What Theoretical Physics Brings to Entrepreneurship

http://de.slideshare.net/coilpsu/klemmer-presentation, p.5

Quite by serendipity, having lunch with a theoretical physicist from Asia some days ago I learned that theoretical physics is not plain theory, but the science field trying to make sense of seen reality. In short an experimental physicist finds a new material, which has some "unexpected" properties (that is the practical part). However, as Kurt Lewin (1890-1947), the famous German-American experimental social psychologist, is quoted, "There is nothing more practical than a good theory" which underlies and explains that real-life phenomenon. For this very same reason theoretical physicists then work to figure out, with the help of computer simulations, perceived patters of reactions of the material due to change of particular parameters, and known knowledge, what the underlying root causes of the new material's properties, and how they can be used, and eventually made practical in future applications.

What has all this to do with entrepreneurship, and eventually innovation?

Let's have a look at innovation and how it comes (in various forms) into the world, and to practical use. Peter Drucker, "management guru" and "Renaissance Man" of the 20th century well respected in the global business community in some form laid out a "theory of innovation", namely the sources of innovations that lead eventually to their economical success. In "Innovation and Entrepreneurship" he lays out seven distinct sources, which range from "The Unexpected" to "New Knowledge". See Andre Kearns' Slideshare  presentation for a good overview of these (and a condensed overview of the book itself) here.

Quite often the public focuses on the innovation based on new knowledge, such as technology-based (generally on new knowledge), and wonders why innovation is not taking off shortly after discovery, and first prototypes of possible products or services based on it. Due to Drucker this kind of innovation is the one with the longest lead time (and quite a high loser rate, due to the shift of other relevant parameters that change over time, especially shifts that touch society as a whole, such as demographics, immigration, or world politics) this should "In the theory and practice of innovation and entrepreneurship, the bright-idea innovating belongs in the appendix" ("The Daily Drucker", 20 July, p. 220).

So making sense of how innovations diffuse into society (and not just on some edges due to price, or perceived value by a minority) is more challenging than it looks like at first sight. Prof. John D. Sterman, Jay W. Forrester Professor of Management, Director MIT System Dynamics Group, not only gave quite a thought-provoking presenting in early 2008 stating that "technological solutions are not enough to address the problem of creating a sustainable world" but has covered the issue of innovation diffusion in his book "Business Dynamics - Systems Thinking and Modeling for a Complex World" (chapter 9.3, Innovation Diffusion as Infection: Modeling New Ideas and New Products, p. 323-347).

So the question stays, "What does it need to bring innovations into the world?"

To close this post, and keep the question open that underlines Kurt Lewin's "There is nothing more practical than a good theory", perhaps it is time for what Jay W. Forrester envisioned in 2007 at the International System Dynamics Conference in Boston in his speech "System dynamics - the next fifty years" and his statement at the end of the speech, "We should be able to move sufficient understanding of the behavior of complex systems into the public sector."

Isn't a "school of thought" (even a quite independent department of an existing university), based on theory and practice alike, the "perfect" place to make this happen?

Unconnected Moves Smartly Joined Together May Lead to Great Future

In mid summer 2012 the Technical University Dresden (TUD) obtained the prestigious title „Excellence University“ out of a years-long process in competition with other German universities. It happens to be the only one in the East-Germany countries (besides Berlin) and with good reasons so it seems.

The region around Dresden, Chemnitz, Freiberg, and in more general terms Saxony has a long lasting legacy of technical invention, technology-driven innovation, research stemming from a time when the early ore reserves were found, and new materials were starting to be used in the energy producing fields.

Rudolf Sigismund Blochmann who not only was one of the founding fathers of the TUD but had brought the German-version of the gaslighting to wide use in Germany as an efficient energy usage for street lighting (which can also nowadays be seen in Dresden in action; info via StadtWiki). Around Chemnitz and Freital there had been intensive coal deep-ground digging with all ajacent innovation which spread to new transport infrastructures, and other innovations that last till today on which to build on for the future.

DRESDEN-concept, the future concept of TUD around a synergetic university combining different diverse, and not always obviously connecting, fields like material science, semiconductors, arts, entrepreneurship, libraries, life sciences, and not least, nor last energy creation. The intent of this partnership of these institutions is to not only draw out the best of all involved partners ranging from Fraunhofer, Helmholtz, Leibniz and Max-Planck Institutes but to facilitate the power of arts, and sozio-science fields for tackling the „grand challenges“ ahead of us with effective, and efficient for education, and making use of this knowledge across boundaries of disciplines, generations, gender, and cultures.

One of these „grand challenges“, energy, which also is one of the main fields of a university of a quite contrary kind, as its curriculum changes every six months which holds it back to be acknowledged as a „real“ university, yet called Singularity University, drew in 250 researchers, scientists, and executives to two days on the River Elbe last week to discuss new ways to create energy in sustainable, and new ways.

Fraunhofer IWS, one of several Fraunhofer institutes based here in Dresden due to the strong technology-based community, and future-orientated wise moves of a handful of institute leaders, and politicians after the reunification to make effective use of the available resources in the region, was host of this conference.

The pulling force of the conference has been the Dresden-based „Dresden Innovation Center Energy Efficiency DIZE“, funded by the Fraunhofer Gesellschaft and the Free State of Saxony. Apart from scientific research, and economic aspects the center focuses on the creation of future scientists, and engineers in the broad field of energy across disciplinary boundaries.

More on the conference can be found at the conference website "Energy in Future" and on Twitter.

The topics of the threads reached from thermoelectrics, solar energy, photovoltaics, energy storage, mobility, fuel cells and energy efficiency, and offered a wide range of insight into an amazing field for „outsiders“, as well as sparking ground for future collaboration, and creation of projects on bringing technologies into practical use for the "insiders".

Besides providing direct benefit for members of the research institutes as well as their direct project partners in the form of meeting and exchanging ideas in condensed matter, coffee breaks enabled the conversation across boundaries. It could be learned that public transportation companies with tram networks, such as the Dresdner Verkehrsbetriebe AG that is currently testing hybrid-electric busses, can offer electrical energy storage of a kind that has been not yet really tapped in. For providing the electric energy for the tramways continuous current at high voltage is provided by transformer substations (spread around the network within the city). These transformer substations can be further used in the future as electric storage stations for electric cars, e-bikes, and alike – the infrastructure is there, now it is time for innovation, and business model creation to set this potential to effective work for society.

As the just announced stop of operations of Better Place (which filed for bankruptcy in Israel), a company focusing on battery swapping technologies for electrical cars with headquarters in Palo Alto, and first prototype markets in Denmark and Israel showed once more the difficulty that "good technologies"despite good intent, and visions in a world of "normal energy providing" can eventually take. It takes bold visions, and smart moves alongside when technology innovation is going to become striving business models that last for decades, or centuries into the future. For sure is only that the future is unclear, full of surprises, and that new ways to tackle the great challenges of humanity (energy, food, health, housing, education, etc.) of which energy is amongst the most fundamental ones, it takes courageous steps out of the research, and prototype world to make a fertile business out of it, and generate the money to further fuel the future research in these fields, and create lasting economic wealth.

What could demonstrate this challenge better than the (rather surprising) announcement of closing of the Collaborative Research Center 804 at TUD due to not relieved funding for this cross-disciplinary spanning project that reaches also on the impacts of technology implementation in society. Dresden, and its citizens have the ability not only to power up economic wealth, and understanding the dynamics behind it by using its technology-based engine, but combine it with its legacy in social sciences as well.

The newly put into operation of UNU-Flores (part of the United Nations University) at WTC Dresden in joint cooperation with TUD is focusing on the education around integrated resources management, and doesn't the described situation provide a chance of the future that could be no better?

Integrating the technology, engineering approach with entrepreneurial visionaries, and glueing both by learning to see, perceive and understand the underlying dynamics by establishing a new institution at the TUD that not only generates its "own funding" by enabling entrepreneurs (these can be very well be former PhD students, or graduate students as well as university personnel) to build their (even though small in the beginning) companies.

The VISION is there to set to work, and Dresden could not be a better place for what the founder of the field system dynamics, Jay W. Forrester, envisioned in his "System dynamics - the next fifty years" talk at the ISDC 2007 in Boston.

If a new cross-disciplinary institute focusing on system dynamics here in Dresden could be outcome from these rather unconnected looking events then a "small step today may lead to bold moves into the future" soon.

The Team of HTxA

Design for the 21st Century Management & Education Institution

Back in 1989, "The Wall" had not yet come down yet, and first tectonic shifts of the social fabric in Europe were already under way, Jay W. Forrester gave a Banquet Talk at the international meeting of the System Dynamics Society. It was July 13, 1989, in Stuttgart.

http://sloanreview.mit.edu/feature/jay-forrester-shock-to-the-system/

As Jay W. Forrester pointed out on how he had become to create the field of system dynamics over the course of his life, on how he and his team managed the development of the first automate air-defense system, and how his work on Urban Dynamics led to the contact with Aurelio Peccei, founder of the Club of Rome  from which the globally acknowledged Limits to Growth later emerged.

At the end of his talk he points out, "A rather small number of relatively simple structures will be found repeatedly in different businesses, professions, and real-life settings. One of Draper's junior high school students, working with bacteria in a culture and in computer simulation, looked up and observed, "This is the world population problem, isn't it?" Such transfer of insights from one setting to another will help to break down the barriers between disciplines. It means that learning in one field becomes applicable to to other fields. There is now a promise of reversing the trend of the last century that has been moving away from the "Renaissance man" toward fragmented specialization. We can now work toward an integrated, systemic, educational process that is more efficient, more appropriate to a world increasing complexity, and more compatible with a unity in life."

Almost 24 years later, what is the evidence that this is true? Personally I very well remember a job interview in Stuttgart for a position as a lean consultant (which when filled out properly goes very much in tune with the words above) back in early 2008. I still recall the drop of my heart beat when the CEO of the company told me, "You are the right person we are looking for at the moment. Your knowledge and expertise in the field is exactly what we need. - Yet, we can't hire you: you would be the first non-engineer (note: economist) in the team of 14!"

If such behavior of business leader is still the prevalent mode of action, where shall we establish the spaces, and institutions that build on Jay W. Forrester's vision of 1989?

The Return of the "Renaissance Man"

Johann Eleazar Zeissig, known as Schenau: The Discussion on Art, 1772
© Staatliche Kunstsammlungen Dresden, photo: Elke Estel, Hans-Peter Klut

Enlightenment as the "facilitator" or "boundary art" for the challenges of the 21st century. Based on the transformations some centuries back when the "dark age" was transforming and opening up the doors to science, exploration, and understanding the deeper sources of life. Even more back, some several thousand years back in China the foundations of our modern society, science, and understanding of nature were grounded. Putting these strings together in a present setting, framing a "container", and get traction done is the aim of "Enlightenment in Dialogue" (2019-04-07: only the German version of the press announcement available online).

Lucky to live in Dresden, where one pillar of that process - Staatliche Kunstsammlungen Dresden - is situated (not just one, but many more such as Semperoper)

We live in exciting times - and it is right in front of us, it is our playground!

The Future of Entrepreneurship - ... into Blue Sky!

Gartner expects trends beyond 2010

1. De-routinization of Work
2. Work Swarms
3. Weak Links
4. Working With the Collective
5. Work Sketch-Ups
6. Spontaneous Work
7. Simulation and Experimentation
8. Pattern Sensitivity
9. Hyperconnected
10. My Place

.... in which way will these affect the future of consulting, and doing business?

What are the next big changes in the entrepreneurship and startup arena?

Here I share my personal views (they get updated) on more than 12 years of done action research in the midst of a challenging workspace environment (the scaling up process of the BMW Plant Leipzig in the mid-2000s), and the field of intrapreneurship (at BMW) and entrepreneurship (since 2008, running my own lean consulting firm, and lately working on a startup)

1. System Dynamics (wiki provided by Gene Bellinger), will be essential to understanding and design complex and interconnected organizational systems 
2. Entrepreneur in the role of process consultant, not giving advice (as this is free of charge and ubiquitous available on the web for anybody)
3. Entrepreneurs will be transparent on the various social networks, giving advice of general concern (Freemium Business Model) 
4. Collaboration and sharing of experiences transparently on the web (on places such as Facebook, GoogleBuzz (shut down), GoogleWave (shut down), TitanPad, and others) 
5. Intercultural consulting journeys similar to the learning journey of CharlesVanDerHaegen and VilleKeraenen, http://bit.ly/cFEz3R 
6. Shared benefit model based on the long-term benefit of the consulted client, similar to #TeamLearningExperience(TeamLea(r)ningExperience) 
7. On flight consulting sessions, sponsored by airlines (Consult & Fly, Travel & Improve will be the first players in this field based in Dresden) 
8. Hourly consulting (doing about two dozen clients at once, learning from diversity, cross-fertilization) 
9. Co-Consulting as prototyped by http://mindbroker.de/wiki/CoConsulting (currently at a stop) already 
10. Pattern recognization based consulting and entrepreneurship based on data provided by smart organizations providing online data as on the Tesla Roadster, http://bit.ly/d1yJh8, or through intelligent sensor/ RFID-based production systems (either in production areas or office environments where flow of paper, electronic files is done) - some general applications laid out and implemented during my past work at BMW Plant Leipzig and Kombiverkehr KG Frankfurt (can be also applied to other fields of interest) 

Updates

2016-06-06 Presentation of HTxA - HighTech x Agency as part of the Ideas Showcase (page 33, in German) at futureSAX Innovation Conference 2016
2016-04-05 Team Project CitizenScienceLab (part of the MOOC #ScalingUp)
2015-03-10 Interview given as part of ArbeitsVisionen2025 (WorkVisions2025) by Guido Bosbach
2014-07-29 A Mission to Bring World Changing Ideas From Singularity University - an interview
2013-07-15 HTxA - HighTech x Agency (a virtual communications agency currently in the making in order to make the knowledge flow out of conference rooms into the unexplored business opportunity world possible by applying digital communication technology)
2012-07-18 Startup Accelerator (concept)

2012-07-07 Jay W. Forrester's vision for the 21st century (and in large my own personal view on the future)

.... so a visionary future is awaiting us all, where ever we may live, or work. 

Would you like to be amongst the first movers to make the future a reality today step by step? BMW Plant Leipzig has already taken some significant steps in Saxony as well as AMD (now Global Foundries Fab1) and there is yet more to come over the coming years.