innovation playground Idris Mootee

GE CEO Jeff Immelt Talked About How Companies Need To Prepare For A "Reset" Speaking At The London Business School Global Summit.

It is the first time I’ve listened to Jeff Immelt (Immelt is the 9th chairman/CEO of GE, a job he has held since 2001) speaking live. He was talking 10ft away from me and I have a closed up view of how the confident CEO of this big and one of the most prestige firm talked about strategy and leadership in times of global crisis. He said candidly that he had only taken 5 days off (including weekends) the last 3 years.

He was speaking at the London Business School's sixth annual Global Leadership Summit this morning, a private event featuring the most prestigious group of business leaders to debate and reflect on the global downturn and how to emerge stronger once the recession is over, which there are plenty of signs that are already happening.

It is not easy taking over a job from Jack Welch, one of the most celebrated CEOs. Those were big shoes and he is filling them nicely. Talking how things could be difficult, he shared a story when he just graduated from B-School, interest rate was at almost 20% and at the end all things worked out ok. His advice to other CEOs, here are four most important things to do in order to lead a company out of a crisis likes this:

1. How to manage business cycles?
2. What is a point of view (about the reset)?
3. How do you think about renewal?
4. What does it mean for business leadership in the 21st century?

The first one is how to manage in a crisis. His answer was simple, first one is preserving cash and making sure absolute balance sheet strength.  Second is moving with speed and quickly taking advantage of the opportunities that exist – where does the opportunities exist and how do we access that. GE took more orders in the latest air show that the past by selling to new customers. Third, keep executing on a long term strategy. And fourth, communicate constantly inside and outside the company. This is the best way to get through the crisis.

The second thing is having a point of view.  What does that mean? According to Immelt,” It is more than managing your way through. Every few years, you need a reset.” This is an interesting one. Most company lacks perspectives, or different perspectives of how different future might unfold before they develop a point of view. Without that, the company lacks direction. It is truly important fro every board to have a point of view of the future, not just senior managers.  His example was US Consumer the last 25 years consumed 6% of what they earned. Now we’re moving from debtors to savers.

He used the word “ big sized themes” to refer to what form a point of view. It is more than just managing your way through. Every few years, you need a “reset.”  GE faces the cycle, they’ve made the choices, 2008 earnings was the third highest in the history of GE.  In his words< “Look for the simple truths in these point of views, use them to help your organization to lead in a reset world.” For GE, the two big themes are 1/ clean energy and 2/affordable healthcare.

The next one is renewal. What does it mean for renewal? It means understanding what opportunities will emerge; what levers we want to pull and what technology will drive the next wave of innovation?

The last one is on business leadership in the 21st century.  I have some thoughts to add so that will be another post. Will catch up with him during coffee as I have a few questions for him.

Michael Jackson's Death Is Tragic. It Reminds Us Of How Fragile We Are, Both As Human Beings And The Things We Created - The Internet.

The web today is filled with Tweets on the tragic death of Michael Jackson. The first company that benefited from this tragic event was Apple. The iTunes Music Store and 9 out of the 10 top albums are all Michael Jackson’s.  And top 5 selling DVDs in Amazon all Jackson’s too. Michael is iconic across generations. Music fans around the world have a deep-rooted connection with this iconic star and his music. And people are quick to try to make money from this. This Neverland Ranch domain name is selling for $20mm on eBay. Why? The seller is suggesting that there is talk of that the Neverland Ranch will be be tnred in a money making thinng bigger than Graceland as an amusement park.

Music is like air we breathe and iPod is the first electronic gadget that every kid grows up with.  Does music helps us to become more ‘us’ as ‘individual’ or it is causing more conformity? Does Michael Jackson’s music scream loud the language of individuality? What causes the cultural conflict with the problems of identity and identification. Our society possesses culture of our own; varying with diverse ethnic and education etc. and at the same time conditioned by popular cultures such as music and TV, and now social media.

The notion of identification and identity, two concepts which frequently appear in connection with the individual's personality development and they are now reflected in our images or avartars on Facebook and other social networks.  The terms identity and identification and implies some key differences; namely that a person's image or identity of himself/herself is obtained early in life as the result of selecting desired traits from various models and that an individual must have a concise concept of himself in order to survive as a productive human being.  Sometimes these two create conflicts.

Michael’ story of his fall was so profound, from a superstar into a financial, physical and psychological. People wonder how that could happened to a talented person and why?  Many belief that Jackson had body dysmorphic disorder, where the sufferer has a distorted self-image and identify crisis. It is very sad. But it is not that uncommon, I see people in the workplace who are unable to obtain meaningful, purposeful identities; and therefore a real "identity crisis" occurs. There are some indications that the younger generation will rely less and less on TV for cultural refinement of an individual. The emergence of social networks and media hopefully will become a medium for them to shape their own identities and prevent crisis.

What’s an identity crisis? The identity of an individual incorporates culture and cultural values. If the culture and the cultural values are unclear to the individual ("culture conflict"), then the result will be faulty identity formation or "identity crisis". Constantly confused and trying to be someone else.

This tragic event shows us again how fragile we are, both as human beings and the things we created-the Internet. Twitter was even temporarily jammed into inaccessibility, and story-breaker TMZ went down as fans around the world tried to find out what was happening.

According to data from Akamai worldwide Internet traffic was 11% higher than normal during the peak hours between 3 p.m. PDT and 4 p.m., when news of Jackson's death was breaking. That traffic forced even Google to its knees for a brief period of time Thursday afternoon. That won’t happen with radio or TV when the world tuned in to see a man landed on the moon. Networking problems will only get worse as traffic grows and our demand for real-time and more new Twitter-like apps.

May he rest in peace.

HP Was Founded In A Garage That Started The Wave Two Of Transformation Of The Modern Enterprise. Watch Out For The Next Wave Which Will Be Driven By Social Technologies.

This is the garage where David Packard and William Hewlett started their new company in 1938 as fresh Stanford University engineering graduates. This is probably one of the key places in California that can be called the birthplace of Silicon Valley. If you visit this tiny garage, you will find In front of the house a plaque officially declaring the location the "birthplace of Silicon Valley” some 70 years ago. The Valley not only transform businesses, it also transform societies and politics.

This once tiny garage workshop was once rented by William Hewlett and David Packard, Stanford engineering grads after stints at MIT and GE came back to Palo Alto to start a HP. This company transformed many of the modern corporations. I am sure in 40 years my grandchildren will be visiting Steve Jobs’ garage with a plaque declaring “birthplace of Apple computers”.

The modern corporation has experienced (survived and prospered) several transformations. Sometime between 1690 and 1790, political innovations triggered the financial innovations that gave birth to modern-day capitalism. Then, democratic governments gave birth to the modern-day financial markets that continue to transform organizations and allow different forms of capital structures. This was Wave One.

Information technology has been transforming organizations from the early days of the mainframe to the BlackBerry of today. Most of the benefits were realized through employee productivity gains from increased access to information about customers, inventory, logistics, finance etc. Consider this Wave Two.

What about Wave Three? It's happening. The new wealth will not come from innovations that hope to perfect the old world. The old world is so broken after all. Rather, new wealth will be derived from innovations will that create new worlds - connecting different worlds. This has been the constant theme of progress, and there is no reason to believe otherwise. The next wave of transformation will be powered by the new, namely social technologies. This change will impact the shapes and forms of today’s organizations, and will widen the gap between the leaders and the laggards of tomorrow’s organizations

Social Technologies is not just about software – it is the new business logic. Enterprise software vendors will be quick to jump into this space and declare they have the solutions. But how can they have a solution when we have yet to fully understand the problems and the opportunities? ERP systems will likely be first to offer social modules (if they know what it means), and CRM companies will want to create plug-ins into social networks and integrate this data into their dashboards. There are already tens of dozens of social intelligence companies out there with solutions, but this is not the right starting point.

This unprecedented degree of collaboration among employees, customers and partners around the world is now possible, and increased interaction will bring unprecedented opportunity and a tool to “level the playing field” globally, with significant ramifications for business model innovation and organizational design. Who will become the HP equivalent in the next wave?

Even Before Any Iranian Revolution, We’re Seeing A Twitter Revolution. This One Is Not Ending Anytime Soon.

This week we see how Twitter becomes CNN newsgathering and distribution tool when everything else gone dark. Twitter is probably mentioned every two minutes on CNN. Because the world relies on Twitter to report what was going on in Iran, Twitter had decided to push off its scheduled maintenance Tuesday morning as the conflict continued. As it happened, Twitter was a major if not sole source of information coming out of Iran. In order to keep the flow of communication to the outside world flowing, Twitter said it would not turn off its service until Iran calmed down. We under estimate how powerful this micro blogging tool can be.

On the flip side, there’s no control over how people use Twitter. There’s always a danger when totalitarian government or organization can abuse it with maliciously intent to deliberately spread misinformation and cause widespread panic. How can we prevent that form happening? There will be more and more situations that we can only reply on Twitter for information, and we'd better figure out ways in which we can authenticate information. Twitter's 140-character-only environment makes it even easier to mislead people, as it's very hard to make a decent argument in 140 characters. There is a very high risk of information being misinterpreted. Then there is confusion over authorship and questions around where the original sources are from. How do we deal with reposting is another challenge.

In additional to causing a revolution with citizen journalism, Twitter can potentially revolutionalize gaming. Soon someone will develop the first ever Twitter-based game. The gaming experience will be very different from motion and graphic games, it will be text-based and may involve secret codes and broadcasting messages to a larger crowd to mobilize the underground forces in Iran or maintain an intelligent dialogue with a mainframe computer controlling missiles in North Korea etc. Not sure how to categorize games like this. Or if they already exist?

What's Your Strategy For Strategic Innovation?

As the pace of innovation accelerates and beyond the speed limit, executives are experiencing two other kinds of hot water, declining bottom line results caused by the “credit crisis” and declining consumer attention as they are becoming immune to “marketing.” Everyone is therefore looking for ways to improve their innovation capability and process; both within the organization as well as with outside help through consultants and even consumers that can help them detect early trends.

Theie mission is to find ways to both drastically widen (and deepen) the funnel of ideation and then more effectively manage the process from concept to pilot and roll-out. Some are seeking to update their obsolescent innovation process and many don’t even have one. They just struggle to get started and many are simply borrowing from product development process which isn’t design for innovation. Everything company has different needs and once a decision is made that your company must innovate to remain or to become competitive, you should start planning a logical yet adaptable process to guide the team during the entire course of action.

Where to start? First pick a type of innovation process that works for your company. Declare your intent and objective. Are you responding to a disruption or simply want to find want to grow your business? The result of this process could include a new product, a new service, a new business model? Look at what tools you have and what are your ingredients that you have to work with. How many cycles of innovation is needed on a 12 month basis?

Second: Once you have decided on your strategic intent, you should look at your organization to see where and how this process should be initiated. How much collaboration is required both inside and outside the organization?  Do we have the right support from outside consultants? Does your organizational structure support the innovation process you have selected?  Will the culture within the company support the innovation development procedures?  The important point here is that the level of acceptance of “transformative” ideas as well as the level of risk tolerance must be compatible with the overall management philosophy of the company, or the dissonance could doom the project.

Third: What is the time scale for such innovation process? This will depend on a couple of factors. Among these are the drivers of the project and the size and complexity of the project. If the development project is an extension or minor modification of an existing product or service, the time scale could well be a few months versus a disruptive move that takes up to a few years.

Fourth: Decide on how you want to finance it? Do you have an innovation budget? Or if you plan to finance it though your marketing, product development, research or other budget? Or you need to create the business case before you get started? Or it is a corporate mandate and you have access to some corporate strategy dollars which the CEO put away for special use.

Even Google has finally realized they just can’t let continue using a laissez faire approach to innovation and product development. In a recent interview with a WSJ they admitted that Google can no longer afford to let promising ideas fall by the wayside. The Internet search giant’s once-torrid growth has slowed. At the same time, it faces fresh competition from Microsoft’s new search engine, Bing, and start-ups such as Twitter Inc., which was founded by ex- Googlers.

The response? Google has recently started doing internal “innovation reviews,” they are formal meetings where executives present product ideas bubbling up through their divisions to Schmidt, Google founders Page and Brin, and other senior folks. The processes are designed to “force management to focus” on promising ideas at an early stage, according to Schmidt. Even innovation needs a process.

Have a great weekend.

What’s The Last Innovation We’ve Seen Coming Out From The Banks? Scenarios For Banks In 2020?

By 2020, today's 39 year old will turn 50 and today 9 year old will be 18 and both represent a whole new generation of customers for the financial services. The 18 will be in the market for financial services and having gone through the banking and credit crisis they will be very skeptical of financial institutions. The newly turned 50 will be joining a powerful group of boomers that have very different idea of what they want for the second part of their life as well as their financial goals. 

By 2020, there will be way fewer banks. Market consolidation will result in making the mega banks even bigger. But they will face non-bank specialists and non-bank banks that specialize in providing highly differentiated product offerings. Partner/Channel relationships will be more important than ever as channel owners continue to gain market power.

In 11 years time, there will be massive innovation on the payment side. I cannot imagine how retail banking will change and even the very nature of currencies. So what services will be wanted and how they will be delivered is likely to radically change by technologies. And even the assumption that customer financial needs will all be met by traditional banks will become a big question as financial services’ potential convergence with another industry. 

There is a five-year project between MIT and Bank of America is bringing together bankers as well as academics to think about the future of banking. The objective is to help provide a unique opportunity to grow banking in innovative ways that respond to the evolving marketplace as well as customer behavior, preferences, and trends.

Some of the ideas they’re working on:

• 
How can every customer be empowered with the knowledge and tools to take better control of their financial futures?
• How will banking interactions evolve as a customer’s physical and virtual worlds become completely intertwined?
• How will social networks and mobile platforms transform customers’ banking experiences, making it easier, more convenient, and better integrated with their daily lives?

It is hard for banks to innovate. And when they do generate some radical ideas, these innovations cannot make it beyond a small pilot?  Often this is the result of dogmas and bureaucracy, and the dynamics of inertia among these large institutions. It is not often that banks get disrupted by a radical technological discontinuity (ATM and online banking were the biggest ones), these large financial institutions are bureaucratic but there are no significant external forces to present any urgency to innovate. There’s also a lack of process and so it is difficult for their management to put their teams, assets and even culture together.

Let me paint three scenarios for Banking 2020:

• Ubiquitous Financial Services - in a world where trust is still mediated physically financial services become ubiquitous. Credit is available from your utility company, insurance company, supermarkets and even employers. These credits will be transferable and they all compete and you can switch you loan among those depending that provides the lowest interest rate.
• Social Money STM – finally money will no longer need to be tangible. Mobile money?  It is happening in Japan and finally coming to the US.  We are 6-8 years behind Asia in mobile (thanks to the larger carriers). Virtual currency/digital wallet are embedded in your digital device and you can use from parking meters to shopping mall. Biometric solves all the security company even if we lose our cell phone. Your IPhone becomes you iWallet. Need cash? Walk up to gas station/convenient store and wave your iPhone to their system, you get your cash. We all hate ATM fees. Competition and free market pricing have created an explosion of new ATMs. Since the advent of access fees in 1996, the number of ATMs has nearly tripled, creating new terminals in more convenient locations.  With Social-Money, you can walk up to your friends and withdraw cash from him/her, the transaction happens in the back. Your money debited and his/her credited. He/She makes $3.
• Quantitative Analytic Risks Management – Technology will progress enough to provide instant calculation of risk / rewards of every monetary instruments. Customer can simply pick and chose products based on their risk profile. Quantitative analytics and smart infographics allow each customer to manage their risk as easy as picking what they want to eat for dinner.  Customer can play with different scenarios where quantitative assessment is accurate to the last cent. System will prompt and alert you when they think you are taking more risks that you should and trigger a review of your credit ratings. Every customer from the bank perspective is a SI number and a risk rating.

What's The Last Innovation You've Seen Coming From The Insurance Industry?

Last week I’ve received this email from one reader of my blog. Here’s his question:

Hi Idris,

I am an Insurance Professional with more than 12 years of experience. I have a good presence and active in a number Social Networks with good number of connections. I am thinking of using them to market more products. I would like to hear your expert views on Social Networks in marketing of Insurance Products. I know you are busy but appreciate any advice you can provide.

Hope to hear from all of you soon.

Regards,
Name Withheld.

The question is how social networks and virtual social connections can have any impact on the sales and distribution of products such as insurance as well as other financial services? I don’t have an answer but we take a quick 15 minute analysis of the issues.

Let’s take a step back and look at the challenges around marketing and distribution of life insurance products (health insurance is a different story). Will the traditional model of “advisor-based” distribution will come under some disruption? 

With the average age of agents rising steadily; sales is stagnant and margins getting thinner, insurance company needs to rethink “marketing and distribution”. Steady of influx of new investment products from banks that are also competing for insurance dollars. The biggest disruption will most likely remain on the distribution side. The importance of asset accumulation products is particularly noteworthy because this is the market where insurers face the most intense competition from all the banks, mutual fund cos, and investment advisory firms. Because these non-traditional competitors have much lower distribution costs than insurers, insurers face intense pressure to operate more efficiently. Distribution costs are one of the largest expense items associated with life and annuity policies.

Industry consolidation in insurance is different from banking. We’ve seen small banks going away but there are not many changes among insurance players, because it has less restriction and many are successful in operating in nationally. But the restructuring of the life insurance industry primarily tends to involve such strategic objectives as an increased emphasis on core competencies or the expansion into new markets rather than the consolidation of geographically concentrated firms as in banking. Expect competitive intensity to remain the same.

Back to the question posted to me. I think there are two ways the insurance industry can take advantage of social technologies. First is to empowering agents to take advantage of social media as their CRM systems. It is the best way to reach people with common interests, while the other is connecting with people engaged in a similar occupation. Provide them with tools to make content a lot more engaging and tons of training. It is as important as knowing how to use a phone.

Second is the extreme widgetization of the products an services. Innovative thinking needs to be built in the existing products around their “socialabiity” and “connectivity”. Life insurance is a high involvement product, it helps us to prepare for two risks—dying too young or living too long. I think living too long is more of a problem.  A recent study done by The Boston College Center for Retirement Research found that 43% of American households are at risk of being unable to maintain their pre-retirement income.  And if you take away some optimistic assumptions such as using a reverse mortgage, over 60% are not prepared.

You can put a lot of innovative thinking into making the product (and experiences) more engaging. Here are a few of the ideas I have from the back pocket and each one of them can be big:

• A socially-enabled annuity product – designed to be marketed through online word-of-mouth?
• A mass produced, multi-component prepackaged one-click solutions – there is a gap in the market place for this?
• A hyper-efficient direct distribution model – a super low cost solution that makes ING looks expensive?
• A  direct selling mid-market lifetime income solution – income is now the most practical consideration?
• Plan conversion exchange – allow people to convert defined contribution assets into income for life through annuitization?

Building On The 140 Platform. What's Will Twitter Do Next? Twitter TV Or Twitter Dating?

Twitter is touching more people than NYT or WSJ (ok it may not be a fair comparison) Add to the fact that a lot of Twitter users rarely hit the hyper-text-transferred-to-the-browser page, but rather use through a desktop and/or mobile app, and the figure gets even more impressive. Twitter is continuing its unstoppable move forward. And what about those Twitter traffic "machines" and “buy your follower” programs? Twitter needs to figure this out as soon as possible. Twitter litter? Perhaps a payment/filter model will eventually work, weeds out the hackers that wont pay $5/month for access to Twitter that has real people and conversations happening. We are also seeing Twitter viruses starting to happening. Anti-virus for Tweeter?

The 140 number is doing magic, at least for them.  How did they get this magic number?  I was reading Patrick Glinski’s paper on Twitter Strategy (part of a series of Social Media Knowledge white paper that we are publishing), it is a very good piece. There’s so much hype abut Tweeter and you can’t imagine how many times Twitter is mentioned when I'm watching CNN news, the news anchor are actively promoting their tweets. TV is not enough?

I’ve had probably more than a hundred requests for Tweeters but I still have not jumped into the bandwagon. Sorry I must have disappointed many.  I just struggle to write in less than 140 characters. I need at least 486 characters in order to say something meaningful.  So I have a problem. Think about it this way, most people who twit are men (no formal statistic, just my guess) because most men are comfortable in communicating in less than 140 characters or less. We have fewer words in our vocabulary and usually say things short and sweet. On the other had, women's verbal capacity is far bigger than men. Women are better in communication in general and don’t usually get to the point fast. So the next big idea may be 300 words Twitter for women?

Can we milk this 140 idea? I just wonder what happen if we limit our everyday conversation to 140 characters per message? What about a social network that only allows 140 connections and your friends need to compete or stay active to remain in your network?  What about your wireless carrier sending you your month statement in 140 characters? I hate reading these monthly statements as they can’t even design one that people can understand. Go hire a usability person!  How about Twitter TV? These 140 seconds show? What about Twitter music? This one is cool.. Twitter Dating! 140 persons you can meet in 140 days?

Twitter TV is real, they have teamed with Reveille productions and Brillstein Entertainment Partners to develop an unscripted series based on the site, which invites 140-character postings from members around the world. The show would harness Twitter to put players on the trail of celebrities in an interactive, competitive format. The producers call their proposed series the first to bring the immediacy of Twitter to the TV screen.

Teaching Ethics In B-Schools? Is That Enough? How About Starting With Rethinking How We Select Candidates?

There were a small group of people at HBS a year ago wanted to crate an MBA oath. During their two years study, they have been challenged to reflect even more deeply because of two events that coincided with the timing of their studies - Harvard Business School’s 100th anniversary and the global financial crisis (both have no direct connections). The school has been rethinking hard about its role in the future of business and societies and how the MBA would continue to be relevant a century from now. Stories like Enron bring shame to all of us who holds an MBA degree, how could that have happen? Are organizations becoming too complex and unmanageable or some of us are so incompetent?

The second event that inspired was global financial crisis of this past year and it poses the question whether business schools are successfully executing their missions of educating responsibility leaders for society. How did we get into this mess? Have we been producing generations of MBAs only concerned with getting rich at the expense of  society and sustainability? After meeting with Professor David Garvin to ask what he thought of the idea of an “integrity pledge” for graduating students and eventually created a “Hippocratic Oath for Managers” which would serve as a professional credo for MBA graduates, like what they have for doctors and lawyers (not sure the one for lawyer makes any sense). 

I learned that only less than 25% of the graduating class of 09 signed the oath.  I find that a little ridiculous that majority of students who have spent over $100,000 on two years of study in an effort to make big money suddenly so keen on social values. With school fees continue on the rise, it is not easy not to take on the maximization strategy. Such naivety will not last when they started climbing the corporate ladder when they graduate. Even if these 25% of MBAs seriously embrace the “values agenda”, it will be a long time before they can have any influence on how key important decisions are made.  I don’ think the Oath makes any difference at all, just look at the legal practices in general.  Does it mean we need to have designers signing oath promising that they will serve the greater good by bringing designs that fulfills needs and sustainable? Here’s the oath if you are interested:

THE MBA OATH

As a manager, my purpose is to serve the greater good by bringing people and resources together to create value that no single individual can create alone. Therefore I will seek a course that enhances the value my enterprise can create for society over the long term. I recognize my decisions can have far-reaching consequences that affect the well being of individuals inside and outside my enterprise, today and in the future. As I reconcile the interests of different constituencies, I will face choices that are not easy for others and me.

Therefore I promise:

I will act with utmost integrity and pursue my work in an ethical manner.
I will safeguard the interests of my shareholders, co-workers, customers and the society in which we operate.
I will manage my enterprise in good faith, guarding against decisions and behavior that advance my own narrow ambitions but harm the enterprise and the societies it serves.                  
I will understand and uphold, both in letter and in spirit, the laws and contracts governing my own conduct and that of my enterprise.
I will take responsibility for my actions, and I will represent the performance and risks of my enterprise accurately and honestly.
I will develop both myself and other managers under my supervision so that the profession continues to grow and contribute to the well being of society.
I will strive to create sustainable economic, social, and environmental prosperity worldwide.
I will be accountable to my peers and they will be accountable to me for living by this oath.

This oath I make freely, and upon my honor.

I am not sure how B-schools will evolve and change is needed for sure, while everyone is trying to innovate and update their curriculum in a  response to today’s need and a new focus on ethical management and socially and environmentally responsible business practices, one Bay Area school has been quietly making progress for its Sustainable MBA program. I’ve met a couple of fresh graduate in California last week, they are definitely a very different breed. Since 2003, SF-based Presidio School of Management has offered an MBA in Sustainable Management that integrates environmental, ethical and socially responsible concerns into every course.  I pan to visit the school next time I am the city. I should talk to the Dean and find out more.

It’s a big mistake to think if only there were more business ethics and social responsibility classes in B-schools; we would have fewer business scandals. That’s definitely not the case. The exercise of judgment and discretion is the defining feature of a profession (or a person), and this is not developed in B-schools, it started way earlier in life. Ethical values need to be built into students right from their early schooldays. Family and friends already also shaped the student’s character. I don’t think ethic courses or signing an oath can force a bad manager to act good. Do you?  For B-schools, how about a character test in addition to GMAT?

Strategy Is About Focus. But Focus Causes Blind Spots. That's The Paradox of Strategy And Innovation.

 Last week I’ve met with an innovation team from a large financial institution, very impressed with the team as well as their know now and I am say it is rare as focus are often placed only on operational side rather than innovation. We shared views on how innovation work and emerging practices in large complex organizations. The funny thing there is slide that I showed them it is almost identical to one of theirs.

Where does good ideas come from? How do you find them? This is more art than science, the best ideas often grow out of the unintended intersection of various elements.. For example, at the point where a brand, category, experience, product or industry ends and another begins, the space between them becomes a platform for launching something new. That’s never been more true than today, ass brands, channels, experiences, products and services get drawn deeper into the social space of community, collaboration and customization. Today, creative collision is the zeitgeist of innovation.

Every intersection across domains as diverse as business, non-profit, science, art, and entertainment is a nexus for innovation. We need to learn to break down associative barriers and view problems in new ways, be ready to walk away from familiar territories and venture into the unknown. The unknown is where large organization feels uneasy. Innovators have a restless curiosity to explore intersections. They see social technologies as an enabler of innovation and new business models, rather than as a way of making the current model more efficient.

We are all over-focused. The economic climate further pushes us to their direction and beyond a point we lose sight of the big opportunities ahead. Focus limits awareness, and important information outside the range of focus can be missed.  The paradox of organizational focus is that it often blinds us to new opportunities. Focus is the core reasons for blind spots. Through constant scanning and reading weak signals, we can then recognize and seize upon that moment when luck aligns the forces of the universe to unite need and opportunity in such a way that the connections between unconnected dots can be seen.  Strategic Innovation is not about creativity or design, it is about organization agility and constant organization realignment.

Is Recycling The Solution? Or Will Bioplastics Be The Answer? Let's Look At The Economics Of Recycling.

Recycling is probably the number one thing consumer relates directly to "Green." People are trying to figure out what incentives are required fo rthe mass to adapt recycling. A company called GreenOps has developed a tracking system that can trace products going from the consumer stream to the recycling stream.

Companies that create consumer packaging can participate and put the GreenOps logo on their materials. Consumers buying goods can choose products identified with that logo. When finished, they take it to a GreenOps Tracking Station where they get a receipt showing the number of items they recycled and a code for redeemable cash at a retailer such as Wholefood etc. A 5 cents per bottle.

The concept is to have these tracking stations placed in high traffic areas like shopping malls, sports stadiums and other places where a whole lot of packaged products are tossed in large quantities. When an item is deposited into the machine, it gets scanned and the materials are tracked so companies can see how much of which products are being recycled. There are three questions: 1/I am not sure how often it needs to be cleared particularly high travel area given the size of the box 2/Is the 5 cents an effective motivation for consumers? 3/ The cost of deployment and I am not sure how the economics work.

Not sure we understand the economics of recycling. The bottle needs to be washed, usually in the kitchen sink with running tap water, so water is consumed. The plastic bottle is then taken to a recycle machine that crushes the bottle. Electricity is consumed to power these recycle machines. A special recycle truck picks up your blue (or green) box and then it delivers the recyclable material to a sorting factory. The factories and machines are built to sort the various recyclable materials from each other, paper, plastics, glass etc. These recycled plastic bottles are not made into new ones, they're used for lower grade plastics such s those used to build playgrounds.  So we will still need to keep manufacture more new plastic bottles. This is a hardly a solution.

Recycling is great idea at first thought, but we often consume more energy in reprocessing our recyclables than we are gaining. There are simply no cost-effective means of recycling food containers into new food containers. Can Bioplastics be the answer?  It's still an open question on whether it is more energy efficient to use biodegradable plastic or just recycle petroleum-based plastic. There are no straight answers. In the meantime, please bring your own bottle.

"Sustainability" Has More Than It Means. There Are No "Sustainability" Without "Social Innovation". Many Of The Solutions We Have Are Simply Too Tactical, Not Dealing With The Systemic Issues.

Here’s a picture of the Better-World-Team and IC team at the Brand Sustainability conference in Monterey, California. Talking to many at the conference, I can see  how people are very passionate about this subject and wanted to make change happen. The question is always the “how” and the debate is over whether it should be top down or bottom up, whether it should be led by policy makers or corporate should take a leading role or consumers should be leading this “revolution”?  There was a heated debate in the discussions groups that I moderated.

The first problem I have with is the narrow definition of sustainability. I don’t it is a just about recycling and green. Definitions of sustainability presumes that there must be justice if we are to survive or even prosper in the long run. It is about future survival of humanity. Thus, as it is said sustainable development requires the alleviation of extreme poverty and a better (honestly I don’t know what I means when I say better) distribution of wealth among the world's population, there is absolutely nothing wrong with more rich people, just not acceptable to see increasing poverty.. And no sustainability would make any sense without addressing “intergenerational and transnational equity” that is not selling our future short at the expenses of our children. And it only means children in the west but also in the developing world.

World-renowned architect William McDonough has translated the sustainability challenge into a provocative question he poses whenever he speaks about the fundamental goals of design. He asks, in our lives and in our work, how do we love all the children of all species for all time? Clearly, McDonough believes that sustainability involves a shift in attitude and values and an expansion of our sphere of moral concern. It is an attitude.

If all of this sounds not confusing enough, there’s more. It is basically a humanity issue more than an environmental issue. We are not seeing the whole if we only see environment. How do we provide a decent life on this planet is a problem facing all humanity? Well I am making the problem too difficult to solve. This is a wicked problem; it is both systemic and maybe the ultimate challenge.

As I see the term sustainability will continue to be misused. There are companies that were doing a great job day one. It is great to hear people from Starbcucks, Ben and Jerry and HP talk about sustainability and how they are doing it. Ben and Jerry is probably one of those very few companies that started thinking business social responsibility and sustainability many decades ago. Rob Michalak, Ben & Jerry's Director of Sustainability was explaining the company’s approach to sustainability. I really like the word they use at Ben and Jerry –“Linked prosperity”.

Ben and Jerry is now an Unilever company, but that doesn’t change their way of doing things. There was an agreement as part the acquisition terms that there would be an independent board to oversea and ensure Ben and Jerry will continue to deliver on its social mission.

There’s no sustainable without social innovation. It means sustainable development. According to Unilever CEO Patrick Cescau , Social innovation by business is a big part of what’s needed to get to sustainable development in general. Cescau's definition of social innovation, at least in Western markets is: "finding new products and services that meet not only the functional needs of consumers for tasty food or clean clothes but also their wider aspirations as citizens."

Social change occurs in waves. We are still many waves away and hope it keeps coming.