RDVP Seminar: Peter Hart, Ricoh Innovations (5/18/2005)

Peter Hart, Chairman and President of Ricoh Innovations came to speak to the fellows about globalizing Co-invention. His starting point was the question of non-technical aspects that influenced adoption rates of technical products. He figured that as the fellows are focused on introducing technology solutions into markets where they haven't previously existed, we would be more cognizant than most of this co-invention process, the way that a target customer population takes an invention and uses it entirely unanticipated ways--changing work patterns as they adapt to this new technology. The feedback loops between different parties in the invention process were critical: between the technology provider and the technology integrator, but even more important, between the end-user and the technology integrator.

He cited 3 factors that influenced adoption rates:

1. Network Effects
   
2. The cost of labor relative to the cost of technology
   
3. Complementarities

These bear a bit more explanation:

1. Network Effects: Metcalfe's Law of the value of belonging to a network increasing with the square of its size. So, as more people have fax machines, having one becomes more valuable, because you can send your fax to more places.
2. Relative costs of labor and technology: He showed two historical plots (price of electric motors vs. assembly workers and price of PC's vs. knowledge workers). In each case, the rapid spread of the technology occured during a period where the price of labor was increasing quickly relative to technology. He pointed out that the correlation could be explained either by technology making the labor more valuable/expense (by making it more efficient) or by expensive labor making it wiser to invest in technology to leverage the employees' contributions.
3. Complementarities: From an economics point of view, this refers to a "negative cross elasticity of demand" (or, for those of us that don't speak fluent economics: the goods are used together, so a price increase in one (gas, for example) results in a decrease in the demand of another (SUV's)). The example that he gave was that although cities had been electrified for lighting, once they were, it became cheaper to use electricity for powering individual "unit drive" motors.

Building on the example of the electric motor, he pointed out that the original reason that Westinghouse brought them to market was increased efficiency in power transmission (through electrical wires rather than mechanical belts). In reality, this turned out to be a minor effect compared to the flexibility of adapting the workflow through a factory according to a logical production process rather than being forced to position machines according to mechanical constraints of belt drives. We talked about a couple other instances where novel customer uses resulted in unintended impacts of the original invention: podcasting for iPods, market equalization of prices once cell phones were more widely distributed, etc.

He also talked a bit about the need to carefully understand the user need and make sure that your product and service supports it. He used a couple of dot-com examples here: WebVan, and its failure to recognize that customers couldn't anticipate all of their shopping needs, so still needed to make a trip to the store, eliminating most of the savings of ordering online. His other dot-com example was Stamps.com, the online postage service. Compared to Pitney-Bowes, at first glance, it's a cheaper online solution. But, he argued, when you consider all of the steps required to mail a package, it's actually much simpler to use a Pitney-Bowes machine. Consequently, Pitney-Bowes' market cap is $10B compared to Stamps.com $350M.

During the Q & A session, he talked a bit about the reasons that Ricoh was investing in BOP research, and argued that Ricoh had often taken the "long view". Now, they're reaping the benefits of their "green" investments started 30 years ago.

RDVP Seminar: Motoo Kusakabe (5/10/2005)

Motoo Kusakabe of the European Bank for Reconstruction and Development (EBRD) is visiting Stanford as part of the selection committee for next year's group of fellows. He gave a seminar on ICT, development, and a National Innovation System. Starting from first principles, he chose a metric that he wanted to improve: per capita GDP. He showed a list of the top performers in terms of increasing GDP over the period from 1980 - 2002:

1. China: 8.2%
   
2. Korea: 6.1%
   
3. Ireland: 4.8%

Then he looked at different theories that might explain the difference between high performers and low performers. He felt that most of the earlier theories (Investment/Savings Gap; Structural / Macroeconomic Policy; and Governance) had not adequately explained the difference, and proposed to delve deeper into whether technology and innovation might explain it better. He further segmented the study into Lower Income Countries (annual per capita GDP < $2,936) and Higher Income Countries (above that rate). Since it was a study of development, OECD countries (already developed) were excluded.

With each category of factor, he determined the strength of the correlation between the 2002 data and their growth rate over this 22 year period. Some findings were surprising (most troubling to me was the NEGATIVE correlation between number of scientists/engineers in Lower Income Countries and their economic growth), others were more expected, if weaker than expected and not always consistent between Higher Income and Lower Income Countries. Some of the factors that Motoo cited included primary education, telephone lines (and installation waiting time), internet users, PC, internet servers, and (especially) government priority in ICT and cluster development; exports (especially of hi-tech and ICT equipment and services); governance factors; availability of credit and risk capital.

He did include the disclaimer that showing a correlation is not causation, and there were some additional suggestions from the audience that he should look at multi-variate correlations and data covering the same period (correlating 2002 data with long-range growth rates implies that if there were causation it was probably that long-term fast GDP growth caused the related factors rather than vice versa).

He moved on from the data to the recommendations, outlining a policy of investment and priorities that he felt governments of the Lower Income Countries and Higher Income Countries should pursue to achieve faster GDP growth. These priorities included education, IT literacy, teacher training, connecting the rural poor, microfinance, a payment system for rural areas, job creation, and an ICT focus in government to create a national strategy and regulatory framework, and set up a universal access fund and incubator. Higher income countries should also focus on ICT exports, and move up to higher scale efforts on universities, incubators and science parks, even a national innovation system that includes collaboration from academic, industrial, business, and government parties.

He concluded with a brief description and demo of an Open Knowledge Management System, a way of creating a portal for sharing information with editor functions. A sample is http://www.ictseminar.org.

RDVP Seminar: Karen Mullarkey (5/4/2005)

Karen Mullarkey of America 24/7 (the people who make the "Day in the Life..." coffee table photo books) came to speak about the power of photos and story telling. She started off with her own story, how she had graduated from college at a time when the only question a woman received in her job interview was "How many words a minute can you type, honey?" As she adapted to this environment and challenged it, after a brief detour through sales and market research departments, she ended up in the photo group, and continuously asked questions that were answered by the premier photographers and journalists.

She directed the photography departments at various publications (Rolling Stone Magazine, Sports Illustrated, and Newsweek) and then worked on the America 24/7 projects. She talked a bit about those projects, which are hugely expensive, and hard to make commercially successful. Rick Smolan transformed the business by lining up corporate sponsors to underwrite production costs. (For the 1995 "24 Hours in Cyberspace" project, Kodak, Adobe, Sun, Netscape, and AOL were sponsors.) For the recent 50 states project, some 1,000 photographers, plus stringers and amateurs submitted 250,000 photos.

After that she talked a bit more about how to use photos to tell the story of our projects. First of all, she encouraged us to use pictures (advice that didn't quite sink in for me if you look at my recent poster...) and choose pictures that "smack you in the face, are very beautiful or let you laugh a little bit" (they'll be more drawn to them). Start with a premise of what you want to show, and outline the story. She talked about self-publishing small books that can be distributed cheaply, as a way to make a project tangible for potential investors, etc.

She also finished off with a generous offer to share her expertise or contacts (photographers around the world to help record our projects), specifically mentioning CameraBits and ZoneZero.com.

RDVP Seminar: Howard Rheingold (4/29/2005)

Howard Rheingold came to speak about the need to start studying cooperation in a more formal way, a topic he treated in greater depth in a course he taught winter quarter. With an interesting background (and wardrobe), he is an entertaining speaker. At times, I felt that he glossed over the existing work in this area. Economists, especially in the area of game theory, problems of fair division, and coalition formation, have been studying this for years. (Indeed, a good part of the reason that I abandoned distributed artificial intelligence, another discipline very interested in cooperation, is that catching up to what the game theorists had already done would have taken years.) His dissection of the prisoner's dilemma and the tragedy of the commons, just scratched the surface and focused more on the "pop" articles rather than the academic ones, though Elinor Ostrom's Governing the Commons did look like an interesting book. More news to me was his report of neuroscience studies that showed that punishing cheaters excites the same areas of the brain as gaining rewards. "Altruistic punishment is the glue that holds society together," was his quote in describing the Ultimatum game. (One person is given $100 to split with a second person (with whom he cannot communicate). If the second person "accepts" the split, they get the money, divided as proposed. If the second person does not accept, they both get zero.)

All in all, I'm happy that he kept it high level, since that left more time, for the areas where I think Howard's viewpoint is unique: technology trends. He talked about the emergence of the cell phone as a way that 1.5B to 3B people will have broadband data access on a "just-in-time" basis, and the implications for information distribution, transactions, forming connections, and maintaining trust and reputation. He covered a laundry list of technologies that allow corporations to benefit from the cooperation of others (e.g., Open Source movement, Amazon API, Google Adwords, Wikipedia, eBay reputation server, ThinkCycle, Folding@home) as well as a set of technologies that make such volunteerism/cooperation that much easier (e.g., email, blogs, wikis, blog rolls, buddy lists, PageRank, etc.)

He also left quite a bit of time for discussion, which led to some interesting comments about migration: the move of people from the countryside to the cities where there may be jobs or from a poor country to a richer one. Technology is a new enabler, however, for these migrants to stay in touch with (and send money to) their home communities on a scale not previously possible.

RDVP Seminar: Peter Tavernise, Cisco (4/27/2005)

I had the sense that Peter Tavernise (see his Omidyar Network Profile) sees things a bit differently than the rest of us. He is a Senior Manager at Cisco Systems Corporate Philanthropy and Senior Program Officer at the Cisco Foundation. At times, I was prepared to dismiss what he was saying as looking through a biased, distorting lens. But at other times, it seemed that his comments were based on keen insight, because he's observing more closely than we are.

Certainly he came to the seminar better informed about the fellows' projects than most speakers. He had created an issue map that showed how he felt the different projects fit together within the overall context of disaster aid. He invited us to refine his draft.

As different topics came under his magnifying lens, he spoke his mind, but with such speed and assumed shared context that I often felt like I was trying to keep up with all the allusions of a rant by Dennis Miller.

His criticisms of the foundation/philanthropy world, especially as an insider, were eye-opening. His views that technology could help, and that it should be up to the funders to seek out and actively support the leaders of organizations that could effect needed change, were encouraging. He wondered why, after so much effort was made to select the best 5 to 7 projects in each of key program areas through the Tech Laureate awards, why all but one are sent home empty-handed? He criticized the stingy payout policies that lead some foundations to consider themselves perpetual memorials to dead people rather than active organizations addressing a key societal need. He pointedly asked why a small organization like Acumen Fund's A to Z Textiles' bed nets could be so much more effective than efforts funded by multi-lateral organizations for years with so much more money. He hoped that as technology permitted donors to recognize which organizations were being effective and which were not that donor-citizens would see that they should care about how organizations were using their money. Out of a $250B sector, Peter said that some $20-80B is being spent/wasted on overhead, redundant and ineffective organizations. The emerging trend of joint for-profit/non-profit models is innovative, but requires further exploration to figure it out, supported by legislation and tax and accounting reform.

Peter also talked about some successes (including the bed nets mentioned above). Global MapAid, incubated at the RDVP, was one. Using handhelds with GPS, collection of accurate GIS data in disaster situations helps aid workers better understand what they are facing. He said that Kofi Annan personally visited the Global MapAid offices during the tsunami relief effort, not for PR purposes but to get his hands on the maps they had!

A second was Active Voice which uses its VoIP and messaging service to provide voice mail boxes to people in need (homeless, job seekers, victims of domestic abuse) these Community Voice Mail services are available across the country and make a huge difference for the people receiving them.

He also mentioned The Foundation Center as a valuable resource for those of us looking to raise money from foundations. He also recommended 3 books:

1. Don't Think of an Elephant
   
2. Finite and Infinite Games
   
3. Confessions of an Economic Hitman

RDVP Seminar: Interplast (4/25/2005)

Susan Hayes, CEO, and Bill Schneider, Chief Medical Officer of Interplast, came to share the work this organization is doing to eliminate the hardship of living with conditions that can be treated through reconstructive plastic surgery. Cleft lip and cleft palate were two of the most common mentioned, but burn scar contractures (where tissue heals from a burn in such a way that the range of motion is limited) is another significant area, and doctors perform the full range of operations for their specialty. These volunteers treat about 3,500 patients per year. The patients are charged nothing.

Volunteer teams of about a dozen people (2 surgeons, 2 anesthesiologists, 4 nurses, 2 translators, 2 pediatricians) travel for a two-week period where they
might treat 20 patients per day. Other programs are "visiting educators" where a doctor makes a one-week visit to one location, covering a single topic. The volunteers are mostly, though not exclusively, Americans. Interplast also runs 7 outreach centers for training. Patients are taken for surgery only if they meet basic health requirements (since their conditions are not life-threatening, they must be in otherwise good health before a surgeon would operate). The Patient Care Improvement Program (PCIP) is designed to look for other ways to improve patient health, like providing iron supplements.

Interplast also focused on the contribution that IT could make--tracking statistics of patient data and enabling virtual collaboration among globally distributed colleagues. They maintain a blog. Their intranet site allows doctors to upload pictures and case histories of particularly challenging cases. But they were not hung up on technology: Dr. Schneider commented that through their expansion plans they have found it is the "individual that matters; a human being that is committed to making the program work locally." He cited the scarcity of plastic surgeons in other countries: with Zambia and Bangladesh each having 1 per 10 million people.