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New growth engines. New paradigm. new Korea. New Growth Engines Convention & Expo Tom Peters/26 May 2009.

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Presentation on theme: "New growth engines. New paradigm. new Korea. New Growth Engines Convention & Expo Tom Peters/26 May 2009."— Presentation transcript:

1 New growth engines. New paradigm. new Korea. New Growth Engines Convention & Expo Tom Peters/26 May 2009

2 NOTE: To appreciate this presentation [and ensure that it is not a mess ], you need Microsoft fonts: Showcard Gothic, Ravie, Chiller and Verdana

3 Slides at tompeters.com

4 Palo Alto/ Silicon Valley/

5 Bedrock/Transformations Bedrock/Transformations ***Gold Rush (California Dream, bet the farm, immigrants, entrepreneurs, optimists, latecomer-start afresh/1850-SF) entrepreneurs, optimists, latecomer-start afresh/1850-SF) ***Union Pacific Railroad (Chinese labor) ***WWII (return via Golden Gate Bridgeimmigrant state) ***Stanford (Sterling) (3 of 10 worldwide) ***Defense ***San Francisco flower children ***Reagan, Schwarzenegger (entrepreneur, immigrant, optimist) ***HP (electronic tools) ***Semiconductors (Shockley, Fairchild Semi-conductor) ***3000 Sand Hill Road (WORLDs largest concentration of VCs) ***Memory chips (Intel, AMD) ***ICs (Intels 180-degree flip)) ***Computers/Big (HP, Sun) ***Computers/Small (Apple) ***Consumer stuff (Atari) ***Biotech (Stanford, UCSF, CA, Genentech) ***Software/Big (Oracle) ***Software/All ***Software/Search (Netscape, Yahoo, Google) ***Green/Energy

6 ***Can giant enterprises maintain competitiveness? What are the competitiveness? What are the limits to scale (e.g., Is a GE limits to scale (e.g., Is a GE too big to manage, or still a too big to manage, or still a paragon of RADICAL paragon of RADICAL DECENTRALIZATION?)? DECENTRALIZATION?)? ***MIXED MODEL = Productive-"winning economy: Giants and SMEs. economy: Giants and SMEs. ***Think, in particular, MITTELSTAND (Remember: Germany is #1 exporter!) (Remember: Germany is #1 exporter!) ***Critical mass in several population centers, each a little different. each a little different. ***Toward an "entrepreneurial society" CHINA (ALIBABA.COM, 32M OF 40M) and INDIA [and USA] (ALIBABA.COM, 32M OF 40M) and INDIA [and USA] "get it,' Japan doesn't. (YUNUS: "get it,' Japan doesn't. (YUNUS: entrepreneurial flair widespread if entrepreneurial flair widespread if encouraged.) encouraged.)

7 Mr. Foster and his McKinsey colleagues collected detailed performance data stretching back 40 years for 1,000 U.S. companies. They found that none of the long-term survivors managed to outperform the market. Worse, the longer companies had been in the database, the worse they did. Financial Times

8 ***Can giant enterprises maintain competitiveness? What are the limits to scale competitiveness? What are the limits to scale (e.g., Is a GE too big to manage, or still a (e.g., Is a GE too big to manage, or still a paragon of RADICAL DECENTRALIZATION?)? paragon of RADICAL DECENTRALIZATION?)? ***MIXED MODEL = Productive-"winning economy: Giants and SMEs. economy: Giants and SMEs. ***Think, in particular, MITTELSTAND (Remember: Germany is #1 exporter!) (Remember: Germany is #1 exporter!) ***Critical mass in several population centers, each a little different. each a little different. ***Toward an "entrepreneurial society" CHINA (ALIBABA.COM, 32M OF 40M) and INDIA [and USA] (ALIBABA.COM, 32M OF 40M) and INDIA [and USA] "get it,' Japan doesn't. (YUNUS: "get it,' Japan doesn't. (YUNUS: entrepreneurial flair widespread if entrepreneurial flair widespread if encouraged.) encouraged.)

9 Germany #1 : Mittelstand !!

10 ***Can giant enterprises maintain competitiveness? What are the limits to scale competitiveness? What are the limits to scale (e.g., Is a GE too big to manage, or still a (e.g., Is a GE too big to manage, or still a paragon of RADICAL DECENTRALIZATION?)? paragon of RADICAL DECENTRALIZATION?)? ***MIXED MODEL = Productive-"winning economy: Giants and SMEs. economy: Giants and SMEs. ***Think, in particular, MITTELSTAND (Remember: Germany is #1 exporter!) (Remember: Germany is #1 exporter!) ***Critical mass in several population centers, each a little different. each a little different. ***Toward an "entrepreneurial society" CHINA (ALIBABA.COM, 32M OF 40M) and INDIA [and USA] (ALIBABA.COM, 32M OF 40M) and INDIA [and USA] "get it,' Japan doesn't. (YUNUS: "get it,' Japan doesn't. (YUNUS: entrepreneurial flair widespread if entrepreneurial flair widespread if encouraged.) encouraged.)

11 ***Toward a "creative society long term "economic value- long term "economic value- added starts at AGE 6 in added starts at AGE 6 in the classroom. the classroom. ***CULTURAL STIGMA MUST BE REMOVED FROM FAILURESMALL OR GRAND. FROM FAILURESMALL OR GRAND. ***Extraordinary role of RESEARCH UNIVERSITIES; nexus of research UNIVERSITIES; nexus of research universities-funds sources. universities-funds sources. ***SILICON VALLEY: Big and SME; critical mass; mfg and cool; incredible diversity; mass; mfg and cool; incredible diversity; venture money, legal resources; university venture money, legal resources; university (3 of worlds Top 10); attitude; tolerance (3 of worlds Top 10); attitude; tolerance for failure. for failure. ***Cornerstone of creative society: DIVERSITY! (Of every sort.) DIVERSITY! (Of every sort.)***Immigrants!

12 Every child is born an artist. The trick is to remain an artist. Picasso

13 Human creativity is the ultimate economic resource. The Creative Age is a wide-open game. Richard Florida, The Rise of the Creative Class

14 ***Toward a "creative societylong term "economic value-added starts at AGE 6 in "economic value-added starts at AGE 6 in the classroom. the classroom. ***CULTURAL STIGMA MUST BE REMOVED FROM FAILURE REMOVED FROM FAILURE SMALL OR GRAND. SMALL OR GRAND. ***Extraordinary role of RESEARCH UNIVERSITIES; nexus of research UNIVERSITIES; nexus of research universities-funds sources. universities-funds sources. ***SILICON VALLEY: Big and SME; critical mass; mfg and cool; incredible diversity; mass; mfg and cool; incredible diversity; venture money, legal resources; university venture money, legal resources; university (3 of worlds Top 10); att-i-tude; tolerance (3 of worlds Top 10); att-i-tude; tolerance for failure. for failure. ***Cornerstone of creative society: DIVERSITY! (Of every sort.) DIVERSITY! (Of every sort.)***Immigrants!

15 Maybe not enough fail. Whenever you fail, it means youre trying new things. McKenna: A lot of companies in the Valley fail. Noyce:Maybe not enough fail. McKenna: What do you mean by that? Noyce: Whenever you fail, it means youre trying new things. Source: Fast Company

16 The secret of fast progress is inefficiency, fast and furious and numerous failures. The Silicon Valley of today is built less atop the spires of earlier triumphs than upon the rubble of earlier debacles. The secret of fast progress is inefficiency, fast and furious and numerous failures. Kevin Kelly The Silicon Valley of today is built less atop the spires of earlier triumphs than upon the rubble of earlier debacles. Newsweek/Paul Saffo

17 IN SILICON VALLEY … IF YOU ARE NOT STOLEN AWAY BY SOME COMPANY EVERY FEW YEARS (OR MONTHS) … YOU ARE NOT CONSIDERED A HOT PROPERTY. STABILITY IS A MARK OF SHAME. Source: Juan Enriquez/As the Future Catches You

18 ***Toward a "creative societylong term "economic value-added starts at AGE 6 in "economic value-added starts at AGE 6 in the classroom. the classroom. ***CULTURAL STIGMA MUST BE REMOVED FROM FAILURESMALL OR GRAND. FROM FAILURESMALL OR GRAND. ***Extraordinary role of RESEARCH UNIVERSITIES; nexus of research UNIVERSITIES; nexus of research universities-funds sources. universities-funds sources. ***SILICON VALLEY: Big and SME; critical mass; mfg and cool; incredible diversity; mass; mfg and cool; incredible diversity; venture money, legal resources; university venture money, legal resources; university (3 of worlds Top 10); attitude; tolerance (3 of worlds Top 10); attitude; tolerance for failure. for failure. ***Cornerstone of creative society: DIVERSITY! (Of every sort.) DIVERSITY! (Of every sort.)***Immigrants!

19 ***Toward a "creative societylong term "economic value-added starts at AGE 6 in "economic value-added starts at AGE 6 in the classroom. the classroom. ***CULTURAL STIGMA MUST BE REMOVED FROM FAILURESMALL OR GRAND. FROM FAILURESMALL OR GRAND. ***Extraordinary role of RESEARCH UNIVERSITIES; nexus of research UNIVERSITIES; nexus of research universities-funds sources. universities-funds sources. ***SILICON VALLEY: Big and SME; critical mass; mfg and cool; incredible diversity; mass; mfg and cool; incredible diversity; venture money, legal resources; university venture money, legal resources; university (3 of worlds Top 10); att-i-tude; tolerance (3 of worlds Top 10); att-i-tude; tolerance for failure. for failure. ***Cornerstone of creative society: DIVERSITY! (Of every society: DIVERSITY! (Of every sort.) sort.)***Immigrants!

20 U.S. Historical Strength: Invest in Creativity *Foster new industries *Free & open society *Investment higher ed, R & D, culture *Immigrants (# 1!) Source: Richard Florida, The Rise of the Creative Class

21 Creativity Index: The 3 Ts: T echnology (HT Index/firms & $$$, Innovation Index/patent growth) T alent (% with bachelors degrees+) T olerance (Melting Pot Index/foreigners, Bohemian Index/artists et al., Gay Index/rel. #s) Source: Richard Florida, The Rise of the Creative Class Creativity Index: The 3 Ts: T echnology (HT Index/firms & $$$, Innovation Index/patent growth) T alent (% with bachelors degrees+) T olerance (Melting Pot Index/foreigners, Bohemian Index/artists et al., Gay Index/rel. #s) Source: Richard Florida, The Rise of the Creative Class

22 ***RICH VARIETY OF FINANCING SOURCES, from angels to big banks. from angels to big banks. ***Active IP bar; CYBER WARFARE capability. *** PRODUCTIVITY (AND INNOVATION) IS A 100% PROPOSITION, from 3-person A 100% PROPOSITION, from 3-person business to giant. business to giant. *** "Best workforce" applies as much to small service companies as to big small service companies as to big manufacturers. manufacturers. ***Innovation applies to SERVICE SECTOR as much as manufacturing (every aspecte.g. much as manufacturing (every aspecte.g. design) design) ***Manufacturing companies gravitate toward/race toward "SERVICES ADDED" as toward/race toward "SERVICES ADDED" as principal revenue-growth sourcethe case of principal revenue-growth sourcethe case of GE (!!), IBM, United Technologies and others. GE (!!), IBM, United Technologies and others.

23 ***RICH VARIETY OF FINANCING SOURCES, from angels to big banks. from angels to big banks. ***Active IP bar; CYBER WARFARE capability. ***PRODUCTIVITY (AND INNOVATION) IS A 100% PROPOSITION, from 3-person business 100% PROPOSITION, from 3-person business to giant. to giant. ***"Best workforce" applies as much to small service companies as to big manufacturers. service companies as to big manufacturers. ***Innovation applies to SERVICE SECTOR as much as manufacturing (every aspecte.g. much as manufacturing (every aspecte.g. design) design) ***Manufacturing companies gravitate toward/race toward "SERVICES toward/race toward "SERVICES ADDED" as principal revenue-growth ADDED" as principal revenue-growth sourcethe case of GE (!!), IBM, HP, sourcethe case of GE (!!), IBM, HP, United Technologies and others. United Technologies and others.

24 IB M : $60B

25 HP + Style + EDS

26 We want to be the air traffic controllers of electrons.* Bob Nardelli, GE Power Systems (10% to 50%+ in about 5 years) *Immelt: Environment, Energy, Healthcare– Systems Integrator

27 UTC/Otis + UTC/ Carrier: boxes to integrated building systems

28 THE GIANT STALKING BIG OIL: How Schlumberger Is Rewriting the Rules of the Energy Game.: IPM [Integrated Project Management] strays from [Schlumbergers] traditional role as a service provider and moves deeper into areas once dominated by the majors. CEO: just about anything an oilfield owner would want, from drilling to production Source: BusinessWeek cover story, January 2008

29 UPS wants to take over the sweet spot in the endless loop of goods, information and capital that all the packages [it moves] represent. ecompany.com (E.g., UPS Logistics manages the logistics of 4.5M Ford vehicles, from 21 mfg. sites to 6,000 NA dealers)UPS wants to take over the sweet spot in the endless loop of goods, information and capital that all the packages [it moves] represent. ecompany.com (E.g., UPS Logistics manages the logistics of 4.5M Ford vehicles, from 21 mfg. sites to 6,000 NA dealers)

30 *** Only a small fraction of manufacturing workers work at manufacturing. workers work at manufacturing. ***Innovation is a product of PRODUCER-USER INTERACTION (service companies as INTERACTION (service companies as sophisticated usersthink UPS, FedExare as sophisticated usersthink UPS, FedExare as important as producers); much of it local. important as producers); much of it local. (Bhidé.) (Bhidé.) ***Innovation in government servicesa significant part of economic growth. significant part of economic growth. ***THE WORLD IS NOT ENTIRELY "FLAT." (ABBs 125 of 300,000.) (ABBs 125 of 300,000.) ***The "DESIGN ADVANTAGEan essential source of value- added. essential source of value- added. ***Equal innovation mandate in 100% of the firm (HR, IS, Logistics, etc.) (HR, IS, Logistics, etc.)

31 ***Only a small fraction of manufacturing workers work at manufacturing. workers work at manufacturing. ***Innovation is a product of PRODUCER- USER INTERACTION (service USER INTERACTION (service companies as sophisticated users companies as sophisticated users think UPS, FedExare as important as think UPS, FedExare as important as producers); much of it local. (Bhidé.) producers); much of it local. (Bhidé.) ***Innovation in government servicesa significant part of economic growth. significant part of economic growth. ***THE WORLD IS NOT ENTIRELY "FLAT." (ABBs 125 of 300,000.) (ABBs 125 of 300,000.) ***The "DESIGN ADVANTAGEan essential source of value- added. essential source of value- added. ***Equal innovation mandate in 100% of the firm (HR, IS, Logistics, etc.) (HR, IS, Logistics, etc.)

32 Sustainable Innovation: Systemic. Very complex. The NECESSARY COMBINATION (very dense network) of EVERYTHING from the development of the Basic Science to numerous INTERMEDIATE Stages to Sales Recruiting and Training and Ads. Essential: Clever and numerous AGGRESSIVE CONSUMERS (venturesome consumption). Path to success or failure … UNPREDICTABLE. FYI: The World is NOT FLAT. World is NOT FLAT. Source: Amar Bhidé, The Venturesome Economy: How Innovation Sustains Prosperity in a More Connected World

33 Sustainable Innovation: Systemic. Very complex. The COMBINATION (very dense network) of EVERYTHING from the Basic Science * to Sales Recruiting and Training and Ads. Essential: Clever and numerous PIONEER CONSUMERS (venturesome consumption). Path to success or failure … UNPREDICTABLE. from the Basic Science * to Sales Recruiting and Training and Ads. Essential: Clever and numerous PIONEER CONSUMERS (venturesome consumption). Path to success or failure … UNPREDICTABLE. *Of modest value [& origin mostly irrelevant] unless the ENTIRE INNOVATION CHAIN is in place and aggressively interacting-competing. irrelevant] unless the ENTIRE INNOVATION CHAIN is in place and aggressively interacting-competing. Source: Amar Bhidé, The Venturesome Economy: How Innovation Sustains Prosperity in a More Connected World Innovation Sustains Prosperity in a More Connected World

34 ***Only a small fraction of manufacturing workers work at manufacturing. workers work at manufacturing. ***Innovation is a product of PRODUCER-USER INTERACTION (service companies as INTERACTION (service companies as sophisticated usersthink UPS, FedExare as sophisticated usersthink UPS, FedExare as important as producers); much of it local. important as producers); much of it local. (Bhidé.) (Bhidé.) ***Innovation in government servicesa significant part of economic growth. significant part of economic growth. ***THE WORLD IS NOT ENTIRELY "FLAT." (ABBs 125 of 300,000.) (ABBs 125 of 300,000.) ***The "DESIGN ADVANTAGEan essential source of value- added. essential source of value- added. ***Equal innovation mandate in 100% of the firm (HR, IS, Logistics, etc.) (HR, IS, Logistics, etc.)

35 ***The essential role of the LOCAL CONSUMER. (The U.S. consumer CANNOT BE/WILL NOT BE (The U.S. consumer CANNOT BE/WILL NOT BE the engine of Asian growth!) the engine of Asian growth!) ***"New" marketplace demographics: Primary purchasers (Europe, North America, purchasers (Europe, North America, Japan, etc.) are Women and "Boomers"+ Japan, etc.) are Women and "Boomers"+ (members of the aging population). (members of the aging population). ***Maintaining Korea's historic "BIAS FOR ACTION (success factor #1 from ACTION (success factor #1 from In Search of Excellence). In Search of Excellence). ***Commitment to EXCELLENCE as national attribute- "brand" (think Germany-mfg, Italy- attribute- "brand" (think Germany-mfg, Italy- design). (I repeat: such a commitment applies design). (I repeat: such a commitment applies to 100% of the work force and to every to 100% of the work force and to every enterprise.) enterprise.)

36 ***The current economic situation does not change the fundamentals of this not change the fundamentals of this necessary strategic, tectonic shift. necessary strategic, tectonic shift. DISRUPTIVE TECHNOLOGIES ARE DISRUPTIVE TECHNOLOGIES ARE PICKING UP STEAMFLURRIES OF PICKING UP STEAMFLURRIES OF ACTIVITY, BUBBLES, ACTIVITY, BUBBLES, CONSOLIDATIONS, ETC WILL BE THE CONSOLIDATIONS, ETC WILL BE THE NORM FOR THE FORSEEABLE FUTURE!. NORM FOR THE FORSEEABLE FUTURE!. ***AS CREATIVE NEEDS GROW WIDESPREAD ENTREPRENEURSHIP WIDESPREAD ENTREPRENEURSHIP WILL BE A REQUISITE FOR WILL BE A REQUISITE FOR TRANSFORMATION-SUCCESS. TRANSFORMATION-SUCCESS.


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