Tag Archives: COVID19

How COVID-19 Has Exposed Us

GUEST POST from Greg Satell

The moon landing in 1969 was, in many ways, the high point of the American century. Since then, we’ve been beset by scandals like Watergate, Iran-Contra and two presidential impeachments, mired in never-ending wars that we don’t win, while increasingly encumbered by rising debts and income inequality amid falling productivity growth. Incomes have stagnated while education and healthcare costs have soared.

Yet in an essay written back in February, just before the Covid-19 crisis, Ross Douthat wrote that these apparent woes are actually signs of success. In effect, he argued that we lack major technological breakthroughs because we become so technologically advanced, and we lack economic progress because we’ve become so prosperous.

Even then, it was a strange and somewhat maddening position to take. Why would Douthat, an intelligent and insightful man, write such things? Because he so wanted to believe them that he went in search for facts to support them. Many of us have been doing the same. Yet the Covid-19 crisis has unmasked us and it’s time to start facing up to the truth.

A Failed Market Revolution

In 1954, the eminent economist Paul Samuelson, came across an obscure dissertation written by a French graduate student named Louis Bachelier around the turn of the century. The paper, which anticipated Einstein’s later breakthrough on Brownian motion, declared somewhat innocently that “the mathematical expectation of the speculator is zero.”

Samuelson’s discovery launched a revolution in mathematical finance models based on on Bachelier’s assumption, including the Efficient Market Hypothesis, portfolio theory, the Capital Asset Pricing Model (CAPM) and the Black-Scholes model. The underlying assumption was that markets were rational, and risk could be quantified and managed effectively.

The flaws in these models should have been obvious even at the time and some, including the mathematician Benoit Mandelbrot, pointed out that markets were far more volatile than the financial engineering models predicted. Nevertheless, policymakers chose to ignore the warnings and put their faith in the “magic of the market.”

Probably the biggest failure of market fundamentalism is that, as economist Thomas Philippon points out in his book The Great Reversal, over the past 40 years markets in the United States have become significantly weaker. In a similar vein, a study published in Harvard Business Review that examined 893 industries found that two thirds had become more concentrated.

The truth is that we’ve chosen weaker markets and less competition, which has led to less dynamism and innovation. That’s no accident.

Digital Disruption

In Regional Advantage, AnnaLee Saxenian describes how Silicon Valley replaced Boston’s “Technology Highway” as the center of the digital universe. While Boston was corporate and hierarchical, Silicon Valley was freewheeling and networked. The Silicon Valley ethos was very much the counterculture.

So, it was no accident that when Steve Jobs flew to New York to recruit John Sculley, who was at the time President of Pepsi, to lead Apple he asked him,”Do you want to sell sugar water for the rest of your life, or do you want to come with me and change the world?” The implication being that selling computers was a higher calling than selling soft drinks.

That was nearly 40 years ago and while the Covid-19 crisis has certainly highlighted some benefits of digital technology, such as cheap and effective teleconferencing, it’s also become clear that the digital revolution has largely been a disappointment. Productivity growth, except for a relatively brief period in the late nineties and early aughts, has been depressed since the 1970s.

Compare the iPhone to the breakthroughs of the mid-twentieth century, such as Bell Lab’s transistor, Boeing’s 707 and IBM’s 360 and it becomes clear that while digital technology has done much to disrupt industries, it’s done relatively little to create significant new value, at least in comparison to earlier technologies.

The Uncertain Promise of Globalization

The aftermath of the fall of the Berlin Wall was a time of great optimism. With the Cold War over, books like Francis Fukayama’s The End of History predicted a capitalist, democratic utopia in which free markets would conquer the world making everyone more prosperous. Those that refused to reform would be unable to compete.

While there were genuine achievements, especially in lifting up the world’s poorest, it’s hard to see how globalization has made us significantly better off. In fact, rather than the triumph of freedom, we’ve seen a global rise in populist authoritarian movements, the polar opposite of what intellectuals like Fukayama predicted.

In the United States, the situation has become especially dire. Social mobility and life expectancy in the white working class are declining, while anxiety and depression are rising to epidemic levels. While wages have stagnated, the cost of healthcare and education has soared, squeezing the middle class. Income inequality is at its highest level in 50 years.

So, while it’s true that there have been real benefits from globalization, such as curbing inflation, we’ve done little to mitigate the costs to the average citizen. That didn’t just happen but was the result of choices that we made.

We Need to Choose Resilience and Grand Challenges Over Output and Disruption

The Covid-19 crisis has unmasked us. We thought that markets, technology and globalization would save us, that we could just set up some sensible rules of the road and everything would run on autopilot. That’s clearly untrue. We took short-term profits while ignoring long-term costs, loaded up on debt and hoped for the best.

The current crisis has followed the same pattern. We simply failed to prepare for known risks because it seemed expedient not to. George Bush warned about the possibility of a pandemic as did his Health and Human Services Secretary. Jay Leno mocked them. The Obama administration set up a step-by-step playbook and it was ignored. The long list of failures goes on.

Yet we don’t have to be victims of our failed choices. We can learn to make better ones. After the 1918 Spanish Flu pandemic, we embarked on a 70-year productivity boom. Out of the ashes of World War II, we built a new era of peace and prosperity that was unprecedented in world history. We can do so again. We have that power.

New technologies, under development as we speak, will likely give us the power to cure cancer, create clean energy, save the environment and colonize space. We can rebuild the middle class, usher in a new era of peace and prosperity, increase life expectancy while improving quality of life. These are all things we may be able to achieve in the next decade or two.

Yet those possibilities are merely potential that we can succeed or fail to actualize. We can, as we did after World War II, choose to invest in the future and tackle grand challenges. We can build new infrastructure, spawn new industries and create an educated workforce. Or we can, as we did after the end of the Cold War, choose disruption over construction.

What’s clear is that nothing is inevitable. The digital revolution didn’t have to be a dud. The Great Recession didn’t have to happen. The Covid-19 Pandemic could have been, at the very least, greatly mitigated. We are responsible for the choices we make. Now is the time to shoot for the moon (and Mars), not to grade ourselves on a curve.

— Article courtesy of the Digital Tonto blog
— Image credit: Pixabay

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Four Reasons the Big Quit Exists

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Four Reasons the Big Quit Exists

Turns out the pandemic prompted mass numbers of employees finally say, “take this job and shove it” to employers and careers they don’t like. Life is too short to be miserable at work.

In a recent NICE Webinar, we discussed how job quit rates have hit a historic high—even while the economy is still recovering from two years of furloughs and layoffs. This is often referred to as The Great Resignation.

Enlightening research from Gallup gathered in March of 2021 found that 48% of the working population in the United States is actively job-hunting or seeking out new opportunities.[1]

NICE Employee Churn word cloud

So, while we watch the labor market churn with no signs of settling, how can businesses avoid the costs of high turnover rates?

“How to Reduce the Risk of Employee Churn Amid the Big Quit”
(click to continue reading this article on the NICE blog)

Image credits: NICE

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A Brave Post-Coronavirus New World

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A Brave Post-Coronavirus New World

GUEST POST from Greg Satell

In 1973, in the wake of the Arab defeat in the Yom Kippur war with Israel, OPEC instituted an oil embargo on America and its allies. The immediate effects of the crisis was a surge in gas prices and a recession in the west. The ripple effects, however, were far more complex and played out over decades.

The rise in oil prices brought much needed hard currency to the Soviet Union, prolonging its existence and setting the stage for its later demise. The American auto industry, with its passion for big, gas guzzling cars, lost ground to the emergent. The new consciousness of conservation led to the establishment of the Department of Energy.

Today the Covid-19 crisis has given a shock to the system and we’re at a similar inflection point. The most immediate effects have been economic recession and the rapid adoption of digital tools, such as video conferencing. Over the next decade or so, however, the short-term impacts will combine with other more longstanding trends to reshape technology and society.

Pervasive Transformation

We tend to think about innovation as if it were a single event, but the truth is that it’s a process of a process of discovery, engineering and transformation, which takes decades to run its course. For example, Alan Turing discovered the principles of a universal computer in 1936, but it wasn’t until the 1950s and 60s that digital computers became commercially available.

Even then, digital technology, didn’t really begin to become truly transformational until the mid-90s. By this time, it was well understood enough to make the leap from highly integrated systems to modular ecosystems, making the technology cheaper, more functional and more reliable. The number of applications exploded and the market grew quickly.

Still, as the Covid-19 crisis has made clear, we’ve really just been scratching the surface. Although digital technology certainly accelerated the pace of work, it did fairly little to fundamentally change the nature of it. People still commuted to work in an office, where they would attend meetings in person, losing hours of productive time each and every day.

Over the next decade, we will see pervasive transformation. As Mark Zuckerberg has pointed out, once people can work remotely, they can work from anywhere, which will change the nature of cities. Instead of “offsite” meetings, we may very well have “onsite” meetings where people from their home cities over travel to headquarters to do more active collaboration.

These trends will combine with nascent technologies like artificial intelligence and blockchain to revolutionize business processes and supply chains. Organizations that cannot adopt key technologies will very likely find themselves unable to compete.

The Rise of Heterogeneous Computing

The digital age did not begin with personal computers in the 70s and 80s, but started back in the 1950s with the shift from electromechanical calculating machines to transistor based mainframes. However, because so few people used computers back then—they were largely relegated to obscure back office tasks and complex scientific calculations—the transformation took place largely out of public view.

A similar process is taking place today with new architectures such as quantum and neuromorphic computing. While these technologies are not yet commercially viable, they are advancing quickly and will eventually become thousands, if not millions, of times more effective than digital systems.

However, what’s most important to understand is that they are fundamentally different from digital computers and from each other. Quantum computers will create incredibly large computing spaces that will handle unimaginable complexity. Neuromorphoic systems, based on the human brain, will be massively powerful, vastly more efficient and more responsive.

Over the next decade we’ll be shifting to a heterogeneous computing environment, where we use different architectures for different tasks. Most likely, we’ll still use digital technology as an interface to access systems, but increasingly performance will be driven by more advanced architectures.

A Shift From Bits to Atoms

The digital revolution created a virtual world. My generation was the first to grow up with video games and our parents worried that we were becoming detached from reality. Then computers entered offices and Dan Bricklin created Visicalc, the first spreadsheet program. Eventually smartphones and social media appeared and we began spending almost as much time in the virtual world as we did in the physical one.

Essentially, what we created was a simulation economy. We could experiment with business models in our computers, find flaws and fix them before they became real. Computer-aided design (CAD) software allowed us to quickly and cheaply design products in bits before we got down to the hard, slow work of shaping atoms. Because it’s much cheaper to fail in the virtual world than the physical one, this made our economy more efficient.

Today we’re doing similar things at the molecular level. For example, digital technology was combined with synthetic biology to quickly sequence the Covid-19 virus. These same technologies then allowed scientists to design vaccines in days and to bring them to market in less than a year.

A parallel revolution is taking in materials science, while at the same time digital technology is beginning to revolutionize traditional industries such as manufacturing and agriculture. The expanded capabilities of heterogeneous computing will accelerate these trends over the next few decades.

What’s important to understand is that we spend vastly more money on atoms than bits. Even at this advanced stage, information technologies only make up about 6% of GDP in advanced economies. Clearly, there is a lot more opportunity in the other 94%, so the potential of the post-digital world is likely to far outstrip anything we’ve seen in our lifetimes.

Collaboration is the New Competitive Advantage

Whenever I think back to when we got that first computer back in the 1980s, I marvel at how different the world was then. We didn’t have email or mobile phones, so unless someone was at home or in the office, they were largely unreachable. Without GPS, we had to either remember where things were or ask for directions.

These technologies have clearly changed our lives dramatically, but they were also fairly simple. Email, mobile and GPS were largely standalone technologies. There were, of course, technical challenges, but these were relatively narrow. The “killer apps” of the post-digital era will require a much higher degree of collaboration over a much more diverse set of skills.

To understand how different this new era of innovation will be, consider how IBM developed the PC. Essentially, they sent some talented engineers to Boca Raton for a year and, in that time, developed a marketable product. For quantum computing, however, it is building a vast network, including national labs, research universities, startups and industrial partners.

The same will be true of the post-Covid world. It’s no accident that Zoom has become the killer app of the pandemic. The truth is that the challenges we will face over the next decade will be far too complex for any one organization to tackle it alone. That’s why collaboration is becoming the new competitive advantage. Power will reside not at the top of hierarchies, but at the center of networks and ecosystems.

— Article courtesy of the Digital Tonto blog
— Image credit: Unsplash

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Cognitive Bandwidth – Staying Innovative in ‘Interesting’ Times

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Cognitive Bandwidth - Staying Innovative in ‘Interesting’ Times

GUEST POST from Pete Foley

‘May you live in interesting times’ is the English translation of an ancient Chinese curse. Superficially presented as a blessing, its true meaning is of course far from positive. As memes go, it has lasted quite a while, perhaps because from a cognitive perspective, that little twist, and the little puzzle it forces us to solve makes it more subtle, but also more impactful than a more direct insult. But the ‘blessing and a curse’ dichotomy that it embodies is also a fundamental insight. Opportunity usually brings potential for trouble, and trouble usually bring potential for opportunity, largely because both involve change. So many are going through an awful time on many fronts at the moment, but if that has a silver lining, it is that with it comes change. And ultimately that creates an opportunity for innovation, and hopefully better times.

Big Issues Create Big Opportunity: I’ve written before about the opportunity that Covid-19 presented for innovation. The shattering of habits and established behaviors, combined with dramatic shifts in personal and work situations opened the door to trial of new products and services to a degree not seen in a generation. But as we (hopefully) continue to emerge from Covid, we’ve been sucker punched by numerous other things. The horror of war in Europe being the most shocking, but we are also facing enormous economic challenges in the form of energy shortages, inflation, supply chain issues, the great resignation and rapidly changing socio-political landscapes. And of course, we still have numerous other pressing ‘pre-Covid’ issues such as climate change, pollution and economic inequality that also require urgent attention.

That is a lot of problems that need solving. And as awful as Covid was for everyone, the current issues around supply chain, global economic instability, inflation and increased cost of debt likely create at least as immediate operational issues for many organizations, and hence an equally urgent need for innovation.

Another Innovators Dilemma. Unfortunately, the time when we need most innovation is often when it is hardest to deliver it. Innovation doesn’t happen overnight, and usually needs clear strategy, resources, funding, creativity and knowledge. And all of these are currently in short supply. An uncertain and rapidly changing world makes setting long-term strategy challenging. Supply chain challenges can have huge short-term operational impact, and suck up resources and expertise normally allocated to longer-term innovation. The great resignation and early retirements reduce available expertise. And on top of all of this, inflation, increasing interest rates, raw material prices and labor costs are squeezing finances. None of this is terribly new news, or insightful, but it does provide context for another, sometimes less obvious barrier to innovation that I want to talk about: One that operates more on the individual level – the squeeze of cognitive bandwidth.

Cognitive Bandwidth: The innovation journey needs creativity everywhere from the nascent front end through to launching into market. Ultimately that creativity comes from individuals. That in turn requires those individuals to be allowed the cognitive bandwidth, or ‘quality thinking time’ to ideate. We can only effectively think deeply about one thing at a time. This is our ‘cognitive bandwidth’, and it is a finite resource. There are only so many hours in a day, and most of us can only allocate a small fraction of those to think deeply about problems or process information. And of course the more problems we are facing, the less bandwidth we usually have. The more difficult the situation, the more of our time is spent distracted, jumping from one issue to another, or attempting to ‘multi-task’. Even when we carve out time, the current climate means all too often we are stressed, or in an elevated emotional state. This reduces the quality as well as quantity of our thinking, and so further narrows our individual cognitive bandwidth.

The Covid Squeeze: Covid-19 of course sucked up a lot of cognitive bandwidth. We had to find new ways to work, learn new tools, and new ways to manage personal lives and work-life balance as many found themselves taking on new roles as educators, care givers, chefs, simply learning how to share an office with a spouse for the first time. There were some compensating effects, such as reduced travel, but even that likely had some less obvious and hard to measure impacts on the creative process that I’ll discuss later. But perhaps the biggest, albeit largely intangible impact on cognitive bandwidth was the impact Covid had on our collective emotional state. Covid, and the changes it brought was hard on everybody. Everyone has there own stories, and we’ve all seen the increase in mental health issues that accompanied the pandemic. But this is almost certainly the ‘tip of the iceberg’. Virtually everyone has experienced some degree of increased stress and negative emotions during Covid, and this directly impacts cognitive bandwidth and hence individual innovative capacity.

The Post-Covid Sucker Punch: One thing I think we were all looking forward to was a return to some semblance of normal. But unfortunately, as Covid (hopefully) subsides, reentry into the post Covid world is proving to be very bumpy, and we are facing the cornucopia of other issues described above. This not only creates a host of ‘fires’ that need to be put out, but it also inevitably takes an emotional toll. After two years of disrupted work and home-life, we are now asking people to again step up and be ‘unusually’ innovative in difficult circumstances, and against a backdrop of war and human suffering. Fatigue and burn-out are almost inevitable.

At a practical level, I see this on a day-to-day basis. I sit in a lot of innovation teams, and one pattern I observe consistently is the workforce getting increasingly stretched; both from a time and emotional perspective. I see more and more people getting pulled out of meetings to fight fires, people attempting to double task, or stepping in and out of meetings, or simply looking frazzled and overworked. Of course, none of this is new, overwork and stress existed log before Covid. But it’s also not surprising that it appears to be increasing during a long period of constant change.

The Neuroscience of the Creative Moment. Innovative thinking comes in multiple forms, but it all requires time. We need time to think deeply, and consciously about problems, and to assimilate data and knowledge. But ‘downtime’ is also a critical, if less understood part of the creative process. There is a very good reason that Eureka moments often happen in the bath, shower, or middle of the night. When the mind is relaxed, has time, and not focused on an immediate problem, it is more likely to make surprisingly obvious connections, or see things in different ways. This is often when the biggest ideas occur. We need conscious thinking to build essential foundations of knowledge, but the most interesting ideas and connections often happen when we are not trying. Have you ever had a name on the tip of your tongue, but no matter how hard you try, you cannot find it? Then a few hours later when you are not trying, it pops into your head? This is an analogous mechanism, where conscious focus simply reinforces and repeats converging on the same, sometimes unwanted result, but when we relax, it opens the channel to the needed connection. There is a lot of research around how this works, which includes the interaction between default mode and executive function, the role of alpha waves and flow state, and the conceptual blending process. It’s still very much an evolving science, but one thing that is fairly consistent across this research is that downtime and periods of reduced stress play an important role in the creative process and making connections. Unfortunately, for many, the pandemic reduced relaxation and ‘own time’. Needing to learn new skills and new ways of working, while also having to solve a myriad of new and ever changing problems sucked up time. Even the loss of commutes took away a period of solo reflection where many of us consciously or unconsciously processed and synthesized the day’s information. But perhaps the hardest pill to swallow has been that while we all hoped that the end of Covid would have provided some relief, if anything the news cycle has got worse. This takes an emotional toll. Part of this reflects the ratings competition within media that favors an ever-increasing stream of bad news. But unfortunately it also reflects a very challenging global reality and very real problems and suffering.

What Can We Do?

There are of course limits to what we can do within our sphere of influence. Most of us cannot directly impact the war in Ukraine, the supply chain crisis or global diplomacy. But we can take steps to reduce pressure on our teams, and ourselves, and thus make innovation and creativity a little easier.

1. Make tough strategic priority decisions. Primarily this is a leadership task, but it’s also something we can to some degree manage in our personal portfolios. One reason we see so much innovation during crisis is focus, and a willingness to sacrifice some goals or standards for more important ones. For us to replicate this means being very selective about what fires to fight, while also being willing to let others burn themselves out. This is not without risk, as short-term survival is of course a prerequisite for any successful long-term strategy. But during periods of rapid change, we also see rapid reversals. For example, spikes in raw material costs are often short-term, and developing alternatives can often take longer than the problem lasts. It sounds obvious, but is often deceptively difficult, especially as deciding to let the wrong fire burn itself out can be quite career limiting. But making difficult priority calls, and saying ‘no’ can be critical to maintaining our innovative and competitive edge, by keeping limited cognitive bandwidth focused of the most important tasks.

2. Help talent to focus on what is really important, and to grow skills that are most relevant to the future. There has been an ongoing trend to increasingly ask talent to handle their own administrative and organizational work. This is partly driven by technology that reduces the need for specialized knowledge to manage many logistics tasks. And eliminating support roles looks good on margins and fixed costs. But asking a highly skilled technical expert to cover their own admin not only adds to their workload, but it is also inefficient, as we are effectively overpaying them to complete tasks that often don’t play to their core skills. Conversely, there is also a lot of skill on the sidelines at the moment, while many have developed skills in working remotely. So is one option is to leverage this to free up innovators and experts. Let them focus more on their areas of expertise, by bringing back more general support roles. Or bring in temporary outside help where short-term issues require expertise that is not anticipated to be part of long-term strategy.

3. Schedule down-time, and create a culture where it is encouraged. Build protected spaces in calendars when meetings are not allowed. Encourage lunch breaks, and enable casual team-building events and wellness practices. It’s easy to view these as non-essential, and the type of activities that we cut first when times get tough. But they are critical to an innovative culture. Mental downtime is not a luxury or a perk, but an essential part of the creative process. And in too many cases, we’ve been in crisis mode for so long, that tool has become blunt or burnt out.

4. Further support this with the design of our physical environments. Another trend has been the move to open offices and shared space. This has benefits for both collaboration, and for space efficiency as hybrid home/office working models emerge. But studies have also shown more innovative ideas emerge when people work alone than in brainstorming environments. So it is critical to provide both physical spaces and a culture that enable private reflection and quiet concentration where people can potentially synthesize information and make connections. The key to a cognitively diverse innovation culture is to provide options for different thinking styles. And this also means that acknowledging that benefits of work from home are not one size fits all. For some it’s a blessing, but both work style and personal circumstance can make working from home a challenge for others. To support a cognitively diverse workforce, some people, especially those early in their careers, may need work as a sanctuary, and a bigger physical footprint at work than others.

5. Finally, distribute work evenly. I remember someone telling me early in my career that, ‘if you need something done quickly, go to the busiest person’. There is some truth in that, and some people thrive on high workload. But it only works to a point, and if taken too far, we risk overloading the cognitive bandwidth of our most creative people, even if they may not realize it themselves. By all means give the most challenging and most important tasks to the best people. But don’t overload them too much. They will often be happy to take on more, but it may not be best for them, their creativity, or the organization. Look very hard to see if the load is evenly distributed within an organization, and if not, ask hard questions why not? And if you are the person everyone comes to, practice saying ‘no’ occasionally!

The good news is that humans are pretty resilient, so it doesn’t always take huge changes to get significant results. We are all the progeny of ancestors who survived wars, famine, disease, social upheaval and natural disasters. And it’s worth noting that we are often at our most creative during periods of greatest tragedy.

Technology advanced at a phenomenal pace during WW-II, and more recently the speed of development of Covid vaccines was staggering. But there are clues in those situations that we can learn from. Resources and focus were unprecedented. During WW-II virtually everything was thrown against the war effort, and tough, sometimes brutal priority calls were the norm.

Project Warp Speed put enormous resources against the Covid vaccine and took huge risks on uncertain bets. Of course, most of us working in innovation don’t have these almost infinite resources, but we can be very strategic in how we use what we have. And keep in mind that wartime mentality is meant to be short-term, while Project Warp Speed was designed to last about a year.

We are in the business of creating a sustainable innovation culture. So, we are not just about protecting the cognitive bandwidth of individuals in the short-term, but also preventing burn out, and creating a sustainable cognitive culture.

Image credit: Pixabay

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Innovation in the time of Covid – Satisfycing Organizations

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Innovation in the time of Covid - Satisfycing Organizations

GUEST POST from Pete Foley

Many of us spend a lot of time thinking about consumer habits, and how to change or reinforce them. As innovators that’s pretty central to our job. And Covid has presented us with a unique opportunity, as so many consumer habits have been disrupted. But work habits are as ingrained and as hard to break as consumer behavior, and so Covid provides a similar once in a generation opportunity to change work processes.

We have been forced us to work differently. Remote working has meant less oversight and more autonomy. In parallel, the world has changed rapidly around us, forcing us to make quicker decisions while relying on less data. As a result, we’ve also probably made a few mistakes, but hopefully also learned from them. It’s been tough, but it’s also been a unique opportunity for learning and change.

The Organizational Brain: I love analogies, and an obvious one is that the change in many organizations brings their processes closer to how the human brain makes decisions. They’ve been satisfycing – a concept borrowed from Behavioral Economics, that describes decisions that are good enough, not always perfect, but reached faster, and with less ‘process’.

This is a key concept in understanding real human behavior. Time is critical to survival. An early human being chased by a hungry saber tooth didn’t have time to ponder every possible escape route. He or she just had to get away from the predator before it reached them, or at least move away faster than the slowest member of the tribe. As a result, we are the ancestors of people who made timely decisions based on limited data, not those who stood pondering every possibility in search of perfection.

Even contemporary decisions, while often not quite as urgent as escaping from a hungry predator, typically involve an analogous trade off between time and completeness of information. How many people know every detail about a stock, or even a car, before they buy? In reality we rarely have time to fully process every relevant piece of information for any decision we make, but instead use a mixture of heuristics, proxy’s and our gut, together with some analysis to make good enough, but often not perfect decisions.

A Corporate Flaw: A flaw in traditional economics was that time was largely ignored. It assumed that humans made perfect decisions based on all available data, no matter how long that took. In many ways, businesses, especially big corporations lean towards this much slower, data based type of decision. Employees have to justify decisions to a far greater degree than we do as individuals. Telling a boss or a shareholder that a decision ‘just felt right’ is probably career limiting, especially if it turns out to be the wrong decision. But this slows them down, and leaves them vulnerably to more agile, less risk averse competition making good enough decisions faster. I’d also argue that a lot of time is also spent creating the illusion of certainty. We collect supporting data, pre-align with a boss, or seek consensus via a team, but all too often this is an exercise in precision, not accuracy. We are only as good as our models, and these often struggle to accurately predict the complex, fast moving real world we live in. I’m sure a few people will not be comfortable with this premise, and I’ll dive a little deeper later, but it’s born out by the high proportion of innovations that fail, despite great supporting consumer data and business projections.

The Covid Change: The good news is that Covid has forced us to change. Meetings have been switched to virtual, and in many cases participation has been trimmed. We haven’t abandoned consensus, but in many cases we’ve had to be more choiceful about when and where it’s needed. We have been forced to give people more autonomy, if only because oversight has been impossible. And hand in hand with all of this, in many cases we’ve also been forced to make decisions without the same level of supporting data we are used to. The pace of change has accelerated, while many of our usual methods of testing have been stymied, or at least had to go through significant changes. Before Covid we may have debated and aligned, or run additional research or tests, both to make more informed decisions, but also to CYA should things go wrong. In the last 18 months we’ve more often had to go with our gut, or at least make decisions where we’re far less ‘ certain’ about the outcome.

We will not know how this has worked out for some time, if ever, as we lack a frame of reference for operating in a pandemic. But my guess is it this has probably worked out fairly well. We probably have made a few more mistakes, or at least sub optimal decisions. And we’ve likely learnt a few hard lessons as well. But most of the time, we’ve probably made good enough decisions. And we’ve likely compensated by learning and adapting on the fly, or have perhaps built more flexibility into our plans to compensate for the lack of ‘certainty’ in our business plans. In other words we’ve been more closely mirroring at an organization level how the human brain works.

I’m going to argue that this is a good thing, for at least four reasons.

1. Less Meetings!! When the work we have to do is too big, too difficult, or beyond the expertise of one person, we create a team to do it. But teams also represent a trade-off. It’s a conundrum that the very differences that make teams so valuable can also make them cumbersome and time consuming. As we add different skills and perspectives in a team, transaction costs increase, all too often resulting in seemingly endless meetings in the pursuit of consensus. At P&G it wasn’t uncommon to have entire days of back-to-back meetings.

And Mea Culpa, I’m a recovering meeting addict. At times that back-to-back schedule almost felt like a badge of honor. Conversely sitting at a desk and thinking, or quietly reading was treated with deep suspicion in some circles, despite it often being a highly productive exercise

2. We’ve grown capability. We’ve been forced to give people more autonomy, which develops skills and motivation. Not everyone will have thrived when pushed out of their comfort zones, but we’ll have given people opportunity, and that will ultimately pay dividends

3. We’ve been forced to embrace more learning from failure.We talk a lot about this, especially in innovation, but more often than not we still celebrate success far more than failure. But a good scientist designs tests to fail, in order to challenge a hypothesis. This does happen in business, but realistically most consumer research is designed to demonstrate success, and hence move us through the next stage-gate in our business process. But we’ve probably made a few more mistakes, so we’ve probably learned a bit more.

4. Perhaps most importantly, we’ve learned to live, and act with less data. Humans all have a risk aversion bias, albeit some more, some less. Data makes us believe we are increasing the quality of our decisions. It can even provide a rational for procrastination.- “Let’s get more data before we push the button’. Historically this has often caused us to run big, expensive consumer research, generate complex volume forecasts, and present detailed and precise (if not accurate) business plans to management. It feels good to believe we are betting on a near certainty, but that’s often unrealistic. A majority of new products fail, despite having excellent consumer and volume forecasting data to back them up. The reality is that the world we place innovation into is usually too complex to accurately predict. The very act of introducing something new disrupts the system, as does any competitive response. And if we are truly introducing something innovative or disruptive, it should by its very nature invalidate at least some of the careful validation work that has gone into our forecasting models and methodologies. All too often, our research creates an illusion of certainty, or at best, over estimates our ability to predict the future. It feels better than it performs.

I’m not suggesting we completely abandon consensus, or consumer testing and modeling. These are great tools for weeding out bad ideas, and for anticipating and fixing issues that are more obvious in hindsight than in enthusiastic foresight. And they can certainly help us to ball-park initiatives, especially if they are not too disruptive. But the success rate of innovation in market strongly suggests that our models are not as reliably predictive as we’d like to believe. It certainly suggests that if we can, we are betting off fine-tuning in market than we are fine tuning for a volume forecast.

Conversely, the human brain is, at least for the next few years, the smartest decision-making ‘entity’ we know. It routinely makes satisfycing decisions that balance the need for action against the cost of obtaining and processing additional information. It accepts ‘good enough’ as a start point, and is really, really good at not locking into decisions prematurely, but using feedback loops to adjust on the fly. It uses heuristics for quick decisions rather than certainty. Given that it’s the pinnacle of millions of years of evolution, it’s probably not a bad thing if our organizations more closely mirror it.

Assuming we eventually vanquish Covid, we’ll all be searching for new equilibriums as the world restabilizes. There are things I’m personally really keen to bring back, such as the serendipity that comes from real human-to-human interaction. But I also hope we don’t loose what we’ve learned. Risk aversion will nudge us to revert back to higher degrees of certainty. And there will certainly be contexts where this makes sense, especially in pharmaceuticals and medicine, where we’ve taken unusual risks because of exceptional time constraints. But in less life and death fields, we may have found we can give people more autonomy, be more selective about consensus, have less meetings, better embrace learning from failure, and may not need as many consumer tests or as precise volume forecasts, as we previously thought. A little bit of agility built into the back end can go a long way to reduce the perceived need of illusory certainty at the front.

Image credit: Pixabay

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COVID-19 Presents an Opportunity to Create an Innovation Culture

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GUEST POST from Pete Foley

I left P&G about eight years ago, and one of my last jobs involved working on innovation culture. It was a passion project, and the topic of one of my first blogs published outside of P&G. It’s also something I keep coming back to, as I believe it is one of, if not the most important components of a successful innovation organization. But I’m writing this because I believe Covid19, together with recent socio-political dynamics has created a once in a lifetime window to effect cultural change in our organizations. It’s a huge opportunity, but one that comes with commensurate risk.

Changing culture is hard. A leadership team can often make a strategic change almost on a dime, but culture has much deeper roots, and so takes longer to change. Strategy is more about what we are doing, culture is more about how we do it. It’s comprised of a multitude of little everyday things that ultimately much of our time. It’s how we make decisions, take risks, act or procrastinate, how much we share, how much we listen. In other words it’s deeply linked to fundamental behavior and values, and is heavily influenced by habits and the unconscious decisions frameworks that Daniel Kahneman calls System 1 thinking. As such, it cannot be changed by management decree. It can be nudged by changing reward or organizational structure, something we tried every few years at P&G. But ultimately changing culture means either changing people’s deeply rooted behaviors, or changing the people themselves.

That’s hard to do, and also inefficient, at least in the short-term. If an innovation team is thinking about process, it’s not thinking about innovations. But Covid19 created a once in a lifetime opportunity. I’d not wish the last 18 months on anyone, but like it or not, our cultures have been disrupted, and that gives us a semblance of a fresh start, and hence an opportunity for change. Habits have already been broken, ‘givens’ challenged and new skills learned. And if the great resignation actually occurs, we can expect an elevated level of personnel movement both between and within companies to go along with broken habits and new skills. A perfect storm for cultural change. .

But how do we take advantage of this rare opportunity? Culture is a big, hairy topic, with a lot of moving parts, so one option is to be a little reductionist, and break it down into it’s component parts. My personal culture model is a hybrid derived from many sources, and comprises Capability, Space, Psychological Safety, Designed Serendipity and Motivation. Let’s look at them in turn:

Capability– Innovation needs people with knowledge and experience. But it also needs fresh perspective. Too much experience locks us into isolated pillars of expertise that make it hard embrace new technology. But too little experience risks the merry-go-round of constantly reinventing the wheel. We need to balance between the two. But we can hit that balance far more effectively if we retain the right kind of experience, experts who are also cognitively agile, open to new experience, and so able to integrate fresh ideas with their hard earned knowledge. The conundrum is that these experts are often the most likely to seek out new challenges, or to relish the risk of career changes. In other words, those most likely to participate in a ‘great resignation’. This makes it imperative to proactively identify, recruit or retain experts with high mental agility, or T-Shaped innovators who can bridge between different groups.

But it’s not enough to get the right mix at the organizational level, we need it to drill down into individual teams. Humans have a habit of self selecting groups that they feel comfortable working with, which can mean diversity within an organization translates into diversity between, rather than within teams. Curating teams to ensure each fully team reflects organizational diversity reduces factions, spreads knowledge, enables cross mentoring and thus creates a stable but not stagnant culture more quickly after a period of change. It also grows the next generation of innovation leaders who have learnt bridging skills ‘on the job’, by working in cognitively diverse teams.

Space –Innovators need time and autonomy. Obviously this needs to be within some reasonable constraints, as businesses today cannot afford ivory towers.. But truly disruptive ideas take time, and some failure along the road to success. Build too much stage gate control into innovation, enforce unrealistic timelines, or talk about productive failure without actually embracing it, and the result will be mediocrity and increasingly smaller innovations. Everything becomes disruptive in name, but not reality. The good news is that this is perhaps the biggest opportunity to come out of Covid19, as for many, remote working has increased both time and autonomy. Of course, remote working comes with downsides, some of which I discuss below, and not everybody has more time at home. But overall we’ve been given a gift of more time and more autonomy. It’s critical that we take full advantage of this, and don’t lose it, or over-manage it in the name of efficiency.

2. Psychological Safety. Failure is now widely acknowledged as part of the innovation process. But in reality, but when the rubber hits the road, it’s still often considered as a negative. After all, we build a culture that values capability and expertise so that we can anticipate ‘obvious’ pitfalls, and so avoid failure. But if we’ve sufficient capability, that makes failures more valuable, as the unexpected is the single biggest source of disruptive and breakthrough innovation. Furthermore, the scientific method, when employed correctly, designs tests to challenge our assumptions, not confirm them. We run tests to uncover unexpected issues before we go to market. So as we rebuild innovation culture, it is critical that the psychology safety needed to fail productively is not just preserved, but enhanced. It really is the key to big ideas. But at the same time, it’s also critical not to confuse it with ‘safe spaces’. Psychological safety has nothing to do with avoiding ideas we are uncomfortable with. Instead it’s about creating an environment where people can safely challenge their own and others’ ideas, share unpopular opinions and failures, and be treated with respect when they do so. That is fundamental to the scientific method, and hence to an effective innovation culture.

3. Designed Serendipity. While this is a reductionist analysis, it’s impossible to avoid how interdependent these components are. Capability needs space to operate, while space helps to create psychological safety. That in turn makes it easier to fail, and share unexpected results. And our most disruptive ideas typically come from those results experts weren’t expecting. Assuming that most competitors have similar pools of expertise, surprising results are the only way to break a close innovation race. These can come from failures, as discussed above. But they can also come from outside, either from someone viewing our results through a different lens, and so seeing something we miss because of confirmation bias, or from somebody sharing information that they wouldn’t realize is relevant to us. While we cannot force this type of cross- disciplinary interaction to occur per se, we can design organizations to facilitate it. We can create spaces where people mix and communicate informally. Or run training sessions that bring together mixed teams. A coffee bar in a work place, or an excellent cafeteria that encourages people to stay on site and mix all have benefits that are hard to quantify, but can also do an enormous amount to trigger an innovative culture. But much of this requires people to be physically present. Remote working provides time and convenience benefits, and works well for some tasks. But we need to prevent the pendulum from swinging too far. Whether it’s the serendipity of unexpected discussions at the water cooler, or the subtle body language that encourages someone to share a counter intuitive idea, or a failure, some personal interactions work better when people are physically in the same place. We can certainly learn from our Covid experience, and reduce non productive time in the office. But subtleties such as body language and microexpressions get lost on Facetime, making tough discussions tougher, sharing ‘bad’ results harder. And without physical presence, we’ll lose much of the serendipity of insight and information sharing in common physical spaces. We don’t have to go back to where we were, but getting the balance right will drive competitive advantage by optimizing sharing, serendipity, and recruitment and retention.

4. Motivation. I’ve saved what I think is the hardest topic until last. Intrinsic motivation is absolutely key to an innovative culture. If people love what they are doing they will go the extra mile. Passion means problems stay top of mind, increasing the chances of serendipitous innovation, or ‘Eureka moments’. Money is important if you don’t have enough, but it’s intrinsic motivation that drives disruptive innovation. That motivation largely comes from one or all of three places; fascination with a problem, deep commitment to a team or authentic alignment between project and individual purpose. The first two are fairly self-evident. But the last one has always been tricky, and has become more difficult in our post Covid, more polarized world. Firstly, it must be authentic. For example, motivating a team to get behind a sustainability project that turns out to be largely greenwashing, or that evolves from authentic to greenwashing under timing or economic pressure can quickly turn motivation into indifference, or worse. And the line between greenwashing and real environmental initiatives is often more fuzzy than we like to admit. There are inevitably trade offs as we try and balance the needs of a business with the need to improve an environmental footprint, and often what starts as a major benefit gets trimmed en route to market. And it’s not one size fit’s all, as one persons authentic is another persons greenwashing. Furthermore, environmental is probably the easiest of the ‘purpose motivators’ to manage.

For more contentious social justice areas, it’s increasingly likely that not everyone in a team will be aligned with a project. Even if they put aside their personal views, intrinsic motivation will inevitably fall in this situation. Conversely, tap into a teams passions too well, and we risk the core brand or product becoming secondary to the ‘cause’. But even bigger risks as we look outward to the consumer. Even if we have an organization that shares common values, taking a position on a contentious social justice issue is quite likely to alienate a significant segment of consumers. Yet we know from Ehrenburg-Bass research that broad appeal and availability usually generates more volume than loyalty, and so even initiatives that enjoy short-term bumps in volume from socio-political positions can suffer long-term damage. The short-term loyalty they create is often more short-lived than any emotional disconnection from a brand from consumers who disagree. There are also additional issues with cognitive fluency, as while some brands are a good fit with environmental or social justice positions, many are not. Consumers only associate about 1-3 attributes with a brand, and there is a significant risk of with subtraction by addition if a brand starts focusing on communications that are not a fluent fit with core equity.

None of this means we shouldn’t strive to create greener products, and indeed for many categories a healthy environmental profile is rapidly becoming price of entry. The picture with social justice is more complex and more polarized, but again, all companies should strive to do the right thing, and be good corporate citizens. But it’s important to do so carefully, ensure that we’re not alienating consumers, that initiatives are a fit with equity, and are sufficiently differentiated at a time when environmental and social justice communication is pervasive. And there is always the question of source validity, and whether your brand has the perceived authority to take a position on an issue. And if our goal is to improve intrinsic motivation and employee satisfaction, it’s also worth considering that internal cultural benefits can often be achieved more effectively via inwardly facing initiatives that don’t risk alienating consumers.

In conclusion, Covid19 has created opportunity for significant change in innovation culture, and in some cases, that change is already irreversible. But it is sill important to step back, ask ourselves how much we want to change, and what parts of our culture we may want to protect. If you are reading this, you are probably an innovator, and so change is in your blood. But do keep in mind that the grass is always greener. Whether we are innovating products, services or organizations, the new often looks better simply because we don’t know the issues we haven’t yet discovered.

I sometimes think innovation is like a giant game of wack-a-mole, where we innovate to improve one area, only to inadvertently create a new unexpected one along the way. Sometimes these are minor, and just a part of the innovation process, sometimes they are much bigger, as in Boeings 737 Max. This does not mean we should stagnate, or miss a once in a generation opportunity. But just as culture is usually slow to change, it’s also slow to fix if we get it wrong. So before messing too much with the DNA of an organization, it’s worth at least considering if the upside is worth the inevitable disruption, both anticipated and unanticipated. We have a once in a lifetime opportunity – don’t miss it, but don’t throw the baby out with the bathwater either!

Image credit: Pixabay

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Mask of the Road Warrior – The Xupermask

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Xupermask on WILL.I.AM

WILL.I.AM and Honeywell have collaborated to bring the Xupermask to market.

What is the Xupermask?

It’s probably easiest to describe the Xupermask as equal parts: health & safety equipment, personal electronics, and fashion statement.

At its heart the Xupermask is a human-centered design intended to empower the user to feel both safe AND productive. It addresses the following set of user needs that are mostly unmet by traditional mask options:

1. Fits well to the face so escaping air doesn’t fog up your glasses
2. Fit also better prevents unsafe air from entering
3. Fans improve the ease of respiration
4. HEPA filters improve air quality
5. Built-in microphone for easier and safer phone calls
6. Built-in Bluetooth noise cancelling headphones for phone and entertainment

For me, the Xupermask seems like overkill for many day to day situations.

But, when I think about getting on public transport every day or flying on a commercial airline cross-country or across an ocean, the idea of having a Xupermask to wear becomes quite appealing.

And for those of us in the western United States, this could come in quite handy during forest fire season – just saying.

What do you think about the Xupermask?

Innovation or not?

Image credit: Xupermask

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Open Source Respirator and Low Cost Ventilator Efforts to Fight Coronavirus (COVID-19)

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Open Source Respirator Project

Mechanical Ventilator

NOTE: Nothing on this page is intended as medical advice. My only goal is to make information available so that people can get involved with co-innovation efforts and share resources that can be leveraged in crisis situations.

Calling all doctors, nurses, designers, engineers and designers…

Join one of the amazing Open Source Ventilator Projects to contribute your passion, creativity, time and expertise to help develop low-cost ventilators to fight the Coronavirus (COVID-19). Here are some ways of getting involved and some inspiration and some cheaper ventilator options:

13,000+ member Open Source Coronavirus Supplies group on Slack
OPEN CALL closes 24 March at 9:00 GMT: Rapidly Manufactured Ventilated Systems
March 19-20 University College London (UCL) Design & Refine Sprint Low Cost Ventilators — Register Now
Ultimate Medical Hackathon
Open Source COVID19 Medical Supplies group on Facebook
DIY Pandemic Ventilator (built during Avian Flu crisis and shared on Instructables)
Story on OneBreath winning PopSci Innovation Award in 2010
OneBreath company web site ($4,000 low cost respirator vs. $35,000 traditional solution)
$500 pandemic ventilator from Canada
Open Respirator Project on Github

Here is a video showing a DIY ventilator solution:

And here is a video from vacuum manufacturer Gtech in the United Kingdom (UK) showing a prototype they are working on to be entirely powered by the hospital oxygen supply in as simple a way as possible so they can hopefully meet the UK government’s call to make 30,000 ventilators in two weeks:

Just added another video highlighting an improvised design experiment the University of Minnesota is working on with some design partners:

The design team has made all of their designs shown in the University of Minnesota video – open source and available by clicking this REDDIT link

Here is an open source ventilator project out of Germany – The CORESPONSE – COvid19 RESPirator (Open Source):

Cost is about 75 Euros per unit and all of the details of this 3D printed open source project are available by clicking here.

Here is an article (click here) and a video detailing how to turn a snorkeling mask into a non-invasive ventilator:

AgVa Healthcare has produced a low cost ventilator starting at under $700 (according to the video) that leverages an app on the user’s smartphone to control its functions. Another great example of Indian ingenuity that was originally submitted as a comment on this article:

Below is a video from the Lemelson Foundation from 2015 that shares the story of how Matt Callaghan came to start OneBreath Ventilators to create lower cost ventilators for developing countries and the rest of the world after H1N1 Swine Flu never became a problem in the USA thanks to President Obama’s administration proactive steps to protect our country. (Learn more about the design process by reading this Stanford Byers Center for BioDesign article)

OneBreath Ventilator

UPDATE: Just found this video showing how to use one ventilator to save FOUR people – video from the United States’ Center for Disease Control (CDC) – all the details health professionals might need:

CAUTION, this from a doctor in Italy about risks of co-ventilating to be kept in mind as you group people to co-ventilate in a crisis situation:

“This is unfortunately not as good of an idea as it seems. In trauma and shootings, it’s one thing because lung compliance is unlikely to change quickly. However, in ARDS (and COVID19), we expect to have dramatic changes in lung compliance. When one patients lung compliance changes, there is a significant risk of underventilating the patient with lowest compliance and overventilating patients with highest compliance – both potentially deadly. I worry that instead of saving one person, you create a situation where you increase the odds of losing both (or all 4) patients“

BUT, according to Alexander Clarke you can solve this problem with flow restrictors…
https://www.prusaprinters.org/prints/25808-3d-printed-circuit-splitter-and-flow-restriction-d

Another article detailing previous research and considerations – https://www.saasceo.com/ventilator-capacity/

Vesper Prisma Health

VESper™ is a unique ventilator expansion device that allows a single ventilator to support up to four patients under emergency use authorization by the FDA during times of acute equipment shortages such as the current COVID-19 pandemic.

Hospitals can apply to receive the free source code and printing specifications for the device, produced using 3D printing technology, the device is developed with material already in use for medical devices and produced at minimal cost:

designed to work with ISO standard respiratory connections;
allows for appropriate filtering of bacteria and viruses in the ventilator tubing;
does not impact the care of other patients connected to the same machine.

SPECIAL BONUS for anyone facing a shortage of protective face shields.

See this article From Design to Mass 3D printing of Medical Shields in Three Days, below is a video highlighting the end result solution from this article:

OR looking for information on DIY hand sanitizer, masks, and protective clothing:

Here is a video showing how to make your own reusable elastomeric respirator (click here for instrutions poster):

And here is a video discussing whether people should wear face masks and how people can use DIY face masks without impacting availability of N95 and surgical masks to healthcare workers:

Here is a video showing how to make face masks to help healthcare workers:

AND here is a link to a PDF of the pattern to make the masks – https://courierpressblogs.com/pdf/howtomakeafacemask.pdf

Additional DIY mask videos can be found here – https://www.sewcanshe.com/blog/5-free-diy-face-mask-tutorials-using-fabric

Here is how to make a DIY Personal Protective Equipment (PPE) smock out of a garbage bag thanks to the people at Hefty:

https://www.hefty.com/handy-hints/articles/diy-poncho-idea-how-to-make-a-trash-bag-raincoat

Doctors and Nurses in Spain and other countries are already having to do this.

And, here is a picture of an ingenious idea of using a headband and buttons to save the ears of healthcare workers from chafing of wearing a mask 13-14 hours a day. Thanks Natasha Smith!

Coronavirus mask and headband solution

And, here is an interesting article about a surgical and N95 mask design that uses salt to help kill viruses like Coronavirus (COVID-19) on masks to improve their effectiveness in protecting the wearer against getting sick

Coronavirus Salt Masks

If you know of other efforts working on creating low cost, quick to produce ventilators, please post as a comment!

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Human-Centered Change and Innovation

Innovation, change and transformation thought leadership, lovingly curated by Braden Kelley

Tag Archives: COVID19

How COVID-19 Has Exposed Us

A Failed Market Revolution

Digital Disruption

The Uncertain Promise of Globalization

We Need to Choose Resilience and Grand Challenges Over Output and Disruption

Four Reasons the Big Quit Exists

A Brave Post-Coronavirus New World

Pervasive Transformation

The Rise of Heterogeneous Computing

A Shift From Bits to Atoms

Collaboration is the New Competitive Advantage

Cognitive Bandwidth – Staying Innovative in ‘Interesting’ Times

Innovation in the time of Covid – Satisfycing Organizations

COVID-19 Presents an Opportunity to Create an Innovation Culture

Mask of the Road Warrior – The Xupermask

Open Source Respirator and Low Cost Ventilator Efforts to Fight Coronavirus (COVID-19)