MIT Sloan Management Review

I had the great pleasure of attending the first day of the BIF-5 Collaborative Innovation Summit, held in Providence, Rhode Island, by the Business Innovation Factory. That’s a lot of jargon for just the names of a conference and its sponsoring organization, but more to the point is the tag line for the event: “A good story can change the world.” Those are strong words, but, at its best, the packed Trinity Rep in Providence worked hard to live up to them.

I’m embarrassed that such a strong conference takes place almost in the backyard of MIT Sloan Management Review and I didn’t know about it until year five, but “BIF,” as the organizers call it, is full of ambition and purpose. Like similar conferences TED and PopTech, BIF offers what it hopes are world-changing ideas. But, unlike TED and PopTech, which celebrate a wide variety of disciplines and are as intent on entertaining as educating, BIF is all business.

It’s a wide definition of business knowledge. Last week in this spot, I mused on leadership lessons from unlikely places. BIF was all about inspiration from unlikely places, with reports from the frontlines of freelance diplomacy and someone whose job it is to figure out what would happen if a pirate fought a knight. But more than unexpected sources, BIF was about unexpected attitude. Late in the first day of the conference, Saul Kaplan, the event’s “founder and chief catalyst,” said “innovation requires a vulnerability most people are not comfortable with.” Like many good stories, the ones told on the stage of BIF were ones in which the principals revealed their vulnerabilities and then revealed what they learned from them.

The whole day was filmed. These talks will find their way onto the net and we’ll point to them. For now, here are a handful of the highlights from a long, deep day:

• The New York Times recently argued that the term “curator” is being overused, but Museum of Modern Arts senior curator Paola Antonelli made a compelling case for curating, in its widest sense, as the activity in which all knowledge workers will engage. “Curating is no more than sifting,” she said, “sifting, so people can organize information in the best way.”
• Harvard Berkman’s Ethan Zuckerman, introduced as “the geek’s geek,” talked about building cultural bridges, with examples ranging from Paul Simon’s Graceland to the videogame World of Warcraft, and used a not-new term that the business thinkers in the room marvelled over: “xenophilia.”
• Author Don Tapscott gave a variation of his usual talk about digital natives, but added a telling wrinkle. He told of his son building a Facebook group for one of his books and the self-organizing community quickly growing and feeling its oats. One member of that Facebook group asked pointedly, “And how exactly will Mr. Tapscott be contributing to our community?” It was a trenchant note regarding how much ownership community members can feel.
• Helmut Traitler, vice president of innovation partnerships at Nestle, discussed the nuts and bolts of managing open innovation projects. Some companies “give out problems in a disguised way,” he said, “but you have to give out openly to get back more.”
• Roger Martin, dean of the Rotman School of Management, talked about fixing MBA education so it no longer produces, as The Economist calls them, “jargon-spewing economic vandals.” He spoke in detail about moving the MBA curriculum from shallow to deep, narrow to broad, static to dynamic. Similarly, ex-MITer John Maeda, president of the Rhode Island School of Design, talked about how fundamental “hand-based” knowledge is being lost as part of our transition to new technologies and new models.

In a small, packed room, it felt like these notables were, with minimal dressing, simply sharing what they were thinking about lately and telling stories that illuminated their ideas. Early in the day, Kaplan talked about what everyone seems to talk about these days: Twitter. He talked glowingly about its applicability to sharing ideas early on. “It lets you get stuff off white board and on to the ground,” he said. A good conference can do that, too.

We here at MIT Sloan Management Review are voracious readers. After all, part of our service is to read management literature so you don’t have to read all of it. But it’s not only academic journals that are full of smart management ideas you can act on. This week’s issue of The Economist has a pair of articles in particular that hit the spot:

In “Creative Tension,” the magazine looks at ways Google is trying to make sure that the inevitable bureaucracy that comes with having 20,000 employees doesn’t stifle innovation. The example in question is Google Wave, a still-in-development mix of email, chat, and file-sharing that some think might unseat Microsoft’s SharePoint. How different was the development of Wave from what the company does usually? Quite a bit. “Some Googlers felt this was a betrayal of the firm’s open culture.”

“A Maket for Ideas” looks at how the Eli Lilly startup Innocentive has created an “innovation marketplace.” “Seekers” post problems and quote a fee; “solvers” compete to answer them. It’s turning out to be a successful model, even as the parent Eli Lilly is cutting jobs.

Finally, the magazine also debuted a new column on business and management that it’s calling “Schumpeter.” As you might expect, the column kicks off with an entry on why it is named after Joseph Schumpeter, who the column identifies as “one of the few intellectuals who saw business straight.” We’re curious to see how this new page tries to do the same.

(Follow all of MIT Sloan Management Review’s TED coverage.)

TEDsters smile through financial meltdown. That’s the headline of a blog post WIRED’s Steven Levy wrote yesterday, essentially arguing that all the optimism in the presentations ignored the multi-trillion-dollar elephant in the room: the current financial horror. TED curator Chris Anderson took that on from the stage first thing this morning. “There might be issues in our world more important than the Gross Domestic Product,” he said. “Market cycles come and go. Good ideas last forever.” To underline that final point, he pulled out a John Maynard Keynes quote from 1930 that felt like it could have been written today:

“This is a nightmare, which will pass away with the morning. For the resources of nature and man’s devices are just as fertile and productive as they ever were. The rate of our progress toward solving the material problems of life is not less rapid. We are as capable as before of affording for everyone a high standard of life … We were not previously deceived. But today we have involved ourselves in a colossal muddle, having blundered in the control of a delicate machine, the working of which we do not understand. The result is that our possibilities of wealth may run to waste for a time — perhaps for a long time.”

The point of the conference, I suppose, is to think beyond the current catastrophe to what may lie beyond. That’s how Juan Enriquez started the conference on Wednesday, and that’s how the mostly sober panels today ended it.

The best way to predict the future is to invent it, Alan Kay (once a TED speaker, naturally) said famously, so it’s not surprising that these makers of the future are interested in predicting it, too. The first session today took on the notion of prediction from a variety of angles. It’s a topic our magazine has covered intensely recently (see our most recent issue).

The first predictor up was Nate Silver, who became everyone’s favorite statistician during the last election cycle with his website fivethirtyeight.com. Silver has a point of view — he’s left of center (no surprise; I’m guessing there were more mosquitoes than Republicans at TED this year) — but he seems much more interested in where the numbers take him than in making political points. And his interests are wide-ranging: before he turned to politics he was best know for his sabermetric research. As with so many TED speakers, Silver started his talk with a provocative question — “Is racism predictable?” — and used presidential election results from 1996 to 2008 to back up his argument that it is. His evidence wasn’t particularly surprising: uneducated, rural whites who have little interaction with African Americans are most likely to be racist, the numbers show. This being TED, Silver also took a crack at how to fix the problem. The most provocative of his suggestions was an intercollegiate exchange program between urban and rural colleges. These might seem far-fetched, but they illuminated Silver’s basic point that what is predictable is also designable.

Political scientist Bruce Bueno de Mesquita was more grandiose. A consultant to the CIA and Department of Defense, he uses game theory to predict the future. Some of his more famous predictions weren’t particularly revelatory (everyone saw the second intifada in Palestine coming), but he agreed with Silver’s predictable=designable premise, saying “you predict the future so you can engineer it.” His provocative question was “What will Iran do?” Bueno de Mesquita argued that full development of a bomb is unlikely and President Ahmadinejad is likely to see his power lessen in the years to come. He “backed up” his hypothesis with plenty of charts, but unlike Silver, who labelled every slide meticulously, he offered up some charts that didn’t even bother to mention what both axes stood for. I hope his prediction of a relatively accommodating Iran is true, but I also took photos of all of his slides just in case. Trust, but verify.

Two MIT-associated speakers rounded out the session. Media Lab giant Nicholas Negroponte gave a brief talk about the status of his One Laptop Per Child (OLPC) project that managed to be both angry and optimistic. It was part rant against the makers of tiny “netbook” laptops, which dominate the market OLPC created, and part vision for the future of OLPC. Both parts were entertaining. “The commercial markets will go to no end to stop us. Netbooks didn’t steal the right things from us,” Negroponte said as he tossed two of the sturdy OLPC devices across the stage. They landed hard and unharmed; you could count on regular laptops to do only the former. The next step in the development of the OLPC is to move to open source hardware: build hardware with open specifications that everyone can copy. It’s a canny move, changing the playing field when the current one isn’t yielding ideal results.

Then Dan Ariely talked about behavioral economics. His stories wouldn’t have been new to anyone who read his book Predictably Irrational: The Hidden Forces That Shape Our Decisions or read senior editor Alden M. Hayashi’s interview with him in MIT Sloan Management Review. Yet he’s an energetic speaker and most in the audience seemed unfamiliar with his work, despite his book having been sent to TED attendees several months ago. His vision of a world in which people reliably make easily anticipated errors has quickly moved from counterintuitive to conventional wisdom.

“From counterintuitive to conventional wisdom” is also, in a sense, the dream that powers TED. Ideas are launched here and sometimes, as with, say, Al Gore’s initial climate crisis presentation, the world accepts them. Some may be put off by the event’s optimism and elitism — and there are good arguments against both of them, but the ideas are stronger than any inadequacies in attitude. As fellow TED attendee Paul Kedrosky twittered earlier today, “For all TED’s flaws, criticisms, etc., it remains a magic thing.” Now let’s see what happens to the ideas from this year’s TED over the next 12 months.

This week, MIT Sloan Management Review is in Long Beach, Calif., for this year’s TED conference, which starts tomorrow. We’ll report daily. Now in its 25th year, TED remains an unclassifiable event. The letters of the name originally stood for technology, entertainment, and design, but in recent years the tag line for the event has become “ideas worth spreading.”

The event is certainly an elitist one. It’s expensive, hard to get into, and you’re just as likely to bump into web inventor Tim Berners-Lee as Overboard star Goldie Hawn in the food lines. If nothing else, TED is a trip. The veteran conference (this reporter has been to six of them) has gone through many permutations. Under curator Chris Anderson, TED is still full of technology, entertainment, and design, but it has really lived up to the change-the-world rhetoric that was always a bit more under the surface during Richard Saul Wurman’s ace stewardship. One high-profile example: Al Gore’s warning about global warming turned into An Inconvenient Truth after a movie producer saw him deliver the talk at TED. Last year E.O. Wilson debuted here the first iteration of his Encyclopedia of Life, funded by a TED grant.

The change-the-world attitude gets a bit out of hand: there’s plenty of talk about how for the past two years the gift bags, by Rickshaw Bagworks, have been constructed from 100-percent post-consumer recycled beverage bottles, but hardly anyone points out that the bags are overstuffed with non-essential items that have a much greater impact on the environment. Indeed, TED is a place for conspicuous consumption, even if it’s relatively sustainable consumption; it’s the only conference I’ve been to in which I’ve seen anyone drive up in a Tesla. (I’ve seen two today here as well as an even more cutting-edge vehicle.) Those with similar ambitions to TED’s, but a more limited budget, may wish to consider attending the alt-TED BIL, which is also in Long Beach this week (and which I hope to visit while I’m here).

For many years, TED was held in Monterey, Calif., but success has brought it to a larger venue farther south, in Long Beach (there’s a smaller, parallel, event being held east of here, in Palm Springs). At Monterey, most of the conference took place in one area. Here, with banners everywhere and events more spread out, it feels like the event has taken over the town, like Sundance does in Park City, South by Southwest does in Austin, and Davos (aka the World Economic Forum) does in, well, Davos. We’ll see how that works.

Indeed, just like last year, TED is coming right after Davos, which was a downer and inspired anger from even sober-minded management thinkers. Last year, TED presenter Craig Venter contrasted the optimism of TED with the pessimism of Davos. This year, especially, we could use a little optimism.

Especially if that optimism is realistic. Except for its entertainers, TED is an irony-free zone, a place where earnest speakers talk about fixing the world as if it is not merely possible, but mandatory. As we’ll see during the conference, the speakers here have a pretty good track record at improving one or another part of the world. The theme for this year’s event is “The Great Unveiling,” which refers in part to the conference’s new location, but also to new ideas due to be debuted here.

So why should managers care what’s happening here? Because the best new ideas helps make good managers better. The joke among TEDsters (an annoying term, yes, but it has stuck) is that attending the conference is an endurance sport. It’s one thing to be in a room listening to spectacular insights for a few hours. It’s another to be doing so for half a week. Nonetheless, part of the experience you get from being at events like TED is that feeling of being overwhelmed: someone just said what feels like the smartest thing you ever heard — and then the next speaker says what feels like the smartest thing you ever heard — and then … well, you get the idea. It’s intellectually exhausting, but it’s also thrilling. And, during the best talks, you can’t help thinking: How can I act on this?

Yesterday we discussed Lawrence Lessig’s work. For some of you, that short summary will be enough. But for those who want to learn more about Lessig’s provocative work, today we discuss his work with him, focusing on his new book Remix: Making Art and Commerce Thrive in the Hybrid Economy.

MIT: What can we learn about the current and upcoming copyright and innovation wars from how they’ve gone in the past?

Lessig: What we learn is there’s a lot of crying and screaming at any moment of significant technical change. Those who are flourishing and prospering from the current technology are the loudest screamers. But the market quickly figures out how to profit in the context of the new technology, and pretty soon into the battle, the competitive system drives people to focus on how to make money rather than how to try to stop progress. That’s what’s beginning to happen right now. And that’s what really makes Remix optimistic.

MIT: How does this hybrid economy that you posit in the book change the definition of the word “original”?

Lessig: In a hybrid world where lots of people are developing and spreading remixes, the question of originality is very important. But in fact it becomes harder to demonstrate your talent or your creativity in this context because your creativity comes from your ability to demonstrate a deeper understanding of the material that you’re working with. People who’ve never done remixes, or have never gotten close to people doing remixes, think it’s easy. They think it’s all about just copying. But to do it well requires some pretty significant talent. It’s different from writing a song from scratch but it still is a talent that’s going to be creating a significant amount of competition among people trying to do it well.

MIT: There have always been cover versions in which the performer totally re-imagines the original. How is what’s happening now different from that?

Lessig: In one sense it’s exactly like that, in one sense it’s about how do you re-use or remake an earlier bit of creativity. But rather than it being one bit of creativity, like one song, or one album, it’s mixing together a whole bunch of different bits of creativity and creating something new out of it. What we need is what people who do cover versions have the right to, non-discriminatory access to the bits of culture that might be put together to produce something interesting or new and compelling.

MIT: Many examples in Remix come from the entertainment business. Can you give us some good, kind of pithy examples of how the notion of a read/write culture is relevant to the non-entertainment businesses?

Lessig: It started with the free software movement. GNU Linux begins with Richard Stallman launching the GNU movement to build a free operating system. Then Linus Torvalds coming along and provides the kernel so that by 1994 or 1995 it begins to be good enough that it could compete with Microsoft as an operating system. At that point, commercial entities like Red Hat come and say, “Wow, here’s a great opportunity for us,” and they try to leverage that sharing economy through a commercial entity. Red Hat was just one of many to produce value for the commercial entity. That’s a classic paradigm of a hybrid. A company like Red Hat needs to make sure that it innovates in a way that doesn’t poison the sharing economy, that’s contributing to the production of Linux. They’ve got to encourage openness in the way they function so they don’t begin to seem like the enemy. The rest of the creative world is going to look more like Red Hat or Ubuntu in the future, than it looks like IBM or the Microsoft of 10 years ago.

MIT: Web 2.0 is famously about harnessing this sort of collective intelligence, particularly from data that people cast off rather than input directly. What do you see as the most compelling examples of products or services or works of art coming out of data that people cast off?

Lessig: The most compelling example is Google. Google’s enormous power comes from the company figuring out very early on that if they captured every bit of data, they could build an enormous value on top of it. When you search Google, Google’s giving you something and you’re giving Google something. The search itself isn’t giving Google anything. But when you then respond to the results of the search by picking a particular link, Google learns something from that, and when Google matches that to everything else you’ve done, Google learns an enormous amount in addition to what you’re giving, what you give just by clicking a particular link. It’s architected to make it so that when I’m doing what I want to do I’m giving Google something of enormous value that it can then leverage. Economists will say this is not new to the market. Financial markets function by trading on the value produced by information produced by people making trades in the marketplace. I learn something when I start seeing prices going up on a certain stock. I learn something about that company that I otherwise wouldn’t have known. The people who are making the trades, because of the rules of the marketplace, can’t help but reveal that information. They’d much rather be able to trade it secretly and not reveal the price exchange, but the market imposes that constraint so that the whole market benefits from the revealing of that information. It’s not like this is the first time we’ve found ways to begin to produce value out of information that’s unintentionally or, as a by-product, revealed. But I think that the Internet lets us leverage that value much more than we ever have been able to before.

For more on Lawrence Lessig’s work, visit his website. A free, Creative Commons-licensed version of Remix will be available there shortly.

Lawrence Lessig thinks there’s a war against innovation going on. Back in February 2007, at the TED conference, he presented a remarkable talk on the topic. The champion of copyright reform and founder of Creative Commons began his rapid-fire talk by noting how John Philips Sousa, the master of American march music, was chagrined a century ago by the invention of the phonograph because he feared it would end entertainment as a form in which amateurs could be the stars. It limited choices, he fretted: an argument one could make about large media companies today. During a tour de force presentation, Lessig galloped through a century of the battle between rights holders and innovators, inexorably moving to today’s ascent of user-generated content. Thanks to such mashups, we’ve got a high-tech realization of Sousa’s dream , amateurs getting heard.

Especially when he examined how BMI killed the ASCAP monopoly on music copyrights back in the 1940s, Lessig made a point worth noting now: The technology may be different and the money in question may be larger, but the current battles between rights holders and innovators are mirrors of ones that have played out over at least the past century. But don’t take my word for it: See the talk for yourself:

Lessig has just published a new book, Remix, that extends his TED presentation. Tomorrow in this space we’ll talk to him about it.