CHRISTIAN SARKAR

Ever wondered what makes a video go viral?  

There are several societal norms challenged in the video. The ad celebrates the second marriage of a woman and includes her daughter. And secondly, the woman is dark-skinned. In a society obsessed with fair complexion, the ad breaks an unwritten rule of Indian advertising. The emotional impact of the ad made it a viral hit, with politicians, citizens, and film stars talking it up on their social media accounts.

Arun Iyer, the creative director, says: “This is the thinking that most progressive people have. They may not be going through the same thing in their life, but the ad makes a bold, progressive, statement and people like to be associated with brands that make such statements.”

The company behind the ad is Tanishq, the largest retail jewelry brand (part of the forward-thinking TATA Group) in India with over 156 stores in 86 cities.

In the US, and specifically in Texas, we have slightly different reasons for emotional contagion: toilet humor.

I met Larry Keeley through a mutual friend several years ago.  He’s the thought leader behind Doblin, the innovation consulting company that’s now part of Deloitte.  At the time, Larry had come up with an innovation scanning methodology which looked across industries to identify innovations up and down the value chain. Larry was also kind enough to join the $300 House project as an adviser, and I’ve learned a lot from him – more than he can imagine!

Now, and this is a good read for the holidays, he’s written a book called Ten Types of Innovation: The Discipline of Building Breakthroughs.

You see, most companies focus on just one type of innovation – product innovation. Sure, some of us are looking at service innovation and business model innovation (thanks to Clayton Christensen and Alex Osterwalder), but we still suffer from tunnel vision.  Time to wake up and look across the entire scope of our business activities. Where can and should we innovate?

How will your company build it’s business innovation portfolio?

Bezos raises the stakes in retail warfare: drone delivery… Are you worried Fedex?

What’s wrong with this picture? 

According to the Global Innovation Index (GII) – co-published by Cornell University, INSEAD and the World Intellectual Property Organization (WIPO) – the most innovative countries in the world are:

1. Switzerland   
2. Sweden   
3. United Kingdom
4. Netherlands
5. United States of America   
6. Finland   
7. Hong Kong (China)
8. Singapore   
9. Denmark   
10. Ireland

Other than chocolate, watches, and secret bank accounts, I’ve never viewed Swiss innovation as leading the world.  The same goes for Sweden (IKEA, Abba?) and the Netherlands (Shell).

Why are these countries being hyped as the most innovative countries in the world? 

Let’s dig a little deeper. Firstly, the index tracks the wrong measures of innovation:

Swiss “innovation” looks like this:

The USA looks like this:

So, let’s look at three other “not-so innovative” countries: Brazil, China, and India – yes, they are “emerging markets”…

Brazil:

China:

India:

See the problem?  Innovation cannot be measured by number of entries to Wikipedia, or number of papers, or patents, or YouTube uploads.

Rather, it should be measured in terms of innovation (and disruption) – by industry.

Brazil, is the first country where renewable energy accounts for more than 85.4% of the domestically produced electricity used. If that’s not innovative, I’ll go re-read Heidi.

China? Well, they’re China. Every product the Swiss used to make is now made cheaper and of comparable quality in China. Red capitalism rules the business world right now, so that’s something of a disruptive innovation, don’t you agree?

And India? They’ve got more scientists and engineers who are hungry to make something happen. India’s also the hot-bed for reverse innovation (which does not seem to be on the radar at the WIPO).  And they just sent a mission to Mars…

So what’s wrong with this innovation survey? 

Simply put, it’s not based on reality. And it’s not an accident that Switzerland is “so innovative,” according to this survey – which happens to be sponsored by INSEAD (in Lausanne) and the WIPO (Geneva).  The innovation for Switzerland is its opaque banking system (ask China about that: Chinese government officials hold about 5,000 personal Swiss bank accounts with the Swiss global financial services company UBS. Two thirds of those accounts belong to high level central government officials.)

… Wait. There is one true innovation from Switzerland that does deserve a mention: the cap on CEO pay. Let’s see if it flies.

Companies and countries that are serious about innovation would do well to not pay attention to this survey, and focus instead on their schools, quality of science education, business transparency, social mobility, gini coefficients, and of course, governance itself (the Corruption Index). See also the Big Shift and A New Culture of Learning.

And if you want to measure creativity, that’s going to be something else entirely.

Elvis Presley and Bob Marley as they would look today (h/t these folks):

What can we learn from these lads? These, the young lions, who conquered the world like Alexander, but then had it all taken from them by Thanatos.

One thing you have they don’t. And if you escape the sword of Thanatos for a while, you still have to deal daily with his post-modern cousins: Boredom and Anxiety.

Just thinking:

He realized now that to be afraid of this death he was staring at with animal terror meant to be afraid of life. Fear of dying justified a limitless attachment to what is alive in man. And all those who had not made the gestures necessary to live their lives, all those who feared and exalted impotence– they were afraid of death because of the sanction it gave to a life in which they had not been involved. They had not lived enough, never having lived at all.

― Albert Camus, A Happy Death

The man also said, “to have time was at once the most magnificent and the most dangerous of experiments.”

Every minute counts. Each year is 525949 minutes. How do you make every minute mean something? How do you escape everydayness?

When Apple announced its plans to bring a 100% renewable energy powered manufacturing plant to Arizona, we would do well to ask why?

The answer is partly to be found in the map below:

What else? 

1) Proximity to Mexico

There’s a Foxconn manufacturing base in Juarez – just over the Mexican border – and it seems like the output from the Arizona plant will end up there. 

2) Tax Structure

Over the past 15 years Arizona has demonstrated a “pro-business” mentality combined with a minimalist regulatory approach by reducing taxes and decreasing regulations:

• No corporate franchise of business inventory tax
• Low workman’s comp and unemployment insurance rates
• No income tax on dividends from out-of-state subsidiaries
• 80% sales factor on corporate income tax scaling to 100% option
• No worldwide unitary tax
• Aggressive depreciation schedule
• 90 day or less permitting
• Virtually all services exempt from sales tax
• No inventory tax
• No Sales tax on manufacturing equipment
• Ability to carry forward 100% of net operating income for twenty consecutive years
• Small businesses with less than $10 million in assets will not be required to pay capital gains taxes beginning in July 2015
• Right to Work State

Arizona also has aggressive tax credits to reduce state corporate income tax liability. This includes phasing in a corporate income tax rate from 6.9% in 2012 to 4.9% in 2017.

So what does this mean for neighboring states?

It’s too early to call this is a new wave of innovation, but it’s worth thinking about. How can states like California, Texas, and New Mexico join this solar-shift?  Do they even want to? 

C’mon, New Mexico!

Apple is to be applauded for bringing manufacturing back to the US. More importantly, they can still think different.

One of the primary reasons for the failure of development projects is that they cannot be sustained. Traditional approaches don’t always work; as soon as the development institutions (NGOs, agencies) leave, things fall apart. Soon the project is either abandoned or simply turned off. This happens all the time with water and energy projects.

One way to work around this and “make it stick” is to involve women in the project. This has been the secret behind the success of organizations like Grameen and the Solar Electric Light Fund.  When women lead and control their own destinies, stuff happens.  This is a lesson learned in the field, but overall the “development-through-empowering-women” movement is fizzling.

Is there anything else we can think of to make development changes stick? 

How about the profit motive?

In his recent book The Solution Revolution: How Business, Government, and Social Enterprises Are Teaming Up to Solve Society’s Toughest Problems Deloitte’s William Eggers asks us to consider erasing public-private sector boundaries.   According to Eggers:

the solution economy is unlocking trillions of dollars in social benefit and commercial value. Where tough societal problems persist, new problem solvers are crowdfunding, ridesharing, app-developing, or impact-investing to design innovative new solutions for seemingly intractable problems. Providing low-cost health care, fighting poverty, creating renewable energy, and preventing obesity are just a few of the tough challenges that also represent tremendous opportunities for those at the vanguard of this movement. They create markets for social good and trade solutions instead of dollars to fill the gap between what government can provide and what citizens need.

The Kodak story so far has been rather colorful, but as Kodak emerges from Chapter 11 bankruptcy, it looks like another company altogether.  Will it ever shine again?

Gone is the document imaging business (spun off as Kodak Alaris; new owners = Kodak’s UK Pension Plan).  Instead, the focus is on a new set of markets: 

In short, the new Kodak ain’t the old Kodak. The key to survival is going to be professional services (watch out Xerox!) >>

Can they do it? How are they going to win? Do they have the capabilities they need?

The search for a new CEO is on.  She‘s going to have to be a consultant’s consultant – a professional services expert. Good night, Kodak. Good night, moon. Good luck.

The disruptors are getting disrupted.

In Consulting on the Cusp of Disruption (Harvard Business Review),
Clayton Christensen, Dina Wang & Derek van Bever point out the coming disruptive changes in the world of management consulting.  

And the big boys are getting ready.  McKinsey Solutions, for example, is essentially a business model innovation that could reshape the way the global consulting firm engages with clients. It’s about “embedding software and technology-based analytics and
tools providing ongoing engagement
outside the traditional project-based model.”  According to Christensen and friends, “McKinsey Solutions is intended to provide a strong hedge against potential disruption.“

So, will software robots replace the consultants?

No just yet, but the authors warn that the threat from smaller, more nimble competitors is real:

At traditional strategy-consulting firms, the
share of work that is classic strategy has been steadily decreasing and
is now about 20%, down from 60% to 70% some 30 years ago.

Wow. That’s some serious disruption, don’t you think? Clients are focusing on value-based pricing instead of per-diem billing.  (And not a moment too soon!) If you’re engaged in any kind of consulting work, or even services, you would do well to buy the article. (As a bonus, you get to learn how the legal market got disrupted!)

Here’s a sample of their thinking: the three consulting business models observed and cataloged:

New upstarts like IDEO bring a collection of skills and capabilities not found in traditional firms. They bridge “the disciplines of
industrial design and innovation consulting… Its unique mix of talent
and strength in solving interdependent problems makes it hard to
imitate.”

Christensen, Wang and van Bever point to the model of IT services as a threat as well. Emerging market competitors like Tata Consultancy Services and Infosys. (I’m not so sure.)

IMHO, the big boys have been asking for trouble.  By focusing on harvesting and/or fleecing clients, they left the doors open for nimbler and more insightful competitors.  I think there’s one more business model that may have been overlooked: the individual, branded consultant. 

Now, more than ever before, companies want to connect to the originator, the source of an idea – instead of going with organizational middlemen.  Thought-leadership translates to market leadership. Some of the big firms are hiring these gurus to harness their I.P. but the list of independent, disruptive gurus is growing fast.

Here are some examples of how specialized individuals (gurus) are taking over markets from the big firms because of their specialized expertise and insights >>

• Peter Drucker – The Original D-I-Y management consultant (R.I.P. Peter!)
• John Hagel III* – Big Shift + edge strategy (now with Deloitte’s Center for the Edge)
• John Seely Brown* – Education and Learning (he works part time for Deloitte’s Center for the Edge)
• Tom Davenport* – Competing on Analytics
• Stuart Hart* – Sustainability and B.O.P.
• Vijay Govindarajan* – Reverse Innovation 
• Tammy Erickson* – Talent Management
• Marshall Goldsmith* – Leadership
• Dean McMann* – Customer Intimacy
• Mo Kasti* – Physician Leadership (see, it’s getting hyper-specialized!)

[* disclosure: these are clients or former clients of mine]

The list just goes on and on:

• Larry Keeley – Innovation (with Doblin, acquired by Monitor, then Deloitte)
• William Eggers – Government Solutions (with Deloitte)
• Jakob Nielsen – Usability 
• Roger Martin – Strategy
• Alan Weiss – Pricing
• Seth Godin – Marketing
• Dan Kennedy – Entrepreneurship
• Perry Marshall – Internet Advertising

What’s interesting is that so many firms were founded or driven by thought-leaders: Monitor (Michael Porter), Innosight (Clayton Christensen), Ogilvy and Mather (David Ogilvy), so that the industry is well aware of the value of big-thinkers.  Where they have failed is in nurturing them and allowing them to shine (e.g. where is Oliver Wyman hiding Adrian Slywotzky?).  Deloitte seems to get it – they acquired Monitor, hired John Hagel and JSB, and encourage the building of the individual brands like William Eggers.

P.S. – here’s an interview with Clayton Christensen done over 10 years ago.  We talk about disrupting the consulting industry in passing!

Discovered in an attic in Norway:

That’s daft!

After getting a few emails about this article in the Guardian, I went back to Professor Clayton Christensen‘s op-ed in the New York Times (h/t Derek Van Bever) and asked myself this question: What kind of innovation is the $300 House really?

I went through the “types” of innovation as described by Christensen:

Empowering Innovation: transforms complicated and costly products available to a few into simpler, cheaper products available to the many, thus creating jobs, because they require more and more people who can build, distribute, sell and service these products. Empowering investments also use capital — to expand capacity and to finance receivables and inventory.

Sustaining Innovation: replaces old products with new models, but creates few new jobs; such innovation has a neutral effect on economic activity and
on capital.

Efficiency Innovation: reduces the cost of making and distributing existing products and services. Such innovations almost always reduce the net number of jobs, because they streamline processes, reduce capital investments, and eliminate waste.

So what about the Base of the Pyramid? What about the non-customer, the folks (generally poor) that are always under-served?

I then started thinking about Stuart Hart‘s sustainable value framework, his green leap, and “The Great Disruption”–when both Mother Nature and Father Greed hit the wall at the same time.

The result?  Let’s define a new term: Impact Innovation – which like Impact Investing – seeks to make a difference.

Impact Innovations are innovations which:

1) solve a major problem (or several major problems simultaneously)

2) are sustainable

3) are affordable (may include hybrid business models)

4) serve the non-customer (new markets that did not exist before).

5) build an ecosystem of products, services, and experiences around the innovation

None of this is especially new, but the language we need to describe the problems we are facing is.

Here’s one group I hope will make it happen. And of course we already see some business entrepreneurs taking up the challenge, making money and doing good simultaneously.

My point is simple: this is going to be the future of development. Governments, non-profits, and business will have to work together. Either that, or we’re in serious trouble.

vs

Cynthia Freeland‘s book – But is it art? – came out before Arthur C. Danto‘s – what art is – in fact he endorses it on the front cover (sort of) – but then he tries to one up her with a sincere form of flattery = his own take on the subject.

As a fan of Danto, I have to say his book is “pretty good and all,” but I’m embarrassed at what the publisher did to him (or perhaps he did it to himself) by copying the “look and feel,” to use the language of design, of Freeland’s remarkable book.

Maybe Danto/Danto’s publisher was reading this at the time:

Still, I think both books have their place.

Freeland’s book is more accessible (which is ironic since she’s a philosopher) and Danto’s book is pretty Hegelian and over-philosophical (but then he’s a philosopher too and an art critic). 

Freeland sees art with the glasses of an aesthetic – she examines the various theories of art in an entertaining, non-academic, journey through time and space. What can we learn from how art is exhibited? How much it costs? Who or what is an artist? How do we assign meaning to art? etc. etc.

Danto insists that art is a trinity – meaning, embodiment, and interpretation. This is straight out of Charles Sanders Pierce, and while he hints at it, Danto doesn’t acknowledge it. Maybe he didn’t read Walker Percy‘s “Toward a Triadic Theory of Meaning” in The Message in a Bottle. Or maybe he did, but I doubt it.

What I find interesting that both books don’t mention the grave danger facing art – the mechanization/digitization of the process of production of art. In my view the danger is the same one Hundertwasser saw when he said that straight lines and photography are the end of art.

Everyone must be creative, said Hundertwasser.

Otherwise, I add, you will become a living, programmable machine. Most of us already are without knowing it. Our modern rituals – shopping, moviegoing, television, gaming, rob us of our creativity and make us passive consumers of machine optimized reality. Art and Big Data collide. Art loses. Profits win. Design destroys art.

Art is the fight to not be a machine. To not have to follow reason. To not have to be a consumer. To say no. The “artistic suspension of reason” lets call it. Or even: “the artistic rejection of profit.”

Art is what keeps us human. Irrational, yet human. Art is love. There, I said it.

The predictable, strategic failure of Nook is now on the front pages of dead-tree media. Despite Nook’s problems, Barnes & Noble Chief
Executive William Lynch said the company “remains committed” to the
Nook devices.  He’s on his way out.

What Barnes & Noble needs to do is think. 

Barnes & Noble has to remember what it is.

Here’s what it is not:

• a Christian book store
• a video-gaming parlor
• a coffee house
• a stationery store
• a toy store

Who will save Barnes & Noble for us? Watch your customers, B&N!

How’s it going J. C. Penney?