Wharton Chapter 18 - Designing the Customized Workplace.

Chapter 18 addresses the issues of the "human capital"factor as it relates to emerging technology and how firms should attempt to balance them. Emerging technologies are surrounding in uncertainties and it's difficult for firms to keep and maintain the talent when it could be years for results to materialize. How do firms balance the people when projects are cancelled and employees are not needed without hurting the morale? Firms must also consider how they recreuit their talent -hire people out of high school and train them or hire older, more educated employees.

The workforce is driven by different motivators (time versus money) and how do these motivators impact the workforce of companies? Employees are becoming less loyal to companies after the fallout of the .com's and tech companies are looking for ways to balance the needs of the employee with the needs of the company. Employees are becoming more powerful with the knowledge that carry and firms worry about how this knowledge can walk out the door to a competitor in such a competitive industry.

There has been a great shift in the structure of organizations to become more flexible with employees by offering them trainings, benefits, bonuses, and mini-sabbaticals. These tactics haven't worked well so businesses are looking for ways to customize the workplace to "suit the needs of both customers and workers simultaneously". Employees now have the power to choose their direction in the company, choose their working schedule, and how to do their work when balanced with the goals and objetctives of the company. Employees should be managed as individuals and not as groups, have outlets to share information and responsibility for the firms situation, and be trusted.

This chapter analyzed the best things about working for a small, tightly-held company and applied it to larger, corporate firms. In smaller companies, employees have the flexibility, the voice and responsibility to share information about the firms situation, and to be trusted. In the following article, it illustrated that little tech firms can play ball with the big firms while offering the customized workspace http://www.forbes.com/technology/2008/03/26/cloud-computing-utility-tech-intel-cx_ag_0326cloud.html.

Wharton Chapter 17 - The Design of New Organizations Forms

Chapter 17 discusses the changes in business forms as new technologies emerge in the marketplace. As new technology and ways to deliver goods and services transform, businesses must create new means and methods to manage and exploit these new forms. The author mentioned 6 elements that can be reconfigured to create distinctive organization forms which include the goals of the organization, the strategies, authority relations, technologies, markets, and processes.

From these element, six new organizational forms are now present:

• Virtual Organization - suppliers, employees, and customers are dispersed geographically but are all connected by technology. Dell's connection with customers can be categorized as a virtual organization. Virtual companies have boundless opportunities to connect with customers but the flexibility can also create a new set of challenges such as the lack of face to face time with customers.
• Network Organization - set of relationships between autonomous or semi-autonomous work units for delivering products or services to customers. There are both internal and external - external: organization that creates ties among independent entities to combine skills (ie. partnerships, joint ventures). Internal: much like and external but ties together entities on the inside of the organization
• Spin-Out - organizations that are developed inside and organization that are unique and different and are then spun out to external entities and are usually partially owned by the parent company.
• Ambidextrous Organizations - organizations that continue with their established environment while creating and promoting emerging business environments (sustain and innovate). This gives structure to the new environment while sustaining the current business environment.
• Front-Back Organizations - Customers are served in the front with the backend of the organization supporting the front end. This is typically in service industries that are customer driven.
• Sense and respond organization - Identifying the emerging needs of the customer and responding intensely to those needs. This is important to meet the ever changing demands of the customer which allows the customer to adapt to the changing conditions

Organizations may go through a series of iterations of organizational forms depending on the stage of the business and the industry. For new businesses, their focus is typically on the customer and the strcuture is built in such a way that the business relationships will help grow the business (Front-Back). As the company grows, it has the ability to adapt to the changing needs of the customer (sense and respond) because of additional capital or because the business has reached a point where they can sustain their business and also grow through innovative environments (ambidextrous). When the company hits a point of maturity, internal innovations can become spin out organizations and new companies can be launched as a result. This can be illustrated through the spin off of palm from a very successful 3com. (http://www.news.com/2100-1033-236997.html)

Video Blog Example

This is a sample video I put together using the Logitech Quickcam Pro 9000 software. I can not only create videos but easily upload them to YouTube or create videos optimized for mobile phones.

There are a variety of avatars I can use to animate facial expressions and movements which is good for those of us who get shy behind the camera. I typically use the camera for video conferencing with old friends but it also allows me to easily create video blogs. I hope you enjoy this brief video of me.

Wharton Chapter 15 - Managing Dynamic Knowledge Networks

Chapter 15 discusses the power of networks and knowledge sharing is very important with emerging technology. Firms must gather the knowledge that circulates around the web and couple that with their own knowledge to form new, useful knowlegde that can be used the firms advantage.

This is first done by analyzing the network and determining the relationships, the flow of knowlege in and around the networks, and who the contacts or "actors" are in the network. Links can then be established to determine the flow and the possible linkages to knowledge. These linkages might include alliances, joint authorship, board interlocks, job changers, or electronic communication. Linkages that may also include "proximity" or area links based on geographics, similar works in technology, cliques working on common goals, or through patent citations.

Networks help establish the outcome of a technology. The sharing of information can help shape the technology both in function and use. Ultimately, these technologies can shape the future for many companies and there are many M&A that occur because of the networks and the technologies a company might possess. Companies should analyze and envision what the networks might looks like, how they will participate in the networks, and how they can harness the knowledge from these networks to create their own advantage.

A new startup firm such as EtripTrader might look at the networks avaible to the company to help build the product and protect the innovation. The idea started with the pilot contacting his son to code the project. The CEO then looked at the competitors products (Sabre airline software - http://www.sabreairlinesolutions.com/products.htm) to analyze features and functionalities. They then called upon Microsoft to help with the coding aspect of the project and used the resources from the Idaho Small Business Development center to gain more networks and contacts to further develop the company. Now, the company is networking with Angel Investors and other VC's to gain money to further develop and market the system. All of these networks were necessary to create and further develop the product.

Wharton Chapter 11 - Appropriating the gains from innovation

In chapter 11, the author states that there are four major appropriation mechanisms to protect innovative gains.

• patents and related legal protection - patents are over-empasized as a way to protect innovations and their effectiveness is sometimes ambiguous. Science and technology can catch up with patents quicker than the patent life. Time and energy may best be invested by evaluating the other mechanisms
• secrecy - one of the hardest mechanisms to protect gains because products can be immitated or information leaked to the public. Simply put, don't share the secrets with the public to protect your innovation. Typically, it's easier to protects secrets surrounding processes than products as processes can be incredibly complex and difficult to reproduce without the knowledge.
• control of complementary assets - by controlling the facilities and capabilities of the manufacturer, innovations can be protected. Without the complementary assets, it's difficult to capitalize on products or know how that require the complementary assets to produce an innovative product. Sometimes, products in an entire industry can be protected because complementary assets are not available to the competitors in the market (IBM example).
• lead time - knowlege and know-how can create lead-time advantages with innovations. product characteristics such as durability can impact lead time. By creating a reputation or having high switching costs for alternate products, advantages can be made in the lead time.

Finding the right mechanism or a combination is very important for companies to protect their innovations. Understanding the uncertainties and applying the appropriate mechanism(s) to protect the innovative gains is important to companies. As the book outlined, "protect the golden goose". It's difficult to determine which idea or innovation will yield the biggest gain but it's important to protect all innovations and think not only about how to protect the innovation today but how to protect the innovation in the future by being responsive.

This framework of protecting innovative ideas can be applied to Mcdonalds food products. McDonalds holds a variety of patents on their processes for french fries (http://www.google.com/patents?id=fbYgAAAAEBAJ&dq=Mcdonalds+product&as_drrb_ap=q&as_minm_ap=1&as_miny_ap=2008&as_maxm_ap=1&as_maxy_ap=2008&as_drrb_is=q&as_minm_is=1&as_miny_is=2008&as_maxm_is=1&as_maxy_is=2008)
Not only is McDonalds products trademarked but the sauce used in the big mac is one of the greatest trade secrets in the fast food industry. Though a patent would help protect the "secret sauce", McDonalds may forgo the patent to protect it as a trade secret. (http://query.nytimes.com/gst/fullpage.html?res=9D00E6D9103EF936A35751C0A9679C8B63). The manufacturing and distribution channels are complementary assets that have allowed Mcdonalds to move into new markets around the world and still deliver a quality product that consumers love (I'm not the biggest fan). McDonalds holds considerable power in their lead time to get new products to market delivering existing products to locations all over the globe.

Wharton Chapter 10 - Scenario Planning for Disruptive Technologies

The chapter asked a few interesting questions to determine how a company can best prepare for emerging technologies by using scenario planning. The future is unknown but companies should ask. "which set of multiple futures" might be likely and how should a company prepare for them. Companies should consider multiple different scenarios and create or adjust their strategies to define the best path. Scenario planning also helps define the best opportunities and risks associated with the emergent technology and how a company should go about handling them. This can be done by watching for weak signals in the industry and amplifying them. These signals can have dramatic changes on a market or industry.

Scenario planning address three challenges that are inherent in emerging technologies:

• Uncertainty - scenario planning is based around this attribute and can be qualified using objective probabilities
• Complexity - scenarios that are based around a diverse set of factors (political, economic, social, technological) and explores how they mingle with one another in a system
• Paradigm Shift - scenarios that change and "shift the entire mindset and rules" and focus "amplifying the weak signals"

Scenario planning takes the various inputs, uncertainties, and data and puts them into usable scenarios with differing assumptions to be further analyzed. The results are patterns among all the outcomes that can help a company make decisions on an emerging technology and shape the future.

There are a number of steps used in constructing scenario planning. These steps include:

1. Define the issue - determine the scope and use past experiences to help define time frame
2. Identify key stakeholders - who are the parties affected by the change and who are the parties that can influence them
3. Study the driving forces that shape the future of the technology - these forces include Political, Economic, Social, Technological. Gather information that pertains to these forces
4. Identify trends that will affect the interest - based on the data, try to understand how and why these trends will expert influence on the future
5. Identify key uncertainties - outcomes from events (i.e. political race) and these uncertainies can be used to project possible outcomes from the scenarios. It's important to understand the level of importance of each of these uncertains and to weight them accordingly
6. Select the 2 most important key uncertainties - go through list of uncertainties and vote on the top two based on findings from steps 2 - 5.
7. Assess te plausability of the scenarious - determine the likelyhood of these scenarios occuring by analzying trends, the number of uncertainties, and the actions of the stakeholders.
8. Assess the revised scenarios - determine how the stakeholders would react in the scenarios to develop more conversation with the organization and strengthen/weaken the scenarios.
9. Complete more research - put the scenarios into models and diagrams to further explain the nature of the scenario and it's complexities.
10. Reassess the uncertainty ranges - examine the variables under each of the scenarios to see how things might change. Go through the details and examine steps 1-9 to see if any of the data should be changed.

The scenario planning is important because it can be used to "calibrate the nature and extent of comittment a firm to should take in pursuing a set of technologies.. ". The chapter applies the concepts from scenario planning to the newpaper industries.

There are four key traps to avoid when scenario planning:

1. Failing to gain top mgmt support early on - getting buy in from the top early on in the project will help ensure success for the project. Top mgmt are most of the key decision makers in scenario planning (Step 2) and without them, steps 3 -10 may not be completed
2. Lack of Diverse Inputs - get outsiders opinions to scenarios as they may see things differently from those internal participants and these people may help identify other complexities or possible scenarios that should be considered
3. Failure to stimulate new strategic options - the options may not be as groundbreaking or as convincing to leaders in the company.
4. Not tracking the scenarios via signposts - the scenarios may not always have all the grainular data and scenarios need to look at both the big picture and the details to fully understand the scope and impact.

A good example that has followed scenario planning has been the change from oil/fossil fuel cars to electric/hybrid vehicles. The issue at hand is that gas has become very expensive and the consumers (the stakeholders) are looking for personal transportation to alleviate the issue of rising fuel prices.

Car manufactures have looked at a variety of technologies (scenarios) regarding how to combat the issue of rising fossil fuel costs. The manufactures have analyzed the driving forces (political issues, economic issues, social issues) of the rising costs and are creating new ways to deliver low-cost, high effecient vehicles to consumers. These new vehicles have come in the forms of hybrid, electric, and biodiesel giving us four scenarios as stated from the energy scenarios website:

• Peak of Oil is in the distance, Reactive Response - resume business as usual; no change
• Peak of Oil is in the distance, Proactive Respone - transition towards other sources & options
• Peak of Oil is soon, Reactive Response - limited local supply of oil and import will be very expensive, pay higher prices or switch to alternative vehicle
• Peak of Oil is soon, Proactive Response - known that the supply of oil will be limited, disperse fuel where most needed and import only when necessary.

The next step is to look at the uncertainties (price of the dollar falls in world market, new oil supply is discovered in the US, etc) and evaluate the plausability and the level of impact and determine feasibility. Car manufactures are continuing research to look into other methods of energy (battery powered and solar powered that allow for greater distance) and reassess their markets and findings. They then make the decision of whether to move forward.

(http://info.energyscenariosireland.com/Scenario_Planning)

Wharton Chapter 9 - Strategy Making in Uncertain Environments

In chapter 9, the author discussed the rapidly changing strategies needed to survive in the market today. New strategies and the continual adjustment of existing strategies must be tested and tried to impact the overall results. The author discussed discipline and imagination as the underlying pillars of strategies.

Discipline - using a consisten application of rules to evaluate a set of alternatives. using systemic ways to evaluate competitive environments.

Limitations: sticking to methods that have always worked rarely create new original insights. Discipline focuses too much on analysis and thinking that because a method was done one way in the past, it will generate similar results in the future (not taking into account variables such as market, technological, and consumer changes). Alternatives are rarely generated and there is too much power placed on analysis.

Imagination - finding "deliberate diversities" in the way problems are defined and using these diversities to develop solutions. Focus less on experience and more on new and innovative ideas and ways to envision the future.

Limitations: simply put- chaos ensues because of lack of structure. Imagation may focus too much on the future and not the current issues at hand. Imagation may overlook valuable experience and undervalue where the technology/company has come from. Imagination can slow the process because it is chaotic and unstructured and can involve many decision makers.

The framework of utilizing experience with imagination is seen in many companies today. Apple again is a very creative company that has expanded it's product line through creativity and understanding their history/core competencies. With many of apple's products, they exercise discipline within their product lines but have also evaluated other alternatives to create superior products in the market. Apple uses both the framework and the limitations to create new, innovative products for constantly changing markets in uncertain environments.