistic genius, I did a classic face-palm and wondered, Why Didn’t anyone Think of this Before?

Before I get into the logistics of it all, let me say that I’m glad the people who need the drugs, such as the generic pyrimethamine of the branded Daraprim, have better access to them. This report indicates the price will be about $1 per pill, compared to $750 that Turing was reported to be considering at one time (but pulled back from).

The trick, not to imply that Imprisis is doing anything that involves slight of hand or fooling anyone, the clever bit, is that Imprisis will provide generic versions of pyrimethamine by using a method that is, and has been for centuries, a generally accepted practice in pharmacies – called compounding.

Compounding is ancient. Used to be, medicines were all individually made by someone with a mortar and pestle and an apothecary of ingredients. As the pharmaceutical industry became more sophisticated, the creation of medicines was standardized (generally a good thing for safety and cost-effectiveness) and pills were produced under strict manufacturing conditions for the masses. Mass-produced pills contain not only the active ingredient but other things to increase its shelf-life, make it easier to swallow, delay release so once a day dosing is possible, decrease stomach upset and some other side effects, and have become the norm.

Occasionally, a physician will prescribe a specialized formulation, which eliminates an allergen, or allows the drug to be administered in different form, such as flavoured liquid or rub-on gel. Compounding is a wonderful throw-back to physician discretion, allowing the doctor to make a professional decision about what’s best for his or her patient, rather than selecting from a menu of pharmaceutical company offerings. Compounding is also popular with veterinarians, who will suggest using a drug that’s been proven effective in humans but needs to be modified for use in animals.

I’ve used compounded drugs. For my cat – a specially formulated gel that I rubbed on his ear to ease long-term administration. For me – combination drugs for topical administration, antibiotics and anti-inflammatories all in one. What the Doctor ordered for the specific situation.

The differences between branded, mass-produced drugs and compounded ones often includes more extensive testing for the preformed pills because the pharmaceutical giant behind them has funded the studies. Also, the pharmaceutical company has the liability if their medicines do damage. With compounding, the prescribing physician takes on this risk, generally with significant knowledge of the properties of the ingredients in the compounded formulation. Somewhat like buying off the shelf versus DIY. Compounding isn’t practical for all the pills prescribed today – we’d need half the population working as pharmacists to provide the millions of drug doses Canadians take every year.

However, clever Imprisis Pharmaceuticals has come up with a practical approach to providing off-patent, rarely used but badly needed drugs, such as the active ingredient in Daraprim. This is the drug Turing jacked the price on and elicited an impassioned response from the public, often focused on the evils of capitalism, pharmaceutical companies and perhaps hedge funds for good measure.

I’d never heard of Imprisis before this and promptly looked them up. They are a very young company,

whose core business is in compounding of existing drugs for better patient outcomes. Although this year looks like their break-even year for sales, prior to 2015, they’ve lost substantial sums. A not unusual scenario for a biomedical startup.

Am I implying the Imprisis has deduced a brilliant solution, hidden in plain sight before everyones eyes and the company deserves the support to do more good, or am I suggesting that being a pharmaceutical Robin Hood is a brilliant marketing tactic by a small company wavering between financial hard times and glory?

I’m not. I’m just sayin’ there’s many perspectives to every good story.

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Brief Encounters with Artificial Intelligence

I’m preoccupied with how artificial intelligence will impact society even though artificial intelligence isn’t very smart or common yet. A couple of recent observations (the type that come with the metaphorical light bulb over the head1, not made with binoculars from a shelter hidden in the shrubbery) brought me to a greater understanding of how artificial intelligence may fit into everyday life.

First encounter: I picked up my phone and thumbed to my favourite cab company. I hadn’t called them in a year and a half, and was surprised to hear an automated attendant answer instead of the woman with the gravelly voice who called me ‘dear’. It said if I wanted to be picked up immediately at the address I was calling from, I could push ‘1’ and it would happen. I did and did and was (want to be picked up at the address, pushed 1, and the cab arrived shortly thereafter). As we cruised towards my destination, I chatted to the driver, telling him that while the call seemed very efficient, I felt odd about it.

What was lacking? Why was having a machine arrange to pick me up, when that was the very reason I’d called the cab company, disconcerting? If the dispatcher had asked if I wanted to be picked up at home, or the usual place, I’d be glad of the personal service.

For me, the missing link was someone who actually cared if the cab came to get me. Someone who wanted to do their job well and understood that if I was going to the train station it was to catch a train, and being late could have a ripple effect: missing the train, then maybe being late for a job interview and therefore mortgage payments. The gravelly-voiced lady may never have given a rat’s ass if I got where I needed to go on time, but generally, people can empathize with the consequences of being late. Yes, a machine can list the potential consequences, but it can’t remember the time it got a flat tire on the way to a wedding rehearsal where it was the best man for a nervous groom who needed his best buddy’s support.

My second encounter is more subtle. I’m knee-deep in business theory, pondering what gives companies like Harley Davidson and Tim Horton’s their competitive advantage. Causal ambiguity is a thing, which I’ve always liked the sound, and the meaning, of. It’s rather similar to the idea that the sum of the parts is less than the whole. Sure you can make motorcycles growl and sputter in an outlaw kind of way but what makes a Harley the motorcycle of choice for everyone from rock stars to the pastor of an upwardly mobile flock? Why is Tim’s a thing half the Canadian population will wait in line for when the competition across the street has the same product (coffee)? Casual ambiguity. Don’t know how – but it works.

The best explanation we have right now is that casual ambiguity is the sum of a vast number of elements, each subtly different than the norm. Will artificial intelligences be able to dissect casual ambiguity into its multitude of components? It’ll be interesting to see what the AIs come up with to explain the appeal of Hello Kitty or the allure of certain notorious socialites.

On the same topic (competitive advantage), but a more mundane level, human nature dictates we develop processes, or rituals. These get passed down through generations, whether it’s a ham recipe or a manufacturing process for golf balls. Scholars of Operations Management know that the best processes morph overtime because every little detail can’t be recorded, so instructions are interpreted and revised. Will AIs eliminate this natural drift, detailing processes with an infinite number of stepwise instructions? Me, I take detailed instructions, read them until I understand the concept and then construct the functional details.

Humans make mistakes. Sometimes the mistakes are good and we discover something new. Sometimes they’re neutral for many cycles and get propagated through the system then someday turn out to be of benefit.

AIs won’t make mistakes, so there will be no drift in the processes they oversee or serendipitous finding of new things. AIs follow instructions with a precision that leaves nothing to the imagination.

So, we humans, with all our squishy emotions and random actions, are useful after all. We care – who can deliver good customer service without caring? And we err. To err is human, not to err – divinely artificial.

1Does that metaphor still work with a compact fluorescent bulb?

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