CREATIVE INTELLIGENCE

Read the Financial Time’s Edward Luce’s insightful piece on the failure of MOOCs and the need for Liberal Arts to foster innovation and jobs in the US. Brilliant. The MOOC movement is falling apart because its pedagogical premises are false. It transmits data in a 19th century methodology through a 21st century delivery system. We focus on the delivery when it is the skill set and value systems in education that are key to raising our creative intelligence.

http://www.ft.com/intl/cms/s/0/141591a0-5399-11e3-9250-00144feabdc0.html?siteedition=intl#axzz2lczTmcTe

In the US, IT jobs are crashing but creative work is soaring. We need to move away from an exclusive focus on STEM towards a Humanities-based education fostering creativity. Progressive education–Montessori, building with blocks, John Dewey, learning by doing, not memorizing, is the future. 

It was buried in the New York Times and absent from the Financial Times, but today the official JOBS Act went into effect–expanding crowd funding from a niche to a platform scaler of creativity. This is a very big deal. I repeat–this is a very big deal. With Kickstarter and Indiegogo, we can act as patrons, participate in creativity and get a “thingie,” a product in return. With the JOBS Act, we can put our money into something and get a monetary return on it, not just a product. This allows all of us to be venture capitalists.

http://www.nytimes.com/2013/09/23/technology/law-opens-financing-of-start-ups-to-crowds.html?ref=business&_r=0

I call this Indie Capitalism and it amounts to the resocialization of capitalism. We have been living in Financial Capitalism for the past 20 years, where the economic system was all about market transactions for money. Financial Capitalism made nearly all of us consumerists–we simply bought stuff on the market and defined our lives, our status, out culture by what we consumed and money. 

Indie Capitalism, Kickstarter and crowdfunding will change us into Makers and Participants in a different sort of system, an Engagement Economy. We can all be investors, creators, participators and consumers at the same time. We can take the power away from distant finance people and claim it as our own. 

The JOBS Act was delayed by a year by government regulators afraid of fraud in crowd funding.  They worried that naive people would invest in bad or phony businesses. Given the fraud of the prevailing Finance Economy by the banks, ratings companies and investment bankers that brought on the Great Recession, this concern is laughable while laudable.  Banks had to pay fines for their dastardly deeds, but were allowed to deny any guilt. CEOs received bonuses, not prison sentences. Let’s hope the regulation for crowd funding is better.

For real coverage of crowd funding, check out Amy Cortese. 

https://twitter.com/Locavesting

Amy’s book, Locavesting, is the best analysis around of this new–and hopefully better- form of capitalism.

Microsoft has thousands of brilliant researchers, engineers and social scientists who are incredibly creative yet this high-tech company appears to an enormous failure on its hands–the new Windows 8 operating system. There is so much riding on this new OS–it is supposed to “update the personal computer for the tablet era by moving to a new touchscreeen interface based on colourful tiles…” according to the FT. 

http://www.ft.com/intl/cms/s/2/330c8b8e-b66b-11e2-93ba-00144feabdc0.html#axzz2SbysP2Zq

But people are finding it difficult to use. The familiar “Start” button is gone. The old desktop  launch screen is hidden. And the new touchscreen isn’t captivating enough. So both old and new consumers are unhappy.

How could Microsoft spend so much time and money and produce a dud? I’m guessing it has something to do with what I call the “Gift Model of Design.” I’m giving a talk at Ziba in Portland on Thursday and this is what I am going to say

“The oldest Dogma of Design is the Gift Dogma. This model of innovation is the favorite of tech and consumer goods companies–most companies actually. It frames Design as a Gift from really smart people who invent cool stuff and throw it over the wall to consumers. Along the way, in flight, designers and marketers get a brief chance to “humanize” and “prettify” the technology. Maybe do a bit of focus group research at the back end. Then toss it onto the market and if people like it, great. If they don’t, oops.

Now I’ve had engineers and researchers say to me “people don’t know what they want until we give it to them.” And they have a point. Look at the biggest innovations of the past 30 years–Google, Amazon, Facebook, Twitter, ZipCar, Instagram, Match.com, Method, and most have come from young entrepreneurs who embody the values and knowledge of their generation. They succeed by mining the existential wants of their generation and give, as gifts, new products, services, experiences to members of their generation. The rest of us, not in their generation, can come along. Or not.

The gift model works OK when you know the person you are giving to, when you embody that person’s culture and values. But as Valentine’s Day shows us, even when you think you know the other person, your chances of success are not all that high. And when you give a gift to a stranger, the odds fall much further. Go outside what you yourself embody and you could be imposing your higher order wants on other people (SLIDE OF SOMEONE WEARING GOOGLE GLASSES). Look at Google Glass.  She looks happy and great wearing Google Glass–but there are many people who may be thinking—is she invading my privacy by taping my conversation without asking or is she sharing your image and words with unknown persons? The Gift Dogma can backfire. ”

I’m guessing that the brilliant engineers at Microsoft didn’t immerse themselves enough in the culture of the company’s consumers to see what is truly meaningful to them. Or, if they or the army of social scientists at the company did, the key cultural information was not incorporated in the design of Windows 8.

Truly tragic.

I suggest a better model of design in my book, Creative Intelligence. Brands are simply the commodification of meaning. You have to understand what is deeply meaningful to consumers to create a successful product. That, apparently, didn’t happen with Windows 8.

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Apple’s CEO Tim Cook was forced by the Chinese Communist Party to apologize for bad consumer warranty service but the microblogs in China are full of people defending the company–and blaming the government.  They are asking why the government is not going after domestic companies who are making fraudulent and sometimes dangerous goods. So what’s going on? 

An insightful piece in my favorite business newspaper, the Financial Times, suggested that forces within the government singled Apple out to send a message to other Western companies that they had to “kowtow” and pay tribute to the government and cooperate. The CCTV, the China Central Television station, run by the government has an annual show on March 15, timed for the world consumer rights day, which focusses on foreign companies in China. Foreign companies spend a lot of money on advertising on the show, according to the FT piece, and those that do not are often the target of investigation.

http://www.ft.com/intl/cms/s/0/c24711f8-9ba3-11e2-a820-00144feabdc0.html#axzz2PP0Earxe

Apple made many mistakes during this warranty crisis in not addressing the issue early and loudly. After it was highlighted on March 15 on the CCTV show (along with Volkswagen), Apple failed to issue a big public apology. VW did. The deeper problem for Apple is not understanding the political culture it is operating in. China is Apple’s second biggest market and could grow to its largest, but not if the company angers the powers in Beijing.  Apple has been under criticism for poor labor practices in the  factories that make its iPads and iPhones. They are owned and run by Foxconn, a Taiwanese assembly company, but Apple is held responsible.  The warranty episode follows several years of suicides at the plants.  

There is a certain irony to the Apple incident. More than any single company, it was Apple that taught China how to build and export high-quality electronic goods to the world. Before Apple came on the scene, China was known for poor-quality goods (and still is in many market areas). But the demands of Steve Jobs and Apple for perfection, pushed  China to raise the bar on quality-control. No good deed goes unpunished. 

I attended the World Economic Forum in Davos for a dozen years and yes, it is very exciting, to be cheek to cheek with the global elite. I found that the orthodoxy expressed in the big, opening  speeches were almost always wrong. But the insights revealed in the smaller meetings were usually right.

At this Davos meeting, the key them is “Resiliency.” In the face of what I call  a VUCA world in my  forthcoming book, Creative Intelligence, Volatile, Uncertain, Chaotic, Ambiguous, speakers are saying we need to build resilient organizations. “Resilience” is a hot topic in corporate circles. But punch into the idea and you come up with little. Resilience for what? Survival. Stasis. Stability. And how do you become resilient? Be agile, flexible, fluid. We know that already.

A better Davos theme would be Creativity. Creativity takes you somewhere. It is at the heart of economic value and growth. It requires a set of competencies that most business people don’t already know–or have forgotten. It gives you the tools to be more than resilient. It enables you to discover, scale and progress. 

But what is going on inside the meetings where you do get insights? Plenty. Financial Times US editor Gillian Tett reports that cybercrime is super-hot. Corporations are under constant attack but are afraid of asking governments, including Washington for help. Tett says the situation is similar to the financial crisis swerve just experienced. Many people in banks saw bad things happening that would inevitably lead to a blow-up but didn’t want to go to the government for help. Individually they were scared but collectively unwilling to act. Cybercrime looks very much like that to her today. 

Tett is using an explanatory frame from one crisis that she covered as a journalist to help her understand and predict a future crisis. Framing is a critical competence of Creative Intelligence. 

http://blogs.ft.com/the-world/2013/01/live-davos-day-one/