World’s Biggest Challenges are its Biggest Market Opportunities

Point: While many wring their hands over seemingly insurmountable problems, entrepreneurs roll up their sleeves and work on solutions.

Story: Peter Diamondis, founder of the X PRIZE Foundation and Zero Gravity Corp., is particularly optimistic. Seeing what small teams can accomplish with today’s technologies, he sees limitless opportunities. “A Maasai tribesman in Kenya today has better mobile communications than President Reagan had 25 years ago. If they’re on a smartphone, they have access to more information than President Clinton did 15 years ago,” he says.

These achievements don’t get as much attention as bad news, because our brains are wired to hone in on anything that could threaten our survival. But above the din of disasters and terrorist attacks are the facts that more people have been lifted out of poverty in the last 50 years than the previous 500. The cost of food is 1/13th what it was in 1870. Even those living below the poverty line in many countries today have access to a telephone, toilet, television, air-conditioning and a car — things that Andrew Carnegie or John D. Rockefeller couldn’t have dreamed of a century ago.

Moore’s law — the doubling of computing power for the same price every 12-24 months — is now showing up in other areas that are linked to computing power, including sensors, 3D printing and biotechnology.  For example, 3D printers that cost $500,000 can now be bought for $1300, making them accessible to small companies and entrepreneurs.

Lower costs like that make it possible to offer much-needed but low-cost products to the “bottom billion” people in the lower rungs of the economic pyramid. For example, an estimated 1.1 billion people lack access to clean drinking water. But four billion of them are spending 30 cents a day for water, which makes clean water a $400 billion a year market, as inventor Dean Kamen points out. Kamen is in trials with a new water purifier that can turn any water (even polluted water, seawater or latrine water) into pure drinking water for less than .02 cents a liter.

Such innovations by entrepreneurs can solve the world’s biggest challenges.

“That’s my source of optimism. That and a realization I made early on that if there’s a problem, I’m going to solve it. Once you see the world that way, it’s a different place,” Diamondis said.

Action:

  • Look at negative events as potential opportunities to create new products or services to prevent or mitigate the negative.
  • Look past the sensationalized “bad news” to see the less-publicized march of positive trends in human development that create or expand markets for products and services.
  • Consider how to leverage the rising spread of modern infrastructure (communications, utilities, and logistics) to access more suppliers, partners, and customers.

Sources and more information:

Peter Diamondis at the Innovation Summit at the Shell Technology Center Houston, January 9, 2013

Peter Diamondis’ book, Abundance: Why the Future Will Be Much Better Than You Think

Ted Greenwald, “X Prize Founder Peter Diamandis Has His Eyes on the Future,” Wired

No Comments »Entrepreneurs, Innovation, Opportunity

Quick-Win Innovations

Point: Get quick wins by encouraging small experiments throughout the organization. They’re fast, inexpensive, and reduce the fear of failure.

Story: One of the biggest obstacles to innovation is fear of failure. Rarely do people want to bet their careers or companies on what might — or might not — be the next big thing.  But fear of failure becomes a self-imposed obstacle to success.

As Amazon’s CEO Jeff Bezos says, “Innovation is part and parcel with going down blind alleys. You can’t have one without the other. But every once in a while, you go down an alley and it opens up into this huge, broad avenue. And that’s so satisfying and, from a shareholder’s point of view, so successful, that it makes going down blind alleys worthwhile.”

The key twist isn’t to avoid failure but to avoid high costs from failure.  To reduce those costs, institute and encourage ongoing little experiments throughout your company.  For example, Google does this by testing more than 5000 software changes a year. Amazon does it by continuous A/B testing.  And CEO Scott Cook made experiments common practice at Intuit. In Cook’s experience, 89% of experiments don’t lead to a breakthrough or even to an improvement, but that doesn’t make them a “failure” — the experiments simply provide data on what doesn’t work.

These little bets cost little in terms of time and money. They don’t require weeks of planning; rather, they’re tweaks to an idea that can lead to eventual, substantive breakthroughs.  Ever hear of a company called Odeo? Most people haven’t, because Odeo was a small podcasting company of little distinction until its CEO, Evan Williams, gave employee Jack Dorsey two weeks to develop his idea of a short messaging system. That quick prototype developed into Twitter.

Action

  • Don’t use uncertainty of success as a filter — the more you don’t know about your chances, the more you can learn by trying.
  • Do consider how you might inexpensively look down a possible avenue to see where it leads.  You might use a A/B testing, co-innovation with a lead customer, or a quick minimum-viable prototype.
  • Test fast, test often, but pay attention to the results, especially if the unexpected happens.
  • Learn what you can from any failures — not just that the idea failed, but why it failed and what it says about your customers, your markets, or your business environment.
  • Use each test of a new avenue to scout for other avenues. Even a blind alley can have a side-passage that leads somewhere wondrous.

For more information:

Dave Gray, The Connected Company

Bloomberg BusinessWeek, “Jeff Bezos: ‘Blind-Alley’ Explorer.”

Peter Sims, Little Bets and “What are Little Bets?

No Comments »Growth, How-to, Innovation, New Product Development, Opportunity, Productivity

Innovation: Harnessing 3.8 Billion Years of R&D

Point: If you’re stuck on how to solve a problem, see if nature has already solved that problem.

Story: Nature has already solved many challenges; the best solutions have survived and improved through evolution.

Consider this example: termite mounds such as those of the Macrotermes michaelseni exist in African environments where the external temperature varies from 35°F at night to 104°F during the day. The living areas inside the termite mounds, however, maintain a constant internal temperature within one degree of 87 °F, day and night.  Millions of years of evolution perfected the termites’ construction habits so that their mounds’ passive solar design and networks of air conduits create a self-cooling ventilation system.

How can humans put this termite-inspired solution to use? Architect Mick Pearce collaborated with engineers at Arup Associates to design a mid-rise building in Harare, Zimbabwe, called Eastgate, that has no air-conditioning, yet stays cool. The Eastgate Center is the largest office and shopping complex in Zimbabwe, but it uses only only 10% of the energy of a conventional building its size. Not only is this good for the environment, but it lowers costs for building occupants. Eastgate occupants pay 20% lower rents than do occupants in nearby buildings pay.

How did Pearce design this building? He looked a 3D digital scans of termite mounds, manipulating them in computer models to understand how the tunnel system works to exchange gases and regulate temperature and humidity. It turns out that the termite mounds operate on a system of convection currents that draw air at the lower part of the mound down to the bottom and then exhaust heated air to the top. The termites open and close ducts by digging new vents and plugging up old ones.  At Eastgate, Pearce installed electronically-controlled fans on the first floor to suck in outside air and then push it up along a central spine, venting it through chimneys at the top.

 

Action

  • If you have a problem to solve, think about the plants and animals that may have had the similar problem. Look to sites like AskNature.org or the Biomimicry 3.8 Institute
  • Study nature for inspirations and ideas that you can adapt
  • If you don’t have time to do this yourself, consider holding an innovation contest with InnoCentive, NineSigma, or Yet2.com to solicit ideas from biologists, oceanographers, etc. who could apply knowledge from the biological world to tackle your problem.

Sources:

Janine Beyrus, Biomimicry: Innovation Inspired by Nature, chapter 1

Biomimicry 3.8 Institute

Abigail Doan, Green Building in Zimbabwe Modeled After Termite Mounds | Inhabitat – Sustainable Design Innovation, Eco Architecture, Green Building

No Comments »Case study, How-to, Innovation

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