China Innovation Capacity Growth Index 2015 and 2020

It is of interest in China and across the world to predict whether China will catch up with the most economically advanced nations in innovation capacity. To facilitate an ongoing assessment of China’s innovation capacity, the article develops a China Innovation Capacity Growth Index composed of eight separate measures. China’s performance in 2020 is compared to the baseline from 2015, showing that China has progressed in six of the eight measures. This article and the accompanying Technicalm Appendix explain each of the measures, including the sources for the data, and report
the changes in performance over time.

Download article here: China Innovation Capacity Growth Index 2015 and 2020

My Writings on Chinese Firms and Innovation in the Chinese Economy

I collected all my Writings on Chinese Firms and Innovation in the Chinese Economy in one place.

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Excerpt from Last Interview with Jim March

Peter Ping Lee interviews James March. I provide here what I personally found the most interesting part of the full interview.

Peter: In your MOR 2005 article (March 2005), you referred to the peripheral position of the indigenous research communities relative to the mainstream research community. Do you think the Chinese research community is like that?

James: So far as possible, we would like to maintain some diversity. The ideology of research is international and sharing, but the risk is that you converge too completely and too fast. So how do you keep it from converging too rapidly and too completely? National and other communities being separate is our way to maintain diversity. It is a complicated problem because, from the point of the view of the separate community, that is not advantageous; they will be more advantageous if they converge with the dominant view; from the point of the view of the total community, there is an advantage having diversity. One of the ways to maintain that diversity in our present world situation is being national with a combination of separate cultures, separate languages, and some kind of local enthusiasm. Whether maintaining the optimum diversity is a much more complicated question, but a completely convergent is not optimum, so you need some diversity.

Peter: Is this analogous to the argument that if you don’t maintain exploration, then there is a tendency that the community will convert into exploitation?

James: It can be framed as exploitation-exploration issue. And that issue arises in all places, and in all places that I know, we have no optimum solution to it. We don’t know what the best mix is, but we know that is not the extremes. Diverse totally is not what you really want to be, but how much diversity you want is very complicated. Some parts are very simple. The longer you look ahead, the more you want diversity; the shorter your time perspective, the less you want diversity; that is fought over and over again. And some areas we have theorems that show that is true. The one I know best is the two-armed bandit world.
That is a set of problems that can be characterized as like going to a casino and confronting a whole array of slot machines. You know these slot machines have different payoffs. But you don’t know which one is the best, so you start experimenting. What is your search rule? After a while, you have found one that appears to be the best. And obviously, you will do well by repeating that rule. But when you repeat that one, you don’t search for any other ones. If you search for another one, you do less well in the short run, but you might do better in the long run. We don’t have any real solution to that problem. We do not know how to determine the optimum outcome.

How Philco-Ford imagined in 1967 what daily life would be like in 1999

According to Wikipedia, Ford owned Philco for 10 years starting in 1961. Hence the name Philco-Ford.  The brand is now owned by Philipps. 

A Fly on the Wall in a Fearless Organization

JPM: Amy Edmondson has written a very thoughtful short overview of what an organization that creates psychological safety for its employees without sacrificing performance looks like. I highly recommend the piece.

What does psychological safety sound like?

The trickiest part of organizational change is translating the big idea into the little interactions that happen hundreds or even thousands of times a day. What are team members actually saying to one another in situations both small and large, both ordinary and earth-shattering?

If you follow the current thinking on leadership and management, you have seen the concept of psychological safety cropping up with greater and greater frequency. Psychological safety describes an atmosphere where team members feel they can speak up with concerns, bad news, or ideas without fear of being shut down, blamed, or humiliated.

I call these cultures fearless organizations. In a fearless organization, people are all in. They don’t let concerns about what others might think cripple them. I’ve spent 20-plus years studying how psychologically safe workplaces unleash creativity, innovation, and learning, and have documented it all in my latest book, The Fearless Organization.

Where it gets complicated is bringing this into the everyday life of the team. First, my standard caveat: Psychological safety is often confused with a “safe space,” when it’s actually nearly the opposite.

A psychologically safe culture is not free of conflict, consequences, or accountability. These things exist but are managed positively and constructively. It does not mean employees are “wrapped in cotton wool,” as my friend and London Business School professor Dan Cable has said. Think of psychological safety as an atmosphere of healthy give-and-take, rather than an atmosphere of tiptoeing around.

So, in a psychologically safe environment, what’s actually being said in the room? I’ve divided the list below into “team leader” and “team member,” mainly for emphasis. But in actuality, anyone anywhere in the hierarchy can permit, build, or claim psychological safety. Team leader

• This is totally new territory for us, so I’m going to need everyone’s input.
• There are many unknowns/things are changing fast/this is complex stuff. So we will make mistakes.
• Okay, that’s one side. Let’s hear some dissent/who’s got something to add/let’s have some give-and-take.
• Lucy, you look concerned. Gilles, you haven’t said much. Adrian, what are you hearing in the warehouse/on the phones/on the road?
• What assumptions are we making? What else could this be/could we investigate/have we left out?
• What are you up against? What help do you need? What’s in your way?
• Did everything go as smoothly as you would have liked? What were the friction points? Are there systems we should retool?
• If you’ve got something to add, just… (mention a few channels of communication, including ones suitable for difficult conversations).
• Thank you for that clear line of sight. (This was the famous reaction of Ford’s Alan Mullaly to some colossally bad news.)
• I really appreciate your bringing this to me. I’m sure it wasn’t easy.

Team member:

• We’ve got some new information we’d like to share.
• Something’s been troubling me. Do you have ten minutes to talk about it?
• Some of this is not good news. Is this an okay time to dig in?
• I mentioned the problem to the team and we’ve got some ideas.
• I’ve hit a roadblock/I’ve got to go back to square one/I’ve made a mistake.
• We tried an experiment, and it didn’t go as expected.
• The front desk says patients aren’t comfortable with this new procedure.
• There’s been an uptick in X, and we can’t explain it just yet.
• I’m not sure who to approach about this kind of thing/the level of detail you like to hear/what’s the best procedure for bringing up a concern.
• Let me recheck that for you. It doesn’t sound right. It’ll only take a minute.
• We need another pair of eyes on this. Best to spend a minute/hour/day/week on that now.
• I don’t feel right about this. Can we do a hard stop right here?
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As you can see, these are perfectly normal, everyday phrases. And that is exactly my point. None of this is technical knowledge or deep expertise; it’s more like cultivating a habit of mind and re-orienting one’s thinking. All of it is quite simple—and yet, not easy.

A few themes emerge from these snippets. Team leaders and members, wherever they are in the hierarchy, must continuously do three things:

1. Frame the challenge. This creates room for questions and concerns, but also for creativity. What you’re really doing is giving permission to experiment, possibly mess up in myriad small ways, and thus to learn. After all, we live in a VUCA world (a military term for variable, uncertain, complex, and ambiguous). There’s always a challenge to frame.
2. Invite participation. Make it 100 percent clear that all voices are welcome. Be continuously on the lookout for the unspoken concern or idea. It remains a stubborn fact that we don’t know what we don’t know. I’ve seen companies do creative things like developing their own insider-speak, almost a set of cues for speaking up. These can be anything—a catchphrase, a line from a movie. And depending on the context, they can be odd or goofy or profound.
3. Respond appropriately. Make speaking up a positive experience, even when you don’t like what you’ve heard. This is incredibly hard sometimes, but absolutely necessary. When you get bad news, you might be angry or disappointed. You may be worried about the project or how the news reflects on you. But in the moment, you must put all that to the side. Thank the messenger enthusiastically, sincerely, and publicly, if appropriate. Then move forward constructively.

These three things must be done in as many ways—and at as many junctures—as it takes.

Here’s a way to think about creating psychological safety. It comes from a different context, but it works. There’s a very gifted designer of educational products, David Dockterman, who has taught a popular course at the Harvard School of Education. One of his maxims: Think of the classroom where kids are doing your activity. Think of what you want them to be saying to each other. Work backward from there.

It’s in that spirit that I offer up the list above. It only scratches the surface, and context is everything. But I do I hope these snippets might help you work backward to a culture of speaking up and forward to a fearless organization.

Source: Psychology Today

Aenne Burda Doku

225 Zufällige Worte (225 Random Words in German) für Brainstorming

Hier sind 225 zufällig Worte. Man kann sie auch als Excel Tabelle herunterladen.

Erwachsener
Flugzeug
Luft
Flugzeugträger
Luftwaffe
Flughafen
Album
Alphabet
Apfel
Arm

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McDonald’s finds success with going back to basics

The Economist reports:

The seeds of the revival of McDonald’s started with a simple decision that is surprisingly easy to get wrong: go back to basics. From 2015 onwards, it pared back its array of menu offerings and focused on price and quality. It recommitted to Ray Kroc’s beloved business model, increasing the share of franchises last year to 93% (of almost 39,000 restaurants), up from 82% in 2015. That provided it with higher-margin and steadier royalty and rental income. It streamlined its sprawling international operations, selling control of its restaurants in China and Hong Kong. The results were impressive. Across McDonald’s sales exceeded $100bn last year; its operating margins, thinner than a frazzled patty in most of the restaurant industry, ballooned to 43%. And its share price sizzled. Since 2015 its market value has almost doubled to $160bn.

Full Story at Economist.com

Peter Hessler:  “How China Controlled the Coronavirus”

The China expert Peter Hessler has written an informative letter on How China Controlled the Coronavirus drawing on his experience on teaching a class on non-fiction writing in Sichuan during the pandemic. Read Article. You can listen to a podcast of the article as well.

Review of “Bubbles and Crashes” by Brent Goldfarb and David A. Kirsch

Brent Goldfarb and David A. Kirsch. Bubbles and Crashes: The Boom and Bust of Technological Innovation. Stanford, CA: Stanford University Press, 2019. 247 pp. $35.00, cloth.

Financial bubbles have been a recurring phenomenon throughout the history of capitalism that have proved costly for society. According to the U.S. Bureau of Economic Analysis, the most recent financial crisis from 2007 to 2009 resulted in a real GDP loss of $650 billion. The U.S. Government Accountability Office (2013: 12) called it the “most severe economic downturn since the Great Depression of the 1930s.”

Given that financial bubbles are more the domain of finance scholars and economists, why should ASQ readers read a book on Bubbles and Crashes? Its subtitle—The Boom and Bust of Technological Innovation—is what makes the book interesting for organizational scholars. Beginning with the famous Aston studies, organizational scholars have increasingly focused on technology as a key shaper, first of individual organizations (Hage and Aiken, 1969) and later of entire populations of organizations (Tushman and Anderson, 1986). The recent interest in “disruption” typically involves a new technology that a startup develops for a niche market. Subsequently the technology is so much improved that the startup can bring it to the core market where it disrupts the leadership position of incumbent firms (Christensen, 1997). Goldfarb and Kirsch extend this literature by examining the role of technological innovation in the formation of bubbles in financial markets. They aim to identify the key causal mechanisms that increase the likelihood of the formation of a speculative bubble.

The book is divided into six chapters. After a brief introduction outlining the most important elements of their theory about the formation of speculative bubbles, chapter 1 introduces the central concepts necessary to differentiate bubbles from non-bubbles. Bubbles are those “boom and bust episodes in which investors drive up prices and get fooled” (p. 24). To determine whether there is a bubble, the authors develop a measure called “frothiness” that represents “the number of standard deviations from the predicted stock or index trend . . . where the ‘trend’ is the predicted stock price looking forward and backward seven years” (p. 35). In short, the measure indicates whether stock prices are inflated. If the frothiness is larger than 2, the stock price is a candidate for a bubble, but the authors bring to bear additional judgments to determine whether investors were fooled. Chapter 2 describes the role of uncertainty and narratives in the formation of bubbles. The authors differentiate four types of uncertainty: technological uncertainty, competitive uncertainty, business model and value chain uncertainty, and demand uncertainty. And they conceptualize narratives—which emerge in an unexpected starring role in the book––as “temporally sequenced accounts of interrelated events or actions undertaken by characters” (p. 51). Chapter 3 explains what role novices, naïfs, and biases play in the formation of bubbles. While chapters 2 and 3 constitute Goldfarb and Kirsch’s theory on the causes of speculative bubbles driven by technological innovation, chapter 4 applies their framework to a sample of technologies to test its explanatory power. In chapter 5 Goldfarb and Kirsch test the external validity of their theory by applying the framework to a different sample of more recent technologies. Chapter 6 derives policy implications from the framework and gives practical advice on how one can assess the probability of being in a bubble. The appendix provides further information on the methods, a summary of the main findings in tables, and a comprehensive list of sources used for writing the detailed histories of the technologies.

 

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