Digest: Rendez Research Salon on Innovation, Tokyo, Japan, August 13-14, 2007

daviding — Thu, 27 Sep 2007 19:36:27 -0500

On two days in Tokyo in August 2007, ten researchers -- representing five countries -- met for a generative discussion to share and create new knowledge on business innovation. This digest provides an overview of the presentations and conversations. Readers may prefer to view the printer-friendly version. The digest is organized in the following sections:

Themes
Agenda
Theme presentations and discussions
Participants

A fuller appreciation of the content discussed should be expected in the final Rendez report.

Themes

The primary interest in this salon was in gaining breadth on the subject of innovation. Speakers were paired in each of four themes. The four themes were:

A changed nature of innovation?
- From a legacy of management research into innovation developed over the past 50 years, what wisdoms should we retain, and which ideas should we abandon?
Innovations in experiences, and experiences in innovations
- How do new technologies change the ways that innovations can be introduced and/or become commonplace? How can the experience of innovations change or not change?
Innovations in network and business ecosystem relationships
- Has the structure of cooperation and competition changed? How does an ICT-mediated and globalized world change the way in which business operate?
Management development and innovation
- How has the training of leaders changed, in academic and corporate settings? How can business professionals be better prepared for the ever-changing marketplace?

For each of these four topics, a discussant was assigned to listen for commonalities and divergences. These were used as starters for discussion in the larger group.

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Agenda

The pace of the salon was relaxed, in order to encourage the development of shared ideas.

Monday, August 13, 2007
Opening: Setting the context for the salon	Purpose and Scope	David Ing, Yoshi Horiuchi
	Introductions	(all)
	Context: The Rendez Research Project	Taina Tukiainen
	Context: Shibaura Institute of Technology	Fumio Kodama
	Context: Innovation Foundations	David Ing
Theme 1: A changed nature of innovation?	Demand articulation	Fumio Kodama
	Services science, management and engineering	Kazuyoshi Hidaka
	Discussant	Gary Metcalf
	Group discussions	(all)
Theme 2: Innovations in experiences, and experiences in innovations	Hybrid game design in agent-based simulation models	Hiroshi Deguchi
	Toward meaningful dialogue	Yoshi Horiuchi
	Discussant	David Ing
	Group discussions	(all)
Tuesday, August 14, 2007
Theme 3: Innovations in network and business ecosystem relationships	Open source development and business ecosystems	David Ing
	Reaching the next level in social and economic development	Jennifer Wilby
	Discussant	Allenna Leonard
	Group discussions	(all)
Theme 4: Management development and innovation	Designing and teaching a new master's degree in international service business management	Taina Tukiainen
	Management development in corporate and academic environments	Gary Metcalf
	Discussant	G.A. Swanson
	Group discussions	(all)
Conclusion	Findings: Major points of convergence. Major points of divergence. Trajectory for further learning.	Taina Tukiainen

At the conclusion on the first day, the group enjoyed a team-building boat cruise on the Sumida River.

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Opening

The purpose, scope and topics of the salon were reviewed in the first part of a presentation by David Ing.

Taina Tukiainen described the activities within the Rendez research project.

The MOT program at the Shibaura Institute of Technology -- Fumio Kodama

The Shibaura Institute of Technology was founded as a professional school in engineering, law, economics, literature and business 80 years ago.
In 2003, the dream of the founder was revived in a new Management of Technology Program.
Kodama was retiring from the University of Tokyo, and become the dean of the school and director of the MOT program.
2003 was the the first MOT program in Japan, as a graduate school for working professionals, beyond on-the-job training.
Since there was not a textbook for MOT, Kodama has now written and published one in Japanese (that won't be translated into English).

Innovation foundations -- David Ing

Most innovation research today is founded on Schumpeter (1934) or Schumpter (1943).
Thomas L. Friedman's 2005 book, The World is Flat, draws questions as to whether the nature of innovation has changed.
In addition, Yochai Benkler's 2006 book, The Wealth of Networks, sees a different world where information and cultural production have been transformed by non-proprietary and non-market cooperative networks.
This salon keeps these challenges in mind for discussion.

Theme 1: A change nature of innovation?

Fumio Kodama was invited to speak about the origins and progress on his ideas of demand articulation. These were compared with Kazuyoshi Hidaka's presentations on Services Science, Management and Engineering.

Demand articulation -- Fumio Kodama

The word "articulation" brings together two opposite concepts: division in parts (decomposition) and putting together by joining (synthesis).
In 1991, Kodama wrote: We define demand articulation as a dynamic interaction of technological activities that involve integrating potential demands into a product concept and decomposing this product concep into development agendas for its individual component technologies. (p. 75)
While Kodama in a U.S. class on technology policy, the case of Three Mile Island incident drew on two sources:
- Theodore Rockwell (1980), The Rickover Effect: How One Man Made a Difference
- Eugene Lewis (1980) Public Entrepreneurship, Toward a Theory of Bureaucratic Political Power: The Organizational Lives of Hyman Rickover, J. Edgar Hoover, and Robert Moses
The idea of a nuclear submarine was a true strategy, but the tough part was the tactics of actually finishing the project within a given period of time.
- Americans and Germans started the project, and abandoned them
- The Japanese started the project, and had a prototype that stayed in the harbour, wasting a lot of money
- The USSR continued development, using the ship to crash the ice in the North Pole, where there's no nearby alternative sources of energy
The different in business model creation is the system of use.
- Note: Clayton Christensen, in his first paper, used the phrase system of use, then later changed it to value of chain.
Most recently, Kodama has been researching the mobile phone market, fitting curves to data
Kodama's current interest is in the fine-tuning between technologies and markets
The key question is how demand articulation should be view, in a global rather than country marketplace

The next frontier in service innovation -- Kazuyoshi Hidaka

Hidaka-san presented two slide sets.
The first was on "Academic Innovation and Skills for the 21st Century".
- The global marketplace has changed, with services now making up to 70% of each national economy.
- There's a need for skilled professionals, with a forecast that between 2010 and 2020, there will be shortfall of 32 million technically-trained professionals -- across the U.S., Europe, Japan, China and India
- This drives the agenda for SSME: Service Science, Management and Engineering
- We need more T-shaped people: deep in one area, but also with broad knowledge
The second presentation was a research perspective, "The Next Frontier in Service Innovation", with no conclusions, but working in theories.
- In 2005, the IBM Global Technolog Outlook first included the idea of innovaiton in services
- There's such a large increase in services in the economy, but not much of a discussion of service innovation
- In services, the innovation process isn't clear
- The definition was eventually expanded from "services science" to include management and engineering
- A framework for systemically developing innovation is challenging
- There are some candiates for services science research: measuring, testing, methodologies
- The framework of service worlds includes models, but could be expanded with real-time information, knowledge and insight

Discussion

From a manufacturing heritage, if we know local markets, we can articulate; but what can we do in global and service markets?
Articulation may be based on multiple technologies already developed, but there's a challenge of integrating two streams that weren't originally conceived together.
When is the function of an innovation really different, e.g. the Internet in the days of time-shared computers, versus broadband access
Service innovation, as compared to traditional innovation, may have network externalities (e.g. game platforms, operating systems), and strong externalities could mean winner takes all.
In Japan, the first focus of service innovation was in IT, with an interest in productivity, eventually leading to MITI to have an interest in service systems.
Coming from Marx, is service a new express for a human layer? Consider an example, the challenge of buying the right ticket (for incompatible lines) in the subways of Tokyo. There's now the Suica card, which is a fuller banking system.

Theme 2: Innovation in experiences, and experiences in innovation

Hiroshi Deguchi was asked to speak about the work he's been doing on a gaming interface into the agent-based social simulations that he's been constructing. Yoshi Horiuchi was invited to speak about his experiences towards establishing effective dialogues using techniques originate with Bela Banathy.

Hybrid gaming in agent-based social simulation -- Hiroshi Deguchi

Agent-based social simulation are computer-based multi-agent complex systems with intersubjective views, that can be used to share evaluations of social or organizational decisions.
Social simulation helps construct a shared social reality, but participation in the model is possible through a hybrid gaming interfacing.
- In a simulation model, all machine agents act according to rules.
- In hybrid gaiming, some agents act according to human decisions
The first social simulation was by Mo-tzu in China, using a belt and wooden tags
Hybrid simulation has been research in Japan since the early 1990s
First project has http://u-mart.org/html , a financial markets hybrid simulation
Other simulations have been conducted for informed consent communications, as well as other participatory approaches (e.g. fire escape methods in a shopping mall, pandemic protection policy making, tragedy of the commons environmental game)
The SOARS project -- social and organizational architecture -- will release v2.0 this fall.

Towards meaningful dialogue -- Yoshi Horiuchi

Horiuchi used a presentation created by Jed Jones, with whom he was been running converations.
The origins of dialogue came from Bela Banathy, who wasn't happy with 10-minute presentations at academic conferences.
As an alternative, why not have 5-day around-the-clock interactions on a theme, where people aren't thinking along, but maybe creating something together.
Dialogue is different from argument or discussion, not with an intention to win over teammates, but instead coming up with something new
There's a two-part structure:
- Generative dialogue
- Strategic dialogue
At first, everyone comes together with a different understanding, so dialogue is a technology to develop shared meaning.
Generative dialogue enables each to know the others, and surface tacit assumptions.
Sometimes, need an ice-breaker, e.g. singing poorly help in Japanese culture, where we are supposed to know each other by social status, company and position.
Strategic dialogue is action-oriented dialogue
Two types of information are exchanged in dialogue:
- Technical information
- Relational information
In the ISSS meeting in the prior week, the group tried to get transcultural
There hasn't been much publication on the experiences of dialogues, so the knowledge of what to do (and not do) needs to get beter

Discussion

In between the two talks, on simulation and on dialogue, were two ideas:
- Scalability
- Peripheral participation
In gaming, there's work towards scalability, where people can learn the meaning of roles
In a heterogeneous gaming world, some roles can be understood, while others can't.
To try out the simulation world, older people seem to need a purpose to try it, where the young just try it out.
The Banathy-style method was tried in an idealized systems design class, where it works with 4 to 5 people, but is more difficult for 8 to 10 people.
(Role --> meaning) and (meaning --> role) are not symmetric.
In Syntegrations, creativity doesn't necessarily happen the way it's planned within a 2.5 day workshop, it may emerge 3 months later.
The IBM consulting organization was originally designed for organic growth, using the ideas of cellular form organization (from Miles & Snow).
Culture matters: in Japan, the customer is always right, but in Denmark, the sales person may reject a nasty customer.
Conversation must emerge from semantic noise, up one level for meaning.

Theme 3: Innovations in network and business ecosystem relationships

David Ing spoke about his research on open source development, and business innovation, a high-tech direction. In a contrasting low-tech environment, Jennifer Wilby was invited to speak about her experiences in assisting the development of a new MBA program in Ethiopia

Open source development and business ecosystems -- David Ing

There's been research on open source development, but this dissertation is different, because both open source and closed source can be observed simultaneously in companies such as IBM.
Distinctions should be made between communities, companies and business ecosystems.
Recognition of capital is related to the idea of social capital from Pierre Bourdieu.
The study traces six cases in IBM, from proprietary --> open, and open --> proprietary.
The preunderstanding comes from three areas:
- ICT-mediated globalization (e.g. Thomas L. Friedman's The World is Flat, and Yochai Benkler's The Wealth of Networks).
- Collective practice (e.g. Hirschman, Jane Jacobs, and Spinosa, Flores & Dreyfus).
- Systems sciences, on business ecosystems, from Timothy F. H. Allen's Supply Side Sustainability.
The gathering of field work on this study will continue for some time.

Enabling management education in an underdeveloped country -- Jennifer Wilby

The University of Hull was asked to help a university starting an MBA program in Ethiopia.
The University of Hull (situated as the second largest port city in England, on its east coast) tends to do a lot of work focused on local development, although its systems research is international.
- Work associated with fishing, boat building and heavy industry has moved elsewhere.
- A centre focused on logistics has emerged, and there's outreach to the underprivileged in heath services and regional economics.
The dean for the new school in Jima came in January 2004,
- Jima is a lush area, higher in elevation, away from the main city of Addis Adaba.
- A proposal was approved by the Ethiopian department of education, and funded by the World Bank to $150,000 USD, which meant tight controls
- Four groups have come for training, and one paper has been written for the Academy of Management.
- The primary interest is currently and MBA, possibly with a Ph.D. some time in the future -- with doctoral degrees currently only granted (and tightly guarded) by the university in Addis Adaba.
In May 2006, met with British council, and received additional funding with expansion to other universities, both in Ethiopian and the UK,
- Additional agenda: ratio of women to men teaching in Ethiopia is 1 to 15, want expanded.
- Expectation that Ethiopian students visiting UK for bachelors would be mentored and encouraged to join master's or Ph.D. program.
Continuity has been an issue, with turnover in deans, and in students.
Wilby's research takes an interpretive approach, based on hierarchy theory, where each individual choose a different scale.
MBA is Ethiopia is seen as way to innovate innovation, changing the country culturallly, economically and socially.
University of Hull's participation is as a service, which takes staff off the track of doing research and getting funding.

Discussion

Across the two cases, there's some similar ideas of coevolution.
- There's different levels of resourcing involved, but there's a lot of tacit/implicit happening in the background
- How will the coevolution happen?
Sometimes it seems like a one-way transfer from the more-developed to the less-developed -- in either countries, or communities -- but there should also be a two-way consideration of what the more-developed could learn from the less-developed
- An example: the use of mobile phones to transfer money in underdeveloped countries
- Use of the tools at hand
Perhaps an alternative view on the Moore's idea of crossing the chasm
- Sometimes valuable innovations are ahead of their time, or are too culturally-specific to make the leap from early adopters to that which the majority of people really like using
The more people involved in a coevolving scheme, the fewer who will be lost in the chasm
Think about innovating innovation, particularly in China and India
- Innovation could be at the level of the platform, rather than for each industry or company
- The supplier of the technology may only be a partial innovator, without an application
Kodama is exploring the idea of a technology commons in energy
- An interest from Washington on "unconventional ways for security"
- Coming energy crisis from doubling consumption, from China and India
- Japan has developed a lot of energy technologies, e.g. coal gassification for when it had coal in the 1980s, but now Japan has used its coal
- Japan could easily license this technology to China and India, with the benefit that they wouldn't export their pollution to Japan
There's some research into scientific commons
- Richard Nelson: Science as a public good, but technology as a private good?

Theme 4: Management development and innovation

Gary Metcalf was invited to speak about his experiences with leadership and management development in public institutions and corporate businesses. Taina Tukiainen spoke about the Master's degree in International Service Business Management established at Helsinki Polytechnic Stadia.

Developing leadership -- Gary Metcalf

Leadership is different from managing ongoing things
It used to be that experts built things that users used, and service involve manuals.
- Manuals don't ship with software anymore, and kids don't read the manuals.
An idea of open source work, where we have the collective wisdom?
- A few central experts, but more participation in a non-linear way
The usual path in manufacturing has been design --> production --> product as usual in manufacturing
- There's something else going on, though, related to expertise that gets linked to productivity, that leads to expertise
Challenge: measuring the ability to innovation?
Metcalf has been working with the Federal Executive Institute, which was initiated by the Bush administration (i.e. the first MBA president) with a belief that government, like business, could be more efficient and tracked
- Thus education is becoming more linked to outcomes, not just in states, but also in university accreditation
- The focus has been on an executive branch management scorecard
- This deals with the top two levels of government pay grades, Senior Executive Service, with 10 to 15 years experience.
The government has organizational issues as would others, when there's 100,000 employees
- They see themselves as distinct from business, and don't like themselves compared to business
- Some senior management positions are actually contracted employees, e.g. seemingly temporary people filling while the search is on for a qualified executive
- Federal employees take an oath to the constitution, while the outsourced role doesn't
Challenge: how to get these senior government officials to think differently
- Metcalf has been working with a partner on executive leadership in a postmodern society
- Some students got it, others didn't
- Military and librarians got it
- Requires people who are willing to explore, rather than just shuffle chairs
Ideas that have been received is government policy through four different lenses:
- economic rationality;
- political rationality;
- legal rationality; and
- professinal rationality
Open question as to how government activities are valued.
- It's clearer if direct services to citizens are offered, e.g. with e-goverment
- It's hard to force government agencies behave like businesses, when, unlike businesses, divisions can't be spun off (with the notable recent exception of the Postal system).

The Master's degree program in International Service Business Management -- Taina Tukiainen

[This presentation was similar to the one presented at the IBM Paliasades event, so a digest has been omitted]

Discussion

Stafford Beer had done some thinking on outcome-based services
- The problem with infrastructure is that we don't know what the outcome will be
- Professional services leave open questions, because alternative paths aren't chosen
If you find yourself closely measuring things, you've got a double problem: measuring the wrong thing, and no measuring the right things that count
Stewardship is an old concept, and difficult to reconcile with the idea of efficiency
Paying people in society for different jobs is a knotty issue

Conclusion

What insights did participatns get out of the 2 days of discussion?

Incremental innovation versus radical innovation, but with demand and scope of use

Ventures and companies typically work outside the mainstream issues and core businesses
A lot of innovation has to do with scalability: expanding the market, understanding the business system, suppliers, processes

Agent-based models and dialogue as methods for experiencing innovation in alternative way

Experience is important to services
Could try a philosophy to get more people involved in innovation, inside and outside the corporations

The services domain as different from the product-oriented domain

Research is needed in to further appreciate how service businesses are similar and different from product businesses
Gaining this appreciation requires gathering individuals from heterogenous backgrounds, which we had for this salon

Open source cases can be viewed not just as either/or, but as both (with closed source development)

Maybe potential association with ideas on a platform industry technology industry commons, e.g. in India and China

Leadership as related to measurement:

Can you measure if you don't know what you're measuring?
Are global measures encouraged or discouraged by scorecard thinking?

The part that generative and strategic dialogues can play in innovation

Services can be viewed in layers, some focused on meaning and understanding, while other is focused on action

Services Science, Management and Engineering reminds of Alcoa getting ownership of a "new" metal, expanding a market

Educational aspects of the globalization process that can't be reduced to universities

Stadia may be like Thunderbird University in Arizona, that teach international programs mostly through powerful contacts with high level people
Contrasts to specialist programs, e.g. MIT

T-shaped people, wide yet deep in one area:

An alternative view: the I first, and then work on the cross
Top of T as generative, then the downstroke as strategic

Getting the context right, all of the innovations that are lurking get a chance to come out

They come out first through the arts
Then products and services that everyone needs
In the renaissance, the interests of the elite were seen as compatible with boiling philosophies
Elites as a metasystem, they're linked all of the time
They've taken a walk, and the sustainability question may bring them back together

Norms may retard innovation

Tall poppy syndrome
They're there, but it just doesn't come out
People on the subway sleep-deprived, need some work life balance
How to strengthen the generative?

Gaming and role playing, depth of involvement

May be an opportunity, especially with 12 year olds
Role playing to get to the generative

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Participants

The following researchers participated in the discussion:

Person	Role / affiliation	Home locale
Taina Tukiainen	Rendez project, principal investigator; Head of the Industrial Management Program, Helsinki Polytechnic Stadia	Helsinki, Finland
Fumio Kodama	Director, MOT Research Center, Graduate School of Engineering Management, Shibaura Institute of Technology	Tokyo, Japan
David Ing	Meeting coordinator (leading content); Rendez project, senior researcher; Business architect and marketing scientist, IBM; Doctoral candidate, Helsinki University of Technology, Department of Industrial Engineering and Management	Toronto, Canada
Yoshi (Yoshihide) Horiuchi	Meeting coordinator (local venue) Professor, Shibaura Institute of Technology	Tokyo, Japan
Kazuyoshi Hidaka	Manager, Tokyo Research Lab, IBM Japan	Tokyo, Japan
Gary Metcalf	President, Interconnections LLC; President, International Society for the Systems Science (2007-2008) Vice-President, International Federation for Systems Research	Ashland, Kentucky, U.S.A.
Jennifer Wilby	Director, Centre for Systems Studies, University of Hull Business School; Vice-President of Administration, International Society for the Systems Sciences	Hull, UK
G.A. Swanson	Professor, Tennessee Technological University; Member of the Board of Trustees, International Society for the Systems Sciences	Cookeville, Tennessee, U.S.A.
Hiroshi Deguchi	Professor, Tokyo Institute of Technology	Tokyo, Japan
Allenna Leonard	Principal, The Complementary Set; Past-President, American Society for Cybernetics	Toronto, Canada

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Rendez - Digest: Rendez Research Salon on Innovation, Tokyo, Japan, August 13-14, 2007 - Comments

Digest: Rendez Research Salon on Innovation, Tokyo, Japan, August 13-14, 2007

Themes

Agenda

Opening

The MOT program at the Shibaura Institute of Technology -- Fumio Kodama

Innovation foundations -- David Ing

Theme 1: A change nature of innovation?

Demand articulation -- Fumio Kodama

The next frontier in service innovation -- Kazuyoshi Hidaka

Discussion

Theme 2: Innovation in experiences, and experiences in innovation

Hybrid gaming in agent-based social simulation -- Hiroshi Deguchi

Towards meaningful dialogue -- Yoshi Horiuchi

Discussion

Theme 3: Innovations in network and business ecosystem relationships

Open source development and business ecosystems -- David Ing

Enabling management education in an underdeveloped country -- Jennifer Wilby

Discussion

Theme 4: Management development and innovation

Developing leadership -- Gary Metcalf

The Master's degree program in International Service Business Management -- Taina Tukiainen

Discussion

Conclusion

Participants