Capitalism Has not Failed.. Companies need to...

Sramana Mitra is disturbed about capitalism.

http://www.forbes.com/2009/11/05/innovation-ayn-rand-intelligent-technology-capitalism.html

And our talented youth gets seduced by this profession of speculation known for its easy and abundantly flowing financial rewards, avoiding those that require much greater intellectual capacity. Most importantly, very early in their lives, our talented youth come to realize that fields that may earn them a Nobel Prize--cancer research or multi-core computing--may not make them rich. But moving money from here to there will.

And thus, we lose Berkeley Ph.Ds in nuclear physics to hedge funds and MIT computer scientists capable of delivering computing to 6 billion people to derivative manipulation on Wall Street. Rand, somewhere down the road, you lost me. I don't see how free market capitalism fixes this systemic flaw.

And I am deeply disturbed.

Capitalism hasn’t failed, it is just not enough. Instead, innovators need to change the old approach of “Focus on profits”, to instead put people and planet first. Then sustainable profits will result.

My father used to say, “What is good for GM is good for the country.” We learned that GM was not a sustainable business model, because they did what was best to make the largest profit, rather than doing what was best for the users, the country and the environment. Others came along who did make products that were far better in quality and lasted far longer than the 3 years that GM designed their cars to last.

So, capitalism did not fail. Failure of GM and others could have been avoided if the companies had done the following:

· Look at their products as part of an entire system, that includes all of the stakeholders- Users and everyone else on earth as well as the earth itself. And then determine-

o What is really needed to create the greatest VALUE. Focus on NEEDS not WANTS.

o Critically examine what exists. How could it be made to perform better, cost far less and be far friendlier to the planet

o Then commit to creating what would be better for people and planet.

The good news is that I see a whole new group of young people who “get it.” They truly want to make the world a better place, by putting people and planet first. And they have already started to create meaningful products and companies. See www.ecovativedesign.com as one example- they have created a sustainable alternative to Styrofoam.

Full Disclosure- This new venture started in my class, Inventor’s Studio at RPI and I am an investor.

Corner Office - Carol Smith - Carol Smith of Elle - Women Are Better Managers - Question - NYTimes.com

www.nytimes.com/2009/07/26/business/26corner.html?scp=2&sq=Corner%20Office&st=Se...

Carol Smith teaches us about leadership:
* Win over people, instead of bossing them
* "to-do lists"- prioritize, get through them, confront problems that show up
* Learn to be like women managers- better advisers, mentors, rational thinkers
* Men and women working together is best combination
* Get out of our "comfort zones" and walk around, see what is happening.
* Learn to give speeches, presentations
* Managing Time- Allocate time (Sundays are good) for getting email and other things out of the way.
* When hiring- See people at least 3 times, once over a meal, to determine if he/she will connect with others and be part of the team.

Importance of Having a Clear Mission

Important message about having a clear vision and mission for ourselves and for whatever we do.

"We succeeded because of the mission," says Mitchell Baker, chairwoman of Mozilla. She is called the "conscience" of the company. "Firefox was faster, safer and blocked pop-ups. It also offered some compelling innovations, like tabs, which allowed users to have multiple pages open inside a single browser window."

Each of us needs to have a clear mission for ourselves and for any ventures that we are associated with.
Find some examples of good Mission Statements and share them in comments below.
You might start at Wikipedia: http://en.wikipedia.org/wiki/Mission_Statement

Steps to Get a Patent

I just received an email from Lisa Song, who I have meet several times at NCIIA Conferences. Lisa asked for advice on how to apply for a patent. My advice is:
FIRST MAKE SURE THAT THERE REALLY IS A NEED FOR YOUR IDEA, AND THAT YOU HAVE A DESIGN THAT IS FAR BETTER, IN ALL RESPECTS, THAN WHAT EXISTS.

So many times, people have ideas, spend lots of time and money, apply for patents, and their work does not end up becoming a real product.
Several reasons for this.

1. There is not a strong enough need for the idea. You have not clearly defined the user and his/her needs. This includes metrics for performance and cost. Be sure to take the time to understand the present state of the art. What is presently available? Criticize what exists in a structured way, on paper. Look at trends. How does your idea fit?
   
2. The idea just is NOT GOOD ENOUGH.
   Your initial idea is almost never good enough. So, unless you have gone through at least 3 iterations on your idea, either forget it, and keep going until you have something that is really great. Don't waste your time on solutions that are just marginally better.
3. You just don't have the passion, skills or resources to make it a reality.
   

And here are the steps needed prior to applying for a patent.

Start with a clear problem statement. You need to identify, understand and clearly define the actual need for specific users. All of this, BEFORE you start thinking of possible solutions.

• Who is the user?
• What is his/her need?
• What is wrong or missing with what presently exists to address the need?
• What is your VISION for a new concept?
• Why is it feasible? Affordable? Technically possible? Can you get a patent to protect your idea? Will you be able to manufacture and market the product?

Problem/ Need Finding-
Focus on important needs, rather than "wants". Start by defining the user. Who is the user? Learn about the user. Be specific- not just "people with disabilities". Who are they? Where do they live? HOW do they live every day? What products are presently available and what problems do the users have with these products?

• What are the metrics (measurable criteria) needed in a new product, in order for it to be successful? Selling price to users. Performance- Features? and BENEFITS for the USERS. A new product must be FAR Better than what presently exists, in all respects. For example, it must be "greener" and less expensive.

Good luck.. and be prepared to work like crazy to make your ideas real.

Jean Shin, Turning Trash Into Artistic Treasure : NPR

www.npr.org/templates/story/story.php?storyId=103674782

Important lessons from artist Jean Shin, for my students and for everyone interested in learning to be more creative. See pictures and hear Susan Stamberg on Morning Edition, May 1, 2009.

• Look more carefully at what exists.
• It's not garbage, it has artistic meaning and can symbolize something important.
• Understand and celebrate the lives and work of ordinary people.
  
• Transform what exists, everyday objects, into something else.
  
• Concepts based on ideas that are meaningful to us- translate the viewing experience into a THINKING PROCESS.
  
• Find the meaning in (art) everything, by going beyond just looking, to feeling and thinking.
  
• The ideas come from underlying thinking, (what does it mean to get older), before starting the design of the art.
  

"In Jean's hands, the process of making these objects new again, of giving them life [and] restored purpose, and making us look at them — or asking us to look at them — in a completely new way is very artful," says Joanna Marsh, who organized the show for the museum.
At the Smithsonian American Art Museum, Washington, D.C.

How Group Decisions Can End up Wrong!

How Investment Committees Go Amiss - WSJ.com

Jason Zweig, in his column, The Intelligent Investor, points out that financial decisions made by committees, are often bad decisions. His advice applies to all kinds of decisions.

• Measure what factors predict success.
  
• Rank the people (and rank the ideas) using metrics.
  
• Reframe the question. Develop arguments "pro" and "con".
  
• Ask "the five whys". Why is the idea superior? Why is this the 'right" answer? Why...?, Why...? Why...?
  
• Define the default position. Any deviation from the default should require extraordinary evidence.

Excellent advice for ANY decision making.

A List of 100 Attributes for People to Succeed

Thanks to Guy Kawasaki for putting this website on Twitter.
Check out the complete list.
Some of my favorites are:
3- Get comfortable asking for advice and help.
4- Present your (startup) ideas to anyone who will listen
5- Get really, really good at concisely stating your (business) idea.
11- What pain are you fixing? And whose pain is it? Who are the stakeholders?
14- Details vs. General. Actually you need both views.
19- Is work fun for you? If not don't bother.
26- "Ready, aim, fire." Should be "ready, fire, adjust."

Very valuable. For everyone, whether you are starting a new venture, or working to be successful in an existing company. I wish someone had given me this list 40 years ago!

Write an Elevator Pitch for Your Blog [Day 1 -31DBBB]

Help to Develop an Elevator Pitch... see this worthwhile website.
Elevator Pitch is not just something to snare an investor. Rather, we all need to create a 1 minute talk that explains-

1. Need- Who is the USER and What is his/her need/ problem?
   
2. Vision- What will we do to address the need?
   
3. Benefits- What will happen when we solve it?
4. Feasible- Why will we succeed? Technically possible, affordable, strategy for making it a reality.
5. Passion- Why is this something important that will make the world a better place?

And then "pitch it" to everyone you meet, to enlist support! Good Luck! Focus on NEEDS not wants. Never stop. Make your vision a reality.

Growth Model is Unsustainable Ponzi Scheme

Thomas Friedman in NY Times today- The Inflection is Near?

What if the crisis of 2008 represents something much more fundamental than a deep recession? What if it’s telling us that the whole growth model we created over the last 50 years is simply unsustainable economically and ecologically and that 2008 was when we hit the wall — when Mother Nature and the market both said: “No more.”

"Crisis is Opportunity" and young people in my class at RPI are working to change the present model. Some of their innovations include:

• Affordable method of providing safe drinking water for billions of people around the world.
• Inexpensive way to eliminate 20% of the mercury pollution in the world, caused by artisinal gold miners in countries like Brazil. We all suffer from this pollution.
  
• New method and device to find and eliminate land mines and other explosives- far less expensive, faster and safer. Finally, we could rid the world of land mines.

Agricultural Waste Plus Mushrooms = Sustainable, Affordable, Better Products
Ecovative Design, was started in 2007, by 2 former students from my class, Inventor's Studio. They continue to make great progress, turning agricultural waste material into useful, biodegradable products, that cost less and are far better in every way. And their work has gained support from numerous agencies including EPA, NYSERDA and Picnic Green Challenge- they won 500,000 Euros in November, first prize. Watch Eben Bayer's presentation. (Full Disclosure: I am an investor in Ecovative Design.)

These bright, motivated young engineers are passionate about making a real difference in the world, especially for the people with the greatest need. And the work that they are doing promises benefits for all. They are changing the model that relies on ever increasing consumption, to one that is based on addressing the most basic needs, in a sustainable way, that protects Mother Nature, creates new jobs for themselves and others around the world and makes life BETTER for everyone. I am so proud of them. They make me optimistic that we can successfully change the present Growth/Business Model. Let's all support this type of thinking and action.

Designers Need to Design the Business Model

An often overlooked part of creating a new product is to also design the Business Model. This is also the responsibility of the engineer or designer. Read about Business Model. Your choice of a business model provides many opportunities for innovation.

This is not the same as a Business Plan, which contains much more information including financial projections. Rather, your Business Model considers and defines the key elements needed to manufacture, distribute and finance your proposed idea.

Now More Than Ever- People, Products and Companies Must Create Value

Each of us needs to constantly ask ourselves, "How can I create more real value for my customers? What is the "Value Proposition"?" In the past, we could get away with simply creating products or services that looked better or were advertised in a clever way.
In this New Reality, long term success depends on producing real value.

• Products need to be FAR BETTER in Every Way, than what exists.
  
• Make the USER #1- Put the user first and always do what is best for him/her, rather than what seems best way to produce near term profits for you and your company.
  
• Green is good, but whatever it is, needs to be less expensive.
• Products and services need to provide additional FUNCTIONS. Look at the Apple iPhone. It isn't just a cool phone or a camera. It can provide a growing list of additional functions
• These new functions need to create value. Don't be fooled by applications that are just "Cute", with no real value that you can point to. How do they save- time and money?
  
• Perhaps the easiest route to making products better is to make them "smarter". Add low cost sensors and electronics in order to add value.
  

Willem Kolff, MD Lives On!

Dr. Willem Kolff, inventor of dialysis and heart machines died at 97. Read his obituary. I had the good fortune of meeting Dr. Kolff several times at meetings of the American Society of Artificial Organs, in the 1970's.
He knew that making progress requires taking risks, even with a person's life. But the results of his risk taking, vision and hard work have saved the lives of many thousands of patients, who rely on connection to a modern dialysis machine to keep them alive.

• He did not accept that failure of an organ meant certain death. Insisted that there must be a solution.
  
• Used readily available materials and quick tests to prove his concepts
• Improved results through iteration and collaboration with others.
• He was always open to new ideas and to listening to young engineers (like me).

Dr. Kolff's life and accomplishments live as an inspiration to future innovators. I teach a freshman design studio at RPI. Three years ago, Oliver Williams and his 3 teammates, were working to design a device to filter water and make it safe to drink. They did research and found 10 different methods. One was "reverse osmosis". They read that an animal intestine could be used as the membrane. Just like Dr. Kolff, Oliver built a working model, using sausage casing from the local butcher, a hand pump, some plastic tubing and 2 plastic 1 gallon jugs. He put apple cider in one jug, pumped and got clear water out into the second jug. Dr. Kolff LIVES.

IDEO Teaches Important Skills for Innovation

Dave Blakely, one of the leaders at design firm IDEO, has very important things to say-Watch his video.

I have met Dave a number of times and I always learn something important from him.
Note what he says about:

• Social responsibility
• "T-Shaped" skills and Human Centered Approach.
• Empathy as key to success
• Need to understand and consider business- cost/ pricing, strategies and tactics
• Constraints- are important to innovation
• Suspend judgment in early stages of ideation and "Encourage wild ideas"
• Prototyping, low fidelity- "Right, Rapid and Rough"
• Keep learning forever
• Learn from your failures.
• Engineering education leading to other opportunities.
  

Changing Obsolete Business Models Can Lead to Disruptive Technologies

Excellent article by Janet Rae-Dupree in the New York Times January 31, 2009. Health care today has many problems-

• Millions of Americans without insurance means reduced access to care, loss of life, lack of efforts aimed at prevention and maintaining good health.
• Rapidly increasing cost of providing health care means that other areas of the economy must suffer

The author urges us to examine business models as an entry point in our efforts to make meaningful changes, "Disruptive Innovations", that can improve lives of many and save money as well. She also writes about the need to consider the entire SYSTEM, in considering how to create meaningful change- Important advice for achieving innovation.