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Introduction To Culture & Art Contents Converged Industry           1


Introduction To Culture & Art Contents Converged Industry

Chosun University



Contents CHAPTER 1. Introduction to Culture & Art Contents Industry | 11 CHAPTER 2. Domestic and International Trends in Culture & Art Contents Industry | 49 CHAPTER 3. High-Touch Service | 83 CHAPTER 4. Creative Thinking: Innovative Products | 113 CHAPTER 5. Creative Thinking: Design | 137 CHAPTER 6. Creative Thinking: Imagination & Evolution |161 CHAPTER 7. Paradigm Shift | 189 CHAPTER 8. Professionalism | 235 CHAPTER 9. Craftsmanship | 263 CHAPTER 10. Crisis and Crisis Management | 281 CHAPTER 11. Convergence & Interdisciplinary Collaboration | 321 CHAPTER 12. Entrepreneurship in Culture & Art Contents Industry | 365 CHAPTER 13. Domestic and International Marketing in Culture & Art Contents Industry | 395 CHAPTER 14. Real World Practice: Interview | 463



Background Since the year of 2000, our living environment has been rapidly changed around digital culture. In industry, manufacturing-based industry now faded away, and service-based contents industry has become the most influential industry in this new millennium. Communication technologies have been improved dramatically over the last few years and produced innovative communication tools that change how we experience media. Especially, in this so-called “smart era,” we now experience and consume most media contents online via smart, or mobile devices. Mobile devices have been extensions of our human body in terms of living “smart life.” Thus, it is inevitable for various industries to be re-configured around mobile devices. For instance, highly valuable contents created by medical, education, and entertainment industries will be converged with highly sensual contents created by culture and art industries, and it is not hard for us to find true value in these converged industries. In other words, it is inevitable for different disciplines and industries to be converged to yield more valuable contents. Throughout various researches, it is believed that there are much needs to have a book to teach converged industry in higher education. Yet, there are not many books available to discuss about these important topics stated above. Thus, this proposed book will equip students with necessary knowledge and skill sets to participate in this high profit yielding industry. Also, this book will allow students to have more options on choosing the profession after they graduate and will be a pipeline of workforce for converged industry. This book will be consisting of theory and practice. Under the guidance of real experts in field, students will plan their own project and execute it through prototyping. As student’s learning outcome, students will produce professional quality portfolio with their own projects, and this portfolio will benefit them to apply for a job or to start their own start-up business.

Need for This Book Project-based learning throughout workshop mimics the real-world situation. Students are required to review the challenge, brainstorm the idea, plan accordingly, and execute it right to solve the problem. It will benefit students enormously since students have to utilize their creativity critically to do the problem solving. Also, to materialize their creative solution, they gain clinical knowledge required by real industries, and these hands-on experiences benefit students to understand expectations from the industry. Another benefit from this project-based learning is that students will learn how to make fast adjustments to adapt rapidly changing digital/service industry. Also, it will give students flexibility to understand globalization and diversity in current industry. Recently, it has been understood that higher-education and industry must work together to make better seamless transition from school to work force, 7

and this book will provide students right experience with theory and practice. Furthermore, this book will bridge school and work force to establish the right model between them.

Objectives for This Book This book combines theory and practice. Various theories required understanding converged field would be discussed. For practice, projectbased learning will be utilized in workshop setting. Throughout the book, students will review the challenge and plan accordingly and then, execute it with professionalism. While materializing their plan, students will learn prototyping and user testing. As student outcome, students will have book portfolio that includes student projects from the book.


Introduction To Culture & Art Contents Converged Industry

Chosun University



Chapter I. Introduction to Culture & Art Contents Industry

<Fig. 1. 1. Times Square advertisement of “Visit Korea” campaign and Bibimbap. A digital advertisement for bibimbap, a Korean dish of rice mixed with vegetables, is shown next to the “Visit Korea” in Times Square, New York during December of 2012. The ad was shown 500 times until January of 2013. It was created by Kyeongduk Seo, a professor at Sungshin Women’s University, and funded by singer Jang-hoon Kim.> <In this chapter…> 1. Key concepts and terminologies a. Culture b. Art c. Contents Creation d. Culture & Art Contents e. Culture & Art Contents Industry f. Cultural Products g. Cultural Technology, CT h. Advanced Cultural Technology Industry i. Service j. Service Industry k. Social Network Service l. Social Commerce m. Pro-sumer n. High Touch Industry 2. Domestic and International Trends in Culture & Art Contents Industry a. Culture & Art Contents Industry as highly influential and profitable industry b. Prediction for Culture & Art Contents Industry in near future c. Examples: Smart App, Medical, Education, Film, Performance, and Military Industries


What is it and why it matters? According to international organizations such as UNESCO and the General Agreement on Tariffs and Trade (GATT), culture & art contents industries combine the creation, production, and distributing of goods and services that are cultural and artistic in nature and usually projected by intellectual property rights. The notion of culture & art contents industries generally includes textual, music, television, and film production and publishing, as well as crafts and design. For some countries, architecture, the visual and performing arts, sports, advertising, and cultural tourism may be included as adding value to the content and generating values for individuals and societies. They are knowledge-based and labor-intensive, creating employment and wealth. By nurturing creativity and fostering innovation, societies will maintain cultural diversity and enhance economic performance. Culture & art contents industries worldwide have adapted to the new digital technologies and to the arrival of national, regional and international regulatory policies. These factors have radically altered the context in which cultural goods, services, and investments flow between countries and, consequently, these industries have undergone a process of internationalization and progressive concentration, resulting in the formation of a few big conglomerates: a new global oligopoly. The contents industry is often considered as an umbrella term that encompasses companies owning and providing mass media and media metadata. This can include music and movies, text publications of any kind, ownership of standards, geographic data, and metadata about all and any of the above. In the information age, the content industry comprises an enormous market. In this book, culture & art contents industries refer the fields of industries that offer contents evolved from specific culture and art disciplines. Also, these contents created should be distributed massively through mass production. In other words, products of culture & art contents industries are consumed by consumers via mass media in mass scale. 1. Key Concepts & Terminologies No matter what subject area you study, it’s important to understand basic concepts and terminologies. Especially, it’s critical for anyone who participates in the discussion of culture & art contents industry to use the same vocabularies since this is a relatively new field of study. Often, people talk about the same object with different names, and it’s extremely confusing to anyone who studies the subject. Thus, it’s required matching key concepts with unified terminologies. a. Culture <What is culture?> 12

The word culture has many different meanings. For some it refers to an appreciation of good literature, music, art, and food. For a biologist, it is likely to be a colony of bacteria or other microorganisms growing in a nutrient medium in a laboratory Petri dish. However, for anthropologists and other behavioral scientists, culture is the full range of learned human behavior patterns. The term was first used in this way by the pioneer English Anthropologist Edward B. Tylor in his book, Primitive Culture, published in 1871. Tylor said that culture is "that complex whole which includes knowledge, belief, art, law, morals, custom, and any other capabilities and habits acquired by man as a member of society." Of course, it is not limited to men. Women possess and create it as well. Since Tylor's time, the concept of culture has become the central focus of anthropology. Culture is a powerful human tool for survival, but it is a fragile phenomenon. It is constantly changing and easily lost because it exists only in our minds. Our written languages, governments, buildings, and other man-made things are merely the products of culture. They are not culture in themselves. For this reason, archaeologists cannot dig up Edward B. Tylor culture directly in their excavations. The (1832-1917) broken pots and other artifacts of ancient people that they uncover are only material remains that reflect cultural patterns--they are things that were made and used through cultural knowledge and skills. <Layers of Culture> There are very likely three layers or levels of culture that are part of your learned behavior patterns and perceptions. Most obviously is the body of cultural traditions that distinguish your specific society. When people speak of Italian, Samoan, or Japanese culture, they are referring to the shared language, traditions, and beliefs that set each of these peoples apart from others. In most cases, those who share your culture do so because they acquired it as they were raised by parents and other family members who have it.


The second layer of culture that may be part of your identity is a subculture. In complex, diverse societies in which people have come from many different parts of the world, they often retain much of their original cultural traditions. As a result, they are likely to be part of an identifiable subculture in their new society. The shared cultural traits of subcultures set them apart from the rest of their society. Examples of easily identifiable subcultures in the United States includes ethnic groups such as Vietnamese Americans, African Americans, and Mexican Americans. Members of each of these subcultures share a common identity, food tradition, dialect or language, and other cultural traits that come from their common ancestral background and experience. As the cultural differences between members of a subculture and the dominant national culture blur and eventually disappear, the subculture ceases to exist except as a group of people who claim a common ancestry. That is generally the case with German Americans and Irish Americans in the United States today. Most of them identify themselves as Americans first. They also see themselves as being part of the cultural mainstream of the nation.

These Cuban American women in Miami, Florida have a shared subculture identity that is reinforced through their language, food, and other traditions

The third layer of culture consists of cultural universals. These are learned behavior patterns that are shared by all of humanity collectively. No matter where people live in the world, they share these universal traits. Examples of such "human cultural" traits. Examples of such â&#x20AC;&#x153;human culturalâ&#x20AC;? traits include: 1. communicating with a verbal language consisting of a limited set of sounds and grammatical rules for constructing sentences 14

2. using age and gender to classify people (e.g., teenager, senior citizen, woman, man) 3. classifying people based on marriage and descent relationships and having kinship terms to refer to them (e.g., wife, mother, uncle, cousin) 4. raising children in some sort of family setting 5. having a sexual division of labor (e.g., menâ&#x20AC;&#x2122;s work versus womenâ&#x20AC;&#x2122;s work) 6. having a concept of privacy 7. having rules to regulate sexual behavior 8. distinguishing between good and bad behavior 9. having some sort of boy ornamentation 10. making jokes and playing games 11. having art 12. having some sort of leadership roles for the implementation of community decisions. While all cultures have these and possibly many other universal traits, different cultures have developed their own specific ways of carrying out or expressing them. For instance, people in deaf subcultures frequently use their hands to communicate with sign language instead of verbal language. However, sign languages have grammatical rules just as verbal ones do. <Culture and Society> Culture and society are not the same thing. While cultures are complexes of learned behavior patterns and perceptions, societies are groups of interacting organisms. People are not the only animals that have societies. Schools of fish, flocks of birds, and hives of bees are societies. In the case of humans, however, societies are groups of people who directly or indirectly interact with each other. People in human societies also generally perceive that their society is distinct from other societies in terms of shared traditions and expectations. While human societies and cultures are not the same thing, they are inextricably connected because culture is created and transmitted to others in a society. Cultures are not the product of lone individuals. They are the continuously evolving products of people interacting with each other. Cultural patterns such as language and politics make no sense except in terms of the interaction of people. If you were the only human on earth, there would be no need for language or government. <Is Culture Limited to Humans?> This is a difference of opinion in the behavioral sciences about whether or not we are the only animal that creates and uses 15

culture. The answer to this question depends on how narrow culture is defined. If it is used broadly to refer to a complex of learned behavior patterns, then it is clear that we are not alone in creating and using culture. Many other animal species teach their young what they themselves learned in order to survive. This is especially true of the chimpanzees and other relatively intelligent apes and monkeys. Wild chimpanzee mothers typically teach their children about several hundred food and medicinal plants. Their children also have to learn about the dominance hierarchy and the social rules within their communities. As males become teenagers, they acquire hunting skills from adults. Females have to learn how to nurse and care for their babies. Chimpanzees even have to learn such basic skills as how to perform sexual intercourse. This knowledge is not hardwired into their brains at birth. They are all learned patterns of behavior just as they are for humans.

Non-human culture? This orangutan mother is using a specially prepared stick to "fish out" food from a crevice. She learned this skill and is now teaching it to her child who is hanging on her shoulder and intently watching.

b. Art <What is Art?> Art is a diverse range of human activities and the products of those activities. Visual arts include the creation of images or objects in the fields, including, but not limited to, painting, sculpture, printmaking, photography, and other visual media. Architecture is often included as one of the visual arts; however, like the decorative arts, it involves the creating of objects where the practical considerations of use are essential â&#x20AC;&#x201C; in a way that they are usually not for a painting, for example. Music, theatre, film, dance, and other performing arts, as well as literature, and other media such as interactive media are included in a broader definition of art or the arts.


Until the 17th century, art referred to any skill or mastery and was not differentiated from crafts or sciences, but in modern usage the fine arts, where aesthetic considerations are paramount, are distinguished from acquired skills in general, and the decorative or applied arts. Art has been characterized in terms of mimesis, expression, communication of emotion, or other values. During the Romantic period, art came to be seen as â&#x20AC;&#x153;a special faculty of the human mind to be classified with religion and science. Though the definition of what constitutes art is disputed and has changed over time, general descriptions mention an idea of human agency and creation through imaginative or technical skill. The nature of art, and related concepts such as creativity and interpretation, are explored in a branch of philosophy known as aesthetics. <Forms, Genres, Media, and Styles> The creative arts are often divided into more specific categories, each related to its technique, or medium, such as decorative arts, plastic arts, performing arts, or literature. Unlike scientific fields, art is one of the few subjects that are academically organized according to technique. An artistic medium is the substance or material the artistic work is made from, and may also refer to the technique used. For example, paint is a medium used in painting, and paper is a medium used in drawing. An art form is the specific shape, or quality an artistic expression takes. The media used often influence the form. For example, the form of a sculpture must exist in space in three dimensions, and respond to gravity. The constraints and limitations of a particular medium are thus called its formal qualities. To give another example, the formal qualities of painting are the canvas texture, color, and brush texture. The formal qualities of video games are non-linearity, interactivity and virtual presence. The form of a particular work of art is determined by the formal qualities of the media, and is not related to the intentions of the artist or the reactions of the audience in any way whatsoever as these properties are related to content rather than form. A genre is a set of conventions and styles within a particular medium. For instance, well recognized genres in film are western, horror, and romantic comedy. Genres in music include death metal, and hip-hop. Genres in painting include still life and pastoral landscape. A particular work of art may bend or combine genres, but each genre has a recognizable group of conventions, clichĂŠs and tropes. 17

The style of an artwork, artist, or movement is the distinctive method and form followed by the respective art. Any loose brushy, dripped or poured abstract painting is called expressionistic. Often a style is linked with a particular historical period, set of ideas, and particular artistic movement. So Jackson Pollock is called an abstract expressionist. A particular style may have specific cultural meanings. For example, Roy Lichtenstein – a painter associated with the American Pap art movement of the 1960s – was not a pointillist, despite his use of dots. Lichtenstein used evenly spaced Ben-Day dots (the type used to reproduce color in comic strips) as a style to question the “high” art of painting with the “low” art of comics, thus commenting on class distinctions in culture. Pointillism, a technique in late Impressionism (1880s) developed especially by the artist George Seurat, employs dots to create variation in color and depth in an attempt to approximate the way people really see color. Both artist use dots, but the particular style and technique relate to the artistic movement adopted by each artist. There are all ways of beginning to define a work of art, to narrow it down. "Imagine you are an art critic whose mission is to compare the meanings you find in a wide range of individual artworks. How would you proceed with your task? One way to begin is to examine the materials each artist selected in making an object, image video, or event. The decision to cast a sculpture in bronze, for instance, inevitably effects its meaning; the work becomes something different from how it might be if it had been cast in gold or plastic or chocolate, even if everything else about the artwork remains the same. Next, you might examine how the materials in each artwork have become an arrangement of shapes, colors, textures, and lines. These, in turn, are organized into various patterns and compositional structures. In your interpretation, you would comment on how salient features of the form contribute to the overall meaning of the finished artwork. [But in the end] the meaning of most artworks... is not exhausted by a discussion of materials, techniques, and form. Most interpretations also include a discussion of the ideas and feelings the artwork engenders.” <Purpose of Art> Art has had a great number of different functions throughout its history, making its purpose difficult to abstract or quantify to any single concept. This does not imply that the purpose of Art is "vague", but that it has had many unique, different reasons for being created. Some of these functions of Art are provided in the following outline. The different purposes of art may be grouped 18

according to those that are non-motivated, and those that are motivated (Lévi-Strauss). c. Contents Creation <What is Content?> In media production and publishing, content is information and experiences that may provide value for an end-user/audience in specific contexts. Content may be delivered via any medium such as the Internet, television, and audio CDs, as well as live events such as conferences and stage performances. The word is used to identify and quantify various formats and genres of information as manageable value-adding components of useful media to the target audience. <Terminology> The word “content” is often used colloquially to refer to media. However, content is more accurately used as a specific term in that it means the content of the medium rather than the medium itself. Likewise, the single word, “media” and some compound words that include “media” (e.g. multimedia, hypermedia) are instead referring to a type of content. An example of a type of content commonly referred to as a type of media is a “motion picture” referred to as a film. The distinction between medium and content is less clear when referring to interactive elements that contain information and are then contained in interactive media, such as dice contained in board games or GUI widgets contained in software. <Content Value> The author, producer or publisher of an original source of information or experiences may or may not be directly responsible for the entire value that they attain as content in a specific context. For example, part of an original article (such as a headline from a news story) may be rendered on another web page displaying the results of a user's search engine query grouped with headlines from other news publications and related advertisements. The value that the original headline has in this group of query results may be very different from the value that it had in its original article. It is possible for a person to derive their own value from content in ways that the author didn't plan or imagine. User innovation makes it possible for users to develop their own content from existing content.


Not all information content requires creative authoring or editing. Through recent technological developments such as mobile phones and automated sensors that can record events anywhere for publishing and converting to potentially reach a global audience on channels such as YouTube, most recorded or transmitted information and experiences, can be deemed content. <Technological Effects On Content> Media production and delivery technology may potentially enhance the value of content by formatting, filtering and combining original sources of content for new audiences with new contexts. The greatest value for a given source of content for a specific audience is often found through such electronic reworking of content as dynamic and real-time as the trends that fuel its interest. Less emphasis on value from content stored for possible use in its original form, and more emphasis on rapid repurposing, reuse, and redeployment has led many publishers and media producers to view their primary function less as originators and more as transformers of content. Thus, one finds out that institutions, that used to focus on publishing printed materials, are now publishing both databases and software to combine content from various sources for a wider-variety of audiences. <Criticism> While marketing and media interests have broadly adopted the term "content," public reaction has been less enthusiastic. The word is rarely used in conversation, and some individuals actively object to the term. The objections are spread across a considerable spectrum: some complain about the term's inherent ambiguity, others assert that the term devalues the work of authors, and still others argue that it overemphasizes the work of authors. d. Culture & Art Contents Industry, or Creative Industries <What is it?> The creative industries refers to a range of economic activities which are concerned with the generation or exploitation of knowledge and information. They may variously also be referred to as the cultural industries (especially in Europe) or the creative economy. Howkins' creative economy comprises advertising, architecture, art, crafts, design, fashion, film, music, performing arts, 20

publishing,R&D, software, toys and games, TV and radio, and video games. Some scholars consider that education industry, including public and private services, is forming a part of creative industry. There remain, therefore, different definitions of the sector.Yet so far Howkins has not been internationally recognized. The creative industries have been seen to become increasingly important to economic well-being, proponents suggesting that "human creativity is the ultimate economic resource," and that â&#x20AC;&#x153;the industries of the twenty-first century will depend increasingly on the generation of knowledge through creativity and innovation." <Definition of the Creative Industries> Various commentators have provided varying suggestions on what activities to include in the concept of "creative industries," and the name itself has become a contested issue - with significant differences and overlap between the terms "creative industries", "cultural industries" and "creative economy." Lash and Urry suggest that each of the creative industries has an "irreducible core" concerned with "the exchange of finance for rights in intellectual property." This echoes the UK Government Department for Culture, Media and Sport definition which describes the creative industries as: "those industries which have their origin in individual creativity, skill and talent and which have a potential for wealth and job creation through the generation and exploitation of intellectual property." As of 2006 the DCMS definition recognizes twelve creative sectors (down from fourteen in their 2001 document), namely: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12.

advertising architecture arts and antique markets crafts design (see also communication design) designer fashion film, video and photography software, computer games and electronic publishing music and the visual and performing arts publishing television radio


("Film and video" became "film, video and photography"; "music" and "performing arts" merged to form "music and the visual and performing arts"; "interactive leisure software" combined with "computer services" to form "software, computer games and electronic publishing".) To this list John Howkins would add toys and games, also including the much broader area of research and development in science and technology. It has also been argued that gastronomy belongs in such a list. Hesmondhalgh reduces the list to what he terms "the core cultural industries" of advertising and marketing, broadcasting, film, internet and music industries, print and electronic publishing, and video and computer games. His definition only includes those industries that create "texts"' or "cultural artefacts" and which engage in some form of industrial reproduction. The DCMS list has proven influential, and many other nations[which?] have formally adopted it. It has also been criticised. It has been argued[by whom?] that the division into sectors obscures a divide between lifestyle business, non-profits, and larger businesses, and between those who receive state subsidies (e.g., film) and those who do not (e.g., computer games). The inclusion of the antiques trade often comes into question, since it does not generally involve production (except of reproductions and fakes). The inclusion of all computer services has also been questioned. Some nations, such as Hong Kong, have preferred to shape their policy around a tighter focus on copyright ownership in the value chain. They adopt the WIPO's classifications, which divide up the creative industries according to who owns the copyrights at various stages during the production and distribution of creative content. Others have suggested a distinction between those industries that are open to mass production and distribution (film and video; videogames; broadcasting; publishing), and those that are primarily craft-based and are meant to be consumed in a particular place and moment (visual arts; performing arts; cultural heritage). <Properties or Characteristics of Creative Industries> According to Caves, creative industries are characterized by seven economic properties:


1. Nobody knows principle: Demand uncertainty exists because the consumers' reaction to a product are neither known beforehand, nor easily understood afterward. 2. Art for artâ&#x20AC;&#x2122;s sake: Workers care about originality, technical professional skill, harmony, etc. of creative goods and are willing to settle for lower wages than offered by 'humdrum' jobs. 3. Motley crew principle: For relatively complex creative products (e.g., films), the production requires diversely skilled inputs. Each skilled input must be present and perform at some minimum level to produce a valuable outcome. 4. Infinite variety: Products are differentiated by quality and uniqueness; each product is a distinct combination of inputs leading to infinite variety options (e.g., works of creative writing, whether poetry, novel, screenplays or otherwise). 5. A list/B list: Skills are vertically differentiated. Artists are ranked on their skills, originality, and proficiency in creative processes and/or products. Small differences in skills and talent may yield huge differences in (financial) success. 6. Time flies: When coordinating complex projects with diversely skilled inputs, time is of the essence. 7. Ars longa: Some creative products have durability aspects that invoke copyright protection, allowing a creator or performer to collect rents. The properties described by Caves have been criticized for being too rigid. Not all creative workers are purely driven by 'art for art's sake'. The 'ars longa' property also holds for certain noncreative products (i.e., licensed products). The 'time flies' property also holds for large construction projects. Creative industries are therefore not unique, but they score generally higher on these properties relative to non-creative industries. <Differences from the Cultural industries> There is often a question about the boundaries between creative industries and the similar term of cultural industries. Cultural industries are best described as an adjunct-sector of the creative industries. Cultural industries include industries that focus on cultural tourism andheritage, museums and libraries, sports and outdoor activities, and a variety of 'way of life' activities that arguably range from local pet shows to a host of hobbyist concerns. Thus cultural industries are more concerned about delivering other kinds of valueâ&#x20AC;&#x201D;including cultural wealth and


social wealth—rather than primarily providing monetary value. (See also cultural institutions studies.) e. Cultural Products Culture plays a very important role to survive in present civilization. In every race and caste this culture is really very important. Every generation has its own culture and this culture varies from time to time. Through culture we can recognize a person. Artists are mainly the savior of our cultural products. These products are mainly classified in four basic components. These are mainly artistic product itself; spin off products, related services and consumer’s experience of the product. The very first component is the central product. It is the work by itself which is mainly created by an individual creator or by a team of work creators. An organization or a market is the one where the work is mainly done by inviting customers to come in contact with creative artists’ labor. In this respect, there are mainly three aspects which are involved around the central component. These aspects are mainly spinning off products, related services and consumer’s experience including attached to the product. There are some organizations which consider these components which are integral to the work and make decision by concerning them. These components are generally left in the discretion of marketing director. Cultural products are important for representing culture of a particular community or race. Each and every country must have its own culture that can represent their race and tradition to the people of the world. Culture is really very important to survive in this world. In today’s civilized world, having culture is quite important. In this world, we find various races of people and their different culture. Each culture is having its products. For maintaining culture these types of products are really very important. These products are really very important for establishing one’s own culture. People may come to know different things from this culture. We people should try hard to maintain our culture whole heartedly. Culture is not static. It is dynamic. Cultural people are called as civilized people. Culture is having certain basic characteristics. The very first characteristic is that culture is learned. Second characteristic is that culture is shaped by group of people. The third characteristic is that culture is cumulative. We can earn some knowledge from this culture and can pass it on from one generation to next. All these are the main characteristics of culture.


Thus cultural products are really very important in defining culture. To get more information about these products of culture, you can take the help of internet. There are many online sites through we can gather information about it and we will also learn how we can maintain our culture. f. Cultural Technology, CT <What is it?> Cultural technology, or CT, is a concept popularized by Lee Sooman, founder of the South Korean music label and talent agency S. M. Entertainment. It is a 3-step process of exporting K-Pop overseas as part of the Korean wave. <Background> During a speech at the Stanford Graduate School of Business in 2011, Lee claimed that he coined the term "Cultural technology" about fourteen years ago, when S.M. decided to launch its artists and cultural content throughout Asia. He also mentioned that although the age of information technology had dominated most of the nineties, he had predicted that the age of "Cultural technology" would come next. Despite Lee's relatively recent claims that he coined the term, the abstract concept of cultural technology (CT) as a type of content-based industry was introduced in Korean academic circles in the late 1990s by Kwangyun Wohn, a computer scientist who later founded the Graduate School of Culture Technology at KAIST. Cultural technology has also been one of the 6 "technology" initiatives of the South Korean government since 2001 [the other 5 T's are information technology (IT), biotechnology (BT), nanotechnology (NT), environmental/energy technology (ET), and space technology (ST)}. The South Korean government supports these six industries through policies and R&D investment among others because the country lacks in natural resources. In regards to cultural technology, the Korean wave or hallyu, is considered one of the most successful outcomes of government support towards exports of Korean entertainment products. <Three Step Process> Training process Step one involves scouting for trainees via global auditions. After screening a few selected applicants, the company operates the simulation of how the voice and the appearance of the trainees 25

would change in three to seven years. Then, they go through the company’s nurturing system called "In-house training". According to The Wall Street Journal, S.M. Entertainment and other South Korean entertainment management companies have created a systematic process to train singers and dancers in its groups. In many cases, would-be idols enter the system at age nine or ten and live together in a house under tight rules. They attend school during the day and take singing and choreography classes at night.[8] After going through years of training, it is hoped that these artists would break into foreign music markets, especially Japan and the West. Along with Lee's SM Entertainment, the South Korean record label YG Entertainment has also developed a type of cultural technology that is minutely controlled. Singers are recruited while in their teens, and then trained for years, rigorously schooled in singing and dancing. About 10 per cent will end up with a successful debut record, alongside a team of bandmates who have been carefully selected to make up the ideal line-up of "attractive faces." International collaborations Step two involves expanding the presence of K-Pop musicians in overseas music markets by teaming up with local entertainment companies and organizing virtual concerts outside South Korea. Joint ventures Finally, joint ventures would then be forged with these local companies. According to a blog post published by the Harvard Business Review, "Cultural technology" even goes so far as to assign foreign composers, producers, and choreographers to be used for certain songs to expand the cultural outreach. “One of the elements of CT ["Cultural technology"] is our training system. Through auditions, we discover hidden talent and put them through three to seven years of music, dance, and acting training in order to create a star that’s close to perfection.” Lee Soo-Man, the founder of S. M. Entertainment g. Advanced Cultural Technology Industry <Recent Trends> Cultural Technology has been rapidly changed with advanced media technologies. Now, this cultural technology industry is 26

moving forward with advance technologies such as smart TV and wearable computers. This, itâ&#x20AC;&#x2122;s widely understood that there will be more need for new contents to feed these new devices. Currently, interactive TV, 4D films, optical Internet and multiplex theatres are the results from advanced cultural technology industry, and with improved technology, need for contents has been dramatically increased. h. Service <What is it?> In economics, a service is an intangible commodity. That is, services are an example of intangible economic goods. Service provision is often an economic activity where the buyer does not generally, except by exclusive contract, obtain exclusive ownership of the thing purchased. The benefits of such a service, if priced, are held to be self-evident in the buyer's willingness to pay for it. Public services are those, that society (nation state, fiscal union, regional) as a whole pays for, through taxes and other means. By composing and orchestrating the appropriate level of resources, skill, ingenuity, andexperience for effecting specific benefits for service consumers, service providers participate in an economy without the restrictions of carrying inventory (stock) or the need to concern themselves with bulky raw materials. On the other hand, their investment in expertise does require consistent service marketing and upgrading in the face of competition. <Characteristics> Services can be paraphrased in terms of their key characteristics, sometimes called the "Five I's of Services." 1. Intangibility Services are intangible and insubstantial: they cannot be touched, gripped, handled, looked at, smelled, tasted. Thus, there is neither potential nor need for transport, storage or stocking of services. Furthermore, a service can be (re)sold or owned by somebody,but it cannot be turned over from the service provider to the service consumer. Solely, the service delivery can be commissioned to a service provider who must generate and render the service at the distinct request of an authorized service consumer. 27

2. Inventory (Perishability) Services have little or no tangible components and therefore cannot be stored for a future use. Services are produced and consumed during the same period of time. Services are perishable in two regards â&#x20AC;˘The service relevant resources, processes and systems are assigned for service delivery during a definite period in time. If the designated or scheduled service consumer does not request and consume the service during this period, the service cannot be performed for him. From the perspective of the service provider, this is a lost business opportunity as he cannot charge any service delivery; potentially, he can assign the resources, processes and systems to another service consumer who requests a service. Examples: The hair dresser serves another client when the scheduled starting time or time slot is over. An empty seat on a plane never can be utilized and charged after departure. â&#x20AC;˘ When the service has been completely rendered to the requesting service consumer, this particular service irreversibly vanishes as it has been consumed by the service consumer. Example: the passenger has been transported to the destination and cannot be transported again to this location at this point in time. 3. Inseparability The service provider is indispensable for service delivery as he must promptly generate and render the service to the requesting service consumer. In many cases the service delivery is executed automatically but the service provider must preparatorily assign resources and systems and actively keep up appropriate service delivery readiness and capabilities. Additionally, the service consumer is inseparable from service delivery because he is involved in it from requesting it up to consuming the rendered benefits. Examples: The service consumer must sit in the hair dresser's shop & chair or in the plane & seat; correspondingly, the hair dresser or the pilot must be in the same shop or plane, respectively, for delivering the service. 4. Inconsistency (Variability) Each service is unique. It is one-time generated, rendered and consumed and can never be exactly repeated as the point in time, location, circumstances, conditions, current configurations and/or assigned resources are different for the next delivery, even if the same service consumer requests the same service. Many 28

services are regarded as heterogeneous or lacking homogeneity and are typically modified for each service consumer or each new situation (consumerised). Example: The taxi service which transports the service consumer from his home to the opera is different from the taxi service which transports the same service consumer from the opera to his home â&#x20AC;&#x201C; another point in time, the other direction, maybe another route, probably another taxi driver and cab. 5. Involvement One of the most important Characteristic of services is the participation of the customer in the service delivery process. A customer has the opportunity to get the services modified according to specific requirement. Each of these characteristics is retractable per se and their inevitable coincidence complicates the consistent service conception and make service delivery a challenge in each and every case. Proper service marketing requires creative visualization to effectively evoke a concrete image in the service consumer's mind. From the service consumer's point of view, these characteristics make it difficult, or even impossible, to evaluate or compare services prior to experiencing the service delivery. Mass generation and delivery of services is very difficult. This can be seen as a problem of inconsistent service quality. Both inputs and outputs to the processes involved providing services are highly variable, as are the relationships between these processes, making it difficult to maintain consistent service quality. For many services there is labor intensity as services usually involve considerable human activity, rather than a precisely determined process; exceptions include utilities. Human resource management is important. The human factor is often the key success factor in service economies. It is difficult to achieve economies of scale or gain dominant market share. There are demand fluctuations and it can be difficult to forecast demand. Demand can vary by season, time of day, business cycle, etc. There is consumer involvement as most service provision requires a high degree of interaction between service consumer and service provider. There is a customer-based relationship based on creating long-term business relationships. Accountants, attorneys, and financial advisers maintain long-term relationships with their clientes for decades. These repeat consumers refer friends and family, helping to create a clientbased relationship.


<Service Definition> The generic clear-cut and complete, concise and consistent definition of the service term reads as follows: A service is a set of one time consumable and perishable benefits •

• •

• •


delivered from the accountable service provider, mostly in close coaction with his internal and external service suppliers, effectuated by distinct functions of technical systems and by distinct activities of individuals, respectively, commissioned according to the needs of his service consumers by the service customer from the accountable service provider, rendered individually to an authorized service consumer at his/her dedicated trigger, and, finally, consumed and utilized by the triggering service consumer for executing his/her upcoming business activity or private activity.

Service industry <What is it?> An industry made up of companies that primarily earn revenue through providing intangible products and services. Service industry companies are involved in retail, transport, distribution, food services, as well as other service-dominated businesses. Also called service sector, tertiary sector of industry. <Tertiary Sector of the Economy> The tertiary sector of the economy (also known as the service sector or the service industry) is one of the three economic sectors, the others being the secondary sector(approximately the same as manufacturing) and the primary sector (agriculture, fishing, and extraction such as mining). <Service Sector> The service sector consists of the "soft" parts of the economy, i.e. activities where people offer their knowledge and time to improve productivity, performance, potential, and sustainability, what is termed affective labor. The basic characteristic of this sector is the production of services instead of end products. Services (also known as "intangible goods") include attention, advice, access, experience, and discussion. The production of information is 30

generally also regarded as a service, but some economists now attribute it to a fourth sector, the quaternary sector. The tertiary sector of industry involves the provision of services to other businesses as well as final consumers. Services may involve the transport, distribution and sale of goods from producer to a consumer, as may happen in wholesaling and retailing, or may involve the provision of a service, such as in pest control or entertainment. The goods may be transformed in the process of providing the service, as happens in the restaurant industry. However, the focus is on people interacting with people and serving the customer rather than transforming physical goods. For the last 100 years, there has been a substantial shift from the primary and secondary sectors to the tertiary sector in industrialized countries. This shift is called tertiarisation. The tertiary sector is now the largest sector of the economy in the Western world, and is also the fastest-growing sector. In examining the growth of the service sector in the early Nineties, the globalist Kenichi Ohmae noted that: "In the United States 70 percent of the workforce works in the service sector; in Japan, 60 percent, and in Taiwan, 50 percent. These are not necessarily busboys and live-in maids. Many of them are in the professional category. They are earning as much as manufacturing workers, and often more.â&#x20AC;? j.

Social Network Service, SNS <What is it?> A social networking service is a platform to build social networks or social relations among people who, for example, share interests, activities, backgrounds, or real-life connections. A social network service consists of a representation of each user (often a profile), his/her social links, and a variety of additional services. Most social network services are web-based and provide means for users to interact over the Internet, such as e-mail and instant messaging. Online community services are sometimes considered as a social network service, though in a broader sense, social network service usually means an individual-centered service whereas online community services are group-centered. Social networking sites allow users to share ideas, pictures, posts, activities, events, and interests with people in their network. The main types of social networking services are those that contain category places (such as former school year or classmates), means to connect with friends (usually with self31

description pages), and a recommendation system linked to trust. Popular methods now combine many of these, with Americanbased services such as Facebook, Google+, tumblr and Twitter widely used worldwide; Nexopiain Canada; Badoo, Bebo, VKontakte, Delphi (online service) (also called Delphi Forums), (mostly in Latvia), Hi5, Hyves (mostly in The Netherlands), iWiW (mostly in Hungary), Nasza-Klasa, Soup (mostly in Poland), Glocals in Switzerland, Skyrock,The Sphere, StudiVZ (mostly in Germany), Tagged, Tuenti (mostly in Spain), and XING in parts of Europe; Hi5 and Orkut in South America and Central America; Mxit in Africa; and Cyworld, Mixi, Orkut, renren, weibo and Wretch in Asia and the Pacific Islands. There have been attempts to standardize these services to avoid the need to duplicate entries of friends and interests (see the FOAFstandard and the Open Source Initiative[clarification needed]). A 2011 survey found that 47% of American adults use a social networking service. <History>

The potential for computer networking to facilitate newly improved forms of computer-mediated social interaction was suggested early on. Efforts to support social networks via computer-mediated communication were made in many early online services, includingUsenet, ARPANET, LISTSERV, and bulletin board services (BBS). Many prototypical features of social networking sites were also present in online services such as 32

America Online, Prodigy, CompuServe, ChatNet, and The WELL. Early social networking on theWorld Wide Web began in the form of generalized online communities such as (1995), Geocities (1994) and Many of these early communities focused on bringing people together to interact with each other through chat rooms, and encouraged users to share personal information and ideas via personal webpages by providing easy-to-use publishing tools and free or inexpensive webspace. Some communities - such as - took a different approach by simply having people link to each other via email addresses. In the late 1990s, user profiles became a central feature of social networking sites, allowing users to compile lists of "friends" and search for other users with similar interests. New social networking methods were developed by the end of the 1990s, and many sites began to develop more advanced features for users to find and manage friends. This newer generation of social networking sites began to flourish with the emergence of in 1997, followed by Makeoutclub in 2000, Hub Culture and Friendster in 2002, and soon became part of the Internet mainstream. Friendster was followed by MySpace and LinkedIna year later, and eventually Bebo. Attesting to the rapid increase in social networking sites' popularity, by 2005, it was reported thatMySpace was getting more page views than Google. Facebook, launched in 2004, became the largest social networking site in the world in early 2009. <Social Impact> Web-based social networking services make it possible to connect people who share interests and activities across political, economic, and geographic borders. Through e-mail and instant messaging, online communities are created where a gift economy and reciprocal altruism are encouraged through cooperation. Information is particularly suited to gift economy, as information is a nonrival good and can be gifted at practically no cost. Facebook and other social networking tools are increasingly the object of scholarly research. Scholars in many fields have begun to investigate the impact of social-networking sites, investigating how such sites may play into issues of identity, privacy, social capital,youth culture, and education. Several websites are beginning to tap into the power of the social networking model for philanthropy. Such models provide a means for connecting otherwise fragmented industries and small organizations without the resources to reach a broader audience with interested users. Social networks are providing a different way for individuals to communicate digitally. These communities of 33

hypertexts allow for the sharing of information and ideas, an old concept placed in a digital environment. In 2011, HCL Technologies conducted research that showed that 50% of British employers had banned the use of social networking sites/services during office hours.

k. Social Commerce <What is it?> Social commerce is a subset of electronic commerce that involves using social media, online media that supports social interaction, and user contributions to assist in the online buying and selling of products and services. More succinctly, social commerce is the use of social network(s) in the context of e-commerce transactions. The term social commerce was introduced by Yahoo! in November 2005 to describe a set of online collaborative shopping tools such as shared pick lists, user ratings and other usergenerated content-sharing of online product information and advice.


The concept of social commerce was developed by David Beisel to denote user-generated advertorial content on e-commerce sites, and by Steve Rubel to include collaborative e-commerce tools that enable shoppers "to get advice from trusted individuals, find goods and services and then purchase them". The social networks that spread this advice have been found to increase the customer's trust in one retailer over another. Today, the area of social commerce has been expanded to include the range of social media tools and content used in the context of e-commerce, especially in the fashion industry. Examples of social commerce include customer ratings and reviews, user recommendations and referrals, social shopping tools (sharing the act of shopping online), forums and communities, social media optimization, social applications and social advertising. Technologies such as Augmented Reality have also been used with social commerce, allowing shoppers to visualize apparel items on themselves and solicit feedback through social media tools. Some academics have sought to distinguish "social commerce" from "social shopping", referring to social commerce as collaborative networks of online vendors, and social shopping as collaborative activity of online shoppers. <The 6 Câ&#x20AC;&#x2122;s of Social Commerce> Discussed at the 2011 BankInter Foundation for Innovation conference on Social Technologies were the 6 C's of Social Technologies. This references the original 3 C's of E-Commerce and adds 3 new C's to update for an era of Social sharing. Content â&#x20AC;&#x201C; The basic need to engage with customers, prospects and stakeholders through valuable published content on the web. Early examples of this were the brochure sites for organizations and this has matured into a vast and growing body of material being published in real time onto the web. Google is the organization that has been at the forefront of indexing and making findable content on the web. Community â&#x20AC;&#x201C; Treating the audience as a community with the objective of building sustainable relationships by providing tangible value. Early incarnations of Community were mobilized through registration and engaged via email programs, this evolved into online forums, chat-rooms and membership groups where users were able to interact with each other, an early example being Yahoo! Groups. Social Networks are the latest incarnation of community and of the many networks Facebook is


the leading organization providing the platform for interpersonal interactions. Commerce – Being able to fulfill customers' needs via a transactional web presence, typically online retailers, banks, insurance companies, travel sales sites provide the most useful business-to-consumer services. Business-to-business sites range from online storage and hosting to product sourcing and fulfillment services. Amazon emerged in the 90's and has gone on to dominate the B2C commerce space extending its services beyond traditional retail commerce. Context – The online world is able to track real-world events and this is primarily being enabled by mobile devices. An online bill payment via Google Checkout or a checkin at a physical location via Facebook or Foursquare links a real world event to an online data entity such as a business or a place. This is a vital element to Social Commerce where the data is now available to organizations wishing to provide products and services to consumers. Connection – The new online networks are defining and documenting the relationships between people – these relationships may originate in the physical world or online and may manifest in the other as a result of a connection in the first. LinkedIn, Facebook, Twitterare prime examples of online networks – Professional, Social and Casual. The relationships, the scope of those relationships and the interactions between individuals are a basis for the actions of Social Commerce. Conversation – The Cluetrain Manifesto noted that all markets are conversations – this may now be reversed for Social Commerce to say that all conversations are markets. A conversation between two parties will likely surface a need that could be fulfilled, thus providing a potential market for supplier organizations. The challenge is for suppliers to be able to tap into those conversations and map those into the range of products and services that they supply. Simple examples of such 'conversations that indicate demand' are where people place objects of desire on their Pinterest board or a 'Like' of an item inside Facebook. Using this structure, organizations wishing to transcend the notions of 'Social Media' (defined as the interaction pathways) and move to true 'Social Commerce' must aim to leverage 'Context, Connection and Conversation' <Elements of Social Commerce>


There are a few elements to keep in mind while utilizing persuasive social commerce effectively. These are: Reciprocity - When a company gives a person something for free, that person will feel the need to return the favor, whether by buying again or giving good recommendations for the company. Community - When people find an individual or a group that shares the same values, likes, beliefs, etc., they find community. People are more committed to a community that they feel accepted within. When this commitment happens, they tend to follow the same trends as a group and when one member introduces a new idea or product, it is accepted more readily based on the previous trust that has been established. It would be beneficial for companies to develop partnerships with social media sites to engage social communities with their products. Social proof - To receive positive feedback, a company needs to be willing to accept social feedback and to show proof that other people are buying, and like, the same things that I like. This can be seen in a lot of online companies such as eBay and Amazon, that allow public feedback of products and when a purchase is made, they immediately generate a list showing purchases that other people have made in relation to my recent purchase. It is beneficial to encourage open recommendation and feedback. This creates trust for you as a seller. 55% of buyers turn to social media when theyâ&#x20AC;&#x2122;re looking for information. Authority - Many people need proof that a product is of good quality. This proof can be based on the recommendations of others who have bought the same product. If there are many user reviews about a product, then a consumer will be more willing to trust their own decision to buy this item. Liking - People trust based on the recommendations of others. If there are a lot of â&#x20AC;&#x153;likesâ&#x20AC;? of a particular product, then the consumer will feel more confident and justified in making this purchase. Scarcity - If a person is convinced that they are purchasing something that is unique, special, or not easy to acquire, they will have more of a willingness to make a purchase. If there is trust established from the seller, they will want to buy these items immediately. This can be seen in the cases of Zara and Apple who create demand for their products by convincing the public that there is a possibility of missing out on being able to purchase them. <Measuring Social Commerce Success> 37

Social Commerce Success can be measured by any of the principle ways to measure social media. Return on Investment (ROI) measures the effect or action of social media on sales. Reputation indices measure the influence of social media investment in terms of changes to online reputation - made up of the volume and valence of social media mentions. Reach metrics use traditional media advertising metrics to measure the exposure rates and levels of an audience with social media. <Notable Social Commerce Sites> • • • • • • • • • • • • • l.

Facebook Groupon Pinterest Polyvore LivingSocial Tabjuice Etsy Cafepress Lockerz OpenSky TheFind ShopSocially

Pro-sumer <What is it?> Prosumer is a portmanteau formed by contracting either the word professional or, less often, producer with the word consumer. For example, a prosumer grade digital camera is a "cross" between consumer grade and professional grade. The term has also taken on multiple meanings in business and economics: the business sector sees the prosumer (professional– consumer) as a market segment, whereas economists see the prosumer (producer–consumer) as having greater independence from the mainstream economy. These differing meanings often describe the same people; consumers unusually interested in the products. It can also be used to differentiate the traditional passive consumer with an active consumer role more involved in


the process, such as activity in the design or customization of the end product. <General Meanings> The term was coined by futurologist Alvin Toffler in 1980. Loosely, Toffler's "proactive consumer" prosumers were common consumers who were predicted to each become active to help personally improve or design the goods and services of the marketplace, transforming it and their roles as consumers. By far the most common usage of the term describes the consumers, enthusiasts who buy products (almost always technical) that fall between professional and consumer grade standards in quality, complexity, or functionality. Prosumer also commonly refers to those products. Semiprofessional. "Prosumer" is a well-accepted category for camcorders, digital cameras, VCRs, "and other video playthings." These advanced product features and higher prosumer expectations lend themselves to increased customizing in Toffler's product-improvement sense. The "producing consumer" prosumer creates goods for their own use and also possibly to sell. Uncommon usage. "Professional consumers" prosumers are excellent, better informed consumers who are buying top-grade or best-value products, or think they are. This group also includes a broader target for marketers and advertisers. According to this attractive hip, young group "are influencing markets all over the globe. Empowered by new technologies and improved access to information, Prosumers are highly knowledgeable and demanding consumers." Uncommon or sarcastic usage; "Americans are prosumers." "I'm a professional "prosumer" and shopaholic." <Producer and Consumer> Marshall McLuhan and Barrington Nevitt suggested in their 1972 book Take Today, that with electric technology, the consumer would become a producer. In the 1980 book, The Third Wave, futurologist Alvin Toffler coined the term "prosumer" when he predicted that the role of producers and consumers would begin to blur and merge (even though he described it in his book Future Shock from 1970). Toffler envisioned a highly saturated marketplace as mass production of standardized products began to satisfy basic consumer demands. To continue growing profit, businesses would initiate a process of mass customization, that is the mass production of highly customized products. 39

However, to reach a high degree of customization, consumers would have to take part in the production process especially in specifyingdesign requirements. In a sense, this is merely an extension or broadening of the kind of relationship that many affluent clients have had with professionals like architects for many decades. Toffler has extended these and many other ideas well into the 21st-century. Along with recently published works such as Revolutionary Wealth, we can recognize and assess both the concept and fact of the prosumer as it is seen and felt on a worldwide scale. That these concepts are having global impact and reach, however, can be measured in part by noting in particular, Toffler's popularity inChina. Discussing some of these issues with Newt Gingrich on C-SPAN's After Words program in June 2006, Toffler mentioned that The Third Wave is the second ranked bestseller of all time in China, just behind a work by Mao Zedong. Don Tapscott reintroduced the concept in his 1995 book The Digital Economy. Despite several decades of usage, the term only recently began to receive full theoretical elaboration. George Ritzer and Nathan Jurgenson, in a widely cited article, claim that prosumption has become a salient characteristic of Web 2.0. Prosumers create value for companies without receiving wages. Mass customization has not taken place in most areas of the economy. Mass customization has ruled the food & beverage industry for years. Look at how many choices we are faced with in the grocery stores and supermarkets. Brand extension and dilution are ways companies have sold more under various names, giving us thousands of choices. Most consumption continues to be passive as critics of television, recorded music, and fast food would argue. Indeed, people are generally uninterested in going to the effort of customizing the myriad products that comprise modern consumer culture. In The Paradox of Choice: Why More is Less, Barry Schwartz argues thatdiminishing returns from a confusing abundance of consumer choice is producing stress and dissatisfaction. Still, one key area of high-customization is taking place: highly involved hobbyists. m. High Touch Industry High Touch Industry is a new concept coined by American futurist John Naisbitt, and offers products, which create high value,


through balance with human sensibility rather than blind pursuit of technological advancement in modern society. 2. Domestic and International Trends in Culture & Art Contents Industry

<Categories in Culture & Art Contents Industry in Korea> <5 Industry Trends Every Creative Team Needs to Understand> At ConceptShare, many of us spend our days working directly with clients to understand their creative operations workflow. Specifically, how they go from Requirements Definition to Design and Iteration to Validation and Approval. By gaining a broad understanding of how they work from A to Z we also see how creative review fits into their overall workflow. We invest a lot of time in learning from our clients because through knowing and understanding we can deliver a better product. Not just features, but a solution that will allow them to streamline their creative review processes and move assets through the production cycle as quickly as possible, producing significant productivity benefits that flow to their bottom lines.

<Keeping up on trends is important!> As we have learned more from our customers we have identified a number of business realities and industry trends that are amplifying the need for smarter creative review processes. These are realities and trends that we see impacting customers across a range of industries 41

from Digital Agencies to Game Studios to Global 2000 Marketing Departments to the Internet Retailer 500. In this new ongoing blog series – Business Realities, Industry Trends and the Rise of Creative Review Workflow – we want to initiate a discussion with marketers, designers, traffic managers and creative operations executives on topics such as: Just In Time Assets Production: assets are being developed by a combination of in-house teams, outsourcers and artists distributed across locations and time zones. This has caused the production environment to start to resemble a complex manufacturing environment. Where campaigns and projects come to a screeching halt if assets don’t show up at the right time and according to spec. Outsourcing: the dual pursuit of talent and lower production costs has been met by the exploding growth of outsourcing. To in-house service bureaus, freelancer networks and 3rd party studios. Where the production of campaigns and projects is increasingly coordinated and delivered through distributed teams. The 24/7 Production Cycle: outsourcing on a global scale and the fact that competition for customers, markets and dollars is a 24/7 game has led to the rise of the 24/7 production cycle. Where work on campaigns and projects is handed off from team to team with the same mindset of an Olympic relay team; get to the finish line as quickly as possible! With the added difficulty of having to hand the baton off across locations, time zones and languages Increased Volume of Assets: a company’s customer market is defined by dozens, hundreds or even thousands of segments who are being targeted through multiple channels. Leading to a significant increase in the volume of assets that need to be produced in a 24/7 production environment. The Economics of Asset Production & The CFO Marketer/Creative Director: The general business environment and all of the trends listed above are merging so that spreadsheets, ROI and other terms usually reserved for CFO locker room talk are now part of the marketer’s and creative director’s daily vocabulary. These individuals are increasingly looking (or being asked to look) at the cost of asset production, ROAR (Return on Asset Resources) and other metrics that are directly tied to getting more assets out the door as quickly as possible. a. Culture & Art Contents Industry as highly influential and profitable industry <Creative Industries connecting the creative dots>


A digital game designer in Cambridge is getting ready to launch a new addictive smartphone game, a furniture designer in Northampton is making showpieces for an upcoming convention, an artist in Haverhill is creating new product lines from his ancient art form, and an author is ready to start on his latest fantasy novel in Boylston. While none of these people know each other and their personal and works paths likely never will cross, they do have one thing in common. They are all part of a sector I love to be a part of, the creative industries – a growing sector full of energy, creativity and ideas. The creative industries sector includes more than 100,000 people pushing the limits of creativity in the marketplace, including our innovative video game companies, design, marketing and architecture firms, and also the people who write books, design houses, shoot movies, make art and record music. In the creative industries we need to find ways to get participants together to look at common issues and find best practices and solutions that will help everyone. We need to become the greater whole that is more than the sum of its parts. Today we become the creative industries. b. Prediction for Culture & Art Contents Industry in near future Examples: Smart App, Medical, Education, Film, Performance, and Military Industries <Exploring The Culture and Creative Industries Debate> The cultural industries – culture as business, often very big business – are the policy-makers pets these days, for obvious reasons. But there are also good reasons, less obvious perhaps but crucial nevertheless, why not-for-profit cultural operators should pay attention to them too. Having just edited a 500-page multi-author volume on ‘the cultural economy’, let me try and explain why. Today, an everincreasing range of symbolic goods and services is being produced and distributed. In the process, the aesthetic has been commodified while the commodity has been aestheticized. While the industrial and the digital mediate practically every cultural process, the segment of the economy that is concerned with such symbolic goods and services mobilizes considerable human, material and technical resources. No wonder that the ‘cultural’ has become a central economic policy issue! Witness the 2006


study The Economy of Culture in Europe done for the European Commission by KEA European Affairs. These developments have also generated the new agenda and discourse of the ‘creative industries.’ The idea of ‘creativity’, that till recently artists had the principal claim on, has been vastly expanded over the last decade. Today, it is applied to a very broad range of activities and professions, many of which are far removed from artistic creation. It is enshrined in the Commission’s 2007 Communication, in which ‘promoting culture as a catalyst for creativity’ is a key strand. But where do we locate ourselves in this ‘creative industries’ agenda? Our activities are neither industrial nor are they forprofit. We’re not arguing here that art and commerce are two opposing worlds, far from it. However, we do want to make the case for engaging with this other world in our own terms. This is the challenge. It has been taken up by analysts who make industry-relevant arguments on behalf of non-industrial, not-forprofit cultural work: our sector is embedded in networks that are interwoven with the creative industries; it develops human capital skills that can be applied in the creative industries and beyond; it includes organisational models and practices that can be used in industry and other domains; it is an attractor of creative individuals and dynamic businesses. Some of these arguments are perhaps overstated. The real problem, though, is less with the ideas themselves and more with the instrumentalizing path they take us down. Do we want to take this path? And surely there are broader reasons to be wary. Should all types of cultural production be justified in terms of economic gain? We may find it tactically useful to use these arguments in our own rhetoric because it is the language policymakers want to hear. The problem though is that this paradigm obliges us to adopt an essentially neo-liberal worldview. Is this what we believe in? These are some of the reasons why it is important to understand the cultural economy and to reflect both on the impacts it has on non-market forms of cultural activity and new relations between the two that affect artistic work. “The idea of ‘creativity’ that till recently artists had the principal claim on has been vastly expanded over the last decade. Today, it is applied to a very broad range of activities and professions, many of which are far removed from artistic creation. "But where do we locate ourselves in this ‘creative industries’ agenda?”


Lying at the crossroads between the arts, business and technology, the creative industries can be defined as â&#x20AC;&#x153;those industries that have their origin in individual creativity, skill and talent and which have a potential for wealth and job creation through the generation and exploitation of intellectual propertyâ&#x20AC;? (UK Creative Industries Task Force, 1997). The sector comprises a large variety of creative fields, from those heavily industrialized such as advertising and marketing, broadcasting, film industries, Internet and mobile content industry, music industries, print and electronic publishing, video and computer games to those less industrialized like the traditional fields of visual arts (painting, sculpture), performing arts (theatre, opera, concerts, and dance), museums and library services. Other creative activities include the crafts, fashion, design industry and household objects. They might also include architecture, cultural tourism, and even sport. They are knowledge-based and labor-intensive, creating employment and wealth. By nurturing creativity and fostering innovation, societies hope both to maintain cultural diversity and to enhance economic performance. For international organizations such as the UNESCO and GATT, cultural industries (sometimes also known as "creative industries") combine the creation, production, and distribution of goods and services that are cultural in nature and usually protected by intellectual property rights. The creative industries represent already a leading sector of the economy in the OECD countries, with an annual growth rates between 5 and 20 percent. The sector is increasingly important for the knowledge-based economy as it is knowledge and labor intensive and fosters innovation; it has a huge potential for generation of employment and export expansion.


Websites to Look @: Invest Korea

Invest Korea: Gwangju


Resources: Housing and Economic Development (State of Massachusetts)



Chapter II. Domestic and International Trends in Culture & Art Contents Industry

<Fig. 2. 1. Red Devils and Korean National Soccer Team on 2002 World Cup. Koreaâ&#x20AC;&#x2122;s unconventional cheering culture has been populated all over the world and now leads a new cheering tradition in all types of sports. Although the main goal of Korean National Soccer Team for 2002 World Cup is playing soccer, it generates much revenue to create various contents. As observed from Korean National Soccer Team and 2002 World Cup, there are many ways to generate profit by creating profitable contents, > <In this chapterâ&#x20AC;Ś> 1. Domestic and International Industrial Trends a. Consumer-Driven Market b. Changes in Market c. High Touch Service Industry Commercializing Cultural Experience d. Paradigm of Future Industry e. Converged Industry 2. Domestic and International Markets for Culture & Art Contents Industry a. Size of the Market for Culture & Art Contents Industry b. Markets Categorized for 4 Biggest Genres in Culture & Art Contents Industry in 2009


10 Pop Culture Trends that Defined the Decade Celebrity is no longer reserved for the select few that walk red carpet and get stalked by paparazzi. The era of social celebrity is here and continues to draw attention. A recent CBC News post by Greig Dymond highlighted 10 terrific examples of this trend — where, thanks to social media, anyone among us can reach celebrity status. “This was the decade when everyone became a celebrity. Well, almost everyone. The past 10 years didn’t invent the concept of celebrity; they just broadened the definition of the term to a ridiculous extent. More people than ever have achieved some minor level of notoriety. As the film The Truman Show shrewdly predicted back in 1998, voyeurism and technology are the twin engines that propelled this shift. Just ask Richard Heene, now-famous (and infamous) father of the “balloon boy.” His story — a twisted amalgam of reality TV, famewhoring, all-news channel coverage and breathless tweets — couldn’t have happened in quite the same way 10 years ago. The lines between entertainment, personal narrative and news have become irrevocably blurred.” Here are what he lists as the 10 pop culture trends that shaped the decade. 1. Reality TV 2. YouTube and the art of the viral video 3. Celebrity gawking, 21st-century style 4. The iPod killed the CD star 5. Newspapers in jeopardy 6. Auto-Tune 7. Twitter, Facebook and the explosion of social media 8. The rise of U.S. cable dramas 9. Guitar Hero/Rock Band 10. The rise of “fake news” <Key Issues of the Culture / Creative Industry> By means of an online survey, the ISM students analyzed the market of the culture/creative industry in the Ruhr metropolis. On the one hand, this analysis was meant to check on industry development and employment situation of the culture/creative industry in the Ruhr and evaluate the current status. On the other hand, the intention was to present strategic targets within the industry and to filter out future trends. Key issues The online survey, sent to ca. 6000 companies of the regional culture/creative 50

industry, dealt with the following issues: 1. Will the Ruhr become an increasingly important area for the culture/creative industry? 2. Is the general positive economic recovery also perceivable in the culture/creative industry in the Ruhr â&#x20AC;&#x201C; and if yes, which impact does it have? 3. Will the culture/creative industry in the Ruhr become an increasingly important employer? 4. Which priorities and trends are considered especially important for the culture/creative industry, and which differences between the various industries do exist? 5. What kind of supportive measures are necessary for the further development of the culture/creative industry? Itâ&#x20AC;&#x2122;s inevitable to struggle and deal with various issues in culture & art contents industry, especially when you deal with creativity. However, itâ&#x20AC;&#x2122;s more important to be prepared and get to know various approaches to successfully overcome any obstacles in business world. 1. Domestic and International Industrial Trends a. Consumer-Driven Market <Customer-Driven Marketing Listening to Who's Really Calling the Shots - Your Customer > Do you know what your customers experience when they walk through your door or call your customer hotline? Do your employees put your customers first? If you don't know the answers to these questions, it's unlikely that you're conducting customer-driven marketing. Customer-driven marketing involves seeing your products or services from your customer's perspective and communicating your messages in the customer's language. This approach goes beyond traditional textbook branding and positioning, which are driven by the marketer, to getting an outside-in perspective and designing a marketing strategy that is driven by the customer's needs. The key to obtaining an outside-in perspective lies in conducting beneath-the-surface customer and employee research. The Psychology of Customer-Driven Marketing


My training and experience in psychology emphasized working to understand my clients' experiences in their daily lives. What is it like to be him or her, to live within that marriage or to work in that job? In addition, what factors in the client's life contribute to a system that has resulted in the current situation? What will it take to make some changes? This experiential approach led to the creation of our three-step process for developing effective customer-driven marketing: 1. What do your customers experience? 2. What's it like to be your employee? 3. What systemic factors contribute to maintaining the current condition? (And what's it going to take to change it?) We include employees in our approach because they are absolutely critical to enabling an organization to meet customer needs. Beyond employees' primary functions, they also serve another vital role â&#x20AC;&#x201D; they are advocates for the brand. Supporting employees so they are equipped and motivated to promote the organization at every point of contact may be one of the most important and effective ingredients in building market share. Simply put, engaged and motivated employees who understand the brand and where it is going translate to happy customers. After all, an organization can devote unlimited advertising proclaiming that it is customer-focused, but nothing conveys this more clearly than how the customer service employee or receptionist answers the phone. Take A Close Look Customer-driven marketing understands customers as people making decisions based on their needs and frames of reference rather than as consumers defined by media habits and demographics. The process involves taking a close look at the customers and employees who have a relationship with your product or service and developing a marketing strategy and messages that are credible, compelling and differentiating. For example, the following insights obtained from our market research were invaluable to the development of an effective customer-driven marketing approach: â&#x20AC;˘

Women are more comfortable thinking about a prescription creme that reduces wrinkles as a cosmetic. The idea of needing to apply the creme regularly is more acceptable if they think of it like coloring their hair rather than taking a prescription drug long-term. This understanding led to the public relations launch of Johnson & Johnson's Renova at 52

department store cosmetic counters staffed by personable dermatologists rather than a more traditional medical product introduction. â&#x20AC;˘

Mango consumers feel so passionately about their favorite fruit's distinct flavor that they actually crave it. Yet in the U.S., only one in three customers has ever tasted a mango because many aren't familiar with how to select, cut and prepare one. Knowing about mango's many healthful benefits as well as learning how to select and cut mangos and use recipes for cooking with them reinforces the more emotional appeal of the fruit and invites people to try it. Mangos from Mexico's web site, marketing materials and knowledgeable merchandising representatives therefore communicate both mangos' powerful imagery as well as very practical information about preparation.


Jim Beam drinkers associate their brand with bonding among friends, their great interest in the outdoors and a tradition of enjoying their favorite bourbon that began, for many, with their fathers. This comprehension resulted in the creation of the brand's Kentucky Bourbon Circle association that now numbers 80,000 premium bourbon drinkers who enjoy a newsletter and tasting events led by bourbon experts who address their interests.

Case Study â&#x20AC;&#x201D; Improving Customer Service The following case study shows how our three-step process led to understanding both customers and employees and development of a systemic approach to marketing. A major retail chain experiencing a significant downturn in sales retained us to conduct focus groups with consumers about how to improve customer service. Step One: Understanding the Customer Experience Our interviews suggested that receiving good service was a powerful experience for customers. They described doing a double-take when noticing employees communicating in a way that felt genuine. As one customer noted, "At the Ontario store, the person waiting on me was really very friendly. Not just the usual 'thanks for coming'. The way he said it was different. It caught my attention and made me feel like he actually cared. It made me want to come back to that particular store." We used our interviews to drill down and identify the cues of good service to target consumers. "How do you know you're getting 53

good service?" we asked. "And why is that important?" These questions helped us identify that making eye contact, smiling and asking if customers need assistance to their cars suggested that employees care. Unfortunately, customers noted that the service they received was erratic and particularly varied among retail locations. Step Two: Understanding the Employee Experience Clearly, a customer service training program was needed for employees. But before developing the program, we conducted research to understand the employee experience to ensure that the training would provide the support they needed. It was no surprise to learn that training varied dramatically between store locations because store managers viewed the time involved as lost income, creating a system that didn't encourage employee training. Employees who didn't receive training felt embarrassed and ashamed that they couldn't be more helpful to customers. As one explained, "They put me on the register right away during the holiday rush and I didn't know how it worked. Customers were yelling at was awful." Step Three: Understanding the System On the other hand, employees who had received training and engaged in good service behaviors reported feeling valued by their customers. Feeling valued, in turn, led to employees feeling proud to work for the chain and, for some, even aspiring to remain with the company and become a manager. Overall, customer reactions to good service were also a strong reinforcer for employees. The commitment and ambition of properly trained employees supported a system that encouraged further training. Understanding both the customer and employee experience for this organization was invaluable for developing an effective program to improve service delivery. The input from employees was instrumental in presenting the benefits of properly training employees to their store managers and gaining their support. With improved service, this business has experienced a dramatic rebound, with double digit sales increases. Customer-driven marketing helps organizations cut through the clutter and meet the bottom line of the people that matter most â&#x20AC;&#x201D; the ones paying for the product or service. b. Changes in Market <4 Factors That Shape Market>


Trends are what allow traders and investors to capture profits. Whether on a short- or long-term time frame, in an overall trending market or a ranging environment, the flow from one price to another is what creates profits and losses. There are four major factors that cause both long-term trends and short-term fluctuations. These factors are governments, international transactions, speculation and expectation, and supply and demand. Major Market Forces Learning how these major factors shape trends over the long term can provide insight into why certain trends are developing, why a trend is in place and how future trends may occur. Here are the four major factors: Governments Governments hold much sway over the free markets. Fiscal and monetary policy have a profound effect on the financial marketplace. By increasing and decreasing interest rates the government and Federal Reserve can effectively slow or attempt to speed up growth within the country. This is called monetary policy. If government spending increases or contracts, this is known as fiscal policy, and can be used to help ease unemployment and/or stabilize prices. By altering interest rates and the amount of dollars available on the open market, governments can change how much investment flows into and out of the country. International Transactions The flow of funds between countries impacts the strength of a country's economy and its currency. The more money that is leaving a country, the weaker the country's economy and currency. Countries that predominantly export, whether physical goods or services, are continually bringing money into their countries. This money can then be reinvested and can stimulate the financial markets within those countries. Speculation and Expectation Speculation and expectation are integral parts of the financial system. Where consumers, investors and politicians believe the economy will go in the future impacts how we act today. Expectation of future action is dependent on current acts and shapes both current and future trends. Sentiment indicators are commonly used to gauge how certain groups are feeling about the current economy. 55

Analysis of these indicators as well as other forms of fundamental and technical analysis can create a bias or expectation of future price rates and trend direction. Supply and Demand Supply and demand for products, currencies and other investments creates a push-pull dynamic in prices. Prices and rates change as supply or demand changes. If something is in demand and supply begins to shrink, prices will rise. If supply increases beyond current demand, prices will fall. If supply is relatively stable, prices can fluctuate higher and lower as demand increases or decreases. Effect on Short- and Long-Term Trends With these factors causing both short- and long-term fluctuations in the market, it is important to understand how all these elements come together to create trends. While these major factors are categorically different, they are closely linked to one another. Government mandates impact international transactions, which play a role in speculation, and supply and demand plays a role in each of these other factors. c. High Touch Service Industry Commercializing Cultural Experience <High Touch Service?> High Touch Service is a customer service that is characterized by a high level of personal contact with customers, as opposed to "lowtouch" customer service, which is provided by vending machines, self-service counters, etc. <5 Ways to Create a High-Touch Customer Service Experience> While calling a customer service line recently, I experienced an automation merry-go-round that is all too familiar. Sixteen “press ones” later, a pre-recorded voice told me what I already knew. Frustrated, I called back and hit “zero” for the operator. I waited…until one answered and transferred me to someone’s voicemail. A person was treating me like a computer — I was not impressed. In the age of efficiency, automation is both a blessing and a curse. Knowing that what needs to be done can be done – on time and without misspellings – is reassuring. However, as we speed up with technology, business owners must always maintain the human touch or we’ll forfeit the personal relationships that keep business strong. The best businesses in a given industry are made up of people who, well, like people. 56

At MoldingBox, we try to emphasize giving the client more than a friend: We provide an advocate. The one-on-one interactions work well for everyone involved. Employees aren’t just cogs in a machine. Clients aren’t just the input end of an outcome process; they can choose to be part of the process itself. Conversations aren’t just rote interactions but actual conversations – a rare and wonderful experience in today’s impersonal world of computerprompted questions. Don’t be a used-car salesman. By focusing on a company’s vision and direction, we can remove the pressure of a sales pitch and earn the position of business partner. A clearer path to understanding a client’s goals helps us provide our best solutions to their needs. You never know who your clients know, or who they will talk to about your business and services. Believe me, they talk a lot, more when they have a poor interaction with a company than when they have a great one. If everyone speaks highly about your company you will only get more clients. If everyone speaks poorly it will only drive clients away, and they will take potential ones with them. Don’t forget your manners! Basic manners are part of being personal. Always say please and thank you! Give the client a person to speak with. Day or night, commit to having a human being take the call (or return one promptly) and work to fulfill client needs. Clients will feel respected as individuals. They’re paying for a service, never just a product. They may happily provide further business, and potentially refer other new business, if they feel engaged. Ask real questions. Sincerity is a given, but it’s too important not to mention. “How are you?” isn’t rhetorical. It actually means, “How are you?” The answer will lead to better results. Asking real questions leads to real answers, which is valuable to both parties. In other words, listen. Even the simple act of remembering a nickname, a birthday, or specific preferences will let people know their exchanges aren’t perfunctory. Include an authentic personal touch. By observing how others incorporate the personal touch, we 57

learn better how to implement it ourselves. Some vendors’ email signatures offer glimpses into who they are with humor, by listing their title, company—and their favorite ice cream. By crossing the bounds of business-like interactions, they show us who they are as people. Follow up, like a real person. Handwritten notes resonate so well, my company’s incorporated them into our own correspondence. Small things can have a big impact, so find a few ways to make people feel special. The main point here is to always remember who pays the bills. Your clients are the lifeblood of your company, so do not ever think that you don’t “need” one. Not all clients are a match for you, but do remember that the ones you take on are writing the checks. Staying true to who you are as people helps others feel and respond similarly. This will build brand loyalty, it will build positive word of mouth, and it will simply feel better too. Keeping clients happy, rather than implementing computers and automation for customer service tactics, will provide what no device can: a personal d. Paradigm of Future Industry <The Top 5 Fastest Growing Industries of the Future> Thanks to technological advances and a ubiquitous and urgent concern for the environment, certain industries have grown tremendously over the past couple of decades. However, which ones will continue to form an influential part of global GDP? Whether looking for new industries to invest in, start a business, or simply better understand the direction in which global business is going, here are the five industries we think will continue to grow and exert influence over global markets in the next decades. 1. Voice Over Internet Protocol (VOIP): This is just a fancy way of referring to communications, technologies, and transmissions techniques involved in the delivery of voice communications and multimedia sessions over Internet Protocol (IP) networks, such as the Internet. The continuing spread of 4G networks that allow for mobile ultra-broadband Internet access is creating new opportunities for high-definition mobile TV, video conferencing, 3D television and Cloud Computing. According to IBISWorld’s VoIP report, in the U.S. alone the market has increased 16.7 percent annually over the last five years, generating $15 billion in revenue each year. While Voice Over technologies (such as Google’s 58

Video Chat and applications such as Viber) are free, according to Forbes it is a $15 billion industry. 2. E-Commerce & Online Auctions Sites: Outperforming most retail sectors, customers are becoming more and more accustomed to buying online rather than in person. Companies such as and eBay are already deeply engaged in the industry with an estimated 11.4% of industry revenue in 2012. However, 75% of the market is made up of small companies. According to an estimate by Forrester Research, in 2013 total retail sales made online will increase to 8%, a number that may appear small but only demonstrates the potential for growth. Internet payment systems like PayPal have continued to improve security and ease of transaction, and will only help this industry continue to grow. 3. Biotechnology: As described by Ray Kurzweil at last year’s World Innovation Forum New York, the biotechnology industry has the potential to explode in the next couple of years. Biotechnology uses biological processes in the development or manufacture of a product or in the technological solution to a problem. Although battling with controversy, high R&D costs with little revenue during development years, and serious research restraints due to the global economic situation, in 2011 the biotech industry raised more capital than any time since the genomics bubble of 2000. Fast Company’s list of the Top 10 Most Innovative Biotech Companies of 2012gives reason to suggest that there are plenty of companies taking big leaps in the area. Some examples? Life Technologies developed a sequencing machine, the Ion Proton, which can decode an entire genome for just $1,000. Bug Agentes Biológicos, headquartered in São Paulo, Brazil, has found a way to naturally combat larvae and stink bugs that threaten sugarcane and soybean plants: wasps programmed to target only their natural enemy. 4. Alternative Energies: Due to an increase in world oil prices in recent years, countries are looking for alternative and renewable energy sources. Wind, tidal, and solar power are just a few of the options that countries have begun to research in order to save money and become less dependent on unstable, oil-rich countries. The British media outlet The Guardian has a section dedicated specifically to Renewable energy, and is filled with examples of such efforts. According to the International Energy Association (IEA)renewable energy accounts for a fifth of worldwide electricity production, with massive investments taking place on a global scale in 2012. Although government policy is a factor, the demand for cheaper, cleaner technology isn’t going to go away in the next couple of decades, if anything it is going to increase. In fact, many of the companies that are making the 59

largest developments in renewable energy are well-known: Chevron Energy Solutions has become a leader in energy conservation, geothermal and solar technologies, and are one of the largest developers of solar photovoltaic projects with over 128,000 solar panels installed. Bloomberg announced that General Electric (GE)is targeting annual sales of $100 billion from its energy unit, whose equipment provides more than a quarter of the world’s power, doubling 2011 projected revenue of $45 billion. 5. Social Network Game Development: Thanks to high speed internet, the video game industry has meshed with social networks and created a powerful and highly profitable force. According to a report by IBISWorld, the industry has grown an average of 128% annually since 2002. Jessica Rovello, Co-Founder and President of the online gaming company Arkadium, believes the gaming economy will continue to develop through the sale of items that enhance game-play. However, we aren’t just referring to entertainment such as Angry Birds and Halo, but positive and educational games. Asi Burak, Founder of Games for Change and developer Jane McGonigal discuss the positive impact that games can have on people and society. In 2012 the industry was expected to grow 20%, and over the next five years grow at an average rate of 25%.touch. <How might car-making look 20 years from now?> THE PAST TWO decades have been an exciting time for the motor industry, but not always in a good way. The battle to achieve scale to survive in a global market produced victims as well as winners, and some of the resulting deals were better than others. Toyota’s absorption of Honda in 2027 went surprisingly well, though it cost a Japanese minister his job. VW’s merger with Tata Motors came as something of a surprise, but with hindsight it made sense: it allowed the combined company to claim the crown as the world’s biggest carmaker and take the lead in the booming South Asian market. Fiat-Chrysler’s alliance with Japan’s Suzuki and its Indian partner, Maruti, has proved rather unwieldy and is still not working smoothly. Hyundai-Kia has worked hard at pushing up its share of the market, having mopped up some casualties among Chinese carmakers. China now has its very own car giant, Zhongguo Tongyong Qiche (China General Motors), the majority-owned affiliate of America’s GM that emerged from the messy break-up of joint ventures between Chinese and foreign carmakers in the early 2020s. China General Motors and China People’s Car (the country’s second car company, better known as China Volkswagen) have pleased the government by launching Chinese-branded and –styled cars that are enjoying rising sales across Asia. 60

In the euro zone years of painful restructuring are at last paying off, with GM’s Peugeot-Opel division enjoying a revival. But excess carmaking capacity almost everywhere means that nobody is making much money. Further consolidation looks likely, and not just among car companies. The recent takeover of Ford by IBM follows naturally from the carmaker’s argument that it should be seen primarily as a software and systems-integration firm. But IBM’s plan to sell Ford’s manufacturing operations to Magna, a big components-maker, has fallen through. By the late 2010s battery technology had got so much better that some carmakers lost interest in internal-combustion engines, but they had to think again. The opening up of the vast shale-gas fields across Asia made gas a much more attractive proposition. Since gas is much cleaner to burn than petrol or diesel, many carmakers were able to meet the 2020 targets for carbon-dioxide emissions with relative ease by offering natural-gas hybrids. And breakthroughs in the early 2020s in making methane gas and liquid fuels from bacteria and algae made the even stricter CO2 targets for 2025 much more attainable. Some carmakers are still doggedly working away at hydrogen fuel cells, but these are competitive only in countries where the government has mandated the provision of hydrogen filling stations. Similarly, fully electric cars are predominant only in countries that can produce electricity cheaply, such as nuclearpowered France. The self-driving car took a temporary knock when the mysterious hacking incident of 2023 (which was never resolved) caused a spate of crashes of cars running on autopilot, leading to a flurry of liability suits. Even so, city governments in China pressed ahead with their ban on manual driving on busy arterial roads to cut congestion and accidents. Now the practice is spreading to Western cities. The mayor of Toronto, Justin Bieber, recently pushed through a radical plan to ban all private cars in the city centre and replace all cabs with driverless taxis. Similar moves in California have prompted the creation of the Steering Wheel Club, which defends Americans’ right to drive. It is led by a former lobbyist for the National Rifle Association. Licence not to kill Cars are now considered perfectly safe when piloting themselves in any situation. Even so, lawmakers in most countries have been slow to repeal the laws on driving tests and licences, and in most places the rules still call for at least one sober “driver” sitting in a front seat. But driving tests have been simplified now that there is no longer a need for manual manoeuvring into parking bays. The 61

Silver Riders, a pressure group formed by octogenarian babyboomers, is campaigning to scrap driving licences altogether so that elderly Americans can get around in their self-driving motors no matter what physical shape they are in. The campaign has now become generation-spanning, attracting support from many teenagers who want to skip driving lessons. Ubiquitous on-board systems for monitoring speed limits and other traffic restrictions on every stretch of road have yielded some unexpected savings: highways authorities no longer have to maintain superfluous traffic signs. Britainâ&#x20AC;&#x2122;s Royal Automobile Club recently launched a nostalgia-fuelled drive to exhibit a representative collection of them in a new museum alongside Birminghamâ&#x20AC;&#x2122;s Spaghetti Junction. e. Converged Industry <Technological Convergence> Technological convergence is the tendency for different technological systems to evolve toward performing similar tasks. Convergence can refer to previously separate technologies such as voice (and telephony features), data (and productivity applications), and video that now share resources and interact with each other synergistically. Telecommunications convergence, network convergence or simply convergence are broad terms used to describe emerging telecommunications technologies, and network architecture used to migrate multiple communications services into a single network. Specifically this involves the converging of previously distinct media such as telephony and data communications into common interfaces on single devices. The rise of digital communication in the late 20th century has made it possible for media organizations (or individuals) to deliver text, audio, and video material over the same wired, wireless, or fiber-optic connections. At the same time, it inspired some media organizations to explore multimedia delivery of information. This digital convergence of news media, in particular, was called "Mediamorphosis" by researcher Roger Fidler, in his 1997 book by that name. Today, we are surrounded by a multi-level convergent media world where all modes of communication and information are continually reforming to adapt to the enduring demands of technologies, "changing the way we create, consume, learn and interact with each other." Convergence in this instance is defined as the interlinking of computing and other information technologies, media content, 62

and communication networks that has arisen as the result of the evolution and popularization of the Internet as well as the activities, products and services that have emerged in the digital media space. Many experts view this as simply being the tip of the iceberg, as all facets of institutional activity and social life such as business, government, art, journalism, health, and education are increasingly being carried out in these digital media spaces across a growing network of information and communication technology devices. Also included in this topic is the basis of computer networks, wherein many different operating systems are able to communicate via different protocols. This could be a prelude to artificial intelligence networks on the Internet eventually leading to a powerful superintelligence via a technological singularity. Convergence services, such as VoIP, IPTV, Mobile TV, etc., will replace the old technologies and is a threat to the current service providers. IP-based convergence is inevitable and will result in new service and new demand in the market. When the old technology converges into the public-owned common, IP based services become access-independent or less dependent. The old service is access-dependent. <Definition of Convergence> Siddhartha defines convergence, in his Policy initiative elemmas on Media Covergence: A Cross National Perspective, as integration and digitalization. Integration, here, is defined as "a process of transformation measure by the degree to which diverse media such as phone, data broadcast and information technology infrastructures are combined into a single seamless all purpose network architecture platform." Digitalization is not so much defined by its physical infrastructure, but by the content or the medium. Van Dijk suggests that "digitalization means breaking down signals into bytes consisting of ones and zeros". Convergence is defined by Blackman, 1998, as a trend in the evolution of technology services and industry structures. Convergence is later defined more specifically as the coming together of telecommunications, computing and broadcasting into a single digital bit-stream. Mueller stands against the statement that convergence is really a takeover of all forms of media by one technology: digital computers. <Technical Implications> Convergent solutions include both fixed-line and mobile 63

technologies. Recent examples of new, convergent services include: • • • • • •

Using the Internet for voice telephony Video on demand Fixed-mobile convergence Mobile-to-mobile convergence Location-based services Integrated products and bundles

Convergent technologies can integrate the fixed-line with mobile to deliver convergent solutions. Convergent technologies include: • • • • • •

IP Multimedia Subsystem Session Initiation Protocol IPTV Voice over IP Voice call continuity Digital video broadcasting – handheld

<Appliances> Some expect that we will eventually access all media content through one device, or "black box". As such, media business practice has been to identify the next "black box" to invest in and provide media for. This has caused a number of problems. Firstly, as "black boxes" are invented and abandoned, the individual is left with numerous devices that can perform the same task, rather than one dedicated for each task. For example, one may own both a computer and a video games console, subsequently owning two DVD players. This is contrary to the streamlined goal of the "black box" theory, and instead creates clutter. Secondly, technological convergence tends to be experimental in nature. This has led to consumers owning technologies with additional functions that are harder, if not impractical, to use rather than one specific device. For example, Intel has created a surfboard with an in-built laptop. Additionally, LG has created a microwave with a television screen. Many people would only watch the TV for the duration of the meal's cooking time, or whilst in the kitchen, but would not use the microwave as the household TV. These examples show that in many cases technological convergence is unnecessary or unneeded. Furthermore, although consumers primarily use a specialized media device for their needs, other "black box" devices that perform the same task can be used to suit their current situation. 64

As a 2002 Cheskin Research report explained: ...Your email needs and expectations are different whether you're at home, work, school, commuting, the airport, etc., and these different devices are designed to suit your needs for accessing content depending on where you are- your situated context. Despite the creation of "black boxes", intended to perform all of one's tasks, the trend is to use devices that can suit the consumer's physical position. Due to the variable utility of portable technology, convergence occurs in high end mobile devices. They incorporate multimedia services, GPS, Internet access, and mobile telephony into a single device, heralding the rise of what has been termed the "smart phone," a device designed to remove the need to carry multiple devices. Convergence of media occurs when multiple products come together to form one product with the advantages of all of them, also known as the black box. This idea of one technology, concocted by Henry Jenkins, has become known more as a fallacy because of the inability to actually put all technical pieces into one. For example, while people can have e-mail and Internet on their phone, they still want full computers with Internet and email in addition. For example, the Wii is not only a games console, but also a web browser and social networking tool. Mobile phones are another good example, in that they increasingly incorporate digital cameras, mp3 players, camcorders, voice recorders, and other devices. This type of convergence is popular.[citation needed] For the consumer, it means more features in less space; for media conglomerates it means remaining competitive. However, convergence has a downside. Particularly in initial forms, converged devices are frequently less functional and reliable than their component parts (e.g., a mobile phone's web browser may not render some web pages correctly, due to not supporting certain rendering methods, such as the iPhone browser not supporting Flash content). As the number of functions in a single device escalates, the ability of that device to serve its original function decreases. For example, the iPhone (which by its name implies that its primary function is that of a mobile phone) can perform many different tasks, but does not feature a traditional numerical pad to make phone calls. Instead, the phone features a touchpad, which some users find more troublesome. As Rheingold asserts, technological convergence 65

holds immense potential for the "improvement of life and liberty in some ways and (could) degrade it in others" He believes the same technology has the potential to be "used as both a weapon of social control and a means of resistance." Since technology has evolved in the past ten years or so, companies are beginning to converge technologies to create demand for new products. This would include phone companies integrating 3G on their phones. In the mid 20th century, television converged the technologies of movies and radio, and television is now being converged with the mobile phone industry and the Internet. Phone calls are also being made with the use of personal computers. Converging technologies combine multiple technologies into one. Newer mobile phones feature cameras, and can hold images, videos, music, and other media. Manufacturers now integrate more advanced features, such as video recording, GPS receivers, data storage, and security mechanisms into the traditional cellphone. <Internet> The role of the Internet has changed from its original use as a communication tool to provide easier and faster access to information, mainly through a broadband connection. The television, radio and newspapers were the world's mediums for accessing news and entertainment; now, all three mediums have converged into one, and people all over the world can read and hear news and other information on the Internet. The convergence of the internet and conventional TV become popular in the 2010s, through smart TV, also sometimes referred to as "Connected TV" or "Hybrid TV", (not to be confused with IPTV, Internet TV, or with Web TV). Smart TV is used to describe the current trend of integration of the internet and Web 2.0 features into modern television sets and settop boxes, as well as the technological convergence between computers and these television sets or set-top boxes. These new devices most often also have a much higher focus on online interactive media, Internet TV, over-the-top content, as well as ondemand streaming media, and less focus on traditional broadcast media like previous generations of television sets and set-top boxes always have had. <In the Marketplace> Convergence is a global marketplace dynamic in which different companies and sectors are being brought together, both as 66

competitors and collaborators, across traditional boundaries of industry and technology. In a world dominated by convergence, many traditional products, services and types of companies will become less relevant, but a stunning array of new ones are possible. An array of technology developments act as accelerators of convergence, including mobility, analytics, cloud, digital and social networks. As a disruptive force, convergence is a threat to the unprepared, but a tremendous growth opportunity for companies that can out-innovate and out-execute their everexpanding list of competitors under dramatically new marketplace rules. With convergence, lines are blurred as companies diversify outside of their original markets. For instance, mobile services are increasingly an important part of the automobile; chemicals companies work with agribusiness; device manufacturers sell music, video and books; booksellers become consumer device companies; search and advertising companies become telcos; media companies act like telcos and vice versa; retailers act like financial services companies and vice versa; cosmetics companies work with pharmaceutical companies; and much, much more. Mobile phone usage broadens dramatically, becoming the means to do previously inconceivable things from making payments to watching videos to operating an intelligent home. <Media> Convergence generally means the intersection of old and new media. Jenkins states that convergence is, "the flow of content across multiple media platforms, the cooperation between multiple media industries, and the migratory behaviour of media audiences." Media convergence is not just a technological shift or a technological process, it also includes shifts within the industrial, cultural, and social paradigms that encourage the consumer to seek out new information. Convergence, simply put, is how individual consumers interact with others on a social level and use various media platforms to create new experiences, new forms of media and content that connect us socially, and not just to other consumers, but to the corporate producers of media in ways that have not been as readily accessible in the past. Advances in technology bring the ability for technological convergence that Rheingold believes can alter the "social-side 67

effects," in that "the virtual, social and physical world are colliding, merging and coordinating." It was predicted in the 1990s that a digital revolution would take place, and that old media would be pushed to one side by new media. Broadcasting is increasingly being replaced by the Internet, enabling consumers all over the world the freedom to access their preferred media content more easily and at a more available rate than ever before. However, when the dot com bubble of the 1990s suddenly popped, that poured cold water over the talk of such a digital revolution. In today's society, the idea of media convergence has once again emerged as a key point of reference as newer as well as established media companies attempt to visualize the future of the entertainment industry. If this revolutionary digital paradigm shift presumed that old media would be increasingly replaced by new media, the convergence paradigm that is currently emerging suggests that new and old media would interact in more complex ways than previously predicted. The paradigm shift that followed the digital revolution assumed that new media was going to change everything. When the dot com market crashed, there was a tendency to imagine that nothing had changed. The real truth lay somewhere in between as there were so many aspects of the current media environment to take into consideration. Many industry leaders are increasingly reverting to media convergence as a way of making sense in an era of disorientating change. In that respect, media convergence in theory is essentially an old concept taking on a new meaning. Media convergence, in reality, is more than just a shift in technology. It alters relationships between industries, technologies, audiences, genres and markets. Media convergence changes the rationality media industries operate in, and the way that media consumers process news and entertainment. Media convergence is essentially a process and not an outcome, so no single black box controls the flow of media. With proliferation of different media channels and increasing portability of new telecommunications and computing technologies, we have entered into an era where media constantly surrounds us. Media convergence requires that media companies rethink existing assumptions about media from the consumer's point of view, as these affect marketing and programming decisions. Media producers must respond to newly empowered consumers. Conversely, it would seem that hardware is instead diverging whilst media content is converging. Media has developed into brands that can offer content in a number of forms. Two examples 68

of this are Star Wars and The Matrix. Both are films, but are also books, video games, cartoons, and action figures. Branding encourages expansion of one concept, rather than the creation of new ideas.[28] In contrast, hardware has diversified to accommodate media convergence. Hardware must be specific to each function. While most scholars argue that the flow of cross-media is accelerating, O'Donnell suggests, especially between films and video game, the semblance of media convergence is misunderstood by people outside of the media production industry. The conglomeration of media industry continues to sell the same story line in different media. For example, Batman is in comics, films, anime, and games. However, the data to create the image of batman in each media is created individually by different teams of creators. The same character and the same visual effect repetitively appear in different media is because of the synergy of media industry to make them similar as possible. In addition, convergence does not happen when the game of two different consoles is produced. No flows between two consoles because it is faster to create game from scratch for the industry. <Social Implication> Convergence Culture Henry Jenkins determines convergence culture to be the flow of content across multiple media platforms, the cooperation between multiple media industries, and the migratory behavior of media audiences who will go almost anywhere in search of the kinds of entertainment experiences they want. The convergence culture is an important factor in transmedia storytelling. Convergence culture introduces new stories and arguments from one form of media into many. Because of this culture a single piece of media content is represented in multiple forms of media. For instance, The Matrix starts as a film, which is followed by two other installments, but in a convergence culture it is not constrained to that form. It becomes a story not only told in the movies but in animated shorts, video games and comic books, three different media platforms. Online, a wiki is created to keep track of the story's expanding cannon. Fan films, discussion forums, and social media pages also form, expanding The Matrix to different online platforms. Convergence culture took what started as a film and expanded it across almost every type of media. Bert is Evil (images) Bert and Bin Laden appeared in CNN coverage of anti-American protest following September 11. The association of Bert and Bin Laden links back to the Ignacio's Photoshop project for fun. 69

Convergence culture is a part of participatory culture. Because average people can now access their interests on many types of media they can also have more of a say. Fans and consumers are able to participate in the creation and circulation of new content. Some companies take advantage of this and search for feedback from their customers through social media and sharing sites such as Youtube. Besides marketing and entertainment, convergence culture has also affected the way we interact with news and information. We can access news on multiple levels of media from the radio, TV, newspapers, and the internet. The internet allows more people to be able to report the news through independent broadcasts and therefore allows a multitude of perspectives to be put forward and accessed by people in many different areas. Convergence allows news to be gathered on a much larger scale. For instance, photographs were taken of torture at Abu Ghraib. These photos were shared and eventually posted on the internet. This led to the breaking of a news story in newspapers, on TV, and the internet. Media scholar Henry Jenkins has described the media convergence with participatory culture as: ...a "catalyst" for amateur digital film-making and what this case study suggests about the future directions popular culture may take. Star Wars fan films represent the intersection of two significant cultural trendsâ&#x20AC;&#x201D;the corporate movement towards media convergence and the unleashing of significant new tools, which enable the grassroots archiving, annotation, appropriation, and recirculation of media content. These fan films build on long-standing practices of the fan community but they also reflect the influence of this changed technological environment that has dramatically lowered the costs of film production and distribution. Cell Phone Convergence The social function of the cell phone changes as the technology converges. Because of Technological advancement, cell phones function more than just as a phone. They contain an internet connection, video players, Mp3 players, and a camera. Another example, Rok Sako To Rok Lo was screened in Delhi, Bangalore, Hyderabad, Mumbai, and other part of India through EDGEenabled mobile phones with live video streaming facility. Social Movement The integration of social movement in cyberspace is one of the 70

potential strategies of social movement in the age of media convergence. Because of the neutrality of the internet and the end-to-end design, the power structure of the internet was designed to avoid discrimination between applications. Mexico's Zapatistas campaign for land rights was one of the most influential case in the information age; Manuel Castells defines the Zapatistas as "the first informational guerrilla movement". The Zapatista uprising had been marginalized by the popular press. The Zapatistas were able to construct a grassroots, decentralized social movement by using the internet. The Zapatistas Effect, observed by Cleaver, continues to organize social movements on a global scale. A sophisticated webmetric analysis, which maps the links between different websites and seeks to identify important nodal points in a network, demonstrates that the Zapatistas cause binds together hundreds of global NGOs. The majority of the social movement organized by Zapatistas targets their campaign especially against global neoliberalism. A successful social movement not only need online support but also protest on the street. Papic wrote, "Social Media Alone Do Not Instigate Revolutions", which discusses how the use of social media in social movements needs good organization both online and offline. 2. Domestic and International Markets for Culture & Art Contents Industry a. Size of the Market for Culture & Art Contents Industry <Koreaâ&#x20AC;&#x2122;s Digital Contents Industry>

<Portion of Digital Contents Industry (2010)> 71

<Portion of Channel> Korea’s digital content industry has the world’s leading highspeed Internet, wireless networks, various computer software programs and platforms, serving as an engine for sustainable growth. In particular, the emergence of a new genre, like UCC, ubiquitous and U-city, will bring more consumers who are familiar with the digital content industry, which will lead to sustained growth. <Game Industry> The gaming industry can be divided into online gaming, PC games, mobile games, video games and arcade games. Before 2000, Korea’s game industry market was confined to foreignpackaged games. But online games have since gained popularity and grown dramatically. Also, with world-class telecommunications infrastructure, the mobile gaming industry started to take off in recent years, leading the digital content industry’s growth in Korea. In 2010, the size of Korea’s game market was estimated at USD 6.7 billion, which is 12.9% more than USD 5.9 billion in 2009, marking the game industry’s continued solid growth. In 2008, the market grew by 9.0% and further recovered in 2009 with 17.4% growth, again exceeding USD 5 billion in sales. In other words, the gaming industry made a comeback. In 2010, the industry also gained another billion dollars to reach USD 6 billion in sales, showing steep growth and looking forward to continued growth. Analyzing the 2010 gaming market by sector, online game revenue was at USD 4.3 billion, with 64.2% of the market share, which reflects a trend of growth. Excluding Internet cafés and 72

arcades, the online games platform takes 85.2% of the market, which means online games are leading the market. Korean online games will maintain their stable domestic market share with sound infrastructure and aggressively move into overseas markets. Internet café revenue was at USD 1.6 billion, with 23.7% of the game market share. Although in second place, revenue dropped by 9.0% from the previous year. Internet cafés are losing their growth momentum and the market is in a declining stage. Video game revenue was at USD 385 million, with 5.7% of the game market share. And mobile games took USD 286 million in revenue, with 4.3% of the market share. Mobile games grew 21.4% from the previous year, which can be explained by the spread of smartphones. Arcade game revenue was at USD 55 million, with 1.0% of the market share. Arcade game room revenue was at USD 69 million, with 1.0% of the market share. Arcade games and arcade game rooms have shown drastic declines since the “Sea Story” controversy. Despite signs of recovery, they still do not occupy a significant proportion of the game market. As for PC games, last year’s revenue was at USD 10 million, with 0.2% of the market share, showing a consistent drop from the previous year. There is a high possibility the PC game market will change its platform and be absorbed by online games.

<Korea Game Market Outlook (2003-2010)> Based on 2010 sales figures, the Korean game market took 5.8% of the global market. Compared to last year’s market share of 3.1%, this is a whopping 2.7% increase. The growth rate of Korea’s game market was faster than that of the world game market. The reason for the dramatic increase in global market share gain was the revision of video game statistics. Considering future global and Korean market trends, forecasts show that Korea will take 6.8% of the global share for 2011, 8.3% in 2012 and 9.7% in 2013. Korea will take up a greater part of the global game market. In the online game sector, Korea took 25.9% of the market share, which is the 73

second largest after China (30.4%), proving to be a power market for online games. Korea’s share increased by 2.9% while China’s share dropped by 0.9%. Though China placed first in 2008 due to explosive online game growth, Korea is back on track.

<Percentage of Local Game Market by Sector (2010)>

<2010 Global and Korean Game Market (Sales)> Korea’s game market is expected to show 13.8% growth in 2011, reaching USD 7.63 billion. Online games grew 20% from a year earlier, and with the exception of PC games and Internet cafés, all other gaming sectors are expected to grow. The specific outlook is as follows: an increase of 25% for video games (USD 481 million), 20% for mobile games (USD 343 million) and 6% for arcade games (USD 68 million). This growth rate is expected to continue through 2012 and 2013. The forecast for 2012 is 17.7% year-on-year growth, reaching USD 8,982 million. For 2013, 15.2% year-on-year growth is expected, reaching USD 1 billion. Online games, which account for the highest percentage in the gaming market, will reach USD 6.5 billion in 2012 and USD 7.7 billion in 2013, showing rapid growth as the year goes on.


<2010 Korea Game Market Segmentation> <Electronic Book Industry> Public and corporate libraries with 24-hour demand are taking ebook services as an essential part of their service. With the recent proliferation of Amazon’s Kindle, Apple’s iPad and other e-book related devices, and with the diversification of e-book contents, Korea’s e-book market is poised for growth and has high expectations. In addition, conglomerates are jumping to the ebook industry, showing market growth expectations. Device makers such as Samsung, LG and iRiver and content providers like Kyobo, Interpark and Yes24 are joining forces to bring integrated e-book devices, which mean the competition is fierce. Also, the launch of the iPad has brought an expansion of the mobile smartphone market. E-book contents are expanding to Apple’s iPhone and Android-based smartphones. Meanwhile, the Ministry of Culture and Tourism designated the e-publishing business as a new growth engine in the 2010 Electronic Publishing Industry Development Plan, which announced a USD 54 million investment in the industry until 2014 to expand the market size to USD 632 million. Korea’s e-book market, spurred by the private sector, will gain momentum with government support. Focused on the B2B market, Korea’s e-book industry formed a USD 119 million market in 2009.

<Korea E-book Market Size>


<Market Trend of E-Learning Service Industry> Korea’s e-learning industry, characterized by high growth-high margin, is growing and becoming entrepreneurial, consolidating on-offline business units and expanding to the overseas market. In 2010, e-learning was not just an industry, but national training infrastructure to develop national human resources. The government is making significant investments to stimulate the elearning market. Cyber University, which moved the physical university online, is an e-learning institute best practice and helping improve people’s intelligence. Also, fears of a recession and the desire to prepare for an uncertain future are increasing demand for self-development. E-learning is considered an ideal solution to meet these needs. The education market was driven by Korea’s college admissions exams – the equivalent of the United States’ SATs – and business-related needs, but recently, people have been learning about music, art and day-to-day issues online. Elementary, secondary and adult educations can be acquired online as well, which enables the e-learning market and increases market size. Korea’s e-learning market in 2007 was USD 1.56 billion, and in 2010 it dramatically increased to USD 2.02 billion. Because Korea has a high Internet penetration rate and high education expenditures, stable demand for education content is expected, which would lead to consistent growth. From 2006 until 2010, the market grew at an average annual rate of 8.6%.

<Market Size and Growth Rate of E-learning Industry> <Digital Music> The digital music market is divided into the bell sound/call ringtones business and BGM (background music) and full-track (for listening) via broadband streaming and download service. Korea’s digital music industry market has shown rapid growth since 2006, when it was as USD 321 million. It reached USD 514 million in 2010. In the past, the driving force of the digital music business was the bell/ringtone business. But a recent source of revenue has been the BGM used in personal blogs and online music downloads. The digital music market is expected to show an 76

annual average growth rate of 16.9% from 2006 to 2011 and reach a market size of USD 700 million.

<E-Learning Market Size> <Digital Broadcasting Industry> The digital broadcasting industry is divided into the digital video production business, digital characters business and animation business. Korea’s digital broadcasting market once reached USD 365 million but remained stagnant due to DVD piracy and other unfavorable issues. However, the aggressive spread of terrestrial digital broadcasting, HDTV receivers, IPTV and the digital cable business caused explosive growth in 2007, at 27.6%. In 2008, the growth rate was at 8.4%, showing consistent recovery. The digitalization of terrestrial and satellite broadcasting in Korea began in the early 2000s. Digital satellite broadcasting officially began with Skylife broadcasting in 2002 and digital terrestrial broadcasting policy will be implemented, as analog broadcasting will be phased out in 2012. The Korea Communications Commission enacted the “Digital Transition Special Act” in June of 2008 to facilitate the transition to digital broadcasting. In 20102011, digital TV demand was estimated at USD 8.8 billion. More than USD 4.5 billion worth of digital TV is expected to be sold in 2012.

<Korea TV Sales and Digital TV Penetration Rate> 77

<Portion of Koran Market in World Game Market in 2010 (based on revenue)> <Korean Digital Contents Industry Based on World’s Best Level Infrastructure> Korea’s digital contents industry has secured the potential for sustainable development through the steady development of its world-beating high-speed Internet and its wireless telecom network, and the various computer programs and platforms used for digital contents production. Notably, the proportion of the population familiar with digital contents has increased constantly following the development and expansion of UCC, and the convergence of telecom and broadcasting, ubiquitous and UCity. Such a background will definitely lead to continuous growth of Korea’s digital contents industry. <Fostering Digital Contents Industry as the Next-Generation Growth-Engine Industry> The Korean government is pursuing a variety of policies to develop the digital contents industry as one of Korea’s next generation core businesses. In 2002, for the first time in the world, Korea enacted The Online Digital Industry Development Act followed by the establishment of the Digital Contents Industry Development Basic Plan under the auspices of the Online Contents Industry Development Council, and declared digital contents as one of the top ten next-generation growth engines of Korea. In addition, the Korean government has supported the expansion of the Digital Contents Production Cooperation Center in the metropolitan area of Seoul so that companies can use the equipment jointly and secure a better production environment. It has also supported the establishment of Multimedia Technology Support Centers in areas lacking a fully-developed digital contents industrial base such as Gwangju and Jeju. The Korean government has also committed itself to supporting research in the areas of creation analysis and digital contents-related information and improving the business environment to address certain market changes. b. Markets Categorized for 4 Biggest Genres in Culture & Art Contents Industry in 2009 Advertisement – $4,448 Billion (37.6%) Printing/Publication – $2.551 Billion (21.6%) 78

Broadcasting - $1,917 Billion (16.2%) Game - $1,098 Billion (9.3%)


Website to Look @: WIPO Program Activities World Intellectual Property Organization Understanding the Engine of Creativity in a Creative Economy: An Interview with John Howkins


Resource: Best Awards 2012: top 10 tools for creative thinking and networking



Chapter III. High-Touch Service

<Fig. 3. 1. Traditionally, customer service at a call center is defined as waiting for people to call in with a question and then answering the question or solving the caller’s problem. A hightouch approach to customer service is to begin a proactive approach, to anticipate what questions or issues callers will have down the road. Also, a high-touch approach means evaluating ‘first-call resolution,’ which is resolving the caller’s issue the first time he or she calls.> <In this chapter…> 1. Era of High-Touch Service a. Sensual Sight: Daniel Day Lewis in “Lincoln (2012)” b. Hong-Do Kim, “The Beauty & Cosmetics” c. Alessandro Mendini, Designer d. Sensitive Responses to High Touch Stimulus: Customers in Economic Crisis 2. Creative Ideas in Implementation / Open-end Discussion a. Innovative/successful design (examples) b. Develop innovative design c. Brainstorming (Library: Strengths and Weaknesses)


High-Touch Industry Turns to High Tech Professional services firms must provide a customized level of service to their customers, but they also want to increase agility, improve employee productivity and cut costs. Virtualization, mobility and social networking help these companies achieve their goals. Professional services firms, perhaps more than other types of companies, need to be accessible to their clients. Regardless of the services rendered— consulting, legal or financial, to name a few—customers expect to be able to reach someone when necessary and to receive a highly customized level of service. At the same time, professional services companies are looking for ways to cut costs and increase agility. Three technologies stand out as being especially critical to professional services firms as they try to achieve these goals: virtualization, mobility and social networking. Virtualization is a hot technology in many industries. Businesses are looking for opportunities to reduce costs and decrease power consumption in their data centers, and server virtualization can deliver that by enabling companies to reduce their reliance on physical servers. Research shows that the percentage of virtual servers running in production is rising. Desktop virtualization is also becoming more common, as firms seek to enhance their ability to manage desktops from a central location and deploy thin clients to replace traditional PCs. “We’re now seeing cheaper devices that are hard-wired to be nothing but a virtual desktop,” says John-David Lovelock, research vice president at Gartner. “When you tailor that with [mobile technology], you can use any device and get access to your desktop as though you were in your workplace.” Mobility—for both computing and communications—is another popular technology. Many firms are installing wireless networks, enabling employees and customers to use a variety of devices to access corporate networks and applications. Some are also issuing devices such as PDAs and smartphones to give their workers access to some of the latest mobile applications. In addition, mobile technology presents companies with new business opportunities. Lovelock cites an example of a cell phone application used by real estate firms in Europe that allows house hunters who are driving to be notified automatically when they are approaching an open house in a particular area. “There are a few countries in Europe where cell phone penetration is 100 percent,” Lovelock says. “The ubiquity of cell phones is going to be a reality that we can count on—not just for use by employees, but for staying in contact with clients.” 84

Another popular way of stay-ing in touch is through social networking, and technologies that enable various types of online collaboration are gaining ground quickly. Social networking is both an opportunity and a threat “for pretty much anyone who sells by reputation into the market,” Lovelock says. “Any of these firms that don’t take control of their brand in the social networking arena will find that they’ve given up control of their brand to the marketplace.” In the short term, many firms are ignoring social networking because they assume its impact on the business is minimal. “But its impact will grow, as it is a brand-new channel to market,” Lovelock says. “It’s a communications channel with clients and potential clients.” Here’s how some professional services firms are successfully using these technologies. Testing Virtualization The architecture, planning and interior design firm Zimmer Gunsul Frasca Architects LLP in Seattle began testing virtualization software from VMware in 2008 and has since deployed it on new servers and has started to convert its existing production servers to virtual machines, says Ronald Pike, an associate at the firm. “We are basically virtualizing what we are comfortable with and what our third-party software vendors approve for virtualization,” Pike explains. “We wanted to leverage our [storage-area network], which had been purchased a year earlier, to get the typical benefits of virtualization: power, cooling and space saving, as well as some disaster recovery options that would not have been as easy to achieve without virtualization and a SAN.” Thanks to virtualization, the firm immediately retired 20 older physical servers and reduced rack space significantly. Zimmer Gunsul Frasca can now deploy servers in minutes. With physical hardware, the server preparation process entails setting up a utility partition, installing drivers for the physical hardware and installing the operating system, Pike says. The firm can now replicate virtual machines across its WAN seamlessly. “We’ve found our newly installed virtualized environment to be ideal for testing and prototyping new services,” Pike says. “It is much faster than using physical hardware.” Last year, the firm used it for testing its Microsoft Exchange 2000 to Exchange 2007 migration. More recently, it used it to test an enterprise resource planning upgrade. Zimmer Gunsul Frasca is also testing desktop virtualization software. But Pike 85

says the firm will likely have a limited deployment of that technology because most employees use applications that are very demanding of desktop hardware. Pike says the company didn’t encounter any serious challenges during the virtualization deployment. “We were surprised how trouble-free the implementation has been,” he says. “I believe it really helped to be using hardware that is certified compatible.” Designing a Mobility Strategy Law firm Fenwick & West LLP in Mountain View, Calif., has made mobile computing and communications technology key tools for many of its employees. “We’ve been using mobile devices since the first BlackBerrys were available,” says Matt Kesner, the firm’s chief technology officer. “We believe we were the first law firm to equip all our partners with mobile e-mail devices, and we were among the first to provide combination e-mail and cell phone devices. “Mobile devices are an important part of our communications strategy. We want to be available to our clients when they need our advice. We also want to use business process automation to provide our services to clients with as little overhead as possible. Mobile devices, with their ever-increasing capabilities, make our workforce more efficient and nimble.” The availability of information is key to this approach. “Mobile devices let us put much of the important knowledge of the organization in the hands of our lawyers,” Kesner explains. “We are pushing to put all of our systems into browser-accessible interfaces so that one day soon, they can have all of our resources on their mobile devices. “Because mobile technology is important to our firm, we try to be among the first users of new waves of products. We often find ourselves beta-testing the latest technologies so we can learn and assimilate them quickly.” Kesner says Fenwick & West uses “just about every kind of mobile device,” including Palm USA’s Treo, Nokia Symbian devices, Microsoft’s Windows Mobile and Apple Computer’s iPhones, in addition to BlackBerrys. The company is also planning to purchase the new Pre multimedia smartphone that Palm launched in June. “We support any mobile platform if we can find a way to meet three security imperatives,” Kesner says. “First, the device must be able to receive and send all e-mail via an encrypted channel. Second, it must be lockable with a security code. And third, we must be able to remotely wipe the device if it is lost.” Fenwick & West encourages its employees to try new mobile applications, 86

such as mapping tools, social networking and video conferencing. “The benefits of mobile devices are all about having access to what you need as a knowledge worker,” Kesner says. Social networking Grant Thornton LLP, a Chicago-based audit, tax and advisory firm, has taken the plunge into social networking to stay connected with current and former employees. In May, the firm launched an employee social network, called theGrid, using software from SelectMinds. The idea for the network came out of an employee survey in which many people requested more two-way communication—both across the firm and with leadership—and a way for employees to share common interests. The network provides a forum for collaboration and knowledge sharing both inside and outside the firm. So far, theGrid has been well-received, with about half the firm’s employees registered as users and some 82 user groups created in the first three weeks after the site was launched, says Anne Lang, chief human resources officer. Groups and discussion threads enable users in Grant Thornton offices around the country to share information about topics related to work, skills, best practices or personal interests. “As the firm grows and we look for more creative ways to build relationships both inside and outside the company, theGrid provides new opportunities for employees to develop friendships and gain colleagues outside of their region, location and service line,” Lang says. In conjunction with the social networking effort, Grant Thornton launched a knowledge-sharing platform called K-Source, which connects people to content so that they can work more effectively. K-Source contains four main technology solutions: a searchable storehouse of information; a people-finder with a skills directory and search engine; general news feeds; and a personalized dashboard for users to receive specific news and market intelligence. “The two technologies complement each other nicely, bringing together a tremendous knowledge-sharing platform with a powerful personal networking component,” Lang says. While most of theGrid’s content is user-generated, there haven’t been any problems with people posting inappropriate discussion threads, Lang says. The firm has provided training for group moderators who oversee the forums. “There are policies and procedures surrounding the groups and forums, so people have a good understanding of what to do and what not to do, she explains.


Social networking “brings a level of empowerment to our people,” Lang says. “They can start groups of interest in a way that doesn’t have to be a formally firm-sponsored group.” <Delivering High-Touch Service in a High-Tech World: E Society> In space, the saying goes, no one can hear you scream. But in cyberspace, poor customer service can be deafening. Of all the trends the Internet has sparked throughout the course of the last few years, the one best suited for long-term success is a trend that never seems destined to go out of style. No matter what you call it — "customer retention," "customer satisfaction," or "order fulfillment" — customer satisfaction remains the bellwether of a successful company (both online and offline). While many companies continue to migrate traditional brick-and-mortar services to the Internet, most are finding the old business rules are as essential online as they are offline. Delivering "high-touch service" in the high-tech world is perhaps more important today than ever before: Given the sheer number of marketplaces customers have to choose from (especially for business services), the sole competitive advantage is often the quality of a company or association’s customer service. At eSociety, we are committed to helping today’s trade associations make the most of their presence on the Internet by giving them the tools they require to meet their members’ needs. Associations are eagerly seeking ways to enhance their online presence since they see the emergence of competitive net markets or vertical portals — industry-focused business-to-business (B2B) communities developed by for-profit entities — taking on roles much like those of traditional trade associations. Facing attrition and diminished influence as well as loss of non-dues revenue and erosion of the perceived value of membership in the association itself, associations are motivated to change. With tremendous growth continuing to be predicted in the e-commerce arena (approximately $1.3 trillion by 2003 in the United States alone), a huge market opportunity has emerged online, resulting in a new kind of marketplace. In short, there is tremendous pressure for associations to explore the Web. Associations, however, have a tremendous opportunity to succeed online, by developing sites that cater to members specific industry needs. They can assume the role of industry hub themselves, precisely because of their domain expertise, credibility, and focus on servicing their member bases. The value of an online hub increases exponentially with the number of participants it has. Commercial sites are fighting tooth and nail to attract the kind of constituency that many associations have supported for decades. eSociety is committed to helping associations and other organizations maximize their Web presence by developing online communities and marketplaces tailored specifically to their industry’s needs. In partnership with 88

industry leaders such as associations, eSociety creates and manages these online marketplaces, which provide an array of business-to-business ecommerce services tailored to a specific industry, including RFP and RFQ centers, auctions, catalog sales, buyer and seller listings and industry directories. eSociety is well-regarded within the association world as an Internet company that understands the e-commerce needs of trade and professional associations. Through our partnerships with key industry leaders — in combination with a fresh new approach to building, marketing, and maintaining a network of marketplaces — it offers a tailored e-commerce solution that helps associations better serve member needs. The advantages of creating these online marketplaces are many. These marketplaces will vastly expand the value associations offer members on a daily basis. They can improve staff productivity by automating processes and eliminating paperwork. They will increase the scope and effectiveness of advocacy efforts. They can even pay for themselves by providing new sources of nondues revenue. It’s no longer sufficient to just build a Web site. Associations must learn to develop online communities where members regularly go to network, learn, and transact business. Each community is unique, just as each association’s membership is unique. In the end, an association’s online presence must respond to customer needs as if it were a real brick-and-mortar entity. So don’t be daunted by the digital world. Many of the tools associations need to succeed in the new economy are the very same tools that brought success in the old economy. eSociety is your architect for the new online economy. 1. Era of High-Touch Service a. Sensual Sight: Daniel Day Lewis in “Lincoln (2012)” Daniel Michael Blake Day-Lewis (born 29 April 1957) is an English actor with both British and Irish citizenship. Born and raised in London, he is the son of Poet Laureate Cecil Day-Lewis and actress Jill Balcon, and the son-in-law of American playwright Arthur Miller. Despite his traditional actor training at the Bristol Old Vic, he is considered to be a method actor, known for his constant devotion to and research of his roles. He often remains completely in character for the duration of the shooting schedules of his films, even to the point of adversely affecting his health. He is known as being one of the most selective actors in the film industry, having starred in only five films since 1998, with as many as five years between each role. One of the most acclaimed actors of his generation, his work has earned him numerous awards, including three Academy Awards 89

for Best Actor, for his portrayals of Christy Brown in My Left Foot (1989), Daniel Plainview in There Will Be Blood (2007), and Abraham Lincoln in Lincoln (2012), a feat which makes him to date one of three male actors to win three Oscars (the other two being Walter Brennan and Jack Nicholson), and the only male actor in history to garner three wins in the lead actor category. Day-Lewis has also won four BAFTA Awards for Best Actor, three Screen Actors Guild Awards, three Critics' Choice Movie Awards, and two Golden Globe Awards.

<Daniel Day-Lewis> Day-Lewis played Abraham Lincoln in Steven Spielberg's film Lincoln. Based on the book Team of Rivals: The Political Genius of Abraham Lincoln, the film began shooting in Richmond, Virginia in October 2011. The film was released in selected U.S. cities on 9 November 2012, and then was nationally released on 16 November 2012. Day-Lewis spent a year in preparation for the role, a time he had requested from Spielberg. Day-Lewis read over 90

100 books on Lincoln, and long worked with the makeup artist to achieve a physical likeness to Lincoln. Lincoln received widespread critical acclaim, much of it directed to Day-Lewis' performance. In December 2012, the movie was nominated for seven Golden Globe Awards including Best Picture (Drama), Best Director for Spielberg, and Best Actor (Drama) for Day-Lewis. It was also nominated for twelve Academy Awards, including Best Picture, Best Director for Spielberg and Best Actor for Day-Lewis. It also became a commercial success, grossing over $275 million worldwide. At the 85th Academy Awards in 2013, Day-Lewis became the first three-time recipient of the Best Actor Oscar for his role in Lincoln. Shortly after winning the Oscar, he announced he would be taking a break from acting, feeling it would be difficult to top his performance in Lincoln.

<Poster of Lincoln (2021)> Lincoln is a 2012 American epic historical drama film directed and co-produced by Steven Spielberg, starring Daniel Day-Lewis as United States President Abraham Lincoln and Sally Field as Mary Todd Lincoln. The film is based in part on Doris Kearns Goodwin's biography Team of Rivals: The Political Genius of Abraham Lincoln, and covers the final four months of Lincoln's life, focusing on the President's efforts in January 1865 to have the Thirteenth Amendment to the United States Constitution passed by the United States House of Representatives. 91

Filming began October 17, 2011, and ended on December 19, 2011. Lincoln premiered on October 8, 2012 at the New York Film Festival. The film was released theatrically on November 9, 2012, in select cities and widely released on November 16, 2012, in the United States by DreamWorks through Disney's Touchstone Pictures distribution label. The film was released on January 25, 2013, in the United Kingdom, with distribution in international territories, including the U.K., by 20th Century Fox. Lincoln received widespread critical acclaim, with major praise directed to Day-Lewis' performance. In December 2012, the film was nominated for seven Golden Globe Awards including Best Motion Picture â&#x20AC;&#x201C; Drama, Best Director for Spielberg and winning Best Actor (Motion Picture â&#x20AC;&#x201C; Drama) for Day-Lewis. At the 85th Academy Awards, the film was nominated for twelve Academy Awards including Best Picture; it won for Best Production Design and Best Actor for Day-Lewis. The film was also a commercial success, having grossed more than $275 million at the box office. <Plot> Lincoln recounts President Abraham Lincoln's efforts, during January 1865, to obtain passage for the Thirteenth Amendment to the United States Constitution in the United States House of Representatives, which would formally abolish slavery in the country. Expecting the Civil War to end within a month but concerned that his 1863 Emancipation Proclamation may be discarded by the courts once the war has concluded and the 13th Amendment defeated by the returning slave states, Lincoln feels it is imperative to pass the amendment by the end of January, thus removing any possibility that slaves who have already been freed may be reenslaved. The Radical Republicans fear the amendment will merely be defeated by some who wish to delay its passage; the support of the amendment by Republicans in the border states is not yet assured either, since they prioritize the issue of ending the war. Even if all of them are ultimately brought on board, the amendment will still require the support of several Democratic congressmen if it is to pass. With dozens of Democrats having just become lame ducks after losing their re-election campaigns in the fall of 1864, some of Lincoln's advisors believe that he should wait until the new Republican-heavy Congress is seated, presumably giving the amendment an easier road to passage. Lincoln, however, remains adamant about having the amendment in place and the issue of slavery settled before the war is concluded and the southern states readmitted into the Union. Lincoln's hopes for passage of the amendment rely upon the 92

support of the Republican Party founder Francis Preston Blair, the only one whose influence can ensure that all members of the western and border state conservative Republican faction will back the amendment. With Union victory in the Civil War seeming highly likely and greatly anticipated, but not yet a fully accomplished fact, Blair is keen to end the hostilities as soon as possible. Therefore, in return for his support, Blair insists that Lincoln allow him to immediately engage the Confederate government in peace negotiations. This is a complication to Lincoln's amendment efforts since he knows that a significant portion of the support he has garnered for the amendment is from the Radical Republican faction for whom a negotiated peace that leaves slavery intact is morally unacceptable. If there seems to be a realistic possibility of ending the war even without guaranteeing the end of slavery, the needed support for the amendment from the more conservative wing (which does not favor abolition) will certainly fall away. Unable to proceed without Blair's support, however, Lincoln reluctantly authorizes Blair's mission. In the meantime, Lincoln and Secretary of State William Seward work on the issue of securing the necessary Democratic votes for the amendment. Lincoln suggests that they concentrate on the lame duck Democrats, as they have already lost re-election and thus will feel free to vote as they please, rather than having to worry about how their vote will affect a future re-election campaign. Since those members also will soon be in need of employment and Lincoln will have many federal jobs to fill as he begins his second term, he sees this as a tool he can use to his advantage. Though Lincoln and Seward are unwilling to offer direct monetary bribes to the Democrats, they authorize agents to quietly go about contacting Democratic congressmen with offers of federal jobs in exchange for their voting in favor of the amendment. With Confederate envoys ready to meet with Lincoln, he instructs them to be kept out of Washington, as the amendment approaches a vote on the House floor. At the moment of truth, Thaddeus Stevens decides to moderate his statements about racial equality to help the amendment's chances of passage. A rumor circulates that there are Confederate representatives in Washington ready to discuss peace, prompting both Democrats and conservative Republicans to advocate postponing the vote on the amendment. Lincoln explicitly denies that such envoys are in or will be in the city â&#x20AC;&#x201D; technically a truthful statement, since he had ordered them to be kept away â&#x20AC;&#x201D; and the vote proceeds, narrowly passing by a margin of two votes. When Lincoln subsequently meets with the Confederates, he tells them that slavery cannot be restored as the North is united for ratification of the amendment, and that several of the southern states' 93

reconstructed legislatures would also vote to ratify. After the amendment's passage, the film's narrative shifts forward two months, portraying Lincoln's visit to the battlefield at Petersburg, Virginia, where he exchanges a few words with General Grant. Shortly thereafter, Grant receives General Lee's surrender at Appomattox Courthouse. On the evening of April 14, 1865, Lincoln is in a meeting with members of his cabinet, discussing possible future measures to enfranchise blacks, when he is reminded that Mrs. Lincoln is waiting to take them to their evening at Ford's Theatre. That night, while Tad Lincoln is viewing Aladdin and the Wonderful Lamp at Grover's Theater, a man announces that the President has been shot. The next morning his physician pronounces him dead. The film concludes with a flashback to Lincoln delivering his second inaugural address. <Critical Response> Lincoln received worldwide critical acclaim. The film currently holds a 89% approval rating on the review aggregate website Rotten Tomatoes, based on 242 reviews with an average rating of 8/10. On Metacritic, which assigns a normalised rating out of 100 based on reviews from critics, the film has a score of 86 (out of 100) based on 44 reviews, indicating "universal acclaim", thus making it Spielberg's highest rated film on the site since Saving Private Ryan. Roger Ebert of the Chicago Sun-Times gave the film 4 out of 4 stars and said, "The hallmark of the man, performed so powerfully by Daniel Day-Lewis in Lincoln, is calm self-confidence, patience and a willingness to play politics in a realistic way." Glenn Kenny of MSN Movies gave it 5 out of 5 stars stating, "It's the most remarkable movie Steven Spielberg has made in quite a spell, and one of the things that makes it remarkable is how it fulfills those expectations by simultaneously ignoring and transcending them." Colin Covert of the Star Tribune wrote, "Lincoln is one of those rare projects where a great director, a great actor and a great writer amplify one another's gifts. The team of Steven Spielberg, Daniel Day-Lewis and Tony Kushner has brought forth a triumphant piece of historical journalism, a profound work of popular art and a rich examination of one of our darkest epochs." It was praised by Charlie McCollum of the San Jose Mercury News as "one of the finest historical dramas ever committed to film." Despite mostly positive reviews, Rex Reed of The New York Observer stated, "In all, there's too much material, too little revelation and almost nothing of Spielberg's reliable cinematic flair." However, the reviews have 94

been unanimous in their praise of Day-Lewis's performance as Abraham Lincoln. A. O. Scott from The New York Times stated the film "is finally a movie about how difficult and costly it has been for the United States to recognize the full and equal humanity of black people" and concluded that the movie was "a rough and noble democratic masterpiece". Scott also stated that Lincoln's concern about his wife's emotional instability and "the strains of a wartime presidency... produce a portrait that is intimate but also decorous, drawn with extraordinary sensitivity and insight and focused, above all, on Lincoln's character as a politician. This is, in other words, less a biopic than a political thriller, a civics lesson that is energetically staged and alive with moral energy." Lebanese film critic Anis Tabet gave the film a positive review, giving it a 3.5/4 rating. As reported in the Maariv newspaper, on February 3, 2013, Israeli prime minister Netanyahu and his ministers discussed Spielberg's film, which several of them saw in Israeli cinemas. They debated whether the end of abolishing slavery justified the means used by Lincoln, and also compared Lincoln's predicament with their own complicated situation in the confused aftermath of the 2013 Israeli elections. The review by The Daily Mail suggested: "The sad truth is that Spielberg and his writer Tony Kushner are offering a phoney, sanitised version of Lincoln." The Sagamore Online review was also critical: "A film based on historical events that lacks accuracy might still attract audiences on entertainment value alone. Unfortunately, director Steven Spielberg’s Lincoln has neither." b. Hong-Do Kim, “The Beauty & Cosmetics” Kim Hong-do, better known by his pen name Danwon (1745–c. 1806), was a Korean painter of the Joseon period. Danwon is known as the first Korean painter to extensively portray Korean daily life, in a manner analogous to the Dutch Masters. Because of this, his paintings today are valued almost as much for the insight they shed on daily life in Joseon as for their inherent aesthetic value. Danwon is remembered today as one of the "Three Wons," together with Hyewon and Owon. He is also often joined to Owon and the 15th century painter An Gyeon as one of Joseon's three greatest painters. Danwon was a member of the Gimhae Kim clan. He grew up in 95

present-day Ansan, South Korea, where he was taught by Pyoam Kang Sehwang, one of the most famous calligraphers of the day. He entered royal service as a member of the Dohwaseo, the official painters of the Joseon court, and drew the portrait of King Jeongjo.1773. Danwon's works are still widely treasured today. The city of Ansan, where he spent his youth and learned his craft, has memorialized him in many ways. The district of Danwon-gu is named after him, as is Ansan's annual "Danwon Art Festival." Many public places have been designed in imitation of his works.

< Hong-Do Kim, â&#x20AC;&#x153;The Beauty & Cosmeticsâ&#x20AC;?> c. Alessandro Mendini, Designer Alessandro Mendini (born 16 August 1931 in Milan) is an Italian designer and architect. He played an important part in the development of Italian design. He also worked, aside from his artistic career, for Casabella, Modo and Domus magazines. 96

His design has been characterized by his strong interest in mixing different cultures and different forms of expression; he creates graphics, furniture, interiors, paintings and architectures and wrote several articles and books; he is also renowned as an enthusiastic member of jury in architectural competition for young designers. He also teaches at the University of Milan. Mendini graduated from Politecnico di Milano in 1959 with a degree in Architecture. He was the editor-in-chief of a magazine from 1980 to 1985 and changed the landscape of modern design through his quintessential works of postmodernism, such as the Proust Armchair and the Groninger Museum. Just as works of the Renaissance period expressed human values and sensibilities, Mendini has contributed to bringing into the heart of design those “values” and “sensibilities” that have been eclipsed by commercialism and functionalism. He collaborates with leading international brands including Cartier, Hermes, and Swarovski. Currently he runs his own practice in Milan, the Atelier Mendini, together with his brother Francesco Mendini.

<Alessandro Mendini and his Wine opener> <Career> In the seventies he was one of the main personalities of the Radical design movement. In 1979 he joined the Studio Alchimia as a partner and here he worked with Ettore Sottsass and Michele De Lucchi. In 1982 he co-founded Domus Academy, the first postgraduate design school. As architect, he designed several buildings; for example the Alessi residence in Omegna, Italy; the theater complex "Teatrino della Bicchieraia" in the Tuscan city of Arezzo; the Forum Museum of 97

Omegna, a memorial tower in Hiroshima, Japan; the Groninger Museum in The Netherlands and the Arosa Casino in Switzerland. His work in product design was influential in the sense that it pushed the boundaries of what products could be. A notable example is his Lassú chair from 1974, a chair built on top of a pyramid structure, which forgoes conventional notions of function. Mendini was addressing the domestic object as a conduit for spirituality, an idea reinforced by his ritualised burning of the chair, photographed for placement on the cover of Casabella in 1975.

<Wine Openers designed by Mendini> <Interview with Mendini> There are very few, very small spaces between the artfully arranged books, vases, busts, plates, figurines, sketches, paintings, shells, bird’s nests, and other items sitting so elegantly on every surface of designer and architect Alessandro Mendini’s apartment, but he stares forlornly at each of the gaps. “So much is missing,” he says with a sigh, before chuckling. “Though I do know where it is.” That would be at the Design Museum of the Triennale, the Palazzo dell’Arte in Milan, where Mendini has curated a blockbuster show, “Quali Cose Siamo,” which translates as “The Things We Are.” It consists of what he calls “an anthropological collection” of 800 objects chosen not on the conventional design criteria of what they do or how they look but because, he believes, they tell us what it is like to be Italian. “It’s sort of a personal museum, or a Fellini play, of my vision of Italy,” Mendini explains. All of the exhibits, including the missing loot from his apartment, are jumbled together as if at a flea market: historic and contemporary, expensive and cheap, practical and extravagant. Among them (although a list doesn’t come close to conveying the ambition and eccentricity of Mendini’s selection) are a giant Campari bottle; pieces of pasta; a Giorgio Morandi still life; the original models of E.T.; an Olivetti Lettera 22 typewriter; a huge 98

Ferragamo shoe; rubble from the 2009 earthquake, which devastated the city of L’Aquila; a replica of Michelangelo’s David; a patchwork jacket worn by the late designer Achille Castiglioni; and a nude portrait of another, Ettore Sottsass. “It’s just fantastic,” says Australian designer Marc Newson. “Seeing that show is like looking into Mendini’s mind, which is an incredible experience because he’s so humorous, sprightly, and generous. He has such a deep knowledge and understanding of design, and the show reflects that, but it’s also quirky, insightful, and playful. He sees the fun in design, and the poetry.” Newson isn’t the only fan of the exhibition, which runs through February 2011 and has been packed with visitors since it opened in March, a few weeks before the design world flocked to Milan for the annual Furniture Fair. “I told everyone I could that it would have been better to have canceled the rest of the fair and just held Mendini’s show,” says British designer Jasper Morrison. “It blows away the constricting frontiers of what is generally thought of as design and frees up our thinking about it.” As if that weren’t enough, Mendini has taken the helm of Domus, the influential design magazine, for a year. He’s also curating an exhibition on Italian craftsmanship, which opens in Verona in September, and completing projects at Atelier Mendini, the architecture practice he runs in Milan with his younger brother, Francesco, including the completion of a vast pavilion for the World Design Capital festival, to be held in South Korea this year. Oh, and he’ll turn 80 next year. “I’m totally in awe of him,” says Paola Antonelli, the senior curator of architecture and design at New York’s Museum of Modern Art. “He’s so subtle, so innovative, and quite brilliant at crystallizing ideas, although he has never been as well known to the general public as designers like Castiglioni and Sottsass, even in Italy, because he’s at his best working behind the scenes.” Mendini’s penchant for discretion has made him one of the design world’s well-kept secrets. Aficionados may know that he edited Domus before, during the early Eighties, as well as two other important Italian design magazines, Casabella and Modo. They’ll know too that he was at the heart of Italy’s radical design movement in the Sixties and Seventies and, later, postmodernism. But even if you’ve never heard of Alessandro Mendini, you’re bound to have been affected by his work. That’s because our lives would be different without him. Mendini has influenced the creation of objects and spaces through his own projects, but his work as a writer, editor, and curator has also had an enormous impact on other designers and architects. The 99

vision he has championed for years—a humane, sensitive, thoughtful, empowering, intellectually rich discipline that’s about ideas, not styling—seems increasingly relevant. It has a special resonance for young designers, who are concerned with cracking environmental problems and imbuing industrial pieces with meaning rather than flipping vertiginously expensive chairs at Sotheby’s or Christie’s. Mendini has an additional role, as one of the last surviving design maestri, as Italians call the “masters” who made their country the global center of design in the late 20th century. Thanks to “Quali Cose Siamo,” he has moved center stage at a time when Italian design is reasserting itself internationally, with the opening in Manhattan in late September of an American outpost of the Triennale in the space formerly occupied by the American Craft Museum, directly opposite MoMA. The inaugural show will be an homage to Mendini’s own design hero, Giò Ponti, the man he succeeded at Domus. (Mendini paid tribute to Ponti by including one of his paintings in “Quali Cose Siamo.”) Mention that you’re meeting Mendini, and you’ll invariably be told that he’s very clever, very charming, and very short, with very blue eyes. Quite right. Sitting in the conference room suspended above his open-plan studio, the architect looks impressively lithe, with a light tan and cropped white hair. He stares at you intently through circular wire-framed glasses but rarely ends a sentence without smiling. “He’s incredibly pleasant to work with, radiating calm and tranquillity,” observes Joseph Grima, who recently left his position as director of Storefront, a nonprofit architecture organization in New York, and moved to Milan to work on Domus’s website; he will take over the magazine from Mendini in February. “He’s also incredibly sharp, one of the most intelligent people I’ve ever worked with, and so open. There’s always a twinkle in his eye.” The studio occupies what was once workers housing in an old factory on Milan’s eastern outskirts. Mendini and his brother moved there in 1989, when they founded Atelier Mendini. They’ve marked their turf by building a postmodernist folly—a supersize, mosaic canopy in the yard—and filled the studio with posters, architectural models, and objects in the vibrant colors and flamboyant patterns that Mendini loves. (Subtle though he is as a theorist, his physical designs are shamelessly showy.) One room is a workshop for his most famous piece, the Proust chair, a voluptuous armchair with an ornately carved wooden frame and dizzying upholstery that he designed in 1978, and has made in different colors and patterns ever since, often painting them himself. “My friend the architect Gae Aulenti once said that everything I 100

designed looked like Carmen Miranda,” he says with a laugh. “And she was right.” Mendini lives above the studio. He has painted the apartment in warm colors and filled it with his treasures, but left the structure intact, down to the cheap, gaudily patterned floor tiles. He grew up in far grander surroundings, among the Sironi, Savinio, and other modern paintings collected by his parents in the Milan town house built for them by the rationalist architect Piero Portaluppi. “Perhaps my love of kitsch and vernacular objects was a reaction against the things I grew up with,” he muses. As a child Mendini loved to draw. Saul Steinberg and Walt Disney were his heroes. But his parents encouraged both him and Francesco to study architecture at Milan Polytechnic. Alessandro then worked in the studio of Marcello Nizzoli, chief design consultant to electronics company Olivetti. (The Lettera 22 typewriter in “Quali Cose Siamo” was designed by him.) Nizzoli was typical of the first generation of design maestri, including Ponti, and later Castiglioni and Sottsass, who’d trained as architects but turned to product design to help postwar manufacturers persuade the public to pay a little extra for “the Italian line.” This seductive image of la dolce vita sold millions of Fiat cars, Vespa scooters, Flos lamps, and La Pavoni espresso machines. As well as powering the country’s postwar recovery, the “design adds value” formula has been adopted by expanding economies since, from Sixties Japan to China today. Italy was lucky in that Nizzoli, Castiglioni, Sottsass, and their fellow maestri were unusually thoughtful and imaginative about their work, and that Ponti contextualized it so sensitively in Domus. Italian design emerged with an intellectual depth that was lacking in most other countries, where design was relegated to a grubbily commercial role, as a poor relation of art. Mendini’s generation of architects and designers, who were born in the Thirties—a decade or so after Castiglioni and Sottsass—and were children during the Mussolini regime and World War II, grew up in this rich, provocative visual culture. Steeped in counterculture politics, they were less comfortable with design’s role as a catalyst for consumerism than their predecessors. By the late Sixties Mendini was embroiled in Italy’s “radical design” movement, in which groups like Archizoom and Superstudio in Florence treated their work as a conceptual tool to challenge the establishment by developing utopian projects. In 1970 he joined Casabella, where he followed Archizoom, Superstudio, and empathetic designers like Sottsass and Gaetano 101

Pesce, as well as emerging postmodernist design groups in the U.S. and Austria. While at the magazine, he assembled a crack team. The art critic was Germano Celant, who later became senior curator of contemporary art at the Guggenheim Museum in New York, and is now curating the Ponti retrospective at the Triennale in New York. (Celant coined the term arte povera to -describe the work of Michelangelo Pistoletto, Alighiero Boetti, and other postPop artists whose work he championed in the magazine.) “Casabella was amazing,” Antonelli recalls. “Everything about it was so strong—the covers, the ideas, everything—because Mendini was always pushing it forward.” By the late Seventies he was doing the same at a new magazine, Modo, and had established himself as a conceptual designer producing work that critiqued commercial design culture. One key example is 1974’s Lassù, for which he mounted a wooden chair on a pedestal and filmed its destruction by fire. For 1978’s “Redesign,” he transformed classic modern chairs into selfparodies. Clouds painted in gaudy colors were attached to Marcel Breuer’s Wassily chair, and the back of Gerrit Rietveld’s ZigZag chair was enlarged to form a cross. Avant-garde designers have toyed with similar ideas ever since, and none of Mendini’s Seventies projects would look out of place in one of the current crop of “critical design” shows. Nor would the pieces he produced for Studio Alchimia, the design group he formed with Sottsass and other friends in 1979. Their aim was to humanize industrial design at a time when modernism seemed intellectually spent. It was during this period that Mendini unleashed his inner Carmen Miranda, and poked fun at the modern movement by violating its proscriptions against bright colors and exaggerated contours, with the creation of vivid-hued objects with theatrical shapes and kitsch motifs, often made by hand. Jasper Morrison saw an Alchimia show during a student trip to the 1979 Milan Furniture Fair. “I was dazzled,” he says. “It was obvious that Mendini was a mischievous, highly intelligent, and radical designer, and that Studio Alchimia produced much more than textbook examples of design.” You can still see the influence of Mendini’s style on the flamboyant objects by theatrical young designers like Jaime Hayon and the duo behind Studio Job, Job Smeets and Nynke Tynagel. Alchimia’s work culminated in “The Banal Object,” an exhibition at the 1980 Venice Biennale, but Sottsass soon chafed against the group’s anticapitalist ideals. “He always wanted to talk about money, and Alchimia wasn’t a place where you could do that,” says Mendini. “So he left and started Memphis. Sottsass said, ‘Are you coming with me or not?’ And I said, ‘No, I’ll stay with Alchimia.’ But I did design something for the first Memphis 102

collection. Up until then we’d been friends, and spoken every day. I always remained friends with Sottsass—I’m not capable of making enemies—but he didn’t remain friends with me. Though we became friends again when Memphis ended.” Design snobs often argue that Memphis was a mediagenic, commercialized version of Studio Alchimia. In many respects it was, but a stupendously successful one. There were long lines outside its launch party at the 1981 Milan Furniture Fair, and the photographs of Sottsass, then in his 60s, surrounded by his young collaborators in a boxing ring–shaped “conversation pit” created by Japanese designer Masanori Umeda, were published worldwide. Until then the postmodernist theories developed by Mendini and others had seemed incomprehensibly complex for the public, but they made instant sense in the form of Memphis’s cartoonish furniture. Pastiche became the defining design style of the Eighties, from Philippe Starck’s restoration of the Royalton Hotel in New York to Karl Lagerfeld’s reinventions of Coco Chanel’s boxy suits. Mendini charted postmodernism’s progress in a new role at Domus. By positioning design and architecture at the intersection of art, literature, philosophy, politics, fashion, and pop culture, and analyzing them all with equal rigor, he created a scintillating editorial mix of highbrow and lowbrow—an innovation that is now mainstream. Another new concept, at least in the scholarly world of architectural publishing, was to splash photographs of architects and designers, often shot against surreal backdrops, on the cover. Mendini’s editorial instincts were fantastic. Both Zaha Hadid and Frank Gehry appeared there, when they were barely known, even within their own profession. “Domus was the bible,” says Newson, who discovered it as a design student in Sydney when working part-time at a news agency. “A couple of subscription copies were air-freighted in every month for a ridiculous amount of money. I used to ‘borrow’ them, and they were my windows into the world of design.” Mendini left Domus in 1985 to focus on a new commercial role as creative director of Alessi, the Italian home-products company. A few years later he took on the same position at Swatch, the Swiss plastic watchmaker. Designing stores and products for both companies introduced him to the mass market, and enabled him to help younger designers. “He put me up for a job at Swatch when I was a complete and utter nobody, and frankly too inexperienced to do it,” recounts Newson. “Mendini recommended me to other companies, too, and always had a nice thing to say about my work. There are plenty of grumpy old men in design, but he’s the absolute opposite.” 103

With his brother, Mendini completed his most ambitious architectural project, the Groninger Museum in the Netherlands, a postmodernist palace that they developed from 1989 to 1994. He has since worked on everything from a toaster and a juicer for Philips to McDonald’s Italian headquarters and a satellite museum for the Triennale in Seoul while producing a steady stream of exhibitions, essays, and sketches. Whenever a new design debate has unfurled, Mendini has participated, often from the start, and always elegantly. Typical was his critique of Lasting Void, a resin and fiberglass seat cast inside the cavity of a dead cow by the young German designer Julia Lohmann. Her objective was to force people to confront the exploitation of animals by industry, but Mendini saw the piece as unnecessarily cruel and trite. He said so in a letter, which was published in several design magazines in 2007 alongside Lohmann’s response. After reading her explanation, he e-mailed her saying he had changed his mind, and hugged her when he saw her in Milan the following year. “The meeting was quite emotional,” Lohmann recalls. “The letter from him was a very good challenge for me. It helped me to clarify my position by questioning myself more thoroughly.” Prolific though he has always been, Mendini remained largely out of the limelight until this spring, when the opening of “Quali Cose Siamo” coincided with his return to Domus. His second stint there has been as iconoclastic as the first but for very different reasons. During his first editorship, Domus was thrilling and audacious; now it is studiedly quiet and calm, in stark contrast to the hysteria with which other magazines are responding to the digital threat. “This time his Domus is very dignified, very rarefied, quite meditative,” says Grima. “It looks back to his Domus of the Eighties, and the early Domus of the Thirties. The typeface he chose is Futura, which is typical of Italian graphic design in that period. His editorial is in the form of a diary, the thoughts of the moment, which are articulated throughout the magazine. That’s the only consideration for him. He would never sacrifice it to chase exclusives.” The new Domus covers are delicate portraits drawn by graphic artist Lorenzo Mattotti. A recent cover star was Sigmund Freud, used to illustrate a piece on what Mendini calls the “psychological interiors” of his study in Vienna, as well as Ludwig Wittgenstein’s home there, and the House of Glass designed by French architect Pierre Chareau in Paris. “At this point I am interested in thinking more deeply about the future, beauty, and quality,” he explains. “Editing Domus for a year is an opportunity to do that.” 104

When asked what interests him in contemporary design and architecture, he winces. “I find it completely impossible to answer that question,” he says before citing the “highly aestheticized minimalism” of French product designers Ronan and Erwan Bouroullec and British architect David Chipperfield. He’s also intrigued by the Green School, a progressive educational facility in Indonesia that was built—and is constantly rebuilt—from locally grown bamboo. Once the year at Domus is over, he plans to devote more time to writing, curating, drawing, and design. “I’m just not capable of concentrating on one thing—Ponti was the same,” says Mendini. “You know, I’ve been a pessimist my whole life, but now I’m optimistic. The world is so violent that I feel it’s my responsibility to find something positive. At my age optimism is essential.” d. Sensitive Responses to High Touch Stimulus: Customers in Economic Crisis <Advisors See Value In High-Touch, Social Approach> Success in financial planning hinges on developing a rapport with clients and building confidence and trust, according to a panel of advisors speaking here at theInvestment Company Institute’s general membership meeting. The panelists suggested that the human side of the practice has been somewhat overlooked among some advisors who have tended to limit their interactions with clients to providing financial advice. Melissa Scott Paine, a partner with Krosnowski & Scott, said the high-touch approach for advisors could become a “growing market niche” that delivers clients a unique value in the form of trusted advice and reassurance about their investment positions, particularly in times of market upheaval. “I definitely think referrals and relationship building is key. I think people have gotten away from that. One of the biggest complaints from a lot of clients that we had back in ’08 and ’09 was during the downside a lot of people don’t hear from advisors, they don’t get feedback, they don’t get that constant contact,” Paine said. “That’s when you really need to be in contact with the clients the most, is when things are going south. You know, when the market’s doing well and things are going up and things are calm, the client likes to hear from you, but they’re more confident.”


Sue van der Linden, first vice president and a wealth advisor withMorgan Stanley, takes it a step further. Van der Linden said she goes to lengths to arrange social outings with clients, orchestrating settings where feelings about succession planning or other matters of family finances might come up naturally in the course of a conversation that would never take place in a business setting. “We do a lot of social time with our clients,” she said. “There are so many things about what I as their advisor need to provide that I am never going to find out within the confines of my office or an accountant’s office or an attorney’s office,”van der Linden said. “I’ve got to get them out — I need them at my house. I need them at their house. I need them at the pool. I need them somewhere not business-related so that they can let their guard down and tell me the stuff that’s keeping them up at night.” Then, too, the reality on the financial side of the business is that investment products have grown increasingly complex, which, coupled with an aging demographic and the still-fresh shock of the financial crisis, argues for advisors to take a more hands-on approach with their clients, particularly as they begin to grapple with retirement planning and wealth-transfer issues. “People are aging, people are in need. As more products develop, the complexity of our industry has grown,” said Christine Emond, a private wealth advisor with Ameriprise Financial. An integral part of the financial advisor’s trade is, of course, managing expectations, not over-promising. But at times it is also important to be available to talk clients back away from the ledge, to reassure them that the latest natural disaster or remote conflict does not presage a market collapse or their personal financial ruin, according to Paine. Many of her clients are retirees, who she says are often spooked by the reliably dramatic reports of tumult and unrest that permeate the Internet and cable news, leaving it to the advisor to offer reassurance. “We’ve gone and told a lot of our clients to try to tune out the noise,” Paine said. “I think from an emotional standpoint, the fact that you have the Internet, you have the media attention 24/7 to everything, does create a lot of concern in the market, and people spend too much time, especially retirees, a lot of times, that don’t have other volunteer activities, watching the news and being reactive to that. And I think that’s one of the reasons that there’s that much more volatility in the market than there was 10 years ago, because as soon as something happens, within three to five minutes, it’s already being reacted on in the market.” 106

2. Creative Ideas in Implementation / Open-end Discussion a. Innovative/successful design (examples)



b. Develop innovative design Whatâ&#x20AC;&#x2122;s innovation? How would you implement your innovative mind into your design? Challenge your pre-conceived notion constantly to bring innovative idea to life. c. Brainstorming (Library: Strengths and Weaknesses) As an exercise, you can brainstorm about innovative library. Does library need to be innovative? If so, why? What are strengths and weaknesses of innovative library?


Exercise: 1. Research on innovative product or company that brought paradigm shift in Culture & Art Contents Industry a. 2 domestic, 2 Asian, 2 American, 2 European products/companies b. Analyze the paradigm shift they brought


Website to Look @: CES Innovations Awards



Chapter IV. Creative Thinking: Innovative Products

<Fig. 4. 1 Apple Inc. struggled a lot to survive in a touch computer market. But, once they released an iPod, Apple gained its dominance in portable media player market, and eventually transformed itself to the leader of ubiquitous portable computing device. Before iPod, Apple was a hardware company, but now Apple became a hybrid company that produces both hardware and software. Also, Apple has continued to innovate and has been successful to constantly impress customers.> <In this chapterâ&#x20AC;Ś> 1. Innovative Products: Analysis on Domestic and International Culture & Art Contents Industry a. Era of Streaming TV: Importance of PPL (Product Placement) Advertising b. Idea Keys c. Entrepreneurship & Examples of Start-up Companies d. Innovative Product Example: Clock without Battery 2. Creative Ideas in Implementation 3. Practical Project a. Suggest 2 ideas that can possibly bring paradigm shift in car industry


Steve Jobs and Innovation

<What is Innovation?> Innovation is the application of new solutions that meet new requirements, inarticulate needs, or existing market needs. This is accomplished through more effective products, processes, services, technologies, or ideas that are readily available to markets, governments and society. The term innovation can be defined as something original and new that "breaks in to" the market or into society. One usually associates to new phenomena that are important in some way. A definition of the term, in line with these aspects, would be the following: "An innovation is something original, new, and important - in whatever field - that breaks in to (or obtains a foothold in) a market or society." While something novel is often described as an innovation, in economics, management science and other fields of practice and analysis it is generally considered a process that brings together various novel ideas in a way that 114

they have an impact on society. Innovation differs from invention in that innovation refers to the use of a better and, as a result, novel idea or method, whereas invention refers more directly to the creation of the idea or method itself. Innovation differs from improvement in that innovation refers to the notion of doing something different rather than doing the same thing better. <7 Innovation Secrets of Steve Jobs> Apple CEO Steve Jobs is hands-down one of the greatest entrepreneurs of all time, so any sensible entrepreneur should spend some time studying his. Carmine Gallo, a communications coach and author, has written a book about Jobs that extracts key lessons on entrepreneurship and innovation. In The Innovation Secrets of Steve Jobs, Gallo lays out what he believes are the seven core principles of Jobs's core business philosophy and how others can adapt it. 1. Do what you love. Following your passion might sound like a soft skill, but Steve Jobs has said it's responsible for much of his success. Jobs was once asked point-blank what advice he would give a young entrepreneur looking for career advice. His response: "Go out and a get a job as a busboy or something until you find something you're really passionate about." Entrepreneurship is hard and takes perseverance. You will not have the energy to jump the inevitable hurdles unless you find that something that you are truly obsessed with. Next step: Find something you love to do so much you can't wait for the sun to rise to do it all over again. 2. Put a dent in the universe. Passion fuels the rocket, but vision directs the rocket to its ultimate destination. In 1976, when Jobs and Steve Wozniak cofounded Apple, Jobs' vision was to put a computer in the hands of everyday people. In 1979, Jobs saw an early and crude graphical user interface being demonstrated at the Xerox research facility in Palo Alto, California. He knew immediately that the technology would make computers appealing to "everyday people." That technology eventually became The Macintosh, which changed everything about the way we interact with computers. Xerox scientists didn't realize its potential because their "vision" was limited to making new copiers. In other words, two people can see the exactly the same thing, but perceive it differently based on their vision. Next step: Create a vision for your brand. In one sentence, explain how it moves society forward. 3. Kick start your brain. Creativity leads to innovative ideas. For Steve Jobs, creativity is connecting things, Jobs believes that a broad set of experiences expands our understanding of the human experience. A broader 115

understanding leads to breakthroughs that others may have missed. Broadening your experience also means seeking inspiration from other industries. At various times, Jobs has found inspiration in a phone book, Zen meditation, visiting India, the fine details of a Mercedes-Benz, a food processor at Macy's, or The Four Seasons hotel chain. Jobs doesn't "steal" ideas as much as he uses ideas from other industries to inspire his own creativity. Next step: Make more connections outside your field. Attend conferences that you normally would not attend. Travel more often. Hire partners and employees from outside your industry. Venture outside your comfort zone. 4. Sell dreams, not products. To Steve Jobs, people who buy Apple products are not "consumers." They are people with hopes, dreams and ambitions. He builds products to help people achieve their dreams. He once said, "some people think you've got to be crazy to buy a Mac, but in that craziness we see genius." How do you see your customers? Help them unleash their inner genius and you'll win over their hearts and minds. Next step: Get to know your customers better. Spend more time with them. Really get to understand their dreams so you can help fulfill those dreams. 5. Say no to 1,000 things. Steve Jobs once said, "I'm as proud of what we don't do as I am of what we do." He is committed to building products with simple, uncluttered design. And that commitment extends beyond products. From the design of the iPod to the iPad, from the packaging of Apple's products, to the functionality of the Web site, in Apple's world, innovation means eliminating the unnecessary so that the necessary may speak. Next step. Reduce the clutter. Ask yourself, 'What can I cut?' Is your Web site too cluttered, making it difficult for customers to find what they're looking for? Are your products to confusing? Is your presentation too long and cluttered? 6. Create insanely great experiences. Jobs has made the Apple stores the gold standard in customer service. The Apple store has become the world's best retailer by introducing simple innovations any business can adopt to create deeper, more emotional connections with their customers. For example, there are no cashiers in an Apple store. There are experts, consultants, even geniuses, but no cashiers. Why? Because Apple is not in the business of moving boxes; they are in the business of enriching lives. Big difference. Next step. Reconsider everything about your customers' experience. Evaluate their experience from the first time they land on your Web site, to calling your office, or interacting with your product. Improve the customer experience at every step by asking yourself, "What can I do to enrich the lives of my customers?" 7. Master the message. Steve Jobs is the world's greatest corporate storyteller, turning product launches into an art form. You can have the most innovative 116

idea in the world, but if you can't get people excited about it, it doesn't matter. For every idea that turns into a successful innovation, there are thousands of ideas that never gain traction because the people behind those ideas failed to tell a compelling story. Next step. Use these simple techniques to improve your presentations: Avoid bullet points as much as possible. Replace with text with photos and images whenever possible. Strive to follow the "40-10" rule-no more than forty words in the first ten slides of your presentation. <How To Innovate In An Uncertain World> By now, we all know what it takes to become successful: as Malcolm Gladwell revealed in Outliers: The Story of Success, with a steady diet of 10,000 hours’ practice, we can become experts in our field. And yet, examples abound of novices who dive in and thrash the competition. What did Reed Hastings know about video rentals before starting Netflix? Very little, just as Jeff Bezos was inexperienced in book sales before he launched Amazon. How did they evade this iron-clad law? In The Click Moment: Seizing Opportunity in an Unpredictable World, Frans Johansson offers an explanation. The 10,000 hour rule works well, he says, only in environments in which “the rules don’t change and you can figure out what you need to do and do it better than anyone else.” If you want to become a classical musician, a tennis star, or a chess Grand Master, starting early and getting in your hours is essential. But most fields aren’t like that. Instead, he says, “many of us don’t know what we need to do,” particularly in fastchanging industries like technology – or fields that are impacted by it. “Sometimes when the rules change, the unexpected can become our friend,” allowing newcomers with insight (like Hastings or Bezos) to succeed where others have not. “That’s why we have to invite the unexpected, rather than keeping it at bay.” In general, says Johansson, the business world thinks about success in the wrong way – with the mentality that “if I think about it hard enough, it’ll get done.” Strategy and analytics will only take you so far, he says. “The reality of success is that it has far more to do with the unexpected, and with serendipity and chance encounters. There are specific serendipitous moments that’ll take your career or your organization and veer it in one direction, and almost all careers or companies have that moment – the click moment. Maybe they accept that idea with [regards to] romantic love,” he says, but not in business. Yet making the effort to increase your exposure to serendipity is increasingly mandatory in today’s fast-moving society. “In the 1990s, I could take something happening in Sweden and bring it to the U.S., or vice versa,” says the Scandinavian-born Johansson. “But today it’s much harder to do that; people in the U.S. and Sweden are Facebook friends, and people will know about [new developments]. These connections are speeding things up. You might think, ‘I’ve seen it work here, let’s try it there,’ but 40 other people have 117

that thought.” If everyone is on the same logical path, the only way to stand out, he says, is to “harness unpredictability.” So how do you do it? To create better ideas, he says, the first step is creating more ideas. “People who change the world try to execute far more ideas,” he says. “Picasso ended up with 50,000 paintings, and that relates to unpredictability – if you could foresee what would be important, you wouldn’t waste time with things people didn’t think were worthwhile.” Another key driver of innovation is having a broad range of perspectives at the table. “Diverse teams create far more ideas, an exponential increase,” he says. “If you can make a unique connection, that can lead to 30 more ideas right away. Better ideas come from further apart.” Indeed, he says, “Diversity drives innovation, and if you’re better at diversity, you have an edge.” In your own life, says Johansson, you should ask yourself: “Are the people you work with always the logical choice?” If so, you might be in an inadvertent rut. Even if you think you don’t know a diverse array of people, Johansson says “we’re always encountering people who are different from us,” whether it’s people on airplanes or extended relatives with vastly different vocations. Too often, he says, we shut down those encounters prematurely. “You’re often trying to figure out what the end goal in the conversation is – and you ignore [the connection] if you’re not sure of the end goal.” But that can be a costly mistake. “If everything is planned in your day, by definition, that’s preventing something unplanned from happening.” Finally, he says, we have to be willing to fail. After all, most new ideas don’t work, and that’s OK, as long as you’ve limited your risk with “little bets.” Notes Johansson, “With Angry Birds, there were 51 [less successful] games before it. Many times, you do things where you can’t fail. People say, ‘I’ll do research.’ But how can you fail at that? It’s important to put yourself out there.” Where do you get your best ideas? Do you believe you can increase the amount of serendipity in your life – and if so, how do you do it? <Source of Innovation> There are several sources of innovation. It can occur as a result of a focus effort by a range of different agents, by chance, or as a result of a major system failure. According to Peter F. Drucker the general sources of innovations are different changes in industry structure, in market structure, in local and global demographics, in human perception, mood and meaning, in the amount of already available scientific knowledge, etc.. In the simplest linear model of innovation the traditionally recognized source is manufacturer innovation. This is where an agent (person or business) innovates in order to sell the innovation. 118

Another source of innovation, only now becoming widely recognized, is enduser innovation. This is where an agent (person or company) develops an innovation for their own (personal or in-house) use because existing products do not meet their needs. MIT economist Eric von Hippel has identified end-user innovation as, by far, the most important and critical in his classic book on the subject, Sources of Innovation. The robotics engineer Joseph F. Engelberger asserts that innovations require only three things: 1. A recognized need, 2. Competent people with relevant technology, and 3. Financial support. However, innovation processes usually involve: identifying needs, developing competences, and finding financial support. The Kline Chain-linked model of innovation places emphasis on potential market needs as drivers of the innovation process, and describes the complex and often iterative feedback loops between marketing, design, manufacturing, and R&D. Innovation by businesses is achieved in many ways, with much attention now given to formal research and development (R&D) for "breakthrough innovations." R&D help spur on patents and other scientific innovations that leads to productive growth in such areas as industry, medicine, engineering, and government. Yet, innovations can be developed by less formal on-the-job modifications of practice, through exchange and combination of professional experience and by many other routes. The more radical and revolutionary innovations tend to emerge from R&D, while more incremental innovations may emerge from practice â&#x20AC;&#x201C; but there are many exceptions to each of these trends. An important innovation factor includes customers buying products or using services. As a result, firms may incorporate users in focus groups (user centred approach), work closely with so called lead users (lead user approach) or users might adapt their products themselves. The lead user method focuses on idea generation based on leading users to develop breakthrough innovations. U-STIR, a project to innovate Europeâ&#x20AC;&#x2122;s surface transportation system, employs such workshops. Regarding this user innovation, a great deal of innovation is done by those actually implementing and using technologies and products as part of their normal activities. In most of the times user innovators have some personal record motivating them. Sometimes user-innovators may become entrepreneurs, selling their product, they may choose to trade their innovation in exchange for other innovations, or they may be adopted by their suppliers. Nowadays, they may also choose to freely reveal their innovations, using methods like open source. In such networks of innovation the users or communities of users can further develop technologies and reinvent their social meaning. 119

1. Innovative Products: Analysis on Domestic and International Culture & Art Contents Industry a. Era of Streaming TV: Importance of PPL (Product Placement) Advertising <Samsung Vs. LG: the story behind the biggest rivalry in tech> The rivalry between Korean tech giants LG and Samsung is well known, but it took a visit to LG's headquarters in South Korea this week for the true nature of the conflict to become clear to us. Both Seoul-based, the two companies have been in competition for nearly 50 years, and they're somewhat obsessed with one another. We've all read the stories about the skullduggery between them: secrets have allegedly been stolen, accusations have been made, court cases have dragged on. Even in the last few weeks, the companies have re-locked horns in patent disputes over their OLED technologies. Police recently raided some Samsung facilities in order to secure evidence after LG accused its neighbor of spying. It's a familiar story in these parts. The upshot of the situation is that passing through buildings owned by these companies is like getting through security at an airport. Bags are scanned. Cameras are confiscated. Lenses on phones are taped over. USB storage devices are not allowed. Security cameras are everywhere. The entrance lobbies are full of metal detectors and bag scanners just like departure lounges, but unlike an airport, you don't have to worry about this on the way in - it's on the way back out again that the stringent security measures are deployed. They want to make sure you're not trying to steal any secrets. As a visitor, it's a fascinating curiosity. For the people who work here, it's just everyday routine. We're currently traveling on a bus heading north towards the border with North Korea. This is where LG's enormous LCD plant is based. We're due to take a tour and we've already been told to expect even more stringent security measures when we get there. It's not hugely surprising - both companies are leading innovation in display technology and seem to be zigging and zagging in unison. Both are bringing out similar products at the same time. Which Korean brand brought the "world's first curved OLED TV" to CES this year? Both of them, naturally.


Why you'd want one is up for debate, especially given that only 200 standard OLED TVs have been sold by LG total in Korea - but LG says the curved version will hit the shelves later this year regardless. They'll be available first at the LG Best Shop megastore in downtown Seoul, which appropriately looms ominously right across the road from the equally sized Samsung superstore. More than tech But LG or Samsung is far more than a technology choice for many people in South Korea. It's a lifestyle - a way of life. And for many of the 200,000 or so people employed by these companies, it's an allegiance that will last their entire working life. Unlike many conglomerates in Europe or America, big businesses in South Korea feel a responsibility to the viability of the nation's economy. As part of that, they take on many graduates every year as a matter of course and the vast majority of these young men and women will then never work for another company from that day until the day they retire. Careers are made and broken within. People simply don't leave. This hiring process is fierce in itself: both LG and Samsung want to hire the best people, but there's a talent shortage in Korea, so there aren't enough skills to go around. If you're a gifted software engineer and you speak Korean, there's a well-paid job waiting for you in Seoul. Surf and turf wars The relationship between these brands goes deeper than mere rivalry, too. The companies are both obsessed and repulsed by each other in equal measure. Samsung has been mentioned a lot by our LG guides this week, and not disparagingly - LG clearly has huge amount of respect for what Samsung has achieved in the last few years. But at the same time, there is no love lost when it comes to the workforce. Both brands have their own social territories locally and internationally. Restaurants, hotels and bars are divided up between them. Samsung employees know not to go to certain places and it's the same the other way around - they don't like to mix socially. It's very similar to the way sports fans in the West know which pubs they should go to for a match, and which they should avoid.


This even plays out at the big tech shows around the world - there are unwritten rules about which Korean restaurants it's OK to go to during CES in Las Vegas or IFA in Berlin, depending on which company you work for. Both look over at the other's turf with envious eyes. Appropriately, both LG and Samsung own their own self-titled Baseball and Soccer teams in Korea â&#x20AC;&#x201C; sports clubs run at a loss to promote the brands and fly the flags. Employees of both companies can apply for tickets to watch the games - the local derbies being the hottest ticket in town. Next time you're in Seoul, perhaps you'd like to head down to the Jamsil Baseball Stadium to watch the LG Twins hit all the homers, or to the Suwon World Cup Stadium to see the Samsung Bluewings play soccer. Of course, the majority of Koreans have no affiliation to either brand - this is a nation of over 50 million people, while LG employs 80,000 people total. But most people still seem to have a preference. We asked random Seoul citizens the question: LG or Samsung? Most people smiled. Some laughed. But they all still gave an answer. <PPL, Product Placement> Product placement, or embedded marketing, is according to the European Union "any form of audiovisual commercial communication consisting of the inclusion of or reference to a product, a service or the trade mark thereof so that it is featured within a program". Product placement stands out as a marketing strategy because it is imperative to attach the utmost importance to "the context and environment within which the product is displayed or used" In April 2006, Broadcasting & Cable reported, "Two thirds of advertisers employ 'branded entertainment'â&#x20AC;&#x201D;product placementâ&#x20AC;&#x201D;with the vast majority of that (80%) in commercial TV programming." The story, based on a survey by the Association of National Advertisers, said "Reasons for using in-show plugs varied from 'stronger emotional connection' to better dovetailing with relevant content, to targeting a specific group." <Ways to measure product placement> Economic effects One way to measure product placement is to measure the economic effects it has on a certain product or in particular how product placement affects the stock price of a company. It has 122

been found that companies that place products in upcoming box office movies tend to have an increase in stock price starting 10 days before the movieâ&#x20AC;&#x2122;s release and lasting for three weeks after the movie release. However, when looking at stock value across a long period of time, the stock price of companies tends to form an inverted U-shape. This means that although product placement tends to cause an increase in stock price for a short time before, during, and after the movie release, this increase in price does not last for an extended period of time. Implicit memory Product placement is also measured through implicit memory. One way to measure implicit memory is to see if participants chose a certain product over other products after seeing a product placement. For example, researchers had children view the movie Home Alone, which featured the cola drink Pepsi. After viewing the movie, kids were asked to grab a drink before the interview began. They had a choice of Coke or Pepsi and researchers recorded what kind of drink the children chose. This measures implicit memory because the children chose the kind of cola without thinking or being prompted by the researchers. Ultimately, the children chose Pepsi, which shows that the placement had an impact on their implicit memory. Explicit memory A third way to measure product placement is by measuring oneâ&#x20AC;&#x2122;s explicit memory. A common method of measuring explicit memory is product recall, where an experimenter asks a participant what brands he or she can remember from a film. Sometimes brand recall is prompted by giving the participant categories or brands to help them remember certain products, and sometimes it is not. Brand recognition is where an experimenter shows a participant a list of brands and they are asked to pick out which ones they saw in the film, TV show, or whatever medium the product placement was in. Accuracy Lastly, product placement can be measured in terms of how accurately it targeted the film's audience, meaning did the product match accurately with the demographic of the audience. In Spain, in-home interviews were done to measure the accuracy of product placements in a selection of films. Movies made in the United States more accurately targeted the Spanish participants compared to European movies. Also, the movies that best targeted their audience were movies that took place in the past instead of present day. 123

<The effectiveness of product placement> It has been found that product placements are effective in getting people to buy or choose products. As mentioned previously, a group of children watched a clip of the movie Home Alone, which featured Pepsi. After watching the movie, the children were given the choice of Pepsi or Coke. 67% of children who had just watched the movie chose Pepsi whereas only 42% of the children who did not see a clip with Pepsi chose Pepsi. Product placements may be so effective because viewers and consumers are all trying to reach an ideal self and while trying to achieve this ideal self they indulge into the stories that the product placements tell. The role of Bollinger (champagne), Jaguar, and Aston Martin was looked at in three vignettes from James Bond movies. In each of these vignettes, these products took on a personality and a role that consumers would want to indulge in and take on. For example, the Aston Martin seemed to be heroic while the Jaguar seemed to be villainous and their roles within the movie held true to these characteristics. Brand placements can be more effective than advertisements. It has been indicated that people like brand placements on the radio more than regular radio commercials. They also thought that brand placements on the radio were more legitimate than commercials. Although this study was done with radio, it is likely that these findings may also apply to film. <Audience factors that influence effectiveness> Field dependence-independence Whether a person is field dependent or field independent can impact effectiveness. A person who is field independent (FI) is someone who is "better able to separate a stimulus from its embedding contexts" and as a result are better at noticing product placements in film. A person who is field dependent (FD) has a hard time viewing an object and its context or background as different entities and has "more difficulties differentiating between relevant and irrelevant information compared with FI individuals." Research shows that field independent people notice product placements significantly more than the field dependent people. Because of this, field independent people were better at brand recall. Additionally, field dependent people tend to like placed brands more than field independent people due to the fact that field independent people were more aware that the intention of the product placement was to get them to buy the product. 124

Attention Multitasking also affects the effectiveness of a product placement. Researchers found that people who were cognitively loaded (preoccupied) thought negatively of products that were well incorporated in the plot compared to those people who were not cognitively loaded (focused solely on the movie). However, cognitively loaded people had a more positive attitude towards products that seemed to interfere with the plot compared to those people who were not cognitively loaded. Also, people who were cognitively loaded tended to view products that were well incorporated in the plot as the same as the competitor product. Products that interfered with the plot were preferred by cognitively loaded people compared to the competitor product and not preferred by non-cognitively loaded people. These findings show that no product placement can be perfect as many people watch movies while doing other tasks and many put forth their full attention while watching movies. Similarly, viewer involvement also impacts effectiveness. It has been found that the more into a film a person is, the less able they are to recall the brands that had product placement in the film. Nationality, ethnicity, & age Nationality also plays a role in how likely a person is to purchase a placed product. It has been found that Americans are more apt to purchase a product they saw placed in a movie compared to French and Austrian people. The ethnicity and age of a viewer also influences the effectiveness of product placement. According to an online survey of 3,340 people, African Americans were more likely to either purchase or research a product after seeing it in a movie compared to Hispanic, Asian, and Caucasian movie watchers. The survey also found that younger people are more likely to purchase or research a product after seeing it in a movie. People ages 19â&#x20AC;&#x201C;25 had the highest product engagement score out of all the age groups. Brand consciousness Brand consciousness also impacts the effectiveness of product placements. It has been found that adolescents who are brand conscious are more aware of product placements and like them more than those who are not brand conscious. This is probably because brand conscious people are interested in brands and want keep up with the latest products.


b. Idea Keys


c. Entrepreneurship & Example of Start-up Companies <5 Innovative Startups From DreamIt NYC Demo Day> DreamIt Ventures' accelerator program debuted its 15 new graduates Wednesday in New York City. The 15 startups gathered for DreamIt's Demo Day to present their projects to media companies, venture capital firms, law firms, advisors, and other investors. The startups represented a wide range of topics, from the recreational to the supremely functional. Video games, sustainable energy optimization, e-learning, and data aggregation platforms were all part of the program, and the startup founders were happy to share their wide range of backgrounds, interests, and life stories. DreamIt Ventures helps startups get a head start with its accelerator program, which consists of a three-month intensive workshop, during which entrepreneurs receive seed funding, coaching, lectures, and networking opportunities. The New York program is now in its third cycle, and while their programs are mostly centered in cities in the United States and Israel, Mark Wachen, DreamIt's managing director, states they are "evaluating possible expansion opportunities to other cities." 127

1. GamePress We've already heard about startups allowing you to create websites without coding. Now, GamePress lets you create video games without having to know a single line of code. You can develop a wide variety of games on an iPad with GamePress, and pre-existing widgets facilitate the addition and customization of commands (such as jumping and running), actions (such as bouncing off a wall), or events (such as a boulder swinging back and forth during a level). You can choose from the startup's collection of templates, or even import your own images. The app, which costs $10, also features a storyboard on which you can organize the sequence of events in your games. Users will eventually be able to publish finished games and even sell them on the iOS App Store. Users will also be able to sell their own sounds, graphics, and designs to GamePress as well, Murtaza Saadat, CEO, explains. GamePress is currently looking to raise $500,000 in order to expand the app's features. 2. Serviceful Juan Chaparro, the CEO of Serviceful, is eager to revolutionize the way we handle home management and, with his startup, aims to do just that. Serviceful provides you with your own personal concierge and aggregates home management tasks onto one platform. "Home ownership is great," Chaparro says, "but maintenance sucks." For $100 a month, Serviceful lets you take pictures of places in your house that need repair, analyzes the situation, and suggests the best provider for fixing the problem. The personal concierge takes care of requests and household needs by sorting through online listings and reviews and selecting the optimal service provider. This makes it unnecessary for users to sort through a sea of reviews themselves before selecting a provider, Chaparro explains. 3. Mimoona With 13 clients under its belt at the time of writing, Mimoona is determined to help fashion designers maximize their revenue and minimize their risk by crowdfunding designs. "The need to be focused on design trends is incredibly important" for designers to survive, Arik Marmorstein, Mimoona's CEO, explains. Mimoona functions as a crowdfunding site for designs, where designers can display models they're considering producing and 128

allow potential buyers to pre-order the designs. If a certain number of people pre-order a design, it gets produced. The idea is to help designers save money and make more successful designs, all while receiving funding and encouraging more engagement with potential customers. According to Marmorstein, Mimoona is the most successful crowdfunding platform in Israel, and the startup is part of DreamIt Israel, which aims to introduce Israeli startups to a U.S. market. Marmorstein states that the startup's goal is "to raise $600,000 and get 300 customers in the next 12 months." 4. WeDidIt WeDidIt combines philanthropy and technology by creating a platform on which non-profits can conduct effective fundraising. WeDitIt determined that online fundraising was the most costeffective method, vastly superior to employing volunteers with clipboards that have to chase down pedestrians. WeDitIt also helps non-profits gain insight on their social media performance by accumulating data over multiple platforms, such as Facebook, Twitter, and more. The startup can measure which social media posts were the most popular among users, and which content donors responded to the most. WeDidIt is looking to raise $750,000, and has recently signed Amnesty International as a partner. 5. Callida Energy Green energy solutions have been in high demand for quite some time, and Callida Energy has proposed a centrally allocated software solution to combat antiquated energy management in large buildings. Using specific data, such as building occupancy, up-to-date weather reports, and precise temperature measurements in different parts of the building, Callida Energy's software optimizes goals and strategies for efficient energy management. On one platform, a building manager can prioritize goals, such as saving costs and improving temperature regulation, which prompts the software to create a corresponding strategy. Raphael Carty, Calliday Energy's CEO, says he was inspired to find a building management solution which was simple, could be effectively customized, and optimized output. <The DNA of the Worldâ&#x20AC;&#x2122;s Most Innovative Companies>


Innovation makes millionaires and undermines monopolies. It raises the profitability of companies and puts a premium on the shares of the most successful. But how can companies foster it? New research sheds light on the innovation process and how firms can tap into it to raise their performance and their share price. Innovative business leaders typically share certain qualities. They are always asking questions, experimenting, observing and networking. While building on past successes, they keep the doors open to future innovation. In a world where success often breeds more success, such behavior can boost the market value of their companies well beyond what current profitability would justify. In a newly published study of what makes a successful innovator, “we looked at people who lead incredibly innovative companies”, says Hal Gregersen, INSEAD Senior Affiliate Professor of Leadership and Director of the Learning to Lead executive education program and one of the study’s co-authors. “And we realized that these companies seemed to be incredibly valuable.” In reaching this realization, Gregersen and his co-authors, Jeffrey H. Dyer of Brigham Young University and Clayton Christensen of Harvard Business School, had hit on what they call the “innovation premium”. And in their book, “The Innovator’s DNA”, they explain how for some of the world’s most innovative companies it can add 50 percent or more to their market value. “Investors pay a stock price based upon two things,” says Gregersen. “One is the cash flow - the money coming from existing products, services and markets. The other is the belief that the company will develop new markets, new services and new products tomorrow.” More jam tomorrow Take a company like Amazon. Given its reputation, suggests Gregersen, an investor might well say: “I’ll pay you this amount for your stock for the existing products and services, and for the markets that you’re in. But I also believe you will do something different in the future. You’ll have new markets. You’ll have new services. You’ll have new products you don’t even have today and because of that, I’ll pay you a premium.” Building on this insight, Gregersen and his co-authors worked with HOLT, a unit of Credit Suisse Group, to draw up an innovation premium roll-call of innovative companies based on analysis of the relationship between their cash flow and their share price. To qualify, companies had to be listed on a stock exchange and have a market capitalization of at least US$10 billion. They also 130

had to have published financial statements over at least the past seven years. The results were striking. Companies like Toyota, Sony and Samsung, which frequently feature on other lists of innovative companies, sank to negative ratings. In their place emerged a number of unexpected and relatively unknown companies - firms like California-based Intuitive Surgical, which builds systems for robotically assisted, minimally invasive surgery, Natura Cosméticos, a Brazilian manufacturer of cosmetics made from plants from the Amazon forest, and Keyence Corporation, a Japanese producer of electronic sensors for automated factory systems. Cut-throat car market The list includes household names like Amazon, Apple and Google. But what makes it different from other similar lists is that it ranks firms not just by past achievements but by what investors expect going forward. “Our list is future-looking, forward-looking and it’s based on past performance predicting the future,” Gregersen explains. “These are organizations that systematically, over at least a five-year period, have generated this kind of premium. Investors bet with their wallets: this company is innovative, not only now but in the future.” Common to all companies on the list is the fact that their share prices are 25 percent or more above what would be justified by cash flow alone. The leader is cloud computing company, with its AppExchange that offers more than 1,000 applications for businesses, and which recently launched Chatter draws on features of Facebook and Twitter to provide social software for enterprise collaboration. Market expectations for further innovations have given it a premium based on 2010 results of no less than 75 percent. Bringing up the rear, PepsiCo scrapes in at number 50, with a premium of 25.45 percent. Companies like Toyota and BMW, by contrast, despite their known capabilities for innovation are nowhere to be seen. That, says Gregersen, is because investors expect them to find it hard to earn dividends from new innovations in the face of tough competition from Chinese manufacturers in today’s cutthroat car market. Think different, behave different So how do companies develop the innovative qualities that enable such results? “There are three elements to this,” says Gregersen. “The people in the company, the processes they have and the philosophies they have.” The essence of the innovator, he adds, is that he or she not only thinks differently from other people, but also behaves differently. Take Steve Jobs, the founder of Apple. “If we walked into his world 131

and followed him for a day, we could see him behaving in ways that will generate new ideas. He lives the Innovator’s DNA skills. He observes the world really carefully. He talks to all different kinds of people. He’s more than willing to engage in different kinds of experiments, constantly peppering the world and the people around him with questions that provoke people and challenge the status quo.” Or take Mike Lazaridis, founder and co-CEO of Research in Motion, the firm that gave the world the BlackBerry, or Scott Cook, the founder of Intuit. They, too, are always asking questions and looking out for the unexpected: “Why not this? Why couldn’t we do that? What’s going on here? How could we do this better?” When someone “behaves that way, acts differently, asks lots of questions, observes like an anthropologist, experiments constantly, networks for new ideas,” Gregersen observes, “they’re likely to get incredibly insightful ideas about new businesses, new products, new services, breakthrough processes: things that will make a difference for any company or country.” Down on the farm That’s something most companies in today’s environment would pay dearly for. And the good news for those who really want to innovate is that, given the right environment, innovation can be within the reach of anyone. “About 25 to 30 percent of our innovation capacity is a genetic component, it’s our DNA,” says Gregersen. “But that’s one-third of the equation. The other two-thirds is the world we live in. It’s fascinating when we interview these famous entrepreneurs to realize that they grew up in worlds where adults paid attention to these innovation skills.” Most often these adults were parents and grandparents, but in about one-third of the cases they were master teachers at Montessori or Montessori-like schools.” To show how curiosity and willingness to experiment can be nurtured, he cites the founder of Amazon, Jeff Bezos, and the chair of Bain & Company, Orit Gadiesh. “Bezos had grandparents who taught him and reinforced to him that experimentation matters. He lived on a farm with them in the summertime and when things broke down, they fixed the things that broke down. They learned that when you try and experiment you can figure out a solution.” As for Gadiesh, “She grew up in a family where questioning was everything and it was reinforced to her that she question. So they both not only had some genetics around these skills, but they grew up in a world that said ‘keep them, pay attention to them, use them, do something with them’. And then when they became 132

adults they actually went out and did something with them.” Everybody’s job What lessons does Gregersen draw for other firms that want a piece of this innovation bonanza? Firstly, innovation starts at the top. “Companies on this list are led by leaders who spend at least a day more a week than a non-innovative CEO doing these innovation skills: asking provocative questions, going out there and making real observations and not relying on second-hand data.” Secondly, innovation must be allowed to permeate every level of the company. In a truly innovative company, innovation has to be everybody’s job. “It’s just part of what you do when you walk in through the door today when you come to work. You need to figure out a better way, a more innovative process, a better product, better service.” Finally, however, a warning: innovation can be disruptive, and in a company with no innovation philosophy, it’s likely to be unwelcome. In this case, says Gregersen, a would-be innovator faces a Catch 22 situation. “If I’m in a company that’s not innovative and I just do what they ask me to do, I’ve sealed my fate to not have a future. If I start engaging these skills, on the other hand, I may get a lot of pushback and irritation, and I may even get fired.” In such a worst case scenario, he concludes, it’s time to use these skills in a more receptive environment, so as to “create a future that otherwise won’t be there”. d. Innovative Product Example: Clock without Battery Clock needs battery. However, there are many ways to make a clock without battery. But, to make one clock without battery and to manufacture it in mass scale are totally different things. Try to think about processes to manufacture clock without battery and how you can benchmark these companies to bring your innovative ideas to life. 2. Creative Ideas in Implementation What are challenges to implement your innovative ideas? You can have tons of innovative ideas, but most of them are not materialized due to many limitations. Think about these limitations and come up with possible solutions to go around these limitations. You have to be creative to bring your 133

innovative idea to life. 3. Practical Project a. Suggest 2 ideas that can possibly bring paradigm shift in car industry


Exercise: 1. Research on innovative design firms that have demonstrated creative design process a. 2 domestic, 2 Asian, 2 American, 2 European products/companies b. Analyze how passion drives that person or company


Website to Look @: The Worldâ&#x20AC;&#x2122;s Most Innovative Companies 2013


Chapter V. Creative Thinking: Design

<Fig. 5. 1. Design matters.> <In this chapter…> 1. Potential in Culture & Art Contents Industry: Creative Thinking a. Maestro Striving for Simplicity: Philippe Starck b. Aesthetic Architecture with Lights & Concretes: Tadao Ando c. “I love luxury.”: Coco Chanel d. Creating New Lifestyle Based On Practicality: Giorgio Armani 2. Creative Ideas in Implementation a. Brainstorming: Creative Design for Library


Good Design Sells There is no doubt that a well designed world is a better world to live in. This applies to many different aspects of our daily lives. Consider your experience walking through the Philadelphia Museum of Art, flipping through a magazine with beautiful imagery and layouts, or shopping at an upscale boutique. These interactions are all made more enjoyable by the appeal of the aesthetic surrounding them. A good looking product is more desirable to the user than one that appears underdone or overlooked. Good design sells. If aesthetic is so alluring, why shouldn’t this be considered a crucial component to the success of a business? Design consideration should be at the core of business development. A lack of consideration for the design of your company and the products you market is selling yourself short. Design is emerging as a critical strategic component of American management and commerce. Your business’s aesthetic is a contributing factor to the decisions consumers make about your products or services, and whether or not they are interested in what you offer. Visual appeal is your driving force. When a consumer is presented with numerous options about a particular good or service, you want to be the chosen one. But if you’re offering the same product as 10 other companies, what’s going to make you stand out? Desirability plays an important and often decisive role in product selection. Aesthetics can make your product seem more trustworthy and professional, which are major selling points in any marketplace. Consumers make decisions based on reliability and trust, so you need to make them feel like they are in intelligent and responsible hands. This is where designers and marketers can work hand-in-hand to assess what consumers are responding to and, if necessary, rebrand or redesign your product. An excellent example of a successful rebrand is Dimaquina’s design update to Aquarius Fresh, a product of Coca Cola Brazil. The old packaging of the product was pretty unremarkable, which made it difficult to stand out to consumers in the marketplace as a choice soda. In 2009, the brand reevaluated itself and considered what really distinguished them from other sodas, its bright colors. Playing up the colorized liquid was key to establishing the soda as a satisfying sensory experience. This was achieved by making the packaging largely transparent and highlighting the vibrancy of each different drink. The updated packaging really distinguished the soda from its competitors. In Coca Cola’s 2010 Annual Report, Aquarius was listed as one of their 14 billion dollar brands, which speaks to the success of the redesign completed in the previous year. The colorful design is still successfully employed today. Whether you’re in the process of establishing a start up business or thinking of revamping your company’s look, there are a few important points to consider: What is the message you want to convey? Any design decisions should be 138

made with an end-goal in mind. You want your customers to feel a certain way about your business and this should be reflected in the image you project to them. Without considering your message, you may be confusing your consumers with conflicting ideas or lack of direction. Who are you marketing your product to? This point is somewhat an extension of the last, but it’s a crucial consideration. Aside from the general message you want to convey, you need to consider who will be receiving it. These considerations should be shown in the decisions you make about the look and feel of your product or business. If you are redesigning, will the changes be minor or a complete revamp? When updating an existing company’s identity, it’s important not to lose all recognition from your brand’s loyal consumers. Some companies choose to make subtle changes to their look periodically in order to stay fresh and modern, while others may make more drastic changes. In either case, your new design should still speak to the previous look to retain brand awareness. Redesigning your business involves a number of very important decision making processes. Vandelay Design laid out a number of key things to consider when doing a revamp. This is a great place to start when brainstorming about what direction your company should be moving in. Consideration of your target audience, what message you seek to convey, and a close attention to design details should likely lead to a great redesign and an appealing company look. <What is Good Design?> Good design is not just what looks good. It also needs to perform, convert, astonish, and fulfill its purpose. It can be innovative or it might just get the job done. Inspired by Dieter Rams, I’ve long kept a list of what I think good design is. It is ever expanding and some things are more important in some projects than other. Below is how my list looks right now – greatly inspired by Dieter Rams, but focused more on online design. Good design is innovative Innovative design can both be a break-through product or service, and a redesign of an existing product or service. A break-through product adds a before unseen value and function to the market and the user, while a redesign improves an existing product. Innovative design always develops in tandem with innovative technology, and can never be an end in itself. Good design is functional


Useful design fills its intended function – and likely both a primary and secondary function. A useful design solves problems and through its design it optimizes a given functionality. Good design makes a product useful “It has to satisfy certain criteria, not only functional, but also psychological and aesthetic. Good design emphasizes the usefulness of a product whilst disregarding anything that could possibly detract from it.” Good design is aesthetic An aesthetic product has an inherent power of being able to fascinate and immediately appeals to its users senses. “Only well-executed objects can be beautiful. The aesthetic quality of a product is integral to its usefulness because products used every day have an effect on people and their well-being.” A good design is intuitive Intuitive design explains itself and makes a user manual unnecessary. A design makes how to use, perceive, and understand a product obvious. A good design explains its function. “It clarifies the product’s structure. Better still, it can make the product clearly express its function by making use of the user’s intuition. At best, it is selfexplanatory.” A good business Assuming a product is designed to sell, a good design does well in the competition and stands out in a competitive market. A good business means a positive profit, why a good design sells well. A good design is honest “An honest design communicates solely the functions and values it offers. It does not attempt to manipulate buyers and users with promises it cannot keep.” A good design is long-lasting In a society of over-consumption, a good design has an important objective. It builds on sustainability in the sense that design and materials are durable and not just a trend. Waste and over-consumption is not a part of good design. “It avoids being fashionable and therefore never appears antiquated. Unlike fashionable design, it lasts many years – even in today’s throwaway society.” 140

A good design is user-oriented Good design is based on its use and designed to improve a given situation for its user. User-oriented design adds value both intellectual and material value to its product and in turn increases satisfaction and the life situation of its user. A good design is unobtrusive “Products and their design should be both neutral and restrained, to leave room for the user’s self-expression. Products fulfilling a purpose are like tools and are neither decorative objects nor works of art.” A good design is thorough – down to the last detail “Nothing must be arbitrary or left to chance. Care and accuracy in the design process show respect towards the consumer.” A good design is as little design as possible “Dieter Rams makes the distinction between the common “Less is more” and his strongly advised “Less, but better” highlighting the fact that this approach focuses on the essential aspects thus, the products are not burdened with nonessentials. The desirable result would then be purer and simpler." A good design engages through intrinsic motivation. A good design makes the user want to engage through intrinsic rather than extrinsic motivation. A good design is focused A good design is effective and efficient in fulfilling its purpose. It relies on as few external factors and inputs as possible, and these are easy to measure and manipulate to achieve an expected other output. A good design is always the simplest possible working solution. <5 Quick Tips for Good Design> If design concepts seem like Lorem ipsum to you, take our crash course with these great design tips! 1. Spacing Less is more! The basic mentality for most people is “fill the space”, which leads to things looking messy and cluttered. Allow images and text to breathe. White space in your design will draw the eye to more important components. If your layout is unorganized, the reader won’t know what to focus on and you run the risk of losing your main message. 141

Tip) Essential as it is to leave space amongst design elements, it is also important to stay clear of page edges. Give yourself at least a quarter inch border. 2. Typography Choosing a typeface (font) is another key component to good design. The typeface(s) you choose will drive the overall look and feel of your design. Mixing fonts is an art and takes time to get the hang of. I suggest looking at examples from other designers who have already accomplished the same aesthetic you are trying to achieve. It’s not cheating, it’s just how we learn what works well. Tip) If you choose to mix typefaces, keep it simple. No more than 2-3 font choices in any design. Tip to save the world: Unless you are designing a birthday invitation for a three year old, please never use comic sans! 3. Body Copy Creating great content for your design is a task in itself. So don’t ruin your hard work by making some of these common design errors: •

Width: Keep paragraphs at a legible length. A good rule to stand by is not having paragraphs with more than 10-12 words in a line. Shorter sections are easy for readers to digest. Leading (the distance between lines of type): It can be difficult to find a happy medium for how much space you should allow in your body copy. Generally the default value is too little spacing. Give lines enough air to breathe, but not too much that a reader’s eye can be easily lost. Widows and Orphans: These are common terms that typographers refer to as single words at the beginning or end of a paragraph.

Tip) Paying attention to these small details can help take your design to the next level. 4. Color Palette Choosing your color palette can be a difficult and daunting task. A good place to start is by picking colors that you already know convey the feeling you’re designing for. Again, keep it simple. Pick two primary colors and one or two subtle secondary colors as an accent. No more than 5 colors tops! Tip) If choosing the perfect color just isn’t your expertise, try getting some help from this favorite designer site: where you can search by 142

category or theme and view a variety of other designer choices. The best part is Kuler gives you the HEX number so you can get the colors spot on. 5. Consistency Even if you have failed at all the categories above, keeping your design consistent can save everything. Make choices in the beginning and then stick with them. Make sure all the headings, subheadings, spacing, fonts, etc. are the same throughout. It can be easy to get off track once you dive into things, so make it a habit to revisit these areas once you’re done. <How Good Designers Think> We all know that really good designers somehow think differently from you and me about new products. But just exactly what does this difference consist of? The best summary of what makes really good designers tick was a simple post by Bruce Nussbaum back in 2007. Since reading that I've often pondered the subject and today, I find it helpful to look at my experience of how good designers think (and do) at each stage of the innovation process: insights, inspiration, and action. Insight: They Look at What We Don't Know Most insight, because it relies so heavily on asking consumers, only deals with improvements to known/ existing products and services (I'd like it bigger, cheaper, quicker, smaller, etc). It rarely deals with the new/never been done before — the unexpected but relevant solution. No one ever asked for Starbucks, or Walkmans or iPods, or the Internet, or texting — they were truly new ideas. And no amount of consumer research gave Steve Jobs the confidence to re-imagine the music industry. Good designers aim to move beyond what you get from simply asking consumers what they need and want. First of all because they understand that most people when asked don't say what they mean or mean what they say, but also because people often don't know. Good designers want to unearth what consumers can't tell them: latent & emerging needs and motivations; actual behaviors and attitudes; and, crucially, barriers to as well as drivers of change — or simply put, what your competitors don't also already know. How? Firstly, good designers don't tend to think about consumers; they think about people and what they want and need. It's a subtle point, but thinking about people as consumers immediately dehumanizes them and makes it harder to empathize. Secondly, good designers like observing — really looking at what people do rather than simply relying on what they say they do. As Paul Smith once 143

explained, when asked where he got his ideas from: "You and I could walk down the street together and look at the same things, but I'd SEE ten times more than you would." Thirdly, they bring expertise in other categories and industries to bear on problems in others. They pull together threads from different functions, disciplines, fields, and sectors, and integrate them into a new and (the dreaded word) "holistic" understanding. Fourthly, good designers look at what might all change in the short, medium and long-term, by engaging with the best trends and forecasting intelligence. Unlike other crystal ball gazers they use this prescience to help them understand how they could bend the future, shape it to their vision. And lastly, good designers pressure test their conclusions by consulting with other cultural 'interpreters' from a broad range of other disciplines. Inspiration: They Look for What to Do Good designers want to solve problems â&#x20AC;&#x201D; and this makes them want to transform insights into inspiration. How? Firstly, they have the ability to visualize what has never been. As Bruce Nussbaum said in the same post, "Many firms are plagued by articulate and persuasive 'smart talkers' who sound good in meetings but get bogged down in abstract complexities." Good designers are good at what I call inspirational tangibility, "making it real," whether it be by concretizing with a sketch what would otherwise be abstract thoughts or so many post-its in a meeting, enabling large amounts of complex data to be understood and absorbed quickly with a diagram, or as Bruce describes it "quickly lashing together a physical or digital mock-up" of a proposed solution. Secondly, good designers live and work in the future most days, immersed in the activity of actively creating and shaping their client's future visions of new products and services. And this familiarity with fusing creativity with what's feasible and commercial every day is what makes good designers so good at doing this consistently and better than others. Thirdly, they overcome the "not invented here..." syndrome. For new ideas to survive and indeed thrive they have to be successfully embraced by all the relevant (another ghastly word) "stakeholders." Good designers can act as a translator between functional silos as different as supply chain, marketing and R&D. Action: They Keep Going When good designers talk about innovation, they mean (and I make no apologies for cribbing Lord Sainsbury's much-quoted definition), "the successful exploitation of new ideas." They don't stop with the invention. They turn their 144

inspirations into reality. How? Firstly, in the case of a new product or service, it's unlikely to be successfully brought to market unless it can be integrated into and be supported by all the other aspects of the marketing mix: and if we're talking new business strategy, then good designers have to understand how the new offering could and should impact (and to what degree) all the other aspects of the organization: from its structure, to its mission and culture...all the way to the business model(s) that underpin everything. Good designers don't claim to be able to do all these things, but they do know to work with the various functions and outside resources that do. And unlike some others, they don't leave their colleagues at the bus stop; they stay with the project until the end because nothing gives a good designer more satisfaction than being able to point to something that everyone else thinks is the best thing since sliced bread and saying, "I did that!" Secondly, they are good at practical resolution. Bruce Nussbaum describes the problem thus, "Some of the smartest execs get bogged down in the messy process of implementation." But again, good designers' ability to "make it real" can help resolve contradictions and find highest common denominator compromises, helping the (innovation/ marketing) process more forward. Thirdly, good designers are good at iterative prototyping, refining the concept through repeated cycles and getting feedback from the right people as they go. James Dyson famously made two thousand prototypes of his bagless vacuum cleaner before he got it right. The rest, as they say, is history. 1. Potential Culture & Art Contents Industry: Creative Thinking a. Maestro Striving for Simplicity: Philippe Starck


Philippe Starck is a French product designer and interior designer, born 18 January 1949 in Paris. He is equally well known as an interior designer, a designer of consumer goods, and for his industrial design and his architectural creations. Philippe Starck started his career in the 1980s. <Career> The son of an aeronautics engineer, Starck studied, when attending school, at the École Nissim de Camondo in Paris. The inflatable structure he imagined in 1969 was a first incursion into questions of materiality, and an early indicator of Starck's interest in where and how people live. Starck's iconoclast designs brought him to the attention of Pierre Cardin who offered him a job as artistic director of his publishing house. At the same time, Starck set up his first industrial design company, Starck Product - which he later renamed Ubik after Philip K. Dick's famous novel - and began working with manufacturers in Italy – Driade, Alessi, Kartell – and internationally, including Austria's Drimmer, Vitra in Switzerland and Spain's Disform, to name but some. His concept of democratic design led him to focus on mass-produced consumer goods rather than one-off pieces, seeking ways to reduce cost and improve quality in mass-market goods. In 1983, the French President François Mitterrand, on the recommendation of his Minister of Culture Jack Lang, chose his project to refurbish the president's private apartments at the Élysée, a decision that was seen as symbolising public acknowledgement of design. The following year he designed the Café Costes. Starck's prolific output gradually extended to every area in which design can have its say: furniture, decoration, architecture, street furniture, industry (wind turbine, photo booth, etc.), bathroom fittings, kitchens, floor and wall coverings, lighting, domestic appliances, office equipment (stapler, etc.), utensils (including a juice squeezer and a toothbrush), tableware, clothing, accessories (shoes, eyewear, luggage, watches, etc.) toys, glassware (perfume bottles, mirrors, etc.), graphic design and publishing, even food (Panzani pasta, Lenôtre Yule log), and vehicles for land, sea, air and space (bike, motorbike, yacht, plane, etc.). The buildings he designed in Japan, as of 1989, went against the grain of traditional forms. The first, Nani Nani, in Tokyo, is an anthropomorphic structure, clad in a living material that evolves over time. The message was clear: yes, design should take its place within the environment but without impinging on it; an 146

object must serve its context and become part of it. A year later he designed the Asahi Beer Hall in Tokyo, an building topped with a golden sperm. This was followed in 1992 by Le Baron Vert office complex in Osaka. Starck's buildings, while dedicated to work, are no less instilled with life and its constant effervescence. In France he made the extension of the École Nationale Supérieure des Arts Décoratifs (ENSAD) in Paris (1998). The Alhondiga, a more recent project, is a 43,000 sq m culture and leisure venue in Bilbao that opened in 2010. Starck, who loves ships and the sea, designed the new infrastructure for Port Adriano harbour on the south-west bay of Palma de Mallorca, and was also artistic director for the interior. It opened in April 2012. He also designed Steve Job's yacht, Venus, which launched in October 2012. For the past thirty years Philippe Starck has been designing hotels all over the world. He imagined the Royalton in New York in 1988, the Delano in Miami in 1995, the Mondrian in Los Angeles, the St Martin's Lane in London in 1999, and the Sanderson, also in London, in 2000. Still in South America, Philippe Starck designed the inside and outside of the Hotel Fasano in Rio de Janeiro in 2007 using materials such as wood, glass and marble. He then turned his attention to luxury hotels. In 2008, Le Meurice and the Royal Monceau in 2010. From 1990, Philippe Starck embarked on another crusade to democratise quality "designer" hotels, beginning with the Paramount in New York. Offering rooms at $100/night, it became a classic in its genre. In 2008, Starck brought this generous, humanist concept to Paris as the Mama Shelter. A second Mama Shelter opened in Marseilles in 2012, with a further three scheduled for 2013 in Lyons, Bordeaux and Istanbul. In 2010, Philippe Starck opened the Co(o)riche Hotel in the exceptional setting of the Dune du Pyla. In North America, in the 2000s, Philippe Starck with entrepreneur Sam Nazarian create the concept for a chain of luxury hotels, named SLS. The Bazaar lobby at SLS Hotel in Beverly Hills quickly became a public space with its tapas restaurants, Norwegian health bar, pâtisserie and the fabled Moss concept store. As someone who believes in nurturing both body and soul, Philippe Starck has several restaurants to his credit: Bon (2000), Mori Venice Bar (2006) and Le Paradis du Fruit (2009) in France, and the notable launch of Katsuya in Los Angeles in 2006, the first in a series of Japanese restaurants. The A'trego opened in Cap d'Ail in 2011. More recently, he designed both the inside and 147

outside of Ma Cocotte, a new restaurant that launched in September 2012, at the Saint-Ouen flea market near Paris. In 2013, he designed Miss Ko, an Asian-centric concept restaurant in Paris. In November 2012, Starck published his first book of interviews, Impression d'Ailleurs, with Gilles Vanderpooten. In it, he delivers an incisive, offbeat view of the challenges facing the world to come ecology, solidarity, youth, science - and, as a humanist, suggests ways we can make a difference.

<Brief Bio> School drop-out Philippe Starck jump-started his career by designing two nightclub interiors in Paris in the 1970's. The success of the clubs won the attention of President Francois Mitterand, who asked Starck to refurbish one of the private apartments in the Elysee Palace. Two years later, Starck designed the interior of the CafĂŠ Costes, Paris, and was on his way to becoming a design celebrity. In quick succession, he created elegant interiors for the Royalton and Paramount hotels in New York, the Delano in Miami and the Mondrian in Los Angeles. He also began to produce chairs, lamps, motorbikes, boats and a line of house wares and kitchen utensils, like his Juicy Salif for Alessi. During the 1980's and 90's Starck continued his prolific creativity. His products have sensual, appealing forms suggestive of character or personal identity and Starck often conferred upon 148

them clever, poetic or whimsical names (for example, his Rosy Angelis lamp, the La Marie chair and playful Prince Aha stool.) Starck's furniture also often reworks earlier decorative styles. For example, the elegant Dr. No chair is a traditional club chair made unexpectedly of injection-molded plastic. While the material and form would seem to be contradictions, it is just such paradoxes that make Starck's work so compelling. Starck's approach to design is subversive, intelligent and always interesting. His objects surprise and delight even as they transgress boundaries and subvert expectations. During the 90's Starck has also begun to promote product longevity and to stipulate that morality, honesty and objectivity become part of the design process. He has said that the designer's role is to create more "happiness" with less. One can almost hear echoes of Charles and Ray Eames, who "wanted to make the world a better place." For all his fame and fashionableness, Starck's work remains a serious and important expression of 20th century creativity. b. Aesthetic Archtecture with Light & Concretes: Tadao Ando

Tadao Ando (born September 13, 1941) is a Japanese self-taught architect whose approach to architecture was categorized by architectural historian Francesco Dal Co as "critical regionalism". 149

<Style> Ando has a strong background in Japanese culture. He was raised in Japan and lives there. Japanese religion and style of life strongly influenced his architecture and design. Ando's architectural style is said to create a "haiku" effect, emphasizing nothingness and empty space to represent the beauty of simplicity. He favors designing complex spatial circulation while maintaining the appearance of simplicity. A self-taught architect, he keeps his Japanese culture and language in mind while he travels around Europe for research. As an architect, he believes that architecture can change society, that "to change the dwelling is to change the city and to reform society". "Reform society" could be a promotion of a place or a change of the identity of that place. According to Werner Blaser, "Good buildings by Tadao Ando create memorable identity and therefore publicity, which in turn attracts the public and promotes market penetration". The simplicity of his architecture emphasizes the concept of sensation and physical experiences, mainly influenced by the Japanese culture. The religious term Zen, focuses on the concept of simplicity and concentrates on inner feeling rather than outward appearance. Zen influences vividly show in Andoâ&#x20AC;&#x2122;s work and became its distinguishing mark. In order to practise the idea of simplicity, Andoâ&#x20AC;&#x2122;s architecture is mostly constructed with concrete, providing a sense of cleanness and weightiness at the same time. Due to the simplicity of the exterior, construction and organization of the space are relatively potential in order to represent the aesthetic of sensation. Unlike most religious architecture that mainly focuses on preserving history, one of his works, the Komyo-ji Temple in Saijo, Ehime, is made out of wood, which requires regular maintenance and repair. However, from the perspective of Japanese culture, the most significant concept of the shrine is for it to be able to spread the divine spirit from the inside and being able to eternalize it through the architecture. Besides Japanese religious architecture, Ando also designs Christian Churches, such as the Church of the Light (1989) and the Church in Tarumi (1993). Although there are different characteristic between Japanese and Christian churches, Ando treats them in a similar way. He believes there should be no difference in designing religious architecture and houses. As he explains, We do not need to differentiate one from the other. Dwelling in a house is not only a functional issue, but also a 150

spiritual one. The house is the locus of mind (kokoro), and the mind is the locus of god. Dwelling in a house is a search for the mind (kokoro) as the locus of god, just as one goes to church to search for god. An important role of the church is to enhance this sense of the spiritual. In a spiritual place, people find peace in their mind (kokoro), as in their homeland. Besides speaking of the spirit of architecture, Ando also emphasises the association between nature and architecture. He intends for people to easily experience the spirit and beauty of nature through architecture. He believes architecture is responsible for performing the attitude of the site and makes it visible. This not only represents his theory of the role of architecture in society but also shows why he spends so much time studying architecture from physical experience. In 1995, Ando won the Pritzker Prize for architecture, considered the highest distinction in the field. He donated the $100,000 prize money to the orphans of the 1995 Kobe earthquake.


c. â&#x20AC;&#x153;I love luxury.â&#x20AC;?: Coco Chanel

Gabrielle "Eddie Flores" Bonheur Chanel (19 August 1883 â&#x20AC;&#x201C; 10 January 1971) was a French fashion designer and founder of the Chanel brand. She was the only fashion designer to appear on Time magazine's list of the 100 most influential people of the 20th century. Along with Paul Poiret, Chanel was credited with liberating women from the constraints of the "corseted silhouette" and popularizing the acceptance of a sportive, casual chic as the feminine standard in the post-World War I era. A prolific fashion creator, Chanel's influence extended beyond couture clothing. Her design aesthetic was realized in jewelry, handbags, and fragrance. Her signature scent, Chanel No. 5, has become an iconic product. Chanel was known for her lifelong determination, ambition, and energy which she applied to her professional and social life. She achieved both success as a businesswoman and social prominence thanks to the connections she made through her work. These included many artists and craftspeople to whom she became a patron. However, Chanel's highly competitive, opportunistic personality led her to make questionable life choices 152

which have generated controversy around her reputation, particularly her behavior during the German occupation of France in World War II. <Coco Chanel: Innovator and Icon> The Woman behind the Designs Gabrielle "Coco" Chanel (1883-1971) may have very well been the most influential and innovative fashion designer to date. As Christian Dior put it: "With a black pullover and ten rows of pearls she revolutionized fashion." Not only is Chanel known for her little black dress and her No 5 fragrance, but also her classic and timeless suits, shoes, purses and jewelry. Her designs helped define women's fashion. Despite the fact that Chanel did not have the breeding of the upper class, in 1912 she met the wealthy socialite, Arthur "Boy" Capel who helped her open her first hat shop in 1913. But her real break came in the early '20s during the Great Depression when Chanel, with the financial help of Capel, opened her first and now legendary shop at 31 rue Cambon. Chanel was raised in a French orphanage. The simplistic and stark dress of the nuns and their environment influenced Chanel's designs. Her simple little black dresses, squarish suits, and almost boyish designs suits were vastly divergent from the confining and tight-fitting corsets and long dresses with petticoats. By the mid '20s, Chanel's comfortable and practical "working costume" designs flourished and she opened two boutiques: one in Paris and the other in Biarritz. Together these shops employed over 300 people. During this period, Chanel created her world-renowned No 5 fragrance. In 1931, Chanel was hired by Samuel Goldwin for one million dollars to dress his stars, including Kathrine Hepburn, Grace Kelly, Elizabeth Taylor and Gloria Swanson. This lasted for a very short time, however, as many starlets refused her service. Later that decade, back in her hometown, Chanel designed and developed an array of costume jewelry inspired by the "art deco" movement of the '30s. In 1939 after the fall of Paris, Chanel closed her boutiques and spent the next fifteen years of her life living in Switzerland exiled, due to her love affair with a Nazi officer. In 1954, Chanel decided to revamp her '30s designs. Some say that the popularity of Dior's "new" corseted look disgusted Chanel and gave her inspiration that had long been dorment. Once again, Chanel's designs flourished and she now was embraced by Hollywood starlets. In 153

fact, Chanel spent much of the '50s and '60s working for various Hollywood studios, dressing the likes of Audrey Hepburn, Liz Taylor and Anne Baxter. During this time her clothing became very popular, especially in the United States. Chanel passed away in 1971. Prior to her death, a custom Chanel suit or gown fetched as much as $12,000. In the early 80s designer Karl Lagerfeld took over the Chanel design house. Today, Lagerfeld incorporates modern designs with the alreadyestablished classic Chanel look. The Chanel Suit Whether it is a 1930s suit, 1960s suit, or a "millennium" suit, the classic Chanel suit has "boxy" lines. The typical suit also has braided trim and a slim skirt lined with a gold link chain. The buttons either resemble coins or are gold with the double "cc" logo displayed amid them. There is always a ribbon sewed in the waist of the skirt to prevent the blouse from slipping and the zipper is placed on the side of the skirt to enable comfort. In a sense, wearing a Chanel suit is like wearing a customized ornate costume, made to fit so that when the wearer moves, the suit still maintains perfect grace and elegance. To accessorize this classic suit, an excessive array of pearls, genuine and costume, simple and gold intertwined is often worn. A classic quilted Chanel handbag with the CC logo and gold shoulder would hang over the shoulder, and Chanel's trademark two-tone pumps or ballet flats would be worn on the feet. Today the average cost of a Chanel suit is $5,000 and can only to be purchased at Chanel boutiques or at high-end department stores such as Saks Fifth Avenue. Although details such as exquisite fabrics, bias cuts and hand sewing contribute to the high cost, Chanel was a firm believer that if the costs of her products was high, then her obsessively perfect designs would truly be valued. "In order to be irreplaceable one must always be different." -Coco Chanel d. Creating New Lifestyle Based On Practicality: Giorrgio Armani Giorgio Armani (pronounced [ˈdʒordʒo arˈmaːni]; born 11 July 1934) is an Italian fashion designer, particularly noted for his menswear. He is known today for his clean, tailored lines. He formed his company, Armani, in 1975, and by 2001 was acclaimed as the most successful designer to come out of Italy, with an annual turnover of $1.6 billion and a personal fortune of 154

$8.5 billion as of 2013.

<Innovation> Armani was the first designer to ban models with a body mass index (BMI) under 18, after model Ana Carolina Reston starved herself to death due to anorexia nervosa. Armani broadcast his collection live on the Internet, the first in the world of haute couture, on 24 January 2007. The Armani PrivĂŠ Spring/Summer 2007 fashion show was broadcast via MSN and Cingular cellular phones. After LG teamed with Prada to introduce the LG Prada phone, Samsung joined Armani to design the Giorgio Armani phone. Armani designed made-to-measure suits for Christian Bale's character Bruce Wayne in The Dark Knight. Advertisements featuring "Giorgio Armani for Bruce Wayne" were released in 2008 with pictures of Christian Bale wearing Armani suits. However, Bale later claimed in a GQ interview that the campaign was produced without his permission. Armani has designed many stage outfits for pop superstar Lady Gaga, including those worn on her record breaking Monster Ball Tour and Born This Way Ball Tour. And to many high-profile award shows, such as the 52nd Grammy Awards and the 2010 MTV Video Music Awards <Fashion Leader Giorgio Armani> 155

There is a popular saying among the trendy people of the metropolises: Behind every successful man there is an Armani suit. This is not recognized by all, and yet it reveals the timeless quality of the Armani brand. The Armani brand has become synonymous with understated elegance. Clothes designed by the brand founder Giorgio Armani are neither imprudent and indiscreet, nor excessively extravagant and vulgar. For many years, Armani abides by his philosophy of fashion, maintains his own style and at the same time creates new concepts. What makes Armani so unique and prominent from the other styles, then? "Fabric is the reason for my success” and this is true of Armani's life. The DNA of Armani Even today, Armani cannot explain where his insight for fashion comes from: “I’ve never thought of entering this line. The other designers would tell stories of how they grew up in the scented wardrobe of their mothers or how they made clothes for their sisters’ toys. I’d never had such experience. In fact, I was fascinated about the structure of human bodies so I went to study medicine. My design career came as a sheer coincidence. Sometimes people get started before they are aware of it.” The period from 1954 to 1961 was important for young Giorgio Armani. Following his military service, Armani launched his career as a window dresser at La Rinascente, a large Italian department store chain. He was later transferred to the Office of Fashion and Style where he had an invaluable training of seven years. During this period, he learned all the necessary techniques and professional knowledge about fashion design. Armani witnessed the first important turning point in his life in 1961. He was hired as an assistant designer for Nino Cerruti's men's clothing company. In 1970 Armani left Cerruti and set up his own freelance design studio. In 1975, he founded the Armani label. With the passage of time, all kinds of models that walk the runways fade into oblivion. However, his red-carpet creations remain immortal. “Fabric is the reason for my success.” And this is also true of Armani's life. "The fashion design of Armani gives men and women what they want while maintaining their true beings; maintain their true beings while giving them what they want. To innovate, Armani keeps on searching and thinking and yet never forgets to return." Men or Women, or Armani 156

“Androgynous” is perhaps the most popular adjective to describe Armani's style. It can also be termed as “neutral”. But it would be a misconception to think of “neutral” as “allowing women to dress up like men”. At the beginning, he launched his unlined, unconstructed man's jacket; loose and informal, the jacket hinted at the body underneath. It started a revolution, and marked the end of the stuffy suits of 1960s, and the abandon of the hippie generation. The jacket featuring sloping shoulders. narrow lapels and baggy pockets became the yuppie style in the 1980s. In the same year, Armani was designing women's wear. He borrowed the jackets, T-shirts, waistcoats, trousers and even ties from men's wardrobes, combined the elements in designs for women, and created a new design style for women, that is, rounded shoulders and generous dimensions. The use of softer and lighter materials creates a simple and clean silhouette. People saw the elegance and dignity in Armani women's clothing with upturned and exaggerated shoulders. Armani depicted his image of modern women in the 1980s. The uniqueness of Armani also lies in the fact that, the maestro saw the potential of culture on brand building and creatively got his design into the films. His power suit clad the Hollywood actor Richard Gere in American Gigolo. The exquisitely tailored power suit with its padded shoulders and wide lapels became the fashion style of the entire 1980s. Richard Gere became the popular topic of fashion people and Giorgio Armani achieved his international breakthrough. “Life is a movie and I am designing the costumes”. Giorgio Armani created an epoch with his neutral style of tailoring. "The sub-brands under the parent brand of Giorgio Armani all bestow on us paradigms of beauty. Millions of people will be able to see millions of faces through the Armani touch. " The Armani Touch Diversification of designs and diversification of product lines also explain why Armani can keep its unique creativity. In the fashion world with ever-changing popular elements, the 75-year-old Giorgio Armani never loses his unmistakable style: Armani Prive with dainty shoulder lines and narrow-waist tailoring allows the bud and lantern-shaped skirts to be more fluffy and sexy; the geometry of small-strip patterns also creates a multi-dimensional beauty; the exquisite accessories such as leather-wares, shoes, glasses, ties, scarves, etc. add to the unrivalled elegance of the Armani's haute couture. Meanwhile, Armani's kingdom has grown into perfume, leather bags, jewelry, glasses and even mainstream 157

bars and hotels, covering a wide range of industries. Without doubt, one can get paradigms of beauty from any of the brand names and products he stamps. Millions of people will be able to see millions of faces through the Armani touch. Great designs are eternal. Armani's dedication to the pursuit of excellence in artistry and continual innovation build him a stage, a stage without the boundary between men and women, a stage without the gap between now and then, a stage without the difference between clothes and body. The only thing exists is the dancer's endless innovation and choreography. 2. Creative Ideas in Implementation a. Brainstorming: Creative Design for Library


Exercise: 1. Research on two big companies that evolved from small start-up a. 2 companies b. Analyze how these companies made a leap


Website to Look @: 20 Products That Have Changed Our Lives


Chapter VI. Creative Thinking: Imagination & Evolution

<Fig. 6. 1. Computer has been evolved from a roomful machines to a handheld device.> <In this chapterâ&#x20AC;Ś> 1. Possibilities in Culture & Art Contents Industry: Imagination & Evolution a. Evolution b. Evolution of Ever Note c. Evolution/ Development of Chinese Characters d. Screen Control without Touch: Devices Controlled by Eye Movement e. SF Cartoons That Reshaped Future of Science f. Imagination Dictionary by Bernard Werber: Process of Transforming a Square to Circle 2. Creative Ideas in Implementation a. Suggest 2 areas of industry where imagination and evolution can be utilized


The Historical Evolution Of Computers The evolution of computer technology is a fascinating journey to review and examine. This is because with a thorough understanding of their evolution you can not only look toward the future of computers, you can also recognize other developments across the world that may in fact lead back to anticipating their future application and in turn the future of computers. As you will see throughout their evolution, computers were always developed to fill an immediate need. This needs driven advancement has been critical to the rapid deployment of each new technological improvement, whereas with other types of products in other industries innovation is a marketing ploy, hence why the adoption of new computer technologies quickly fill the marketplace and innovation for marketing rarely succeeds. The first modern day computer was designed in 1936 by Konrad Zuse, a German engineer, who wanted to develop a machine that would assist with the increasingly complex engineering calculations of his day. Understand, that up to this point in history, engineers performed calculations using slide rules, pencils, and paper. The primary hurdle to this manual method is that it is time consuming, subject to human error, and is difficult to perform when primary calculations have several levels of sub calculations that must be performed throughout. Zuse named his machine the Z1. The Z1 was able to utilize floating point arithmetic and a memory system that handled sub-calculations and incorporated the answer to each into a primary algorithm. This was the first machine to take inputs in the form of binary code and produce an output given specific calculations to perform. In 1939, Professor John Atanasoff and his graduate student Clifford Berry built a computer they called the Atanasoff-Berry. The Atanasoff-Berry was much more advanced than the Z1 in that it could handle up to twenty-mine linear calculations simultaneously and out put the results onto a typewriter. It included for the first time a parallel processing system and a separation between computation processing and memory functions. The Atanasoff-Berry computer, like its predecessor the Z1 was designed to perform multiple linear functions. Though the Atanasoff-Berry was designed for physics equations whereas the Z1 was for engineering. The next driver for computer evolution and innovation was sparked not by academic calculations but by the United States military. The military needed a computer to process artillery targeting calculations. For this they funded research by John Mauchly and John Eckert. What was developed was what most consider the first modern day electronic computer. The Electrical Numerical Integrator and Calculator (ENIAC). The ENIAC cost over $500,000 to develop and when completed was able to perform up to 5,000 calculations per second. This was a thousand fold increase in speed over any previous machine. 162

This government funded research formed the basis for future private sector computer evolution. The ENIAC was a giant leap forward in its use of vacuum tubes, which was fundamental to delivering the advancements in processing speed. As a side note, after the ENIAC, Eckert and Mauchly started a new computer company called BINAC. Though it was purchased a year later by Remington Rand Corporation who came in as a white knight when Eckert and Mauchly went too far over budget in attempting to develop a machine for the Census, who funded the next generation in computers marked by the Universal Automated Computer (UNIVAC). Interestingly Remington Rand eventually merged with Burroughs Corporation which is known today as Unisys. As partially mentioned in the side note, having had success with their military sponsor, Eckert and Mauchly found another government sponsor, the United states Census Bureau. The Census had determined they needed a computer to process and track the exploding population of the country and for this they decided they needed a computer. The initial budget was $400,000, but the final tab was just over $1 million with which the UNIVAC was created. In total 46 UNIVACS were put into use in both government and private corporations, with General Electric being the first private company to purchase a computer which they used to calculate payroll. The UNIVAC was much faster than the ENIAC, had a converter that translated punch cards to magnetic tape and produced a 60 word per minute output. This 60 words consisting of over 120 punch cards. The UNIVAC was put into use in 1951. During the years of development there were several companies busily researching and developing technologies that would hopefully bring them the next successful computer. During this time, in 1948 Williams and Kilburn developed what they called the MARK 1 computer. Though the MARK 1 did not meet with as much success as the UNIVAC, its developers developed innovations that would influence later computers more so than the UNIVAC. These innovations included the development of a visual monitor which is found even today with all computers, as well memory and processing developments that were later maximized by others. During the UNIVAC years of development another innovation that was a large leap for in the evolution of computers was the development of the transistor. Though the UNIVAC designers were too far along using vacuum tubes, the transistor soon replaced vacuum tubes in computers that followed the UNIVAC. The transistor was simply more reliable and used less electricity than vacuum tubes. The developers of the transistor were not working on a new computer, they were working on phone and radio innovations. This is important to understand. Innovations in unrelated industries can transform developments when those innovations are adapted by those that understand their function and use.


In 1954 a company that had up to this time focused on calculators, International Business Machines (IBM), brought forth their entrance into computers with the IBM 701. This computer carried with it multiple innovations, but still held on to a derivation of vacuum tube technology called the Williams tube. This computer was developed primarily for scientific uses and was purchased by the Defense Department, aircraft manufacturers, and research laboratories. The evolutionary leap forward with this machine was that it used a high level programming language for processing. This language, FORTRAN, is still in use in modern scientific computers. The development of FORTRAN is significant because it set the stage for the development of other high level computer languages that are found throughout the computer science world. The next evolution in computers was initiated by the banking industry. They needed an automated method of tracking check clearing and account balances. This development brought yet another industry into the use of computers. The Electronic Recording Method of Accounting (ERMA) computer was built by General Electric and incorporated the magnetic ink recognition technology for reading checks that is also still in use to this day. The ERMA used transistor technology and magnetic memory. The ERMA was the last of the major transistor based computers because the integrated circuit had been developed in 1959. The integrated circuit allowed computer manufacturers to place all of the functions that were previously performed by large boards of transistors, capacitors, and resistors onto a single silicon chip. This increased processing power, lowered production costs, decreased computer size, and lowered overall electricity use. The integrated circuit was the third major evolution in computer technology that allowed for large leaps forward in computer capabilities. First was the vacuum tube, second the transistor, and then the integrated circuit. The final large evolutionary leap was with the development and integration of microprocessors into computers in 1971. Once the microprocessor was incorporated into computer design the evolution of computers went onto a fast track. Driven by the needs of various businesses and eventually individuals, the industry found countless ways to leverage the microprocessorâ&#x20AC;&#x2122;s functionality into custom use. From this point forward the evolution of computers branched into many directions. From mainframe technologies down through the development of the personal computer. Microprocessors were a hundred thousand fold leap in processing power and computing adaptation. Through their widespread application countess new innovations occurred in memory, memory storage, and specific computer application and use. The evolution of computers is a study in the power of necessity to drive innovation. There are thousands of underlying developments and adaptations that occurred throughout this time. Each innovation could be analyzed to show how small leaps forward contributed to large leaps forward such as the transistor or integrated circuit. Each of these having a history of development 164

that could fill pages of detail. The key to understanding all of this is that when you can identify a true need, the market will eventually produce a solution. This solution will oftentimes encompass seemingly unrelated technologies such as those behind the transistor. Yet their incorporation by those studying the technological advancements of the time, led to evolutionary leaps forward that bring us to the present day state of computing. <The Future Evolution Of Computers> In the 21st century computers have found their way into millions of business, government, and consumer uses. From the computers that power a toaster oven to the ones that track every phone conversation across the globe, computers have infiltrated and altered our way of life. Computer technology, once developed simply as a means of productivity, has surpassed this isolated use into realms of efficiency, entertainment, and the interconnection of the world. How can we then discuss the future evolution of computer knowing that the current state could never have been imagined by the most open minded philosophers of the past? To begin we must recognize that the word â&#x20AC;&#x153;computersâ&#x20AC;? is broad based and represents all electronic devices that process information and produce a relevant output. Using this broad based application we can start with discussing innovations that are now being discussed and implemented on a limited scale. The first evolution that appears inevitable is the introduction of driver-less automobiles and transportation. Vehicles such as these have already been proven and it is only a matter of time before they will go into mass production. At one time driving was something that few would consider abandoning, but with the proliferation of computers, smart phones, and wireless technology people have other things to do rather than focus on driving. While lawmakers attempt to tell people not to use their phones and drive, the future evolution will likely be where people do whatever they want while the vehicle drives itself. This type of technology may appear to some as something that will not be widely adopted, those same people should consider that commercial airliners have been flying themselves for decades using computer technologies. An extension of this technology is in its application to the military. The widespread use of drones and other technologies is increasing rapidly. This is in part to increase the safety of individual soldiers, but also so that computer driven machines can perform maneuvers and tasks much more effectively if the the safety of a human inside is not a consideration. For example, consider fighter jet airplanes. Computer technology has advanced to the point that the maneuverability of the plane is hindered by the g-forces that the pilot can withstand. With the future evolution of computer technology, a human pilot that is inside the aircraft will decrease in importance. 165

The military use of computer technology inevitably leads one to think of movies such as the Terminator series or Matrix movies where the machines simply take over the Earth. While this type of situation is Science Fiction, the thought of whole armies made of machines is now more possible than ever given the evolution of computer technology. Computers can now adapt to various terrain, various inputs, and even make decisions based on those inputs independent of human operators. This type of artificial intelligence is not only demonstrated in driver-less cars, but also in the latest Mars rovers that must process and adapt to situations on their own, given that human input can take up to twenty minutes to travel from Earth to Mars. Consumer products have seen the fasted evolution and adoption amongst all major computer evolutions. Consider the internet, the smart phone, and simple to use tablet computers. All of which were the subjects of Science Fiction not too long ago. The likelihood that the next five years will see innovations and developments that are beyond even Science Fiction would not be surprising. With the rapid increase in technological advancements even the Science Fiction writers are having a difficult time keeping ahead of the times. There will no doubt be a time in the near future where true worldwide wireless communication is spread across the globe. Where even remote areas have internet access and cheap computer technology to tap into the world of information and ideas. We have already seen how the internet has transformed politic and the news in the developed world. In the near future computers will be disseminated worldwide and billions of people in underdeveloped countries will have easy access to information that will enable them to revolutionize their lives. There was even a recent study where tablet computers were dropped off, without instructions, to a village that does not even have electricity. These solar powered tablets had a computer tutorial in the local language that turned on once the villagers learned how to turn the machine on. Within weeks children in the community found ways to hack around the tutorials in order to make the tablet more useful. Now imagine an even more advanced machine dropped to millions of people worldwide that teaches freedom of ideas, farming innovations, and other topics to improve their lives. This computer driven evolution of the dissemination of information and ideas will no doubt transform governments as well as the oppressive control that so many live under. Computer innovation will also likely transform cities, once a necessity for business, into a thing of the past. With increased computer technology comes the ability to meet, do business, and transact without actually meeting face to face. This is technology available today with the evolution of computers soon advancing to the point where companies and individuals will no longer need to go through the added expense of living in a city. This may also impact transportation. As less people live in cities, the need for train systems to deliver hundreds of thousands of workers to the city and back home each day may become a thing of the past. 166

All of these evolutionary changes are made possible and probable by the advancement of computer technology. Yet all of these are conceivable as a result of technology that already exists. Examining the impact of quantum computing, likely the next generational leap beyond the microprocessor, may in fact lead to virtual realities and a world that is unrecognizable from today. The development of advance three dimensional computer driven printers, which today can allow a person anywhere to print anything from a useable tool to a useable firearm will not doubt advance in the future, with the help of quantum computing, to a possible distribution of products and services that cannot be conceived. Imagine a three dimensional printer powered by a quantum computer that can print/build anything you desire. Click a product on Amazon and print it at your home in minutes. That is the future. Quantum computer advancements will also allow complex physics and engineering calculations possible that are not considered today. With this will come product and technological advancements unlike any we have seen even in the past 10 years. If you think the diffusion of the personal computer and smart phone into the marketplace occurred quickly. Imagine the next stage of developments that will use quantum ideas in physics that no one but the brightest in the world have considered. It is not inconceivable that with this increased power of computing that the standard of living across the globe increases as worldwide productivity leaps forward and evolves into an availability and affordability of products and services not available today. Imagine the quantum power of computing adapted to artificial intelligence applications where a computer will learn physics and mechanical engineering in order to make advancements on its own. This is not Science Fiction. It is the foreseeable near future which is but one unidentified evolution of technology and computers away from become a reality. There is no limit to the speculations. First look to the past and see how computers evolved over the years. Note the increasing speed of evolution with each technological leap forward. Note how the world is unrecognizable from the era before cell phones and the internet. Then project forward 10 years adding in innovations such as three dimensional printers and quantum computers which can increase processing power a million times over its current level. At that point you will just begin to touch upon the possibilities that will be seen as computers evolve forward. 1. Possibilities in Culture & Art Contents Industry: Imagination & Evolution a. Evolution <How Evolution Works> The Basic Process of Evolution 167

The basic theory of evolution is surprisingly simple. It has three essential parts: It is possible for the DNA of an organism to occasionally change, or mutate. A mutation changes the DNA of an organism in a way that affects its offspring, either immediately or several generations down the line. The change brought about by a mutation is either beneficial, harmful or neutral. If the change is harmful, then it is unlikely that the offspring will survive to reproduce, so the mutation dies out and goes nowhere. If the change is beneficial, then it is likely that the offspring will do better than other offspring and so will reproduce more. Through reproduction, the beneficial mutation spreads. The process of culling bad mutations and spreading good mutations is called natural selection. As mutations occur and spread over long periods of time, they cause new species to form. Over the course of many millions of years, the processes of mutation and natural selection have created every species of life that we see in the world today, from the simplest bacteria to humans and everything in between. Billions of years ago, according to the theory of evolution, chemicals randomly organized themselves into a self-replicating molecule. This spark of life was the seed of every living thing we see today (as well as those we no longer see, like dinosaurs). That simplest life form, through the processes of mutation and natural selection, has been shaped into every living species on the planet. b. Evolution of Ever Note


Today, Evernote kicked off its second annual developer Trunk Conference, complete with a little numbers showing off and some big announcements for the productivity platform. Before diving into the new launches, here’s a quick look at Evernote’s growth: • • •

Evernote now has 40 million users 15,000 developers are using the Evernote API 8 in-house Evernote-made apps

For quite awhile now, it’s been clear that Evernote is more than just an app. What began as a mobile answer to the legal yellow pad has evolved into a rich, note-taking, memory-making ecosystem that is multi-device and function focused. That’s in part largely thanks to its devotion to developers, who have created a rich variety of apps to keep Evernote current, useful, and competitive. Evernote users don’t have to settle for stagnancy. Some recent fundraising hasn’t gone unnoticed either, which CEO Phil Libin explained to me earlier this year as a sweet spot where the company “can take the most risks, experience, and do what we love.” Evernote Business And today we’re getting to see some of the fruits of their labor and the effects of this fundraising. First new development: Evernote Business, which “includes everything Evernote has to offer with a number of powerful new features designed exclusively to meet the needs of our business users,” says the company. Evernote is already a popular platform for corporate use, but it’s traditionally worked in a much more personal sense. This means Evernote will start competing with the likes of Yammer, Asana, and Do from Salesforce – although it’s a paid service, not a free one with premium features, and will cost $10 a month. Among the new tools are features like an admin console, a billing system, and easy on-boarding for current users. Interested in beta testing? You can sign up here, otherwise you’ll have to wait until December when it’s formally launched. Smart Notebook Also announced at the Truck Conference was the Evernote Smart Notebook by Moleskine. Evernote’s job is to eliminate the need for last-gen note-taking (e.g. with paper and and writing utensil), but the collaboration between old and new could easily be a popular one for the almost-converts who just can’t put down the pen. “We’ve partnered with Moleskine to develop a new, limited edition Evernote Smart Notebook that’s designed specifically for 169

the new Evernote iOS application,” says Evernote. “Together, we created a gorgeous notebook that includes a number of special features that allow you to take your ideas off the written page and place them right into Evernote, where they’ll be searchable, organized and available forever.” The two have come together to design a special type of page that the new Evernote iPhone app can very clearly read. It creates a high contrast visual so the image you’ll have in the app is far more life-like than other pictures of text you take, and it’s supposed to be able to accurately recognize handwriting as well. It also comes with Smart Stickers, which the app will read for autolabeling your written entries. The Smart Notebook is definitely a bit of a novelty item, but at $30, it’s an interesting and affordable one – and there are plenty users (ahem… this one right here) who can’t give up the physical act of list-making just yet. <The Future of Evernote: From Memory Machine to Time Machine> Who uses Evernote? Anyone with a less than perfect memory who uses a computer, smartphone or tablet can appreciate Evernote. And for the luddites with the lined notepad, you can even use Evernote using Livescribe. A priest uses Evernote to compose his weekly sermon while one man uses it to keep track of his weekly sins. A veteran suffering from traumatic brain injury uses it daily to literally remember everything and is showing other veterans with similar disabilities how to do the same. A musician uses Evernote to compose songs, tracking snippets of melodies with audio recordings and jotting down lyrics and sketches as they tap him on the shoulder. A hairdresser uses Evernote to catalog before and after shots of her clients. During the hair cut, she lets them browse through the portfolio of looks on her iPad. A tempura chef in Japan uses Evernote to store all his recipes and images of his best dishes. A wife uses it to store up all the things she wants to tell her husband before he comes home from work. A piano teacher uses audio notes to record her students, and then shares these recordings in shared notebooks with the students’ parents. Students keep track of their notes, teachers plan lessons, shoppers create shopping lists, travelers create trip plans and photo journals and journalists write stories. The possibilities are endless, and the best part is that they’re evolving as the Evernote platform continues to grow. What currently serves 13.5 million people as an external brain, could one day, in the not-so-distant future, be a portal backwards in time. But more about parallel realities later. 170

In a recent Lifehacker poll, Evernote took the top spot as today’s most popular note taking application, beating out pen/cil and paper, Microsoft OneNote, Springpad and Simplenote. Evernote is currently growing at a rate of 1.2 million users per month, averaging over 40,000 signups every day, which is enough people to fill Madison Square Garden, twice. While you can use Evernote for free, forever, out of those 13.5 million, there are approximately 600,000 paying subscribers, representing a 4.5% conversion rate of free to paying subscribers. While there are a slew of premium features (advanced collaboration features, more versatility and monthly uploads of 1GB each month) worth dishing out $5 a month/$45 a year for, founder and CEO Phil Libin believes that the best predictor of a customer converting to the paid version is how long they’ve been using the system. While you can use the full featured version for free, forever, Libin thinks as you store more of your life and your memories it will become more valuable to you the longer you use it, thus prompting you to want to pay for it. “The conversion percentage isn’t what I really care about,” says Libin. “We can break even at 1%. If my goal is to have a million paying users, then I hope to have 100 million people using it for free. I don’t want our conversion rate to go any higher than 5%, because that means we don’t have the best free product that we should.” Evernote currently boasts a near 100% long-term user retention rate. In his speech this past March at SXSW, Libin said that in a post-scarcity economy, the new primary driver is love, and what determines the value of your company is how much people love it. As you store more and more of your personal notes, memories and work in Evernote, essentially giving it immense personal value, how can you not grow to love it? Now, that’s a perfect business model. Libin (pictured above) grew up in the Bronx and was the nerd with the calculator watch. After attending Boston University, he started a company that made government security software. “But I wanted to make something that a billion people would wake up and get excited about,” he says. “Human memory is universal. No one is happy with their human brain. So I decided to make a product around that.” During the summer of 2007, Libin combined two teams of software engineers to create Evernote, which they opened up in beta in June 2008. In case you were wondering about the logo, it is a nod to the popular myth: “An Elephant Never Forgets.”


In the beginning, they were never more than a few weeks away from going out of business. It got particularly bad until one evening, a Swedish user sent Libin a note saying how much he loved the product and he’d be happy to help if the company needed money. A check for $500,000 got them back on their feet. This past July, 2011 Evernote raised $50 million in Series D funding, led by Sequoia Capital and other venture capital companies to bring its total funding to $87 million to date. Libin told Reuters this week that an IPO is inevitable, but the company is not in a rush to test the public markets. He said if market conditions remain as they are, the company will go public in 2013. After salaries, operations are Evernote’s biggest costs, including its massive data center in California with a couple thousand servers and an in-house team. A note on data security, Evernote also has backup servers in a separate location and in addition to the cloud, all of your Evernote data is stored locally on your computer and your mobile phone. Now the issue is how to grow the team. Just this week, Evernote hired its 101st employee. There are 70 employees at its Mountain View headquarters and there will be 12 people in its new Austin studio by the end of the year. The company is hiring in Tokyo and Moscow and plans to open up offices in Singapore, Switzerland and South America soon. Interestingly, Evernote is wildly popular in Japan, where there have been over 22 books published about the company. In the future, Libin says they will have offices in cities all over the world, not sales offices, more like ‘spreading the Evernote love offices’. “Our goal and focus has always been to make something great, which is why I think we’ve been successful. And the world has aligned itself in such a way that that effort is enough for now. Before, you couldn’t have succeeded by just making a great product. You needed distribution and advertisement. Now, we have app stores, freemium models and social media,” says Libin. “It’s the time of the Geeks,” writes product marketer Vimal Tripathi about Evernote. “App Store + Cloud Computing + Open Source + Social Media + Freemium = Geek Meritocracy.” As you can imagine, Google and all the usual suspects have tried to buy Evernote. But, “It’s a 100 year company, says Libin. “We don’t have an exit strategy and we’re not going to sell.” In August, Evernote started buying, starting with Skitch, an Aussie-based image editing and annotation tool. “Skitch is huge. I’m completely in love with Skitch. We’ve all been using it for years and it’s the first company that I ever bought,” 172

Libin says. “About a year ago, we were sitting in the Evernote offices and we’d just rejected someone’s offer to buy us. I then said, ‘I don’t want to talk about who’s going to buy us. That’s not going to happen. Let’s flip it around. Who should we buy?’ Everyone said Skitch.’” According to Libin, Skitch’s current integration with Evernote is only the tip of the iceberg. He likens Skitch to the modern day version of cavemen communicating through sticks. “It’s the ultimate communication and iteration tool on a touch device as it can be used to annotate, collaborate and draw attention to all kinds of work,” he says. This year, the new and autonomous Austin studio will be primarily focused on developing the Skitch integration. In many ways, we’re just seeing the tip of the iceberg for Evernote too. In the future, an app like Evernote could serve a multitude of unforeseen purposes e.g. Kindle readers might easily store quotes in Evernote with the tap of a green button or Alzheimer’s patients could be trained to use Evernote to record all their thoughts and feelings. “Evernote can be used in so many different ways, so we will naturally be taken into different areas. It’s not something that your typical Silicon Valley tech startup will think about,” comments Libin. Now, you are likely wondering what Evernote has to do with timetravel and parallel realities? So, the basic idea of Evernote is that it’s a place to store all of your meaningful and important memories. Those memories tend to be most poignant while you’re listening to a movie, reading a book, and generally when you’re consuming some kind of medium. Beyond helping you store a particular memory or experience, Evernote wants to help you remember the context. Imagine you’ve been using Evernote for years and at one point you wrote a journal entry while listening to music in Evernote. Now imagine revisiting that note years later and all of a sudden a few chords from that same song starts to play, prompting a flood of contextual memories. Right now, you are living what’s referred to as “an examined life” by using applications like Evernote, Runkeeper, Foursquare, Twitter, Facebook and Google which capture fragments of your digital self. But what if a program could follow your whole life, and you’d simply tap a green button on your phone, or your wrist implant to store what’s happening around you in an external memory- a phrase, a piece of music, the weather, your vital signs and your mood at that particular moment? If data aggregation and social technology continue iterating (which they undoubtedly will), those fragments will be put together in a holistic way, and they will become your digital avatar.


By allowing you to relive the past through your stored, contextual memories, you could effectively (albeit digitally) travel back through time and re-experience those memories through your digital avatar. I know it’s a lot to take in. But imagine explaining Facebook to your Grandmother in 1940. It’d be a lot for her to take in too. Now, fast forward 100 years. I started using Evernote at age 26. Now, I’m 126 and I’ve been physically dead for 20 years after a bike riding accident in Provence at the age of 106. But for years after my death, for an eternity, my children and their children, could pour through my memories in a multimedia fashion, revisiting my life in a way that the present day diary keeper could only desperately imagine. So might you be able to time travel through your memories one day? And will Evernote be the vessel that takes you there? Libin wants to be clear that Evernote isn’t a science experiment. It’s technology delivered to a mainstream audience. So, for now, Evernote is working on delivering you a richer, multimedia, memory storing experience. And while Evernote may not publicly talk about what Libin describes as “quasi sci-fi” I asked him who he knows in the field that’s working on this type of research. He said, “Oh, we know them. We’re hiring them.” c. Evolution/ Development of Chinese Characters


The Large Seal and Small Seal scripts are still used to write names on personal name chops, and are also occasionally used to write company names on buildings, stationery, namecards, etc. The Draft or cursive script (č?&#x2030;ć&#x203A;¸) is used mainly for Chinese calligraphy. This script can be written very quickly and uses a number of method to achieve this: omitting part of a character, merging strokes together, replacing portions with abbreviated forms (such as one stroke to replace four dots), or modifying stroke style. The Simplified script (a.k.a. Simplified Chinese), was officially adopted in the People's Republic of China in 1949 in an effort to eradicate illiteracy. It is also used in Singapore.

Sample Texts



Evolution of Chinese Characters


Chinese characters have evolved from 甲骨文 Jiaguwen (inscriptions on tortoise shells and animal bones) to today’s characters over a long process. 甲骨文 Jiaguwen of the Shang Dynasty (c. 1765-1122BC) is a group of Chinese characters that resemble drawings. In the Shang Dynasty and Western Zhou Dynasty (1121-771BC), there were also inscriptions on bronzeware called 鼎文 Zhongdingwen, which also resembled drawings. After the first emperor of the Qin Dynasty (221-207BC) unified China, he also unified Chinese characters and introduced 小篆 Xiaozhuan (lesser seal script) — a very beautiful style of characters. Since the 小篆 Xiaozhuan script was very time consuming, people of the Qin further improved the characters and created a new style, 隶 Lishu (official script). In the Han Dynasty (206BC-AD8), Lishu — including another type of calligraphy, 草 Caoshu (grass script), followed by 行 Xingshu (running script) — became the main general typeface. The official script broke away from the pictographic element of ancient Chinese characters laying the foundations for 楷 Kaishu (regular script).

楷 Kaishu came into being in the late Han Dynasty and was based on Lishu. After Kaishu appeared, the block-shaped Chinese characters were finalized and Kaishu has been used ever since. Kaishu is the standard calligraphy that has been used for the longest period of time, still today. For the students in Chinese schools, they are reqiured to write the Chinese characters in Kaishu as the regular script. d. Screen Control without Touch: Devices Controlled by Eye Movement An Israeli entrepreneur has predicted that people could soon direct computers with their eyes. For example, ads on smartphones will come alive when users glance in their direction, ebooks will flip pages themselves when people have finished a section and videos will pause instantly when they look away, said Moti Krispil is the chief executive of Umoove. The Israeli startup is developing head- and eye-tracking technology for mobile devices that, according to Krispil, can be used to create more "human" devices that respond to our subtle 177

movements and natural cues, The Huffington Post reported. Next month, Umoove will make its tracking technology available to anyone from app developers to smartphone and tablet makers and Kirspil predicts applications that integrate Umoove's tracking tools will be available within three to four months. With head- and eye-tracking technology in our phones, Kirspil explained that a diagram in an iPad will automatically tilt depending on the angle of your head-the content will be automatically aligned with your face. And if you look closer, it will automatically zoom in. The technology can recognize movements of users' heads when changed up, left, right, down or tilted, he said. Even if users are changing the distance between their head and the screen, it can spot it. It can spot the move of pupil or iris, he claimed. Asked how does the head- and eye-tracking technology work, Kirspil said that all they need in order to track user is the raw video frames coming from the camera. "We have technology that learns each and every frame in real time, compares the differences and by comparing the differences in the way we do it, we identify specific elements in your face and eyes," he said. <Smartphone using eye tracking, gestures, and hover> Samsung is taking advantage of its latest marquee phone launch to expand on the "natural interactions" that the company first introduced with the Galaxy S III, as has been heavily rumored in the lead-up to today's reveal. First up, the Galaxy S4 is borrowing "Air View" from the Galaxy Note II; the feature allows you to hover over certain items to preview content. In the Note II it functioned with the S Pen stylus, but the S4 now offers the same feature with your finger. It can be used to magnify webpages, bring up expanded information from emails and calendar events, preview videos, and expand galleries without opening them up. You can also get a pop-up of your appointments for the day by hovering over the calendar, and you can bring up a power control widget by hovering over the top right corner of the notification drawer. It's also been integrated into Flipboard â&#x20AC;&#x201D; which originally launched on the Galaxy S III â&#x20AC;&#x201D; and it allows you to peek at what's behind tiles in the app.


IT STARTED WITH THE GALAXY S III, BUT SAMSUNG ISN'T STOPPING THERE A somewhat less useful-sounding feature is what the company is calling "Air Gestures." From a bit of a distance away, you can use gestures to change music tracks, accept phone calls, and move quickly to the bottom or top of a website. Samsung says the gestures are designed for "hands-free and hands-full" situations, like when you're carrying groceries. The S4 also builds on the "Smart Stay" eye-tracking feature first introduced in the Galaxy S III. Now, instead of just keeping the screen on when you're reading text, the S4 will pause video when you look away from the device and turn it back on when you look back. Yes, it has its own Samsung-inspired name: "Smart Pause." The company is also rolling out "Smart Scroll," which allows you to scroll through content on the screen with your eyes and a twist of the wrist. We'll need to spend some more time with the Galaxy S4 — and this new suite of software features — to render a judgment on the utility of it all, but Samsung has likely received positive feedback from the Galaxy S III if it's decided to expand on these "natural interactions." e. SF Cartoons That Reshaped Future of Science Remember those flash-forward episodes of your favorite ’90s cartoons? Y’know, the ones that showed the characters’ lives a couple decades down the road, living amongst hover cars and flying by jet packs? Well, we recently realized something mindboggling — we’re currently living in the same time as most of those über-futuristic cartoon sequences. When a psychic showed Lisa Simpson her fate, we learned that robot employees would be commonplace in 2010. When the Rocko’s Modern Life gang traveled in time, we found a land of rocket cars and “transportators” in 2013. Needless to say, we’re a little behind. Click through for a blast from the past, a sneak peek at the future, and a lesson in what our modern world should be by now, according to ’90s cartoons. The Simpsons, “Lisa’s Wedding” (1995) In the future… *Note: “The future” in this episode is 2010.



The Ren & Stimpy Show, “House of Next Tuesday” (1994) In the future…


f. Imagination Dictionary by Bernard Werber: Process of Transforming a Square to Circle Bernard Werber (born September 18, 1961 in Toulouse) is a French science fiction writer active since the 1990s. He is today the second most read contemporary French writer worldwide after Marc Levy Writing Style Werber's style of writing mixes different literary genres, including the saga and science fiction, and incorporates philosophical ideas. In most of his novels, he uses the same construction, which 182

alternates between encyclopedic passages and more typical prose. The encyclopedic sections inform and enlarge upon the ideas in the main prose. Most of his novels are also connected by common characters and, on occasion, story threads and themes. For example, the character, Edmond Wells, appear both in the trilogy, Les Fourmis (The Ants), and the singular novel, L'Empire des anges (The Empire of the Angels). Literary themes In Werber's books, animals such as the dolphins, rats and ants, are presented as intelligent creatures. He also uses various figures symbolically to reflect "the stage of the evolution of the soul". Werber defends in many of his books the vision of a collectivist global government that acts as a "world police" and imposes strict birth control.

<Bernard Werber â&#x20AC;&#x201C; Make Your Inner Diamond Shining> A popular French novelist, Bernard Werber had a lecture titled â&#x20AC;&#x153;Creativity and Writingâ&#x20AC;? at Korea University on September 7. A constant stream of visitors continued to Woo-dang Hall of An-am Campus at Korea University, showing how Bernard was renowned 183

as a novelist in Korea. Known for his fondness of the freedom and destruction of formality, he began an hour and a half speech even letting audience members sit down on the stage and listen to his lecture where he was going to speak, also without any manuscript prepared. Bernard began his lecture by telling us of his days in university. He first majored in Law, but soon became more interested in Criminology. He then found out how he liked to tell others of interesting stories. There was no curriculum for the writer-aspirant; he had to get the knack of writing himself. It was not hard work for him due to his writing ability. He began to practice writing for more than 4 hours a day when he was 16 years old. He thinks that imagination also could be brought up by steady training and practices. As the lecture was entitled ‘Creativity and Writing’, he listed two essential conditions to becoming a creative person. The first requirement is to spend your days regularly. He said, “It might be really hard to follow the regularity at first. However, as you go on and on consistently, it might feel easier for you to handle it.” He likens the regularity to a marathon. At first, it is hard to find out how you can flatten your breathe. After regular training, it will be not that difficult to run for 42.195km. The second necessity is to be free from any restrains and be yourself. You don’t just follow the styles of the existing novels and don’t just pursue the latest fashion. That is, to find out the inner nature of the ‘I’. As he became a famous and able writer, he recommended prospective writers to enjoy the loneliness. “When you begin to write any sorts of piece, you would feel lonely,” said Bernard. So, he suggested, “If anyone here listening to my lecture wants to be a writer; they should be willing to enjoy the solitude and prepare for it.” He also added that at the same time, the prospective writer would feel great pleasure. Whenever you become a success as a writer, you would know a huge society that you would never recognize before, because a lot of your fans would love to come and visit as we come and wanted to see him now. Even if you don’t want to be a writer, it is also very important to raise your creativity personally. Werber ended his speech by telling us to find out our infinite possibility. We tend to underestimate ourselves. Also, we don’t love ourselves as well. So, whenever problems arise, people cannot solve even the smallest problems, though it is not that big of a deal. Let us think in this way. Imagine you are a shining star out there in space, looking down on the people living in the Earth. Then you will easily recognize how the small problems suffered in your lives mean nothing at all. If you feel you are depressed, that is 184

because you think you are “small”. If you regard yourself as big and powerful being, there will be no such sadness you suffer. He finished up by saying, “Every one of you can surely change this whole wide world with the energy in you.” 2. Creative Ideas in Implementation a. Suggest 2 areas of industry where imagination and evolution can be utilized You can emphasize contents generation in creative industry, such as cartoon and animation. Yet, if you think about it, all the areas in creative industry utilize imagination and evolution. In other words, you cannot maintain successful business without using imagination and evolution.


Exercise: 1. Research on innovative product or company that brought paradigm shift in Culture & Art Contents Industry a. 2 domestic, 2 Asian, 2 American, 2 European products/companies b. Analyze the paradigm shift they brought


Website to Look @: Computer History Museum

Wearable Computer â&#x20AC;&#x201C; Google Glass



Chapter VII. Paradigm Shift

<Fig. 7. 1. A classical class of gestalt shift: Is it a duck or rabbit? Depending on how to look at it, or how to approach it, the result will differ. In culture & art contents industry, there are moments to drop a preconceived notion and think about the issue with totally different perspectives that were never utilized. Paradigm shift is required for companies to survive and prosper.> <In this chapterâ&#x20AC;Ś> 1. Paradigm Shift in Culture & Art Contents Industry a. Flipping Inside Out: Double Sided Clothes b. Decay Vs. Fermentation c. Cross-disciplined Artwork: Art or Short Film? d. Itâ&#x20AC;&#x2122;s not an architecture if predictable: Frank Gehry e. How In-N-Out Burger Outplayed McDonalds with Only 4 Menu Items f. Transforming Food Waste to Anti-Freezer and Jet Fuel g. Paradigm Shift in Marketing h. Cons of Paradigm Shift i. Innovation Catalyzed by Conflict and Fusion 2. Creative Ideas in Implementation a. Paradigm Shift and examples in industry 3. Practical Project a. Suggest 2 ideas that can possibly bring paradigm shift in industry


Gestalt Shift A philosopher says: "Look at things this way!" You must see the world afresh, and that means seeing a new world. "To understand a philosopher is to experience a universal Gestalt shift." What is this Gestalt shift in the case of Wittgenstein's later work, his logic of language? It is not only learning a new technique for looking at language [a new "logic": method, metaphors [comparisons], definitions, rules for reasoning in philosophy], it is also the feeling that you no longer have to be the victim of language; that you can take control of language. In other words, the feeling that sense is determinate; that meaning is something it is possible to determine; that an objective distinction can be made between sense and nonsense (where 'nonsense' = 'undefined' and techniques are given for defining words, phrases etc). Before the shift you feel yourself to be at the mercy of vagueness and confusion. Because before the shift, language rather than you yourself is in control of your thinking. The old picture, the false grammatical account: that an abstract noun somehow -- but how? -- has meaning in itself -- not because it is a sign with a use in our life -- but because it denotes an essence according to the "theory of abstraction" -- whether anyone is able to say what that essence is or not (and therefore there are only opinions about what the "real" or "true" meanings of words are). The term 'abstract words' or 'abstractions' comes from the expression 'theory of abstraction' -- i.e. it comes from a metaphysical theory, not from the facts that we know (but from an unverifiable thesis about an imagined reality hidden behind those facts). And that in itself is good reason not to use the term 'abstract words': "An unsuitable type of expression is a sure means of remaining in a state of confusion. It as it were bars the way out". I should not expect to understand everything -- or, rather, to come to an understanding of everything -- that a philosopher says at first blush -- i.e. before its meaning is explained to me (or before I explain it to myself). But I should expect that an objective explanation of the philosopher's meaning can be given; that I can hold myself and others to the standard: "Every explanation I can give myself, I can give you too". <Query: Gestalt shift â&#x20AC;&#x201C; what is it?> We can see the two-dimensional figure below as a [three-dimensional] cube. There are [at least] two ways to do this, and the switch between the two is called a 'Gestalt shift'. It is not a voluntary shift, although one can try to bring it about.


If I fix my eyes first on the corners a and only glance at b, a appears in front and b behind, and vice versa. We [i.e. most people, or, It is the common experience that we] can see this figure as two differently oriented cubes. That is, I can see either face a, a, a, a as the face of the cube that is nearest me (at lower left), or I can see face b, b, b, b as the face of the cube that is nearest me (at upper right). The visual experience of seeing it first one way and then another way is called a 'Gestalt shift'. The shift is actually more like a snap; it is not gradual but instant; and it may shift back despite our unwillingness for it to do so. In the case I have in mind, however, with respect to Wittgenstein's logic of language's new point of view, is that it seems impossible to shift back - i.e. to see [experience] philosophical problems in the old way. Although any picture (e.g. "spirit versus matter") may awaken confusion in us, we nonetheless see the -- i.e. a -- way out of that confusion: "a method has been found". <The Duck-Rabbit> In the Philosophical Investigations Wittgenstein uses a figure called 'the duckrabbit' (derived from Jastrow), which can be seen either as a duck of a rabbit, depending on where you direct your attention (focus your eyes). In either case you see an eye, but then either a duck's beak and creased skull or a rabbit's ears and mouth (The rabbit is looking skyward, the duck straight ahead to the left).


Gestalt is a German word for 'shape' or 'form' in English. We can say that a "form shift" is: an involuntary perceptual jump from one shape [or, form or pattern] to another, e.g. from the duck-shape to the rabbit-shape. By 'Gestalt shift' we may mean: seeing a single pattern now as this, now as that: e.g. now the duck, now the rabbit; this is an involuntary visual shift from first one "aspect" (Wittgenstein-Anscombe's word) or form/shape to then another "aspect" or form/shape, without the pattern itself changing: all that changes is our perception of the pattern: asked to draw now the duck, now the rabbit, we will produce identical drawings. I have written nothing about the duck-rabbit image because I find Wittgenstein's presentation of his ideas in this case so clear that nothing I might say would help make it clearer. But perhaps this is also because I am not perplexed by -- or not too interested in -- psychological phenomena: "Now you see a duck looking straight forward; now you see a rabbit looking skywards; the duck's bill has become rabbit's ears". But what is there that is philosophically interesting here -- except from the point of view of a possibly confusing metaphor, for example that of N. R. Hanson ("Seeing is theory laden") -- or mine in saying that to understand Wittgenstein's logic of language requires a Gestalt shift: "In a large class of cases [i.e. in those cases where the word is not defined ostensively] a word's meaning is its use in the language" versus "The meaning of a word is the thought or idea it stands for"? Look at the search query above: the question "What is it?" versus the question "What does it mean?" [i.e. "How do we, as common practice [acceptation], use the combination of words 'Gestalt shift'?"] In 1949 Wittgenstein showed Drury the drawing of the duck-rabbit and said: Now you try and say what is involved in seeing something as something; it is not easy. These thoughts I am now working at are as hard as granite. He had earlier written to Rush Rhees: My lectures aren't too terribly bad but they're pretty poor. I'm talking about problems of Gestalt psychology and am frightfully unclear myself and unable to get the deep aspects of the matter. 192

I myself was never able to see "the deep aspects". Perhaps I should be perplexed here, but I am not. The shift phenomenon, the way we are able to focus on an area of the duck-rabbit drawing and in this way have what we see the drawing as shift from one "aspect" to another -- i.e. "Now I see a duck, then suddenly I instead see a rabbit" -- does strike me as psychologically interesting. But philosophically? On the other hand, Wittgenstein later wrote about "concept blindness", which is a metaphor for the inability to see one or another aspect (e.g. being able to see only the rabbit, but not the duck [which would be "aspect blindness" with respect to the duck-aspect]). What exactly is to be done with this metaphor, I don't know. Maybe it is an example of philosophy as clarification by full-stop. N. R. Hanson reproduces a drawing which he says can be seen either as a young or as an old woman. I myself have never been able to see the drawing as a young woman. But what philosophical implications that visual fact has -- i.e. that not everyone [or even that no member of the human species] can see every aspect or (acquire every concept) --, I don't know. But it is connected to the notion of "forms of life" and to "The limit of thought [in philosophy, science, mathematics] -- is concept formation". It is a powerful metaphor for that. <Old Woman-Young Woman>

But when Hanson adds that if one looks at the drawing "Ă  la Toulouse-Lautrec" then one sees a young woman ..... I wonder if in this case it is useful to speak of a Gestalt shift. Certainly if you add Toulouse-Lautrec, then you do encourage a shift of sorts -- i.e. a particular way of looking at things, at a human face e.g. ("Yes, now I can see her as a young woman") ..... I would not call this an example [instance] of Gestalt shift (even if there is a "family resemblance" to that, because ... as if resemblances were ever hard to find; indeed, a limitation 193

of Wittgenstein's metaphor is that resemblances are only too easy to find). Hanson has provided a context -- whereas a Gestalt shift should be raw [spontaneous]? But by labeling the cube above, does not Wittgenstein also place that drawing in a context? When I wrote the two paragraphs below I was experiencing "aspect blindness" or inability to see one aspect of the Gestalt. (How to see both aspects.) However, not everything in the next two paragraphs is incorrect; it is not clear why Hanson says what he does about the drawing. What I would say is that in the case of Hanson's "old woman-young woman" drawing, there are not two aspects, because both the young and old woman are absolutely identical -- i.e. you cannot show Hanson's distinction by pointing to specific places on the drawing as you can in Wittgenstein's examples: "Focus on 'a', now on 'b'" and "Here is a duck's bill; but now, there is a rabbit's ears". Instead, in Hanson's example you look at the drawing with ToulouseLautrec's posters in mind (and easily see a young woman), or without ToulouseLautrec (You see an old woman). That is, to call Hanson's example an instance of Gestalt shift has a blurring effect: it dissolves an otherwise sharp distinction. In sum, if you allow yourself too much freedom in how you apply the expression 'Gestalt shift', then any drawing at all might be used as an example (You have only to provide a context as Hanson does). Thus, considered as a tool, it would be more useful to apply the expression 'Gestalt shift' only to cases where the viewer experiences a snap or jump from one aspect to another. In Hanson's "old woman-young woman" drawing, the viewer experiences no such snap. <How to See the Young-woman Aspect> With regard to the old woman-young woman, a correspondent wrote that "it is as most certainly a Gestalt shift as the duck-rabbit. The old woman's eye is the young woman's ear, the underside of the old woman's nose is the young woman's jaw line, and the old woman's smile the young woman's choker around her neck. The young woman is looking away, her neck exposed."


In other words: The end of the old woman's nose is the young woman's chin. The young woman's face is turned away from us, and the old woman's eye is the young woman's left ear, but the hair is the same for both aspect-women. (That, of course, assumes that the old woman is the aspect that resembles a poster by Toulouse-Lautrec.) I myself could, at first, see that young woman only after I used a colored pencil (to outline her face and neck) and an eraser (to remove much of her hood and dress), but I can thus see her. Although then I do not see the point of Hanson's adding "Ă  la Toulouse-Lautrec". It is possible, in any case, to simply see the drawing either as an old woman (in our normal style of drawing) or as a young woman (in the style of Toulouse-Lautrec) without any need for a Gestalt shift. And either way of looking at the drawing serves Hanson's purpose, I think, but there is some broadening of Hanson's point if the drawing is looked at in the latter way -- i.e. without any Gestalt shift. Query: drawings where two different images can be seen but not at the same time. That would belong to the defining characteristics of 'Gestalt shift', or, the criteria for classifying any particular image as an example of a Gestalt shift. Query: Gestalt concepts overlap. What might the query mean by the word 'overlap'? The duck and rabbit aspects do not overlap (1) in the sense of 'overlap' that one aspect partially covers up the other, unless that simply means that only one aspect can be seen at a time, or (2) in the sense of 'overlap' that they have something in common, unless that simply means that they are both aspects of the same image. 195

Is it not an important point that that they don't overlap? that they are different concepts, not inter-connected but only externally connected -- i.e. nothing would be lost by the duck-aspect if there were no rabbit-aspect, or any other aspect besides the duck-aspect, to be seen in the duck-rabbit image, just as it is logically possible that ducks might exist without rabbits also existing. (Cf. although the part of speech of both the words 'duck' and 'rabbit' is name-ofobject, the objects that are pointed to when those two words are ostensively defined are different: the meaning [use] of one is not dependent on the meaning of the other). Query: in between Gestalt switches. What characterizes this phenomenon, and is used to define it -- i.e. to define ("to limit", "set boundaries to") the concept 'Gestalt shift' -- is that there is no "in between", i.e. no transition from seeing one aspect to seeing the other; it happens in an instant (and thus expressions such as 'Gestalt snap' or maybe 'Gestalt flip' may be particularly apt). Note that 'Gestalt shift' is defined by psychological not physiological criteria, by testimony rather than by e.g. events in the central nervous system. <Gestalt Shift as Simile> That was how I began this page, when I used the expression 'a universal Gestalt shift', with a comparison. The form of a simile: A is like B. But that comparison is undefined language until it is stated in what way A is like B. (And that statement may be true or false, because A may or may not be like B in that particular way. On the other hand, some similes are suggestive rather than precise, suggestive or too vague to make anything clearer.) Query: seeing aspects, Wittgenstein, religion. Gestalt shift would in this case be a metaphor, like 'concept-blindness' (Wittgenstein's remark about blindness to the concept 'God'). But how is that like the duck-rabbit? Suppose it were the case that some people could (as perhaps some really can) only see one or the other aspect. But how is being unable to see the rabbit-aspect (e.g.) to be compared with not being able to understand how any reasonable human being could seriously use the word 'God' (how the concept 'God' may have an important place in a reasonable man's thinking)? Can one be blind to the religious aspect of life? Some similes are suggestive -- suggestive or too vague to make anything clearer. Which is this? <â&#x20AC;?Seeing is theory-ladenâ&#x20AC;?> Seeing a bird in the sky involves seeing that it will not suddenly do vertical snap rolls ... This is knowledge.


And not asking the geese in the park for directions and the time of day. We may perhaps say that this is knowledge (an example of what we call 'knowledge'), but what relationship has this to seeing? Would we say that there is any theory-laden seeing here: "If you see a goose, you also see that ..." or "If you see a goose, you see at the same time that ..." or "Seeing a goose is seeing that ..." Perhaps Hanson's point is that: there are not two acts here, only one. Does making a connection to perception make something clearer here; what does Hanson accomplish by making this connection? Is the connection that normally we don't think about these things: I do not normally deduce: "That is a goose, and geese do not bite, and therefore I need not be afraid that this goose will bite me." Although I might, if asked, give this deduction as a justification for my behavior, my behavior can be compared to seeing in the sense that it can also be compared to instinct: I act without thinking. I do not say "This is a staircase and ... and therefore I must lift my foot if I wish to climb it." When I see a goose I see an object about which I know many things -- 'I know' means that I have many expectations, and if I am on familiar territory, then I have a clear attitude toward anomalies ... or have I? I do not know what I would say if just any such-and-such [prodigy] occurred. We do not live in a world where such things happen very often (Indeed they are quite rare). Was Hanson stating a metaphor [making a comparison, an analogy]? "In science we want to look without pre-conceptions." -- But conceptions and perceptions are not the same thing: they are different concepts. Hanson wanted to point to the areas where these concepts overlap, where there is no clear distinction between a conception and a perception. However, I do not believe you can say that these concepts overlap everywhere [i.e. in all cases where we apply the words 'percept' and 'concept'], as "seeing is theory-laden" seems to suggest. Comparison between Kant and Hanson: but Hanson's pre-conceptions can change, whereas Kant's ["time", "space"] cannot (They belong to the essence of human nature). Is this correct? <Kant and Wittgenstein> Comparison between Kant and Wittgenstein: in Kant's jargon, if I understand Kant's jargon, in a Gestalt shift the concept changes, but the percept does not. Here, Wittgenstein's 'aspect' would correspond to Kant's 'concept', I think. (However, in the example of the cube faces above, would we say there is a concept change as well as a percept change, or only a percept change; and yet in this example of a Gestalt shift, we do see different aspects.) Query: how does a picture of a duck-rabbit show principle of perception? That "percepts without concepts are blind"? For if there were a concept 'rabbit', but no concept 'duck' in our language -- for language is the concern 197

of logic, although there may be other uses for the word 'concept' than to mean 'rules for using a word' --, then the duck-rabbit would be an image only of a rabbit? Query: categories, Kant; form of life, Wittgenstein. The connection would, I think, be that Kant's categories are one type of "form of life", the type where there is no choice [the type where we speak of "different life forms"] -- i.e. one that is involuntary. That is, some "forms of life" may be shared by some human beings but not others; whereas Kant's categories are "necessarily" shared by all mankind, because they belong to a frame of reference that is essential to the human mind. The difference is that Wittgenstein's account is a description, not an explanation; whereas Kant's account is not a description, but instead a metaphysical theory. (If I know what I am talking about, and I may not know what I am talking about.) Query: Kant's gestalt switch. I imagine that you could apply the metaphor, if metaphor it be, I have applied to Wittgenstein's logic of language to the work of every philosopher worth his salt: a new way of looking at things replaces the/an old/er way of looking at things. But, as I intend the metaphor to be understood, this is not seeing a new aspect of a familiar figure, but the replacement of e.g. the duck with the rabbit, not the retention of both. Query: rabbit, duck, different view points, theory. The duck-rabbit image can be used as a metaphor for two different points of view (or frames of reference): they may begin with the exact same data -although whether or not they do begin that way cannot be judged within either frame of reference (duck or rabbit) nor is there of course an absolute frame of reference, but only by some third frame of reference or other -- but see entirely different things, make entirely different things of it. But is the image duck-rabbit also a metaphor for two contrasting scientific theories, e.g. the geo- and helio-centric models of the solar system: different pictures, but exactly the same data? That is a vague, carelessly suggested notion, as the following shows: Query: geocentric, heliocentric, percepts, concepts. That does not apply in the case of these two theories, because it is not a matter of different Gestalts [Gestalten] (as with the duck-rabbit). Because although we organize the facts differently using these two models, we neither perceive nor conceive the facts we see (in the night sky) differently. Whereas with the duck-rabbit, the percepts are the same [the single drawing, the fact] but the concepts ['duck', 'rabbit'] are different. A model is not a concept in the sense of the word 'concept' that contrasts with 'percept'. (We use the word 'concept' many different ways, some quite vague, as when we call a scientific 198

model a concept.) There is also Gestalt shift, not as a metaphor, but as a picture that can be used to give a sense to 'Time is not real' (although it is a fantasy picture). If I say, as I have, that "To understand Wittgenstein's logic of language is to experience a universal Gestalt shift", that is only in the domain of Logic. Cf. the motto of the Philosophical Investigations: It is the nature of every advance that it appears much greater than it actually is. -- Nestroy. And indeed neither the Philosophical Investigations nor the rest of Wittgenstein's post-TLP work in any way responds to the eternal philosophical question of (in Plato's words) "we are discussing no small matter, but how to live" (although it may point away from false paths in the study of Ethics, as well as in Metaphysics).

Paradigm Shift A paradigm shift (or revolutionary science) is, according to Thomas Kuhn, in his influential book The Structure of Scientific Revolutions (1962), a change in the basic assumptions, or paradigms, within the ruling theory of science. It is in contrast to his idea of normal science. According to Kuhn, "A paradigm is what members of a scientific community, and they alone, share". Unlike a normal scientist, Kuhn held, "a student in the humanities has constantly before him a number of competing and incommensurable solutions to these problems, solutions that he must ultimately examine for himself". Once a paradigm shift is complete, a scientist cannot, for example, reject the germ theory of disease to posit the possibility that miasma causes disease or reject modern physics and optics to posit that ether carries light. In contrast, a critic in the humanities can choose to adopt an array of stances (e.g., Marxist criticism, Freudian criticism, Deconstruction, 19th-century-style literary criticism), which may be more or less fashionable during any given period but all regarded as legitimate. Since the 1960s, the term has also been used in numerous non-scientific contexts to describe a profound change in a fundamental model or perception of events, even though Kuhn himself restricted the use of the term to the hard sciences. Compare as a structured form of Zeitgeist. <Marketing> In the later part of the 1990s, 'paradigm shift' emerged as a buzzword, popularized as marketing speak and appearing more frequently in print and publication. In his book Mind The Gaffe, author Larry Trask advises readers to refrain from using it, and to use caution when reading anything that contains the phrase. It is referred to in several articles and books as abused and overused to the point of becoming meaningless. 199

<Revolutionary Science> The scientific revolution was the emergence of modern science during the early modern period, when developments in mathematics, physics, astronomy, biology, medicine, and chemistry transformed views of society and nature. According to traditional accounts, the scientific revolution began in Europe towards the end of the Renaissance era and continued through the late 18th century, influencing the intellectual social movement known as the Enlightenment. While its dates are disputed, the publication in 1543 of Nicolaus Copernicus's De revolutionibus orbium coelestium (On the Revolutions of the Heavenly Spheres) and Andreas Vesalius's De humani corporis fabrica (On the Fabric of the Human body) is often cited as marking the beginning of the scientific revolution. By the end of the 18th century the scientific revolution had given way to the "Age of Reflection". Philosopher and historian Alexandre KoyrĂŠ coined the term scientific revolution in 1939 to describe this epoch. 1. Paradigm Shift in Culture & Art Contents Industry a. Flipping Inside Out: Double Sided Clothes

It was a big paradigm shift in fashion industry to think of flipping inside out for clothes. At first, there was much resistance to this notion, but once it was realized, people got accustomed to the notion. Double-faced fabrics are a form of double cloth made of one warp and two sets of wefts, or (less often) two warps and one weft. These fabrics have two right sides or faces and no wrong side, and include most blankets, satin ribbons, and interlinings.


b. Decay Vs. Fermentation <The thin line between fermentation and rot> May I offer you some warm, bacteria-ridden dough topped with rotten milk and discs of rotten meat? No? That is a pepperoni pizza. If that sounds too unappetising, substitute "bacteria-ridden" with “risen” (pizza crust, like bread, relies on the work of a unicellular fungus known as Saccharomyces cerevisiae—or, more commonly, yeast), and "rotten" with “fermented”. The cheese and meat are both the delicious product of bacteria. Fermentation preserves: saucisson lasts far longer and is easier to keep at room temperature than fresh pork. Sauerkraut and kimchi last longer than fresh cabbage. Paradoxically, fermentation can also make food safer to consume: for centuries in Europe it was easier to find potable beer than water. And it often makes food taste better. After being shot, game birds are hung to age; some believe they should be served only after their heads have fallen off. The line between fermentation and rot is pretty thin. The only useful distinction between the two may be that rot produces something that tastes bad and fermentation produces something that tastes good. Or at least something that some of us enjoy, and often after an initial hesitation—even revulsion. The thought of eating blue cheese happens to make me queasy; it always has. But while I recoiled at first from the fermented fish pastes and sauces of South-East Asia, I could not now imagine my pantry without them, in both their liquid and solid states. The fermented fish provides a nice salty taste along with a serious jolt of "umami"—a meaty, rich savouriness. They are cellos where soy sauces and salt are violins. Used raw in combination with chilies, shallots and lime juice in a nuoc cham sauce, they not only complement the other ingredients, but undergird them all. Fish sauces provide structure. Shaken into long-simmering soups and stocks, they add complexity and depth. The liquid stuff is easier to find; most grocery stores now stock some sort of fish sauce. I’m partial to the Tiparos brand, which is teacoloured and rather strong, and Golden Boy, which is lighter and milder (and has a chubby, happy baby on the label). I have found that Golden Boy is usually more expensive and harder to find than Tiparos—or any other brand for that matter. Higher prices do not always mean higher quality, particularly when it comes to East Asian ingredients: you’ll often pay less for more or better at an Asian supermarket than a Western one. With fish sauce, though, it’s worth paying a bit more to avoid anything with added colorants, sweeteners or MSG. 201

The more solid stuff comes in jars or blocks. The jars are relatively easy to find. The blocks—called belacan (Malay), terassi or trassi (Bahasa)—are tougher to source; finding a good one harder still. Most large Asian supermarkets will stock them, though. As with fish sauce, the key is to avoid added colourings or preservatives (the latter is much harder to avoid—keeping these imports kitchenready often takes a bit of chemical help). Take it from someone who learned the hard way: store your block of fermented fish in the refrigerator, swaddled in plastic wrap, then a plastic bag, then a vacuum-sealed container (unless you want the contents of your refrigerator to smell of belacan). Unlike fish sauce, which does not need to be cooked, belacan/terassi is never eaten raw. To make the stuff, anchovies or tiny shrimp are salted, barrelled, weighted and left to ferment in the sun. The salt and fermentation draws water from the fish; fish sauce is that runoff. The solid block is the shrimp itself, processed and dried to the consistency of hardened clay. These products have an ancient lineage: the Romans used a similar fish-based condiment called garum. It was born of frugality: the fish and shrimp used in these sauces are too small to eat. Making them into something usable—and therefore sellable—allows fishermen to get paid for what otherwise would have been thrown back into the sea. But there is no getting around the fact that they reek. But that's often the case with some of our most prized foods. When was the last time you whiffed a bit of prosciutto? And some especially pungent varieties of raw Camembert have earned the affectionate nickname “les pieds de Dieu”—the feet of God. If your first reaction is disgust, persevere. I now use fish sauce not only in South-East Asian recipes, but also almost any stock. Here are a couple of suggestions to get you started: Nuoc cham is the classic fish-based Vietnamese dipping sauce for grilled or fried foods. If you’ve been to a Vietnamese restaurant, you have likely eaten it may times over. In taste it should be sweet, salty, sour and hot; its composition is as varied and open to possibility as a salad dressing. My preference is to mix together ¼ cup of water, ¼ cup of sugar, 1/3; cup of fish sauce, the juice of four limes or three lemons, two chopped cloves of garlic, two chopped shallots and either one chopped Thai chili or about a teaspoon of red pepper flakes. That produces a sauce that is heavy on the sour (citrus) and the sweet (sugar and shallots). If your taste runs more to heat, increase the number of chilies. If you prefer salty or strong, reduce the amount of water. Kangkung is the Malaysian name for water spinach, a bitter green with narrow leaves sprouting off a long, hollow stem. It has a much 202

milder, grassier taste than western spinach, and a pleasant crunch as well. Kangkung belacan is a tasty stir-fry of this vegetable with solid shrimp paste. To make it start with about a tablespoon of belacan. Stir-fry it in vegetable oil on medium-high to high heat with a few shallots, a couple of garlic cloves and a chopped chili or two. It will be very pungent for the first minute or so; then it mellows. Add a large bunch of chopped water spinach and a couple of teaspoons of soy sauce. SautĂŠ until the greens wilt but are still bright green, about three minutes. Like the above recipe, this is open to variations: some cooks add dried shrimp for extra funk, some bean paste for extra sweetness, or a squeeze of lime at the end for extra sour. This recipe feeds four regular people or one me. <Role of microorganisms in Kimchi Fermentation> Kimchi fermentation is carried out by various microorganisms present in the raw materials and ingredients of kimchi. Among them, lactic acid bacteria which can grow in 3% brine play the most active role in the kimchi fermentation; it suppresses the growth of other bacteria which could grow under such conditions. Among the 200 bacteria isolated form kimchi, the important microorganisms in kimchi fermentation are known to be Lactobacillus plantarum, L. Brevis, Streptococcus faecalis, Leuconostoc mesenteroides, and Pediococcus pentosaceus. Most kinds of bacteria belonging to the genus Lactobacillus have been found to be present in kimchi. The number of aerobes increased in the early stage of kimchi fermentation and then decreased, while the number of anaerobes continued to increase during the middle stage. A rapid increase of aerobes in the late stage was due to the growth of film-forming yeasts. Leu. mesenteroides actively grows in the early stage of kimchi fermentation, thereby producing lactic acid and carbon dioxide which could acidify kimchi and create an anaerobic state to suppress the growth of aerobes. Streptococcus actively grows in the early stage of fermentation, Pediococcus in the mid-stage, and L. plantarum and L. brevis in the late stage, which could affect the ripening of kimchi. The rate of kimchi fermentation was markedly affected by salt concentration and fermentation temperature, and kimchi was at an optimum for consumption when it contained 0.6-0.8% titratable acidity (pH 4.2), 3% salt, and high volatile organic acids. <Fermented Foos> 203

Fermented foods are yet another example of what's old becoming new again. Traditionally, almost every civilization regularly produced and consumed at least one cultured food. While our generation had all but forgotten traditional fermentation practices, now that scientific research is investigating the effect of active bacterial cultures from fermented foods on health, foods such as sauerkraut, kimchi, miso, chutneys, kefir, and yogurt are reappearing in kitchens everywhere. Cultured dairy products are dairy foods that have been fermented with lactic acid bacteria, known as probiotics. There is evidence of cultured milk products being produced as food as long ago as 10,000 B.C. While many types of cultured milk products can be found around the world, yogurt is by far the most common. Although the benefits of yogurt on digestive health had already been recognized, the microbiologist Ilya Mechnikov popularized its use throughout Europe in the 1900s, believing that lactobacillus bacteria were responsible for the remarkable longevity of Bulgarians. Fermentation with lactic acid bacteria increases the nutritive value of foods because of improved bioavailability and can enhance the absorption of protein and minerals, particularly calcium, iron, zinc, magnesium, phosphorus and copper. Lactic acid bacteria can synthesize the vitamins folic acid, thiamin, niacin, riboflavin and vitamin B12, even when they aren't provided in the diet. Empirical research has identified a long list of health conditions that may be helped by consuming foods containing lactic acid bacteria, including colitis, constipation, diarrhea, gas, gastric reflux, heartburn, Crohn's disease, gum disease and high cholesterol. Recent studies have shown a positive effect of probiotics on autism and obesity. Probiotic bacteria must be consumed every day to be effective as they cannot implant in the gastrointestinal tract and they do leave the body quite readily. Include a variety of foods fermented with lactic acid bacteria in your diet daily. The fermentation process increases the shelf life of dairy products. Refrigerated, yogurt has a shelf life of 35-40 days. c. Cross-disciplined Artwork: Art of Short Film? <Is it art or film?> There has been many new attempts for young artist to create a 204

bigger impact on the society. Often, they borrow the form from other disciplines. For instance, there has been a trend to produce a short film-like visual as their body of work. Then, this question rose: is it art or film? Answer should be both. These days, it’s meaningless to talk about discipline specific work. As long as it delivers the main message of the author of the contents, artists will use whatever medium available. And, filmmakers will do the same thing.

Documentation images from “El Fin Del Mundo (2012)” is an artwork created by Jyoungwon Moon and Junho Jeon. However, the quality is so high, and viewers almost think they are watching a feature film. This is an interesting paradigm shift in visual arts since the boundary between visual arts and film once again faded because of these young artists’ attempts. d. It’s not an architecture if predictable: Frank Gehry Frank Owen Gehry, CC (born Frank Owen Goldberg; February 28, 1929) is a Canadian-American Pritzker Prize-winning architect based in Los Angeles. His buildings, including his private residence, have become tourist 205

attractions. His works are cited as being among the most important works of contemporary architecture in the 2010 World Architecture Survey, which led Vanity Fair to label him as "the most important architect of our age". Gehry's best-known works include the titanium-covered Guggenheim Museum in Bilbao, Spain; MIT Ray and Maria Stata Center in Cambridge, Massachusetts; Walt Disney Concert Hall in downtown Los Angeles; Experience Music Project in Seattle; Weisman Art Museum in Minneapolis; Dancing House in Prague; the Vitra Design Museum and the museum MARTa Herford in Germany; the Art Gallery of Ontario in Toronto; the Cinémathèque française in Paris; and 8 Spruce Street in New York City. But it was his private residence in Santa Monica, California, that jumpstarted his career, lifting it from the status of "paper architecture"— a phenomenon that many famous architects have experienced in their formative decades through experimentation almost exclusively on paper before receiving their first major commission in later years. Gehry is also the designer of the future Dwight D. Eisenhower Memorial.

<The tower at 8 Spruce Street in lower Manhattan> 206

<Walt Disney Concert Hall>

<Dancing House in Prague> 207

<Frank Gehry Talk About Cloud Architecture> The great contemporary architect Frank Gehry has built a reputation by challenging our core beliefs around what buildings should look like, as well as the very role of design. His work is often described as "deconstructivist," meaning that he reduces his creations to be more of a reflection of the tension that binds atomic elements as opposed to the singular "harmonic" whole of a Frank Lloyd Wright conception. Gehry has established an entirely new paradigm for architecture - one that is enabled by the most modern construction materials and techniques. His buildings, which would have been impossible to construct a generation ago, have given us a new way to appreciate architecture. Frank Lloyd Wright's Prairie School architecture has proven to be timeless in both form and function. His buildings have withstood the test of time, and -- in contrast to the work of his contemporaries -- strike us as "modern" a century after their conception. Adopting the new paradigm of a cloud-centric application architecture provides a once-in-a-generation opportunity to rearchitect how an organization serves both internal and external constituents. In terms of customer relationship managemen, it allows for unparalleled customer-centricity. In operational terms, the cloud offers an extraordinary opportunity to "get lean" by consolidating disparate systems into a single elastic record for product, pricing and customer data. Achieving the full potential of the cloud paradigm shift requires vision, courage and expert execution. By embracing cloud computing, companies benefit from an application architecture that harnesses the potential of new capabilities like a Gehry while delivering the efficiency and elegance of a Wright. What Does Architecture Represent? Semantics play a powerful and important role in our projects. The terms "portal," "CRM" and even "customer" (versus "end-user" or "channel partner") can have widely divergent meanings. Thus, every new project requires an early level-set on definitions for these and other relativistic terms. Similarly, the term "architecture" means different things to different people. In my experience, when people are talking about architecture, they are really talking about one of three things: 208

business architecture, applications architecture or systems architecture. For example, the business architecture defines how a value proposition is developed and delivered within a product or service's ecosystem. The business architecture also drives how the functional groups responsible for delivering that product or service to market interact to support business processes. Applications architecture defines the primary automated systems that support business processes, such as marketing, sales and customer support. This architecture also rationalizes where certain core functionality resides. For example, inventory management functions may reside in CRM, e-commerce or accounting systems, as well as in stand-alone systems, depending upon the architecture being supported. Lastly, systems architecture describes both how and when systems communicate with each other, and what business rules are enforced by this architecture. Sound complicated? It can be, especially when a legacy business is involved. These businesses commonly employ a tangle of business processes cobbled together over time as a workaround for inflexible and sometimes poorly implemented legacy systems. Enter the Genius of Cloud Computing Cloud offers a generational opportunity to reconsider not just systems, but the entire business architecture. Why? Because our experience has shown that cloud-based systems shatter the barriers for systems deployment as we have known them, by eliminating long-held assumptions about system constraints. I've seen enterprise resource planning systems deployments that have taken longer than the typical four-year college education, while an ERP cloud deployment can take less than four months. Using cloud-based architecture, the ways in which a company goes to market can be completely transformed, leaving it far more nimble and much more capable of experimenting with new ways of going to market and promoting products and services. Ultimately, this is only possible when cloud computing is fully embraced within the context of business, applications and systems re-architecture. Embracing the possibilities means reinventing, discarding assumptions and embracing change. For those who do, the real promise of cloud computing awaits. Finding Common Ground


New technologies have enabled breakthrough designs in construction that have allowed the whimsical musings of an architect like Frank Gehry to be turned into inspiring sweeps of creativity. In the same manner, cloud computing enables entirely new ways of approaching how automated systems are constructed and, more importantly, how these systems interact with one another. One exciting development that has occurred in parallel with the rise of cloud computing is the advent of "open" systems, which have come to replace the closed architectures that dominated previous technological eras. Open systems allow business applications to freely exchange data using commonly accepted protocols. As the practice of interconnecting systems became more commonplace, the idea of moving past one-to-one connections to interdependent networked computing took hold. These open-systems capabilities are what allow various "clouds" to coexist and form ecosystems. This is how eBay has created an ecosystem around its auction platform, leveraging PayPal and other payment transaction gateways. Amazon and Google "rent" their cloud to other application vendors, forming other ecosystems. Facebook, Foursquare and Zynga all share interdependent fates in the "social cloud." Even hardware companies depend on open-systems capabilities. Nokia's new CEO was recently quoted as saying the key to the company's survival was to either create a new ecosystem or join an existing one. The ecosystem that Apple has been able to construct resembles a city comprised of Frank Gehry buildings -- each of them unique, yet sharing a common aesthetic. Of course, the overarching unifying principle of the Apple ecosystem is really a matter of form following function -- the triumph of the user experience as the ultimate arbiter of mass acceptance. Frank Lloyd Wright would have been proud. As with many emerging technology trends, we are only scratching the potential of cloud computing. Ultimately, my belief is that the most powerful way to leverage this technology centers on the ability it gives us to form new ecosystems quickly and easily. Those who will prosper will have both the vision of Frank Gehry and the courage, tenacity and bold execution of Frank Lloyd Wright. Cloud computing delivers the "right" balance of technology enablement, timing and execution to create the ecosystems of the future. e. How In-N-Out Burger Outplayed McDonalds with Only 4 Menu 210


<In-N-Out Burger beats McDonaldâ&#x20AC;&#x2122;s in Consumer Reports fast food Ratings> With high marks for food, service, value and speed, In-N-Out Burger topped the burger chart in Consumer Reports' first-ever major ratings of fast food restaurants. McDonald's, Burger King and Wendy's all ranked lower. Consumer Reports readers made over 98,000 visits to 53 fast food chains, and found that Burger King, KFC, McDonaldâ&#x20AC;&#x2122;s and Taco Bell offered uninspiring food and so-so service. While In-N-Out Burger was the top-ranked burger chain, other restaurants also did well in their categories. Chick-fil-A topped KFC and all other chicken chains, with high scores for food, value, speed, and the politeness of its staff. Chipotle Mexican Grill beat out 8 other Mexican food chains, including Taco Bell . Many restaurants scored higher for service than they did for food. At chains with the highest rankings, 42 to 54 percent of customers called the food excellent, but at Burger King, KFC, McDonaldâ&#x20AC;&#x2122;s, and Taco Bell, no more than 11 percent did. At pizza chain Sbarro, 27 percent judged the food fair, poor, or very poor. While many fast food restaurants offer healthful menu options, most consumers are taking a pass; only 13 percent of those surveyed by Consumer Reports said they had eaten a healthful 211

meal during their most recent visit to a fast food chain. "Indulgence wins over healthfulness every time,” says Darren Tristano, executive vice president of Technomic, a food-service research and consulting firm in Chicago. <Paradigm Shift in Fast Food Industry> In today’s world, fast food is a staple of many peoples diet, and it would be difficult to imagine a world without a McDonald’s, Taco Bell, or any other fast food chain, but there was a time where this was the case. In the early 1900’s, there were no restaurants such as these, and people either cooked at home, or went to restaurants to eat. Even though a select few companies even attempted to serve “fast food” in the early 1900’s, the industry took off in the 50’s, with the advancements in automobiles and communication techniques serving to stimulate the fast food industry, and it has only continued to rapidly grow. The first fast food join to officially open its doors was White Castle, which opened in 1916. There was no drive thru attached to this establishment, but it was the first place to serve high speed, low cost hamburgers, and it was also the first place to have a limited menu. Americans reacted to this slowly at first, but then the potential in a restaurant similar to this was realized. In 1919 A&W Root Beer open the first thing that was similar to a drive thru. They began taking their fountain drinks and placing them in roadside stands for people to enjoy. At the same time that all of this was going on, Henry Ford was making large advancements in the automobile industry. He created the assembly line, which allowed for cars to be built at a much quicker, and more efficient rate, which resulted in more affordable cars that the majority of Americans could afford. With more Americans driving, there were more opportunities in the fast food industry that were there for the taking. The first step in taking advantage of this new technology was to create an easy way for people to order their food without leaving their car, and the solution to this was a drive thru. The only problem was that no one had ever created one, and there was skepticism about the success of such an invention. The first actual drive thru was created by In-N-Out burger. They were the first to incorporate call box technology into their operation. They had a small box where you ordered, and then you went a little further and got your food. This was a revelation back then, and people realized how convenient this new technology was, and the industry started to take off. Over the next 15 years, many of the fast food facilities that we know and love today, such as Taco Bell, McDonald’s, Wendy’s, and Burger 212

King, were created. During the 1960’s to the 1990’s, the fast food industry grew at a steady pace, and continued to improve upon the old ideas. This made the entire process of ordering fast food quicker, easier, and more efficient, which lead to even more customers from before. Also with many of the new technologies of these times, new items were added to many of the menu’s at the restaurants. This lead to newer menu choices, which meant that the restaurants would be more appealing to a broader variety of people, which lead to increased revenue for the industry. It was not a serious jump, but enough to keep the industry well above water. This was also a time of severe international expansion. With all of the success that the fast food restaurants were having in the United States, they began to experiment going over seas. This was not a mistake, and the restaurants caught on. There were certain countries that were more accepting to it than others, such as China, and the opportunity was taken. The start of the 21st century was a time in which the fast food industry took off, gathered a second wind sort of speak, and became a very successful industry. One of the major reasons for this was the financial crisis that swept through the United States during this time. While the fast food industry may not serve the healthiest food, it definitely has the best money saving options. For about ten dollars, a family of four could easily be fed and be full. If you go to a grocery store such as Safeway or Giant and not be able to do the same thing. Ten dollars at a grocery store does not take you very far, and while the food at a fast food facility may not be as healthy, people are willing to eat unhealthy food as opposed to going hungry. While this may seem like an advantage, there are some negative side effects, and they are by no means unnoticeable. Over the past 36 years, the fast food industry has increased by over 1000% percent, from 16.1 million in 1975, to the over 180 billion dollars that Americans spent in 2011. This number doesn’t show any signs of decreasing anytime soon either. McDonald’s feeds 45 million people in the world each day, and Americans spend 50 million dollars on fast food each day. These statistics are the evidence that backs up the fact that fast food is now a staple in millions of people’s diets. There is one statistic that tops all of these, and backs up the fact that American’s love fast food, and it is that America is the most obese country in the world. With 58 million American’s overweight, 40 million obese, and 3 million morbidly obese, it is evident that America has a problem with the amount of fast food that is consumed. This has sparked debates throughout the fast food 213

industry, and forcing many different changes in the ingredients, methods of cooking, and food options in fast food restaurants. One of these major changes was that in 2002, McDonald’s cut back on the amount of trans fat in their food by 48%. This was a huge change, and made the food served a little bit healthier. Another change is the type of meat that is used in the food. In most fast food commercials these days, you will always hear phrases such as “all white meat chicken breast”. This is trying to promote a healthier type of chicken, which makes the consumer crave that specific fast food joint’s food more than the others. Advertisements are on of the most successful ways to reach out to consumers. In 2011, 4.5 billion dollars were spent on advertisements for fast food restaurants, most of which were targets for teens. The commercials feature catch slogans, bright colors, and are usually very prominent on children’s channels. This marketing strategy is very efficient and usually very successful, which is why American’s spend over 180 billion dollars a year on fast food. The fast food industry has grown exponentially over the past 75 years, and it is showing no signs of slowing down. With busy schedules, tight budgets, and the growing need for efficient food, the fast food industry has nowhere to go but up. If the food that is served can get healthier, than the industry will be even more successful. With the addition of many new future technological advances, the industry can go even further. People will keep on eating the food, and the need will only go up. For better or for worse, the fast food industry is here, and it is here to stay. f. Transforming Food Waste to Anti-Freezer and Jet Fuel <Creating Jet Fuel from Biomass Waste> First British Airways, and now Qantas are teaming with the Solena Group to build commercial plasma gasification and FischerTropsch plants to create synthetic jet fuel from carbonaceous biomass waste. Solena's joint venture with Qantas – which could be announced within the next fortnight – follows a tie-up with British Airways, signed in February last year, to build the world's first commercialscale biojet fuel plant in London, creating up to 1,200 jobs. Once operational in 2014, the London plant, costing £200m to build, will convert up to 500,000 tonnes of waste a year into 16m gallons of green jet fuel, which BA said would be enough to power 2% of its aircraft at its main base at Heathrow. The waste will come from food scraps and other household material such as 214

grass and tree cuttings, agricultural and industrial waste. It is thought the Qantas plant, to be built in Australia, will be similar. Solena uses technology based on the Fischer-Tropsch process, which manufactures synthetic liquid fuel using oil substitutes. Germany relied on this technology during the second world war to make fuel for its tanks and planes because it did not have access to oil supplies. Airlines have been using synthetic fuel made in this way from coal for years, but this results in high carbon emissions. The use of biomass – which does not produce any extra emissions – as an oil substitute has more recently been pioneered by Solena. The privately owned company says that planes can run on this green synthetic fuel, without it having to be mixed with kerosenebased jet fuel. In the UK and US, regulators allow only a maximum 50% blend, and the fuel was only recently certified for use by the UK authorities. BA is understood to be exploring the possibility of using 100% biojet fuel, once it is approved as expected. Airlines including Virgin Atlantic have also been testing biofuels – made mostly from crops, which are converted into fuel – by blending them with kerosene-based jet fuel. But experts say these blends have to have a low level of biofuels to ensure that engine safety and performance are maintained. In February 2008, Virgin became the first airline in the world to operate a commercial aircraft on a biofuel blend, but this was only 20% and through just one of the plane's four engines. The use of conventional, crop-based biofuels is controversial. Some environmentalists are concerned that an increase in the farming of crops and trees for biofuels could take up too much agricultural land and hit food production. But Solena plans to make its biojet fuel using waste, not crops. Industry experts say that, in the future, biojet fuel will work out cheaper than kerosene-based fuel as oil prices rise. Producers such as Solena could also earn subsidies by using waste materials that may otherwise have to be sent to landfill. The Germany airline Lufthansa is also understood to be interested in a joint venture with Solena. But with each plant costing £200m to build, it will take time to roll out the technology. One challenge faced by Solena is securing a supply of biomass waste for its new plants. Ideally, facilities will be located in or near cities, where most of the waste will be sourced, and near airlines' bases. The bioenergy producer will face competition from other companies planning to build incinerators, which also need to use 215

waste to generate subsidised electricity. _Guardian Of course the supply of biomass waste will present a problem for the world's airlines, if they intend to fly on cellulosic fuels from waste. Naturally, they will eventually have to look to biomass farms -- whether seawater aquatic farms of seaweed, forestry farms of fast-growing woody crops, or designed high-yield grasses such as Giant King Grass. The idea of maintaining a high volume fuel industry on waste scraps is laughable. But the climate of carbon hysteria will drive corporate PR departments to ridiculous lengths in order to paint their companies green. Much better to move quickly beyond cosmetic efforts and to get serious about advanced cellulosic fuels. If Qantas, British Airlines, Virgin, etc. want to use biomass jet fuel, they need to spend money to solve the energy density problem of biomass fuels. It is a solvable problem. But instead they add fuel to the idiotic "foods vs. fuels" non-debate. g. Paradigm Shift in Marketing I thought it was “paradigm”. Or is that overused word old and busted now? Paradigm and paradigm shifts were definitely broken by overuse in the 1990s. Eventually the term became meaningless because it was used to describe virtually any change in business models. Let’s tackle quickly what a paradigm shift is. To paraphrase the scientific definition, a paradigm shift occurs when you encounter anomalies that cannot be explained by any existing scientific knowledge. The understanding of how germs work would be a paradigm shift because disease is’t caused by humors or evil spirits, but by microbial organisms. New science needed to be developed to explain the mechanics of disease. Looking at it through that lens, there have been relatively few paradigm shifts in marketing over centuries of human history because there are very few anomalies in human communications that don’t fit how we work as human beings. The Gutenberg press was one, allowing companies and organizations outside the clergy to print things. Broadcast media began with Gutenberg. The channels for delivery of content – radio, television, Internet – changed over time, but the model of communicating information to people en masse was a paradigm shift.


Taken from that perspective, social media not only isnâ&#x20AC;&#x2122;t a paradigm shift, itâ&#x20AC;&#x2122;s not even remotely close to new. The idea that businesses could and should communicate with customers and have conversations with them stretch back to prehistoric times when merchants in local bazaars first figured out that telling a customer to tell a friend about their apple stand was a good way to build business. The channels have changed throughout the millennia and the scale with which you can do so has dramatically increased, but the method of two-way communication via Twitter is exactly the same as the apple merchant from 50,000 years ago. In that light, the last paradigm shift of marketing communications really was the age of broadcast which began in 1436 CE. This also explains why we have a tendency even in social media to manage our communications channels as a broadcast channel; itâ&#x20AC;&#x2122;s the most recent innovation to the theory of communications and the only one that scales well. <An Interview with David Scott> Today's marketing efforts are not like past marketing efforts. 217

Indeed marketing is undergoing a paradigm shift as increased importance is placed on quantitative results— chief executives want to know what to expect in return for their marketing spends, says David Scott, author of The New Rules of Lead Generation. Originally marketing was about branding, about how to get the word out and have people remember your company or brand. Lately it has shifted to a more scientific approach and focused on return on investment, he says. "Yesterday the chief marketing officer was asked [by chief executives], 'How do I make the biggest bang?' And today they're asked, 'How do I get the biggest return from my investment? How do I draw in more customers with the spend that I make? And how do I keep those customers longer?'" Scott says. Marketing is going from more of a touchy feely or more of a qualitative type of marketing to more quantitative where there's some real truth and science behind everything that is done, he says. And there's more of a conversation in the board room than there has been in the past. "The marketer now is really charged with not only saying, 'Hey, I need a budget of $30 million, but rather if I receive a budget of $30 million, this is what I can return to the company. This is how many leads. This is how much revenue,'" Scott says. Scott explains: • • • •

The marketing shift How the shift applies to B2B service firms Why the AIDA curve is still important His five-step plan for a lead generation campaign

h. Cons of Paradigm Shift <Why the paradigm shift in management is so difficult> We have been cocksure of many things that were not so. - Oliver Wendell Holmes Jr. In 1539, Copernicus overturned more than a thousand years of doctrine that the sun revolves around the earth with his theory that the earth is one of a number of planets revolving around the sun. No amount of tweaking the old theory led to progress. Scientists had to look at the problem in a totally different way to solve the problem. In 1865, Gregor Mendel presented a paper in Moravia that 218

eventually jettisoned decades of scientific work in genetics. The prevailing theory was that all genetic characteristics were passed from parents to the next generation in an average fashion. Mendel’s work in pea plants showed that genetics works over multiple generations with hybrid, dominant and recessive genes. No amount of tweaking the old theory led to progress. Scientists had to look at the problem in a completely different way to solve the problem. In 1982, scientists knew that stomach ulcers were caused by stress, spicy foods, and stomach acid. So they ignored Barry Marshall, an Australian physician, when he presented evidence that peptic ulcers are caused by a bacterium living in the stomach. They knew that no bacterium could possibly live in the human stomach, given the presence of acid as strong as that found in a car battery. The breakthrough that won for Marshall the Nobel Prize for Medicine didn’t come by improving the conventional theory of stomach ulcers. He had to look at the problem in a totally different way to solve the problem. Paradigm shifts are discontinuous Paradigm shifts are discontinuous. Working ever more diligently within the existing paradigm leads to frustration, not progress. Instead, scientists have to look at the problem in a fundamentally different way to solve the problem. Now, whether the business schools or managers want it or not, a discontinuous paradigm shift in management is happening. It’s a shift from a firm-centric view of the world in which the firm’s purpose is to make money for its shareholders to a customercentric view of the world in which the purpose of the firm is to add value for customers. Among many factors driving the shift is the realization that the new paradigm not only makes more money for the firm than shareholder capitalism: when correctly executed, it makes tons more money, as one can see from the results of firms when they implement the new paradigm, like Apple [AAPL], Amazon [AMZN], Salesforce [CRM], Costco [COST] or Zara [BMAD:ITX]. The fact that it’s also better for those doing the work and for those for whom the work is done will also help accelerate the transition. The paradigm shift is as fundamental as the shift from a geocentric to a heliocentric view of the heavens, the realization that genes work over multiple generations, or the discovery that stomach ulcers are caused by a bacterium. The shift in management is a shift from shareholder capitalism in which the firm revolves around the manager to a customer 219

capitalism in which the firm revolves around the customer. No amount of tweaking the shareholder model of capitalism can fix it, because the goal of making money for shareholder entails a set of management practices—hierarchical bureaucracy—that are inherently incompatible with the goal of delighting customers: each tweak entails a new set of problems, that sooner or later lead the firm to regress back to the norm of hierarchical bureaucracy. The experience of paradigm shifts in science can teach us a good deal about the ongoing paradigm shift in management, about which I wrote recently: Don’t Diss The Paradigm Shift In Management: It’s Happening! Common sense is commonly wrong One problem that paradigm shifts in science encounter is that the shifts appear to fly in the face of common sense. Copernicus’s theory of a heliocentric world ran flat smack into this problem. It was “obvious” that the sun and the stars revolve around the earth. Use your eyes! Half the stars are above the horizon and half are below the horizon at any given time. Can’t you see? The idea that the solid ground on which we are standing is whizzing through space at 60,000 miles an hour? Preposterous! Before Barry Marshall, every scientist knew that no bacterium could live in the human stomach, as the stomach produced acid as strong as that found in a car battery. A bacterium in the stomach causing ulcers? Ridiculous! To many managers today, the idea that the purpose of a firm is to make money for its shareholders is equally obvious. The shareholders created the firm. They own it. They control it. Why would they be doing all this if it wasn’t to make money for themselves? It’s common sense. Everyone knows that. Everyone, that is, except anyone who has actually set foot into a marketplace and tried to operate on that basis. The commercial reality is that in a marketplace, people won’t part with their money unless they believe that we are offering something to them. They may do business with us once, but if they find out that we are simply out to make money for ourselves at their expense, they will stop doing business with us as soon as they can. The only vaIid definition of business purpose This social reality is expressed in Peter Drucker’s dictum of 1973: “There is only one valid definition of business purpose: to create a customer… It is the customer who determines what a business is. It 220

is the customer alone whose willingness to pay for a good or for a service converts economic resources into wealth…The customer is the foundation of a business and keeps it in existence.” However, the idea that a firm is in business to make money for its shareholders wasn’t invented by people who had spent time in the marketplace and asked customers to part with their money. It was invented by money men trying to figure out how to get rich from a pre-existing franchise and by academics in back-rooms aiding and abetting their cause. They didn’t notice that if firms devoted themselves to making money, the firm would soon start doing things that got in the way of making money, like making money from bad profits, like seeking quick wins that destroyed the firm’s sustainability, like shying away from innovation as too risky or like encouraging the C-suite to feather its own nests. “The current paradigm used to work” Another interesting facet of paradigm shifts in science is that the older paradigm is difficult to displace precisely because it has been shown to work in solving problems in the past. Thus in astronomy, the geocentric system, espoused by the Hellenistic astronomer Claudius Ptolemaeus in the 2nd century AD, was accepted for over a thousand years as the correct cosmological model by European and Islamic astronomers. It offered accurate predictions of celestial events, such as planetary positions. So why replace it? Copernicus’s heliocentric model did no better than predicting celestial events than the Ptolemaic system. All the Copernicus’s model could offer was the nebulous promise of better, simpler, solutions to other problems, that might be developed at some point in the future. Fifty years ago, when a few big firms could dictate terms to the marketplace, the idea that the firm could simply focus on making money worked. But as globalization and the Internet steadily shifted the balance of power from the seller to the buyer, firms that simply focused on making money found it steadily more difficult to achieve profitability. Now what used to be common sense is obsolete. If you want to make money, focus on delivering value to customers. Making money is the result of the firm’s activities, not the goal. The social cost of replacing paradigms Copernicus’s theory was a better theory, but the social and political cost of accepting it was horrendous: it risked undermining 221

the entire religious basis of medieval society, along with the authority of the Pope. It wasn’t until several centuries later that the Roman Catholic Church finally capitulated and accepted they theory. Similarly the shift from a firm-centric view of the world to a customer-centric view of the world has horrendous psychological costs for managers who have perceived themselves as being in control of the workplace and the marketplace. To accept the new paradigm they would have to accept that the customer is the boss. Unthinkable! Criteria for assessing competing paradigms Thomas Kuhn suggested criteria to help determine whether a shift in paradigm is warranted. The criteria are: • • • • •

Accurate – empirically adequate with experimentation and observation Consistent – internally consistent, but also externally consistent with other theories Simple – the simplest explanation, principally similar to Occam’s Razor Broad Scope – a theory’s consequences should extend beyond that which it was initially designed to explain Fruitful – a theory should disclose new phenomena or new relationships among phenomena

What is fruitful? Both the geocentric and the heliocentric views of the world were accurate, consistent and simple. Where they differed was in “broad scope” and “fruitfulness”. The geocentric theory offered no explanation why the planets were revolving in these circles and offered no plausible picture of the universe as a whole. The heliocentric theory answered these questions and suggested a whole range of useful hypotheses about the rest of the universe. As a result, it triumphed, despite the social cost to earthly authority. Similarly the firm-centric view of the world and customer-centric view of the world are both simple and internally consistent. Where they differ most is in terms of accuracy and fruitfulness. In terms of accuracy, the firm-centric view of the world offers no explanation why the rates of return on assets and on invested capital have been in decline for more than four decades and no suggests no way forward in an economy where there is low demand for the foreseeable future. 222

In terms of “fruitfulness” of management, the dimensions are whether the shift is (1) good for the firm and its shareholders, (2) good for those doing the work, (3) good for those for whom the work is done and (4) good for other stakeholders in the community and society in which the firm operates. Much of the writing about reforming management over the last century has focused either on (2) what is good for those doing the work, or (3) what is good for those for whom the work is done or (4) what is good for the society in which the firm operates. However the decisive advantage for the customer-focused view of the firm is that it is better for the firm itself i.e. makes more money for the firm and its shareholders. The other elements of fruitfulness are nice. What makes the paradigm shift inexorable is the fact that it makes more money. i.

Innovation Catalyzed by Conflict and Fusion <Where Art and Literature Fuse With Science And Engineering> Innovation is a word that sparks off great debate and discussion wherever it is mentioned in any place in the world. It means different things to different people, can be measured differently, and innovation success can be measured in many different ways. It is a word of great mystery, a word that creates some tension and division, as people use it to describe the different things that they wish to do. Today we have conflict, or least a divergence of opinion. As I reflect into the future, I see the same thing continuing. So, am I really saying that innovation will not develop or change in the next 3 to 5 years? No, not all. The winners in innovation will be those people who can understand it enough to be able to use it in the workplace to solve problems and create opportunities. Innovation can be done by people, who are very highly educated, or with well-developed technical skills, or with people who have little or no education, in a formal sense, but they do require training to acquire the new innovation skill set. Future successes will be delivered through a potent mixture of different people with different expectations and experiences sharing together. Where I think the conflict and disagreement of how innovation works will be most pronounced or seen is in the area of what we call ‘Open Innovation’ — the idea of sharing with others from outside of your organization and your normal areas of work and influence. Already there are examples where this collaborative 223

innovation has been very successful for example the Chinese motorcycle industry. However people often get hung up on nondisclosure agreements and intellectual property, and these are the barriers to open innovation — a lack of trust and missing personal synergies. Some of these new open innovation opportunities may well be found in the collaboration of the Arts and Literature with Science and Engineering; or in the joining together of Business and the Community; Government and the Citizen. I suppose you could say it is the next stage development of PPP — Public Private Partnership, which has its fans and critics, its successes and its failures. The point is, it is when you meet and match people from different interests, geographies, histories and experiences, skill sets and expectations then you get the friction for creating ideas that genuinely take you to new and different places, and this is where the breakthrough innovation that creates enormous new wealth is to be found. Some say it is in the area of business model design that is where innovation is developing. I see this aspect of innovation as providing the clues and pointers to the skills that we need to take innovation to this new level. But I believe it will be the fusion of business model and open innovation that will be the source of the new ground breaking, innovation breakthroughs. 2. Creative Ideas in Implementation a. Paradigm Shift and example in industry <Paradigm Shifts Build Innovative Companies and Opportunities for Artist> Paradigm shifts have not just replaced products, they’ve revamped the markets the items sell in. The power of design and innovation can actually reshape an entire brand or the marketplace in which it exists. In the past, designers focused on making one new product. Today, they create a much broader story, an experience that consumers remember, which has far greater impact on the bottom line. In the new jargon of the Creativity Economy, this process is called “paradigm shifting.” Old ideas about products and services are reframed and replaced by a new concept, a fresh sensibility. So old ’60s Birkenstock sandals, reborn as “birkies,” still have an ergonomic, ecological feel to them but appeal to another generation. Give it some thought, and you can come up with plenty of examples of paradigms shifting from the old to the new .


And as you can see from an article I found below dating back to 2005, these kinds of paradigm shifts are no longer ” new” but in full bloom and becoming mainstream… Now we, as artists, need to bring them into Main Street businesses. We need to take the concepts of Fortune 100 and bring them into pizza parlors, beauty salons, Chinese restaurants and are favorite dry cleaners. The time is ripe and there is economic opportunities here for artists to realize. Listen closely. There’s a new conversation under way across America that may well change your future. If you work for Procter & Gamble Co. (PG ) or General Electric Co. (GE ), you already know what’s going on. If you don’t, you might want to stop what you’re doing and consider this: The Knowledge Economy as we know it is being eclipsed by something new — call it the Creativity Economy. Even as policymakers and pundits wring their hands over the outsourcing of engineering, software writing, accounting, and myriad other high-tech, high-end service jobs — not to mention the move of manufacturing to Asia — U.S. companies are evolving to the next level of economic activity. What was once central to corporations — price, quality, and much of the left-brain, digitized analytical work associated with knowledge — is fast being shipped off to lower-paid, highly trained Chinese and Indians, as well as Hungarians, Czechs, and Russians. Increasingly, the new core competence is creativity — the right-brain stuff that smart companies are now harnessing to generate top-line growth. The game is changing. It isn’t just about math and science anymore. It’s about creativity, imagination, and, above all, innovation. What is unfolding is the commoditization of knowledge. We have seen global forces undermine autos, electronics, and other manufacturing, but the Knowledge Economy was expected to last forever and play to America’s strengths: great universities, terrific labs, smart immigrants, an entrepreneurial business culture. Oops. It turns out there are a growing number of really smart engineers and scientists “out there,” too. They’ve learned to make assembly lines run efficiently, whether they turn out cars or code, refrigerators or legal briefs. So U.S. companies are moving on to creating consumer experiences, not just products; reconceiving entire brand categories, not merely adding a few more colors; and, above all, innovating in new and surprising arenas. The U.S. has a lead in this unfolding Creativity Economy — for the moment. The new forms of innovation driving it forward are based 225

on an intimate understanding of consumer culture — the ability to determine what people want even before they can articulate it. Working in what is still the largest consumer market in the world gives U.S. companies a huge edge. So does being able to think outside the box — something Americans still do better than most. But Toyota Motor Corp. (TM ) has a feel for U.S. consumers, and Samsung Group can be pretty creative, too. Competition will surely be intense. A New Dance For managers, the biggest challenge may be making the leap from their Six Sigma process skills to new ways of thinking. For corporations, transforming themselves will require new sets of values and organizational principles. Have you heard of design strategy? It’s probably the Next Big Thing after Six Sigma. How about consumer-centric innovation? It may be the most powerful way to raise a company’s innovation success rate. Do you know what innovation metrics your company needs? Have you heard of CENCOR (calibrate, explore, create, organize, and realize)? It’s the post-Six Sigma dogma GE is spreading far and wide among its managers. Are B-schools on top of all this change? Not really, but Stanford University is starting a “D-school” — a design school where managers can learn the dynamics of innovation. Teaching elephants to dance is never easy, but that’s the task ahead if you want your company — and your career — to prosper. You’re thinking “this is all hype,” aren’t you? Just another “newest and biggest” fad, right? Wrong. Ask the 940 senior executives from around the world who said in a recent Boston Consulting Group Inc. survey that increasing top-line revenues through innovation has become essential to success in their industry. The same BCG survey showed that more than half of the execs were dissatisfied with the financial returns on their investments in innovation. They should be. By one measure, from innovation consultant Doblin Inc., nearly 96% of all innovation attempts fail to beat targets for return on investment. No wonder innovation frustration is the talk of corner offices. BusinessWeek is joining this growing conversation about getting creative by launching a new online Innovation & Design portal — — to present the best research and thinking on the subject. Take a look at the interactive selfassessment feature developed by Larry Keeley’s Doblin Inc. There are six innovation metrics available. Keeley is the guru of the evolving field of innovation science. Some compare him to W. Edwards Deming, who revolutionized the field of quality measurement.


There is, in fact, a whole new generation of innovation gurus. They are not the superstars of the ’90s, such as Clayton Christensen, who focused on what might be called macro-innovation — the impact of big, unexpected new technologies on companies. The new gurus focus more on micro-innovation — teaching companies how to connect with their customers’ emotions, linking research and development labs to consumer needs, recalibrating employee incentives to emphasize creativity, constructing maps showing opportunities for innovation. When creative mojo gets going, it can explode into innovation. An example: the mundane mop. Cleaning used to be done with mops and water. Design Continuum Inc. in West Newton, Mass., researched cleaning for P&G and observed that water tends to slop dirt around, while dry rags pick it up (thanks to electrostatic attraction). Ergo, the Swiffer. In the design-speak of the Creativity Economy, this is paradigm shifting. Design Continuum helped P&G shift the cleaning paradigm. Now the Swiffer may become P&G’s newest $1 billion brand. Think out-of-the-box consumer experiences, and you get the idea of paradigm shifting. Old paradigm: corner coffee shops. New paradigm: Starbucks (SBUX ). Old: radio. New: satellite radio. Old: crowded electronics stores. New: Apple Computer (AAPL ) stores. Old: grungy, smelly circuses. New: Cirque du Soleil. Old: any airline. New: JetBlue Airways (JBLU ). Old: Macy’s (FD ). New: Target (TGT ). Old: Earth-toned Birkenstock sandals. New: colorful beach “Birkis.” The evolution of the economy toward creativity has been underway for some time. Steve Jobs, of course, has turned Apple into the paragon of the creative corporation. Companies throughout the world are deconstructing Apple’s success in design and innovation, and learning the lessons. Today all kinds of blue-chip CEOs are signing on to creativity. A.G. Lafley, P&G’s CEO, and Jeffrey R. Immelt, GE’s CEO are at the core of the new movement. Lafley started it when he took over in 2000, but Immelt’s conversion to creativity when he became chief executive in 2001 is giving the shift to creativity more momentum. Because of GE’S size and scope, when it moves, the economy moves with it. The vocabulary of business may be changing as well. It’s hard to imagine former GE boss Jack Welch saying: “Creativity and imagination applied in a business context is innovation,” as Immelt recently did. Or “we’re measuring GE’s top leaders on how imaginative they are. Imaginative leaders are the ones who have the courage to fund new ideas, lead teams to discover better ideas, and lead people to take more educated risks,” as he added. That’s a sea change from rewarding GE managers for a career of floating from operation to operation, 227

massaging the process for incremental improvements. Lafley sits on GE’s board, so two of America’s most powerful and effective CEOs now meet regularly, talk about creativity, discuss which of the new breed of innovation gurus is offering the best advice, and exchange notes on what works and what doesn’t. When the history of the transition from the Knowledge Economy to the Creativity Economy is written, these two will probably get much of the credit. To understand why the creativity movement is becoming so important, you need to go back to its roots at P&G. By harnessing the power of design, P&G has transformed itself from a stagnant brand manager into a model of innovation efficiency that outperforms industry rivals. Before Lafley, P&G’s volume growth was basically flat. The company cared more about how its products functioned than it did about how customers felt about them. “P&G had the best chemical engineering and marketing operations in the country,” says Patrick Whitney, director of the Institute of Design at Illinois Institute of Technology. “It didn’t care about the user experience.” P&G could tell retailers to stock eight kinds of Crest, and they did. As power shifted to big retailers, P&G couldn’t do that. “It had to create new products, and to do that, P&G had to get closer to the consumer,” says Whitney. Fresh Eyes Lafley turned to design. In 2001 he established a new executive post: vice-president for design, innovation, and strategy, naming Claudia B. Kotchka, now 53, to fill it. She and Lafley knew they couldn’t change P&G’s culture without fresh eyes from the outside. So they made a major decision: Even as P&G began laying off thousands of top executives, middle managers, scientists, and others, it quadrupled its design staff. For the first time it hired a legion of designers who had worked at other companies and in other industries. In a second crucial decision, Kotchka dispatched designers to work directly with R&D staffers to help to conceive new products. This changed P&G’s entire innovation process, making it consumer-centric rather than driven by new technology. To open up the company further, P&G started hiring different kinds of consultants. Among them were Design Continuum; ZIBA Design in Portland, Ore.; Chicago’s Doblin Inc.; and IDEO in Palo Alto, Calif. Here’s how it works at P&G: Kotchka contacts P&G’s divisional heads, asking for a list of possible opportunities designers might 228

address. Recently, the head of home care said it was time to look at bathroom cleaning. Kotchka brought in IDEO with the goal of helping out. IDEO and P&G’s designers went out and observed people cleaning bathrooms around the world. In South America they saw women using brooms to clean walls and showers effectively and built a prototype combining a small hand cleaner with a long pole. P&G tested the idea via a survey. People hated it. But P&G hung in there. What is fast becoming the Holy Grail of innovation — the “unmet, unarticulated” needs of consumers — didn’t show up in the survey. Instead, P&G relied on the informed intuition of designers and tested the idea again, using working prototypes. People loved the real thing. P&G then broke down the walls of its Mr. Clean brand, reached in and used the Mr. Clean detergent for the new product. The Mr. Clean MagicReach was introduced in April — with a four-foot detachable pole. Mundane as this example may be, it shows how design strategy can generate innovative new products and sales. To build a design infrastructure, Lafley also established what he calls his innovation “gym,” a place to train managers in the new design thinking. And he created a Design Board of non-P&Gers who provide an independent perspective on products, brand extensions, and marketing. Jeff Immelt inherited one of America’s most successful companies. GE’s incredible process culture, which brought so much to the bottom line in the ’90s, was no longer enough to maintain its leadership in the 21st century. Like Lafley, Immelt needed to create an innovation culture quickly. One of his major goals was to raise GE’s average organic growth to 8% from the 5% of the past decade. The skills Jack Welch prized — cost-cutting, efficiency, the continual improvement of operations — couldn’t deliver that. Big Bets Immelt launched a series of what he calls Imagination Breakthrough projects, investing more than $5 billion in 80 initiatives that take GE into new markets, product areas, and industries. He told his managers to connect with consumers, learn to take risks, and place big bets. GE is already reaping major benefits from previous bold moves. Its latest quarterly profit surge of 24% is due in part to reframing the idea of power generation. The company expanded it from gas turbines to wind and solar, which paid off. Also like Lafley, Immelt is pushing to change the corporate 229

structure to spur creativity. He appointed Beth Comstock to the newly created position of chief marketing officer in charge of generating innovation and creativity. He’s bringing in many of the same design and innovation gurus Lafley uses so effectively. And GE being GE, has its new acronym, CENCOR, for its innovation process. Call it CENCOR, creativity, or imagination, GE is doing it. Comstock recently held a “China market discovery” session, bringing together some 90 people for three days. Outside innovation consultants pushed the envelope. “We forced the group to get outside itself, to look at China with new eyes,” says Comstock. The effort appears to be working: Sales to China soared in the latest quarter. What is the methodology of the new design strategy that Lafley, Immelt, and others are adopting? The basics are simple. They start with observation — going out and directly seeing customers shop at malls, families eating in restaurants, or patients being treated in hospitals. Gap Inc. (GPS ) and others have found that social shopping — in pairs and threesomes — is the norm in its stores, so it’s making dressing rooms bigger. Trying out lots of ideas fast by making models or videos (prototyping) is the next step. This lets managers visualize concepts, make decisions on which to improve and which to discard, and launch products faster. Storytelling is very important. Designers have found that placing a potential new product within an emotional story that connects with consumers raises the chances of success. The design of the new line of MINI_motion watches and driving shoes, for example, captures the story of the Mini Cooper’s cool urban driving experience. It’s about the driver, not the car. The final ingredient in design strategy is building an organizational process that does these things all the time. This kind of change can be wrenching for a company, but the payoffs are enormous. “You can build a kind of culture of routine innovation through design thinking,” says one of the pioneers of the new discipline, David Kelley, co-founder of IDEO and head of the new D-school at Stanford. So watch out, consultants. A whole new cadre of advisers is out to lead CEOs into the Creativity Economy. They speak a language different from Establishment consultants’ (more anthropology, less technology) and advise differently (more hands-on workshops, fewer companywide surveys). Mainstream consultants, such as BCG, are building their innovation expertise, but they’d better hurry.


The new gurus have emerged from the depths of the late ’90s meltdown and the shock of Asian competition to show CEOs a path beyond the Knowledge Economy to an even higher-valueadded business model. They say they have found a way to play a high-margin game in a low-priced world, a means of differentiating products in a commoditized marketplace and a methodology for staying ahead of Asian rivals. They are the keepers of creativity in a world awash in technology, the champions of innovation in a globe drowning in commodities. Meet seven of them and many more on our new site. There’s a lot of talk about America becoming a 97-pound weakling. But the naysayers don’t get the strength inherent in a truly Creative Economy. This revolution has barely begun, and building creative, innovative companies is the great task ahead. In the stories that follow, you’ll find the tools, methods, and metrics to help make it happen 3. Practical Project a. Suggest 2 ideas that can possibly bring paradigm shift in industry First, examine what paradigms exist in industry. And then, suggest things to cause a big shift in those paradigms. <Paradigms and Paradigm Shifts> While paradigms are an every day part of our lives, problems can occur when paradigms shift, and often they do. The rapid expanse of computer technology is an example of a paradigm shift. This shift will have a profound affect on the rest of society. Young people today are growing up with instantaneous access to more information than older generations could gather in a lifetime. Our educational structures as well as our work structure will be drastically altered to make way for this new paradigm. As paradigms shift, the new ones are usually met with a great deal of resistance. As pointed out earlier, our sanity is often riding on our paradigms. We are not going to give them up easily (until the new paradigm can be somehow incorporated into our picture of reality.) When paradigms shift, they almost inevitably are met with the same kind of resistance: •

We are literally unable to "see" the evidence of the new paradigm even though it is right in front of our "eyes." (The 231

• • •

evidence does not fit into the old framework so it is psychologically denied.) We see the evidence but rationalize it away. We see the evidence and distort it to fit our paradigm. We see the evidence but declare that it is inaccurate. Perhaps something is wrong with the tools of measurement or the person presenting the new information.

Why is there so much resistance? Aside from challenging the concepts of reality which support our sanity, it is pointed out by Joel Barker (a futurist who has studied paradigms and paradigm shifts for over twenty years) that, "when a paradigm shifts, everyone goes back to zero." He gives the example of the Swiss watch industry. For 60 years they dominated the world in watch manufacturing. They were first in this industry by far with no one in close second. They had more than 65% of the world watch market and their watches were reputed to be the finest in the world. Then, something happened. A paradigm shifted. There market share dropped from 65% to less than 10%. What happened was called the digital watch. Fifty thousand of the sixty-two thousand watch makers lost their jobs. The nation was in catastrophe. "They made the most accurate gears in the world. It was irrelevant. They made the best bearings. Who cared. They manufactured the finest mainsprings. Unneeded. All the advantages they had accrued in the old paradigm were worthless in the new." The ironic part of this story is that the digital watch was invented by the Swiss themselves. However, the manufacturers rejected the new invention. The new invention was picked up by Seiko of Japan and it’s a good probability you are wearing one, or one of its descendants, on your wrist right now!


Exercise: 1. Research on individual or company that demonstrates high professionalism in Culture & Art Contents Industry a. 2 domestic, 2 Asian, 2 American, 2 European products/companies b. Analyze how professionalism is measured in industry


Website to Look @: The Biggest Paradigm Shift of Our Generation: The 4 “Any’s”


Chapter VIII. Professionalism

<Fig. 8. 1. Picture of the feet of worldly renowned ballerina, Sue-jin Kang. Without context, these feet might not look beautiful. However, when you get to know these feet belong to world-class ballerina, Sue-jin Kang and reflect her professionalism in this picture, you appreciate this visual representation of the most beautiful feet in the world. Beauty might be subjective, but everyone agrees on that true professionals look truly beautiful.> <In this chapterâ&#x20AC;Ś> 1. True Professionals in Culture & Art Contents Industry a. Beautiful Pictures of Ballerina Sue-jin Kang b. Pictures of Ballerina Sue-jin Kangâ&#x20AC;&#x2122;s Feet c. Brief Profile of Ballerina Sue-jin Kang d. Taxi Driver (1976) e. Raging Bull (1980) f. Method Acting g. Customer Driven Marketing 2. Creative Ideas in Implementation a. How can you demonstrate your professionalism 3. Practical Project a. How to produce a product that shows your professionalism


Professionalism A professional is someone who has completed formal education and training in one or more profession. The term also describes the standards of education and training that prepare members of the profession with the particular knowledge and skills necessary to perform the role of that profession. In addition, most professionals are subject to strict codes of conduct enshrining rigorous ethical and moral obligations. Professional standards of practice and ethics for a particular field are typically agreed upon and maintained through widely recognized professional associations. Some definitions of professional limit this term to those professions that serve some important aspect of public interest and the general good of society. The term is also used to differentiate between an individual employed in a particular field from an amateur who is unpaid. For example, a professional photographer would be understood as someone engaged in the field of photography for remuneration. In sports, amateur players are distinguished from those who are paidâ&#x20AC;&#x201D;hence "professional footballer" and "professional golfer". In some cultures, the term is used as shorthand to describe a particular social stratum of well-educated workers who enjoy considerable work autonomy and are commonly engaged in creative and intellectually challenging work. <Definition> The main criteria for professionalism includes the following: 1. Expert and specialized knowledge in field which one is practicing professionally. 2. Excellent manual/practical and literary skills in relation to profession. 3. High quality work in (examples): creations, products, services, presentations, consultancy, primary/other research, administrative, marketing, photography or other work endeavours. 4. A high standard of professional ethics, behaviour and work activities while carrying out one's profession (as an employee, self-employed person, career, enterprise, business, company, or partnership/associate/colleague, etc.). The professional owes a higher duty to a client, often a privilege of confidentiality, as well as a duty not to abandon a genuine client just because he or she may not be able to pay or remunerate the professional. Often the professional is required to put the interest of the client ahead of his own interests. 5. Reasonable work morale and motivation. Having interest and desire to do a job well as holding positive attitude towards the profession are important elements in attaining a high level of professionalism. 6. Appropriate treatment of relationships with colleagues. Consideration should be shown to elderly, junior or inexperienced colleagues, as well


as those with special needs. An example must be set to perpetuate the attitude of one's business without doing it harm. 7. A professional is an expert who is a master in a specific type of profession. <Trades> In narrow usage, not all expertise is considered a profession. Although sometimes referred to as professions, occupations such as skilled construction and maintenance work are more generally thought of as trades or crafts. The completion of an apprenticeship is generally associated with skilled labor or trades such as carpenter, electrician, mason, painter, plumber and other similar occupations. A related distinction would be that a professional does mainly mental or administrative work, as opposed to engaging in physical work. <Sports> In sports, a professional is someone who receives monetary compensation for participating. The opposite is an amateur, meaning a person who does not receive monetary compensation. The term "professional" is commonly used incorrectly when referring to sports, as the distinction simply refers to how the athlete is funded, and not necessarily competitions or achievements. Sometimes the professional status of an activity is controversial; for example, there is debate as to whether professionals should be allowed to compete in the Olympics. The motivation for money (either in rewards, salaries or advertising revenue) is sometimes seen as a corrupting influence, tainting a sport. It has been suggested that the crude, all or nothing categories, of professional or amateur should be reconsidered. A historical shift is occurring with the rise of Proâ&#x20AC;&#x2018;Ams, a new category of people pursuing amateur activities to professional standards. <Criticisms> Although professional training appears to be ideologically neutral, it may be biased towards those with higher class backgrounds and a formal education. In his 2000 book, Disciplined Minds: A Critical Look at Salaried Professionals and the Soul-Battering System that Shapes Their Lives, Jeff Schmidt observes that qualified professionals are less creative and diverse in their opinions and habits than non-professionals, which he attributes to the subtle indoctrination and filtering which accompanies the process of professional training. His evidence is both qualitative and quantitative, including professional examinations, industry statistics and personal accounts of trainees and professionals. A study on journalistic professionalism argued that professionalism is a combination of two factors, secondary socialization of journalists in the workplace and the fetishization of journalistic norms and standards. In this way, undesirable traits in 237

new employees can be weeded out, and remaining employees are free to cynically criticize their professional norms as long as they keep working and following them. The latter concept adapted from philosopher Slavoj ŽiŞek and his concept of ideology. The etymology and historical meaning of the term professional seems to indicate an individual whose philosophy and habits have been conditioned by a professor.[citation needed] So, a professional is the follower of a professor. Plumbers are therefore not considered professionals. While they certainly make a living doing what they do, with a particular expertise, and with a certain expectation of manners, plumbers do not acquire their skills through a professor, or even through a professional professor. They learn from private firms that distribute the knowledge, or they learn from friendly association with a master plumber. <Why Is Professionalism Important?> Professionalism encompasses a worker's behavior, appearance, and workplace ethics. Employees who have high standards of professionalism are frequently perceived as being more credible and reliable than their coworkers. As a result, professional employees are frequently regarded as their company's leaders. Credibility Professionalism includes a worker's candor, drive, and willingness to improve her performance. Thus, professional employees have more credibility in their workplace. Work Environment Because professional employees focus on the workplace before their personal problems and agendas, professionalism makes the workplace more comfortable for employees and clients alike. Ethics Professionalism encompasses a strong sense of ethics, which is crucial to running a successful business and avoiding legal problems. Productivity Workers with a professional attitude are able to focus on their work and avoid unnecessary distractions, which allows them to contribute more to the company. Perceptions of Professional Workers


Employees who behave professionally are often perceived to be more competent and valuable to the company, which leads these workers to receive pay raises and promotions. <Importance of Professionalism> Professionalism at its most basic involves respect. It includes respect for clients, colleagues, bosses and for the company. Professionals take pride in doing their work well and according to the standards established by their industry. Professionalism requires moderating one's behavior to come into line with the expectations and needs of the role one plays in the workplace. It can be demanding. In many instances, professionalism can be constraining and create role conflict and personal discomfort. However, people who display professionalism will receive respect in return and are often rewarded for the high expectations they have met. Boundaries Although it can be challenging to establish boundaries in personal relationships, it is essential to establish boundaries in the workplace. Everyone has a role to play in an organization. Professional behavior helps separate business from the personal; it keeps relationships limited to the business context at hand. For example, a judge cannot have personal conversations with a plaintiff or defendant. Bank tellers represent the institution as they perform transactions for the customers. No one finds it offensive when a teller checks a client's math or his accounting of cash. The role demands it and professional behavior makes it clear that the teller is simply doing his job. Duty A professional works in her employer's or client's interests. She may not always agree with decisions or enjoy what she's doing but in order to do right by the person engaging her services, she does her job ably. If a professional doesn't like her work or agree with her employers, she should probably consider a new job. However, the idea is to always act ethically by taking fiduciary duties and loyalties seriously. Respect Taking the high road can be a challenge. Those practicing professionalism always strive to keep their personal feelings in check and show respect, even to those who are disrespectful or rude. For example, a good customer service professional doesn't argue with an irate customer. Instead, he listens and addresses the customer's concerns. Even though an irate customer may irritate him or demonstrate a lack of respect, a customer service representative understands that becoming angry and making the situation personal will only worsen things and lower his professional standing. Ownership 239

People respect someone who takes pride in her work. Whether she's shining shoes or running a multinational corporation, someone who values professionalism does the best work she can at all times. Dedication, integrity and responsibility are elements of professionalism that make a person successful in her field. By taking ownership of their roles and duties, professionals make names for themselves and usually find promotion, opportunities and repeat business come easily to them. <5 Signs That You Lack Professionalism> We all make mistakes, however some of the behavior that goes on in the office is fairly outrageous. Here are 5 signs your professional behavior could use some polishing: 1. Sending a picture of a wilted rose via the office IM to a married coworker that you have only met briefly is not recommended (especially when you are an intern who started two weeks prior.) 2. Multitasking is impressive, but pulling out your knitting in staff meeting may be overkill. 3. If you leave your wife for another woman, probably best to change the phone number on your public resume. 4. If you are the only person wearing jeans in a room full of 150 people, take heed. Taking heed means not wearing them again the following week to the same event. 5. When youâ&#x20AC;&#x2122;re invited to a fancy restaurant by the brand new CEO, best to avoid topics such as the Zombie Apocalypse or staged moonlanding conspiracies. After 40 hours a week in one place, getting comfortable on the job is understandable. Complacency is sometimes expected, but questionable behavior is something to keep on your radar. Even when you are complying with the rules, if you have poor office etiquette, people will judge you. If any of the above stories ring true with you, it might be time to revisit etiquette rules for the workplace. As Emily Post said, â&#x20AC;&#x153; Manners are a sensitive awareness of the feelings of others. If you have that awareness, you have good manners, no matter which fork you use.â&#x20AC;? And while we are at it, going around collecting money for your own office birthday party is a bold, bold move. <Effects of Unprofessionalism> Professionalism means having the right kind of attitude and is much discussed in context with the workplace. So at the onset of the article, let us discuss this 240

broad and important term - professionalism. What does it actually mean when we hear someone say 'he or she is a thorough professional'. Professionalism encompasses everything from the right kind of attitude to being perfect in secondary things like dressing style, grooming and behavior. Every organization looks for employees with a proper attitude because they bring in with them a positive spirit and also are an asset to the organization. On the other hand, unprofessional employees are more or less a kind of burden on the organization. Unprofessionalism affects the progress of both, the individual and the organization. The various effects of it are put together in the coming paragraphs. The Effects of Unprofessionalism Unprofessionalism revealingly affects the work of the individual. Consider the example of an employee who wastes time chit chatting with other workers and creates a nuisance at the work place. This is a supreme example of unprofessional attitude that is attributed to many employees of a unit. It affects the work of all the workers as it disturbs the peace at work. Not following the expected company timings and guidelines is also a sign of lack of professionalism. Relating to work it can be anything like not being sincere and committed towards work and the duties assigned. More of unprofessional signs have been discussed at the end of the article. In a gist, any organization will not tolerate this attitude in its employees for long and it will increase the chances of the employee getting fired from work. Being unprofessional also hampers the mindset of the individuals. Consistently being pulled up for bad behavior is not good for the confidence of the individual. This behavior thus serves in the least interest of the growth of the employee and so employees should try to cultivate discipline and organization in their work life. It was mentioned in the earlier paragraph that employees who lack organization skills and the right attitude are a burden to the organization. If a majority of the employees are not behaving in the desired way, it does harm to the progress and image of their company. Unprofessional employees contribute less and this indirectly does harm to the profit earning capacity of the company. There will be goodwill about the organization if all the employees in it are disciplined and equally contributing. Thus you see, this behavior is of no use to the organization as well as to the individual. Signs of Unprofessionalism Professionalism is something we learn as we move forward in our career. Most obviously freshmen find it difficult to develop the right attitude. We have discussed below some of the common signs that are associated with unprofessional behavior.


Employees not following discipline during the working hours is one of the common signs of unprofessionalism. This includes spending hours talking on a cell phone or near the water cooler with colleagues, and gossiping about others in the workplace.

Not working hard to achieve the set targets is also an example of unprofessional conduct. This often is an outcome of the first sign.

Disturbing other workers, indulging in backbiting about others, doing harm to the work of others, and unnecessarily troubling someone in the office also accounts for lack of a professional attitude.

Rude behavior with clients or coworkers, losing one's temper easily and unwillingness to work in a team also are indicators of lack of professionalism at the workplace.

Discussing too much about the personal life with colleagues during the working hours is also not expected from the employees. This can also account for spreading negativity in the work environment.

No organization would want to cater to unprofessional employees. It is the responsibility of the employee to understand and do justice to the work expected from him. A professional employee is valued by any organization and is well rewarded for his work. 1. True Professionals in Culture & Art Contents Industry a. Beautiful Pictures of Ballerina Sujin Kang



b. Pictures of Ballerina Sujin Kangâ&#x20AC;&#x2122;s Feet


c. Brief Profile of Ballerina Sujin Kang Kang Sue-jin (born 24 April 1967) is a South Korean ballerina. She is a principal dancer at Stuttgart Ballet. <Early Life> Kang Soo-jin was born in Seoul, South Korea. After initial ballet lessons in Korea, she went to Marika Besobrazova at the Académie de Danse Classique in Monte Carlo. In 1985, she won the Prix de Lausanne. In 1986, she became a member of the Stuttgart Ballet, where she was appointed Soloist in 1994 and Principal Dancer in 1997. <Career> • • • • • • • •

Studied at Sun Hwa Arts Middle School from 1979, majored in Korean Traditional Dance Studied at Sun Hwa Arts High School from 1982 Studied at Académie de Danse Classique in Monte Carlo from 1982 Joined Stuttgart Ballet in 1986 - The first and youngest Asian to join the Stuttgart Ballet Soloist in Stuttgart Ballet 1994 Debut in USA, Onegin and Romeo and Juliet Prima ballerina assoluta with Stuttgart Ballet from 1997 Permanent member with Stuttgart Ballet from 2002

<Featured Performances> • • • • • • • • • • • •

2008 Appeared at Lotte Dept. Store CF. 2006 Korean Nat'l Ballet, 2006 New Year's Gala 2004 Stuttgart Ballet's featured performance Onegin 2002 Stuttgart Ballet's Die Kameliendame 1999 Gala performance - Korea's best Ballerina 1998 Die Kameliendame 1997 Hunchback of Notre Dame 1996 Giselle 1994 Sleeping Beauty 1993 Magic Flute 1992 Romeo and Juliet 1992 Mata Hari

<Honors and Awards> • • •

Won the Prix de Lausanne in 1985[2] Recipient of the Korean Young Artist Award, 1998 Recipient of the Best Female Ballerina Award at the Prix Benois de la Danse, 1999 245

• • • •

National Hwa-Gwan Order of Cultural Merit by the Ministry of Culture, Sports and Tourism (South Korea), 1999 Ho-Am Prize in the Arts, 2001 Recipient of the German title “Kammertänzerin” (German: Royal Court Dancer), 2007 [3] Recipient of the John Cranko Award, 2007

d. Taxi Driver (1976)

Taxi Driver is a 1976 American vigilante film directed by Martin Scorsese and written by Paul Schrader. The film is set in New York City, soon after the end of the Vietnam War. The film stars Robert De Niro and features Jodie Foster, Harvey Keitel, Cybill Shepherd, and Albert Brooks in his film debut. It is regularly cited by critics, film directors and audiences alike as one of the greatest films of all time. Nominated for four Academy 246

Awards, including Best Picture, it won the Palme d'Or at the 1976 Cannes Film Festival. The American Film Institute ranked Taxi Driver as the 52nd greatest American film on their AFI's 100 Yearsâ&#x20AC;Ś100 Movies (10th Anniversary Edition) list. In 2012, Sight and Sound named it the 31st best film ever created on its decadal critics' poll, ranked with The Godfather Part II, and the 5th greatest film ever on its directors' poll. The film was considered "culturally, historically or aesthetically" significant by the US Library of Congress and was selected to be preserved in the National Film Registry in 1994. <Controversies> The climactic shoot-out was considered intensely graphic at the time it was initially released. To attain an "R" rating, Scorsese had the colors desaturated, making the brightly colored blood less prominent. In later interviews, Scorsese commented that he was actually pleased by the color change and he considered it an improvement over the originally filmed scene, which has been lost. In the special edition DVD, Michael Chapman, the film's cinematographer, regrets the decision and the fact that no print with the unmuted colors exists anymore, as the originals had long since deteriorated. Some critics expressed concern over 13-year-old Jodie Foster's presence during the climactic shoot-out. However, Foster stated that she was present during the setup and staging of the special effects used during the scene; the entire process was explained and demonstrated for her, step by step. Rather than being upset or traumatized, Foster said, she was fascinated and entertained by the behind-the-scenes preparation that went into the scene. In addition, before being given the part, Foster was subjected to psychological testing to ensure that she would not be emotionally scarred by her role, in accordance with California Labor Board requirements. Copies of the movie distributed for TV broadcast had an unexplained disclaimer added during the closing credits: TO OUR TELEVISION AUDIENCE: In the aftermath of violence, the distinction between hero and villain is sometimes a matter of interpretation or misinterpretation of facts. TAXI DRIVER suggests that tragic errors can be made. The Filmmakers. John Hinckley, Jr. Taxi Driver formed part of the delusional fantasy of John Hinckley, Jr.[13][14] which triggered his attempted assassination of President Ronald Reagan in 1981, an act for which he was found not guilty 247

by reason of insanity.[15][16] Hinckley stated that his actions were an attempt to impress actress Jodie Foster, on whom Hinckley was fixated, by mimicking Travis's mohawked appearance at the Palantine rally. His attorney concluded his defense by playing the movie for the jury. <Interpretations of the Ending> Roger Ebert has written of the film's ending: "There has been much discussion about the ending, in which we see newspaper clippings about Travis's 'heroism' of saving Iris, and then Betsy gets into his cab and seems to give him admiration instead of her earlier disgust. Is this a fantasy scene? Did Travis survive the shoot-out? Are we experiencing his dying thoughts? Can the sequence be accepted as literally true? ... I am not sure there can be an answer to these questions. The end sequence plays like music, not drama: It completes the story on an emotional, not a literal, level. We end not on carnage but on redemption, which is the goal of so many of Scorsese's characters." James Berardinelli, in his review of the film, argues against the dream or fantasy interpretation, stating: "Scorsese and writer Paul Schrader append the perfect conclusion to Taxi Driver. Steeped in irony, the five-minute epilogue underscores the vagaries of fate. The media builds Bickle into a hero, when, had he been a little quicker drawing his gun against Senator Palantine, he would have been reviled as an assassin. As the film closes, the misanthrope has been embraced as the model citizenâ&#x20AC;&#x201D; someone who takes on pimps, drug dealers, and mobsters to save one little girl." On the Laserdisc audio commentary, Scorsese acknowledged several critics' interpretation on the film's ending being Bickle's dying dream. He admits that the last scene of Bickle glancing at an unseen object implies that he might fall into rage and recklessness in the future, and he is like "a ticking time bomb." Writer Paul Schrader confirms this in his commentary on the 30th anniversary DVD, stating that Travis "is not cured by the movie's end," and that, "he's not going to be a hero next time." When asked, on the website Reddit about the ending of this film, Schrader stated that it was not to be taken as a dream sequence, but that he envisioned it as returning to be beginning of the film as if the last frame "could be spliced to the first frame, and the movie started all over again." 248

<Legacy> Taxi Driver, American Gigolo, Light Sleeper, and The Walker make up a series referred to variously as the "Man in a Room" or "Night Worker" movies. Screenwriter Paul Schrader (who directed the other three films) has stated that he considers the central characters of the four films to be one character, who has changed as he has aged. The film also influenced the Charles Winkler film You Talkin' to Me? You talkin' to me? The catchphrase "You talkin' to me?" has become a pop culture icon. In 2005, it was chosen as #10 on the American Film Institute's AFI's 100 Years... 100 Movie Quotes. In the scene, Bickle is looking into a mirror at himself, imagining a confrontation which would give him a chance to draw his gun. He says the following line: “You talkin' to me? You talkin' to me? You talkin' to me? Then who the hell else are you talkin' to? You talkin' to me? Well I'm the only one here. Who the fuck do you think you're talking to?” Roger Ebert called it "the truest line in the film... Travis Bickle's desperate need to make some kind of contact somehow—to share or mimic the effortless social interaction he sees all around him, but does not participate in." Paul Schrader does not take credit for the line, saying that his script only read, "Travis speaks to himself in the mirror", and that De Niro improvised the dialogue. However, Schrader went on to say that De Niro's performance was inspired by a routine by "an underground New York comedian" whom he had once seen, possibly including his signature line. In his 2009 memoir, saxophonist Clarence Clemons said De Niro explained the line's origins when Clemons coached De Niro to play the saxophone for the movie New York, New York. Clemons says De Niro had seen Bruce Springsteen say it onstage at a concert as fans were screaming his name, and decided to make the line his own. e. Raging Bull (1980) Raging Bull is a 1980 American biographical sports drama film directed by Martin Scorsese, produced by Robert Chartoff and Irwin Winkler and adapted by Paul Schrader and Mardik Martin 249

from Jake LaMotta's memoir Raging Bull: My Story. It stars Robert De Niro as Jake LaMotta, an Italian American middleweight boxer whose self-destructive and obsessive rage, sexual jealousy, and animalistic appetite destroyed his relationship with his wife and family. Also featured in the film are Joe Pesci as Joey, La Motta's well-intentioned brother and manager who tries to help Jake battle his inner demons; and Cathy Moriarty as his abused wife. The film features supporting roles from Nicholas Colasanto, Theresa Saldana and Frank Vincent. Scorsese was initially reluctant to develop the project, though he eventually came to relate to La Motta's story. Schrader re-wrote Martin's first screenplay, and Scorsese and De Niro together made uncredited contributions thereafter. Pesci was an unknown actor prior to the film, as was Moriarty, who was suggested for her role by Pesci. During principal photography, each of the boxing scenes was choreographed for a specific visual style and De Niro gained approximately 60 pounds (27 kg) to portray La Motta in his later post-boxing years. Scorsese was exacting in the process of editing and mixing the film, expecting it to be his last major feature. After receiving mixed initial reviews (and criticism due to its violent content), it went on to garner a high critical reputation and now to a very large extent is regarded among the greatest films ever made, including by Roger Ebert of the Chicago Sun-Times, Gene Siskel of the Chicago Tribune, British film historian Leslie Halliwell, the American Film Institute, Time, The New York Times, Variety, Entertainment Weekly, Empire, Total Film, Film 4, and BFI's Sight and Sound. It was listed in the National Film Registry in 1990, its first year of eligibility.


<Plot> In a brief scene in 1964, an aging, overweight Italian American, Jake LaMotta (Robert De Niro), practices a comedy routine. The rest of the film then occurs in flashback. In 1941, LaMotta is in a major boxing match against Jimmy Reeves, where he received his first loss. Jake's brother Joey LaMotta (Joe Pesci) discusses a potential shot for the middleweight title with one of his Mafia connections, Salvy Batts (Frank Vincent). Some time thereafter, Jake spots a 15-year-old girl named Vickie (Cathy Moriarty) at an open-air swimming pool in his Bronx neighborhood. He eventually pursues a relationship with her, even though he is already married. In 1943, Jake defeats Sugar Ray Robinson, and has a rematch three weeks later. Despite the fact that Jake dominates Robinson during the bout, the judges surprisingly rule in favor of Robinson and Joey feels Robinson won only because he was enlisting into the US Army the following week. By 1947, Jake marries Vickie. Jake constantly worries about Vickie having feelings for other men, particularly when she makes an off-hand comment about Tony Janiro, Jake's opponent in his next fight. His jealousy is evident when he brutally defeats Janiro in front of the local Mob boss, Tommy Como (Nicholas Colasanto), and Vickie. As Joey discusses the victory with journalists at the Copacabana, he is distracted by seeing Vickie approach a table with Salvy and his crew. Joey speaks with Vickie, who says she is giving up on his brother. Blaming Salvy, Joey viciously attacks him in a fight that spills outside of the club. Como later orders them to apologize, and has Joey tell Jake that if he wants a chance at the championship title, which Como controls, he will have to take a dive first. In a match against Billy Fox, after briefly pummeling his opponent, Jake does not even bother to put up a fight. He is suspended shortly thereafter from the board on suspicion of throwing the fight, though he realizes the error of his judgment when it is too late. He is eventually reinstated, and in 1949, wins the middleweight championship title against Marcel Cerdan. A year later, Jake asks Joey if he fought with Salvy at the Copacabana because of Vickie. Jake then asks if Joey had an affair with her; Joey refuses to answer, insults Jake, and leaves. Jake directly asks Vickie about the affair, and when she hides from him in the bathroom, he breaks down the door, prompting her to sarcastically state that she had sex with the entire neighborhood (including his brother, Salvy, and Tommy Como). Jake angrily walks to Joey's house, with Vickie following him, and brutally beats Joey in front of his wife and children. After defending his championship belt in a brutal fifteen round bout against Laurent Dauthuille in 1950, he makes a call to his brother 251

after the fight, but when Joey assumes Salvy is on the other end and starts insulting and cursing at him, Jake says nothing and hangs up. Estranged from Joey, Jake's career begins to decline slowly and he eventually loses his title to Sugar Ray Robinson in their final encounter in 1951. By 1956, Jake and his family have moved to Miami. After staying out all night at his new nightclub there, Vickie tells him she wants a divorce (which she has been planning since his retirement). He is later arrested for introducing under-age girls (posing as 21-yearolds) to men in his club and serves a jail sentence in 1957 after failing to raise enough bribe money when he misguidedly removes the jewels from his championship belt instead of selling the belt itself. In his jail cell, Jake pounds the walls, sorrowfully questioning his misfortune and crying in despair. Upon returning to New York in 1958, he happens upon his estranged brother Joey, who forgives him but is elusive. Returning to the opening scene in 1964, Jake refers to the "I coulda been a contender" scene from the 1954 film On the Waterfront starring Marlon Brando, complaining that his brother should have been there for him but is also keen enough to give himself some slack. After a stage hand informs him that the auditorium where he is about to perform is crowded, Jake starts to chant "I'm the boss" while shadowboxing. The film ends with a Biblical quote. This quote was a reference to Martin Scorsese's film professor, Haig Manoogian to whom the film is dedicated as he died just before it was released. Scorsese credits Manoogian with helping him "to see". So, for the second time, [the Pharisees] summoned the man who had been blind and said: "Speak the truth before God. We know this fellow is a sinner." "Whether or not he is a sinner, I do not know," the man replied. "All I know is this: Once I was blind and now I can see." John IX. 24â&#x20AC;&#x201C;26, The New English Bible <Reception> Box office The brew of violence and anger, combined with the lack of a proper advertising campaign, led to the film's lukewarm box office intake of only $23 million, when compared to its $18 million budget. It only earned $10.1 million in theatrical rentals. Scorsese became concerned for his future career and worried that producers and studios might refuse to finance his films. According to Box Office Mojo, the film grossed $23,383,987 in domestic theaters. 252

Critical reception Raging Bull first premiered in New York on December 19, 1980 to polarized reviews. Jack Kroll of Newsweek called Raging Bull the "best movie of the year" Vincent Canby of The New York Times said that Scorsese "has made his most ambitious film as well as his finest" and went on to praise Moriarty's debut performance as "either she is one of the film finds of the decade or Mr. Scorsese is Svengali. Perhaps both." Time praised De Niro's performance since "much of Raging Bull exists because of the possibilities it offers De Niro to display his own explosive art". Steven Jenkins from the British Film Institute's (BFI) magazine, Monthly Film Journal, said "Raging Bull may prove to be Scorsese's finest achievement to date". Awards Raging Bull was nominated for eight Academy Awards (including Best Picture, Director, Actor, Supporting Actress, Supporting Actor, Cinematography, Sound (Donald O. Mitchell, Bill Nicholson, David J. Kimball and Les Lazarowitz), and Editing) at the 1980 Academy Awards. The film won two awards: Best Actor, for De Niro, and Best Film Editing. The Oscars were held the day after President Ronald Reagan was shot by John Hinckley Jr., who did it as an attempt to impress Jodie Foster, who played a child prostitute in another of Scorsese's famous films, Taxi Driver. Out of fear of being attacked, Scorsese went to the ceremony with FBI bodyguards disguised as guests who escorted him out before the announcement of the Academy Award for Best Picture was made (the winner being Ordinary People). The Los Angeles Film Critics Association voted Raging Bull the best film of 1980 and best actor for De Niro. The National Board of Review also voted best actor for De Niro and best supporting actor to Pesci. The Golden Globes awarded another best actor award for De Niro and National Society of Film Critics gave best cinematography to Chapman. The Berlin Film Festival chose Raging Bull to open the festival in 1981. Legacy By the end of the 1980s, Raging Bull had cemented its reputation as a modern classic. It was voted the best film of the 1980s in numerous critics' polls and is regularly pointed to as both Scorsese's best film and one of the finest American films ever made. Several prominent critics, among them Roger Ebert, declared the film to be an instant classic and the consummation 253

of Scorsese's earlier promise. Ebert proclaimed it the best film of the 1980s, and one of the ten greatest films of all time. The film has been deemed "culturally, historically, and aesthetically significant" by the United States Library of Congress and was selected for preservation in the National Film Registry in 1990. The film currently holds a 98% "Certified Fresh" rating on the review aggregate website Rotten Tomatoes, with an average rating of 9.1/10. The similarly themed Metacritic rates the movie 92/100 ("universal acclaim"). Raging Bull was listed by Time magazine as one of the All-TIME 100 Movies. Variety magazine ranked the film number 39 on their list of the 50 greatest movies. Raging Bull was fifth on Entertainment Weekly's list of the 100 Greatest Movies of All Time. The film tied with The Bicycle Thieves and Vertigo at number 6 on Sight & Sound's 2002 poll of the greatest movies ever. When Sight & Sound's directors' and critics' lists are combined, Raging Bull gets the most points of all movies that has been produced since 1974. In 2002, Film4 held a poll of the 100 Greatest Movies, on which Raging Bull was voted in at number 20. Halliwell's Film Guide, a British film guide, placed Raging Bull seventh in a poll naming their selection for the "Top 1,000 Movies". In 2008, Empire magazine held a poll of The 500 Greatest Movies of All Time, taking votes from 10,000 readers, 150 film makers and 50 film critics: Raging Bull was placed at number 11. It was also placed on a similar list of 1000 movies by The New York Times. In 2010, Total Film selected the film as one of The 100 Greatest Movies of All Time., a subsidiary of American Movie Classics, placed Raging Bull on their list of the 100 greatest movies. Additionally, ranked the film as the 16th best movie of all time (a list of the 9,335 most notable). f. Method Acting In the dramatic arts, method acting is a group of techniques actors use to create in themselves the thoughts and feelings of their characters, so as to develop lifelike performances. Though not all method actors use the same approach, the "method" in method acting usually refers to the practiceâ&#x20AC;&#x201D;influenced by Constantin Stanislavski and created by Lee Strasbergâ&#x20AC;&#x201D;in which actors create characters by drawing on their own emotions and memories, aided by a set of exercises and practices including sense memory and affective memory. Method acting is similar to Stanislavski's system. Method actors are often characterised as immersing themselves in their characters, to the extent that they stay in character offstage or off-camera for the duration of a project. However, this


is a popular misconception. While some actors have used this approach, it is generally not taught as part of the Method. Method acting has been described as having "revolutionized American theater." While classical acting instruction "...had focused on developing external talents," the Method was "...the first systematized training that also developed internal abilities (sensory, psychological, emotional)." Method acting continues to evolve, with many contemporary acting teachers, schools, and colleges teaching an integrated approach that draws from several different schools of thought about acting. <Technique> "The Method" refers to the teachings of Lee Strasbergâ&#x20AC;&#x201D;but the term "method acting" sometimes applies to teachings of his Group Theatre colleagues, including Stella Adler, Robert Lewis, and Sanford Meisner, and to other schools of acting influenced byStanislavski's system, each of which takes a slightly different approach. Constantin Stanislavski himself said that certain techniques that are considered "method" are not true to his original system, with an undue emphasis on the exercises of affective memory.[citation needed] However there is no one correct way of method acting, for each different method technique is simply a different teachers' understanding of the ideas of Stanislavski and others. Generally, Method acting combines the actor's careful consideration of the character's psychological motives and personal identification with the character, possibly including a reproduction of the character's emotional state by recalling emotions or sensations from the actor's own life. It is often contrasted with acting in which thoughts and emotions are indicated, or presented in a clichĂŠd, unrealistic way. Among the concepts and techniques of Method acting are substitution, "as if," sense memory, affective memory, animal work, and archetype work. Strasberg uses the question, "What would motivate me, the actor, to behave in the way the character does?" Strasberg asks the actor to replace the play's circumstances with his or her own, the substitution. Sanford Meisner, another Group Theatre pioneer, championed a closely related version of the Method, which came to be called the Meisner technique. Meisner broke from Strasberg on sense memory and affective memoryâ&#x20AC;&#x201D;basic techniques espoused by Strasberg through which actors access their own personal experiences to identify with and portray the emotional lives of 255

their characters. Meisner believed this approach made actors focus on themselves and not fully tell the story. He advocated actors fully immersing themselves "in the moment" and concentrating on their partner. Meisner taught actors to achieve spontaneity by understanding the given circumstances of the scene (as did Strasberg). He designed interpersonal exercises to help actors invest emotionally in the scene, freeing them to react "honestly" as the character. Meisner described acting as " truthfully under imaginary circumstances." Robert Lewis also broke with Strasberg. In his books Methodâ&#x20AC;&#x201D;or Madness? and the more autobiographical Slings and Arrows, Lewis disagreed with the idea that vocal training should be separated from pure emotional training. Lewis felt that more emphasis should be placed on formal voice and body training, such as teaching actors how to speak verse and enunciate clearly, rather than on pure raw emotion, which he felt was the focus of Method training. Stella Adler, an actress and acting teacher whose fame was cemented by the success of her studentsâ&#x20AC;&#x201D;who included Marlon Brando, Warren Beatty, and Robert De Niroâ&#x20AC;&#x201D;also broke with Strasberg after she studied with Stanislavski himself, the only Group Theatre teacher to do so, after he had modified many of his early ideas. Her version of the Method is based on the idea that actors should conjure up emotion not by using their own personal memories, but by using the scene's given circumstances. Like Strasberg's, Adler's technique relies on carrying through tasks, wants, needs, and objectives. It also seeks to stimulate the actor's imagination through the use of "as ifs." Adler often taught that "drawing on personal experience alone was too limited." Therefore, she urged performers to draw on their imaginations and utilize "emotional memory" to the fullest. <Contemporary Approaches> Contemporary Method acting teachers and schools often synthesize the work of their predecessors into an integrated approach. They reject the notion that any one of the major Method teachers of the 20th century was completely correct or incorrect, and they continue to develop new acting tools and techniques. Some modern acting theorists and teachers have noted that Lee Strasberg, Sanford Meisner, Stella Adler, and others often misunderstood each other's work, and that their criticisms were based on this misunderstanding. For example, they all taught actors to use their imagination, to connect with each other in performance, to analyze the script for wants, needs, and 256

objectives. Meisner often said that Strasberg actors were too focused on themselves, but Strasberg trained many of the most respected actors of the 20th century. In addition to taking an integrated approach, contemporary actors sometimes seek help from psychologists or use imaginative tools such as dream work or archetype work to remove emotional blocks. Techniques have also been developed to prevent the world of the performance from spilling over into an actor's personal life in destructive ways. <  Robert De Niro's Method: Acting, Authorship, and Agency in the New Hollywood (1967–1980)> Despite the fact that Robert De Niro is one of the most famous and iconic stars of the past 40 years, there is surprisingly very little writing devoted to the actor and his artistry. The result is a vacuum in film and cultural histories, which miss not only his immense contributions to moviemaking, but to the legacy of film acting. The donation of his career's worth of scripts, papers, costumes, memos, and correspondence to the Ransom Center, then, is one of the most exciting and significant new film acquisitions in recent years. The Robert De Niro papers chronicle all of the films that De Niro was involved with (including films that he has produced and directed) from start to finish, revealing a more comprehensive account of how a film is made, and chronicling his significant creative input into all aspects of production. In my dissertation "Robert De Niro's Method: Acting, Authorship, and Agency in the New Hollywood (1967–1980)," I argue that Robert De Niro's contributions to 1970s film permanently changed our understanding of screen performance while expanding the previously rigid boundaries between authorship, agency, and acting. I provide rarely seen evidence of his meticulous research, his collaborations with directors, and his extreme bodily transformations, re-centering De Niro as a major intellectual and creative force in a decade that has largely focused on directors instead of actors. Some of the most interesting items in the De Niro papers illuminate the actor's creative process—something that has largely been obscured due to his privacy, and, above all, modesty. De Niro's acting method is a comprehensive enterprise, beginning immediately after he is cast in a production and often going on for months before the film shoots. This was certainly the case in Raging Bull, and the Ransom Center provides new evidence of his extreme preparation for this role, including his supervision of the script-writing process, his training as a boxer to emulate the real257

life Jake La Motta, and his influence over Martin Scorsese, who De Niro persuaded to direct the film. The Raging Bull files include transcripts of De Niro's interviews with La Motta's ex-wife Vikki, congratulatory correspondence from his acting peers such as Paul Newman, Jane Fonda, and Al Pacino, among many others, as well as photos from make-up and costume tests. Above all, the De Niro papers provide evidence of the actor's active role in writing the film by crossing out and rewriting much of his character's dialog in the screenplayâ&#x20AC;&#x201D; something that occurs in almost every script in which De Niro is involved. g. Customer Driven Marketing <What is a Customer-Driven Marketing?> How Do I Incorporate Customer Feedback into My Marketing Programs? Step 1: Start with the customer. Find out what customers need. How? Ask them. There are many methods of obtaining information from the customer. Depending on your budget, you may opt to implement more than one of the following methods: face to face conversations, telephone calls, email communications, surveys, focus groups, advisory councils, social networking, blogging, etc. In fact, the more methods you deploy the greater chance for success. Step 2: Ask the right questions. Begin by asking for honest feedback about what they like and don't like about doing business with you. Customers value a company who asks for their opinion. Move to questions around what their expectations are. Ask specifically what is it about your company or product or employees that make the customer buy your products. Step 3: Don't stop asking. Every interaction with a customer should reveal a little more about what's important to the customer. Track your conversations by logging customer interactions in a database. If you're not learning more about your customer with every conversation, you're losing valuable insight to use to strengthen your relationships. Step 4: Anticipate the basics.


There are basic needs which are global in nature. For example, every customer wants more for less. Don't wait for the customer to tell you they want better price. That's a given. Think like the customer. Give them what they want, when it makes good financial sense to do so. Step 5: Read between the lines. Once you have gathered customer needs data, begin to analyze it. Look for ways to improve on what they are asking for. Customers can only envision what's available today. It's our job to provide more so customers are compelled to try us over the competition. If a customer asked for a specific color for your product, perhaps offering a variety of colors would be a delighter because a person's tastes or style may change over time. Having the flexibility of color might interest them in your product. Look for ways to give the customers more than they asked for. It shows you value the customer and want what's best for them. Step 6: Prioritize Program Elements Rank the program elements to ensure program elements address as many customer needs as possible. Elements offered as delighters will rank high too. As you assess which elements to implement, prioritize the items directly linking back to a specific customer need and/or a delighter for the customer. These are the items that will compel customers to buy. Therefore, put your resources where they bring the biggest bang for the buck. If you have a great idea for the program but it doesn't address a current need or delighter for the customer, hold off. Save it for another program at a later date. In this way dollars are spent on items we are confident have a direct impact to customer. So you want to capture customer mindshare? Build your marketing programs with customer needs in mind. Be selective about the marketing elements you include. Choose elements directly impact or satisfy the customer's need. Then build a marketing story around how you listen to your customer and designed the program specifically for them. Nothing says you care more than following through with action based on something the customer told you previously. 2. Creative Ideas in Implementation a. How can you demonstrate your professionalism Although you possess high-quality professionalism, presentation is important, too. In general, professionalism reveals itself over the time throughout your work. However, you have to make yourself 259

visible to your peers and supervisors, and itâ&#x20AC;&#x2122;s important for you to be accessible. After all, you have to be a positive influence using professionalism and strong work ethics in work environment. 3. Practical Project a. How to produce a product that shows your professionalism It requires creative and critical thinking process to produce a product that shows your professionalism.


Exercise: 1. Forming an idea 1 a. Form an innovative idea in the field of your interest (Cartoon, Animation, Game, Mobile Contents, etc.)


Website to Look @: Maryland Professionalism Center, Inc.


Chapter IX. Craftsmanship

<Fig. 9. 1. Craftsmanship ages with practices. Commitment. As everything manufactured in a factory these days, it’s getting harder to find a true maestro. But, their craftsmanship and spirit to keep their specialty has been recognized in many forms because it’s already known that machines cannot simply replace them.> <In this chapter…> 1. True Craftsmanship in Culture & Art Contents Industry a. Palace Bakery in Gwangju & Mammoth Bakery in Andong b. Hermes, True Masterpiece 2. Creative Ideas in Implementation a. How can you demonstrate your craftsmanship 3. Practical Project a. How to produce a product that shows your craftsmanship


Craftsman A craftsman or artisan is a skilled manual worker who makes items that may be functional or strictly decorative. Craftsman may also refer to: • • • • • • • • • •

Master craftsman, an artisan who practices a handicraft or trade Craftsman (album), a 1995 album by Guy Clark Craftsman (tools), a brand of tools The Craftsman, a magazine founded by Gustav Stickley in 1901 Craftsman Magazine, a magazine for craftspeople published in the UK from 1983 to 2007 Craftsman Book Company, publisher of technical references for construction professionals Craftsmen Industries, marketing company American Craftsman style, an American domestic architectural and interior design Craftsman, a style of architecture and furniture arising from the British Arts and Crafts Movement Craftsman, a military rank within the Royal Electrical and Mechanical Engineers, equivalent to a private

<Artisan> An artisan or artizan (from French: artisan, Italian: artigiano) or craftsman (craftsperson) is a skilled manual worker who makes items that may be functional or strictly decorative, including furniture, sculpture, clothing, jewellery, household items and tools or even machines such as the handmade devices of a watchmaker. Artisans practice a craft and may through experience and aptitude reach the expressive levels of an artist. The adjective "artisanal" is sometimes used in describing hand-processing in what is usually viewed as an industrial process, such as in the phrase artisanal mining. Thus, "artisanal" is sometimes used in marketing and advertising as a buzz word to describe or imply some relation with the crafting of handmade food products, such as bread, beverages or cheese. Many of these have traditionally been handmade, rural or pastoral goods but are also now commonly made on a larger scale with automated mechanization in factories and other industrial areas. Origin Artisans were the dominant producers of consumer products prior to the Industrial Revolution. According to classical economics theory, the division of labour occurs with internal market development. However, according to economist John Hicks, merchants and artisans originated as servants to the rulers.


Medieval Artisans During the Middle Ages, the term "artisan" was applied to those who made things or provided services. It did not apply to unskilled labourers. Artisans were divided into two distinct groups: those who operated their own businesses and those who did not. Those who owned their businesses were called masters, while the latter were the journeymen and apprentices. One misunderstanding many people have about this social group is that they picture them as "workers" in the modern sense: employed by someone. The most influential group among the artisans were the masters, the business owners. The owners enjoyed a higher social status in their communities. <Why Craftsmanship Still Matters> Craftsmanship seems to have skipped a whole generation. Especially in a Lean Startup hyped world, where throwing code against the wall and iterating until people use the product is promoted as the way of the future. No doubt, the movement towards small teams, quick iterations, and listening to your customers is part of building a great product. But to believe this is how you craft thoughtful experience with a clear purpose, is wrong. Itâ&#x20AC;&#x2122;s like telling an artist to smear colors on the wall until people buy the painting. True craftsmanship has a purpose. Originally called Artisans, these builders spent their life time shaping experiences with their hands. Perfecting each product, they werenâ&#x20AC;&#x2122;t afraid to take their time. And although the tools have changed (keyboards for pens, power tools for hammers, mass production for sewing machines) it doesnâ&#x20AC;&#x2122;t mean the art of the craftsmanship has to be lost. So in a startup paced world, how do you embrace craftsmanship? Understand the History Everything you are doing has been done before. Humans have been communicating, building, eating, making, working, living, and reproducing for a very long time. The only thing that has really changed are the tools we use. And the best artisans understand this. They understand the history of their products and the intent behind them. They understand how they were made and how they evolved over time. Facebook is the modern day coffee shop.


Twitter is a faster way to send a telegram. Rain Shadow Meats, a butcher in Seattle, makes it clear they understand the history of being a butcher. Their fresh meats, open kitchen, big chopping blocks, simple language, and amazing smells take you back in time. Even if you only read about what butchers used to be like, you instantly feel comfortable. Chrome Industries, famous for their seat buckle messenger bags, knows its history. Started 17 years ago, they still use military duffle bags as their inspiration, sewing machines to make their products, and American factories to hand craft. Despite the pressure to grow, they have stayed true to their purpose of utility and mobility. And you can feel it everytime you touch their products. Even software makers are thinking about the history of writing code. [The Pragmatic Programmer( and the Software Craftsmanship relate software engineers to original artisans. Before you can craft, you have to understand the artisans before you. Pick a Metaphor Metaphors are a powerful way to bring the past to the future. No more evident than Apple’s use of Dieter Rams’ design as a source of inspiration. It’s no mistake that the iPod looks alot like an old radio. Because when you see it, you are instantly familiar with the shape, size, and expectation. Outside of designers, what a lot of people don’t realize is that you subconsciously recognize familiar experiences the minute you see them. The sights, smells, and the smallest of details instantly become comforting. To make history clear to your team, pick a metaphor they can understand. Something in the past that is directly connected to what you are doing in the future. Not easy to do, the right metaphor will help make your brand, design, and customer experience authentic. Contour’s metaphor was a movie camera. Especially when GoPro was a picture camera, it was important our product and brand went back to the origins of film making. Where perspective was important, the shape was long (not square), and you could feel the quality of the materials. Take Your Time “If you don’t have time to do it right, when will you have the time to do it over?” ― John Wooden Building a masterpiece requires incredible patience. It requires you to prioritize 266

quality over quantity. Less over more. Simple over complex. Even worse, it requires you to be consistent, even while the pressure to ship grows like a tidal wave over your head. Don’t be confused. It doesn’t mean you perfect your work, void of feedback. The Lean Startup methodology of iterating with people is right. And although Apple doesn’t iterate in public, they do spend years internally crafting and recrafting until it is perfect. I missed this at Contour. The financial need to ship with the fear of falling behind in the technology race created unnecessary illusions that shipping was more important than crafting. Easy to critique after the fact, there were times we shipped when I knew the experience wasn’t even close to perfect. Saying I wanted to create amazing product experiences, my actions spoke louder than my words. It took almost nine years to get the experience right, but Contour Roam2 finally delivers on the original promise, to make action video easy. A compact, single button, bulletproof action camera. A nearly five star product, I’m incredibly proud of this work. Conclusion The hardest part of craftsmanship is being vulnerable. Pouring your soul into your work is like opening your heart to be broken multiple times over. A necessary experience in finding true love. Recognizing they will spend their lifetime building, true Artisans aren’t in a hurry to move on. They are willing to open themselves up against the struggle of failure until finally they get it right. <Craftsmanship matters, even when it’s not easy> Say the phrase "house construction" in Canada and you're talking about new buildings, renovations and wood. But it's easy to forget that other parts of the world have entirely different building styles. Fascinatingly different. Venice, Italy, is a case in point. I travelled to the city of canals in May, looking specifically for differences in the way people live in and manage homes there. What I discovered was not only interesting, but it also offers lessons for us Canadian homeowners, too. Venice has two things Canada does not. Every square inch of the place is already covered with buildings and most of what's there went up hundreds of years ago. As you'd expect with a history like this, Venice is a place of brick and stone and most of it is crumbling way beyond what you see here in Canada. The really striking thing about Venice is the size of the restoration job that's looming and how little of it seems to be happening. Most buildings are made 267

with ancient, sandy-red colored brick that wasn't fired quite hot enough. That's why it's not unusual to see entire buildings where half the brick thickness has been washed away by centuries of rain. Bricks that were on the cool side of the wood-fired kiln show up with much deeper areas of washing away than bricks right nearby. Venice is also a city of towers and about half of the ones I saw have a visible lean to them. The brick tower just outside the most famous cathedral in Venice - San Marco - collapsed without warning on July 14, 1902. The rebuilt version in its place now has a noticeable lean to it as well. I guess that's what you get when you build a masonry city on a bunch of marshy islands. So why build in a place that's just 45 centimetres above high tide? As barbarian marauders made their living burning and pillaging the cities of Italy in the fourth century, refugees fled to the 100-plus marshy islands around the delta of the Po River where it empties into the Adriatic Sea. Fear and danger is why Venice is located in such a watery and unlikely place, but the results certainly do have their advantages. Venice is a strikingly beautiful place, despite the exterior deterioration, with lots to teach us Canadians about beauty and commitment to craftsmanship. The ex-tent to which the Venetian people embody craftsmanship and are willing to pay for it is humbling. It's also highly attractive and real estate prices show it. As an example, a friend I made in the city lives in an ordinary 1,400-square-foot home with her two children and architect husband. The only reason they can live in Venice at all is because the house - currently valued at about $1.3 million Canadian - was a gift from her father. Nothing's cheap in Venice. Another thing about Venice is that it's impossible for renovation and restoration work to ever hap-pen as efficiently as it does here in Canada. Footpaths and canals are the only ways to get around and they've developed organically over the centuries, not along any sort of logical grid. That's why I regularly saw drywall and cement and plaster being shlepped by hand, a few pieces at a time, on a trolley or wheelbarrow, while deking around tourists like me. The main thing I take away from Venice is a renewed sense that craftsmanship matters, even when it's not easy. The reason the city population swells by 500 per cent each tourist season is because people from around the world are starved for a taste of a place that's built on more than just efficiency and superficial style. That, I think, is the greatest lesson we Canadians can learn from the beautiful impracticality of the Venetian home scene. 1. True Craftsmanship in Culture & Art Contents Industry a. Palace Bakery in Gwangju & Mammoth Bakery in Andong


<Success of hyper-local brands in 21st century> Pictures above showing local bakery shops lasted for many decades competing against nationally franchised bakery shops. Itâ&#x20AC;&#x2122;s not easy to survive in this environment, yet these local brands utilize their craftsmanship and differentiate themselves from national franchise stores. <Philly Clothing Line Gets Kickstart, Works With Local Craftmen> One young Philadelphia entrepreneur is getting a kickstart to launch his brand nationally and helping to drive the city's economy. Fox 29's Meg Baker went shopping with Seun Olubodun at his new store, Duke & Winston, located in the Northern Liberties section of Philadelphia. Sometimes all that stands between a person and his dream is a little cash. That was the case with Olubodun, who had an idea but not the resources to get it off the ground. 269

Introducing his English bulldog, Duke, as the inspiration for his clothing line, Duke & Winston, Olubodun says he started his brand with one T-shirt with Duke's face on it in 2009. The initial launch of the hometown brand was funded by selling his car. But to begin to expand nationally, Olubodun turned to Kickstarter, a website that helps organize funding for startups. Olubodun posted a video on the site, Duke included, and from there the idea took off. "On the first day, we met 25 percent of our goal. By the second day, it was 50 percent. And within eight days, we raised the goal of $20,000, which is completely incredible. I freaked out," he said. Without any experience, Duke & Winston has added hats, ties, sweatshirts and more to the casual yet preppy line. "The whole point of the line is that it's really clean and simple," Olubodun said. The nautical-themed goods are primarily produced locally in Pennsylvania, starting with a cotton mill in Lancaster, Amish country. "My t-shirts are all printed in Port Richmond, the dog beds are sewn by an awesome factory in South Philly by a family that's been there for about 60 years," he said. The hats are also the embroidered in South Philly, and the candles are made "literally right down the street in Fishtown," Olubodun said. Working with local craftsman allows him to have his hand in everything. "Why not work with other people that are local? That way we can see each other, I see the people that make my stuff almost every day," he explained. Having lived in the neighborhood for over five years, Olubodun says "almost everyone who lives around here walks by my shop, and they come in, and a lot of them are like, 'Oh, wow, this is awesome. This is great for the neighborhood.'" After exceeding his Kickstarter goal, Olubodun is planning on taking Duke & Winston national.


b. Hermès and Craftsmanship, True Masterpiece <Hermès and Craftsmanship> The question was surely rhetorical. “Do you know the right way to eat caviar?’’ said John Martinez, a cater-waiter. Is there a wrong way, he was asked, as glossy guests like Allison Sarofim and Anh Duong and Aerin Lauder and Lauren duPont queued up for freshly toasted blinis dolloped with glistening sturgeon roe. For the record and not that it matters — and not, furthermore, that many readers are likely to be struggling to master caviar etiquette in a crud economy — the method is as follows: load caviar on delivery vehicle (blini, preferably) insert through pie-hole, press blini and caviar gently toward roof of palate, part lips slightly, imbibe small sip of air, savor slowly the unfolding cholesterol-laden taste of fish eggs. Alternatively: gobble and grin. This was at a Fashion Week cocktail party and dinner given by Hermès in a deconsecrated Park Avenue church, a fine place in which to gather a group of prosperous New Yorkers to show reverence for the efforts that go into making a Kelly bag. Festival des Métiers the event was called, or festival of artisans, and to underscore the point that — unlike at some other luxury goods houses — the Hermès value proposition remains rooted in skilled craft, the venerable French house had imported a posse of skilled workers to show how it’s done. The number of individual pieces of leather, for instance, required to make a purse with a roughly $8,300 base price is so great that Pierre Grosperrin, the Kelly bag expert on hand, claimed he’d never counted them. Mr. Grosperrin was gluing a bit of stamped leather as he said this, at one of 10 stations where artisans showed off, say, the five layers of materials that go into a handbag handle; the many (as many as 46) separate silk-screen processes required to make a $400 Hermès scarf; the way a hand-steamed birch frame is used to build an Hermès jumping saddle; the painstaking and probably also blinding technique required to apply miniature diamonds to a studded Hermès manacle. “What happens if you make a mistake?’’ the gem setter, Maud 271

Laville, was asked. “I don’t make a mistake,’’ Ms. Laville replied coolly in French. Of course she doesn’t. (Well, actually, oops, sometimes she does, said Peter Malachi, a Hermès spokesman. When that happens, the bracelet is scrapped; French labor laws being what they are, Ms. Laville remains.) The point, the subtle message of the evening, was underlining a grandmotherly home truth: You get what you pay for. In the recent evolution of the luxury goods trade, as many are aware, this has not necessarily been the case. Particularly during the bull market days of logomania and designer-bag frenzy, consumers flung cash at any kind of junk with a label. In light of that, said Guillaume de Seynes, a Hermès managing director and also a member of the Hermès family, it is a struggle to maintain a dynastic business like his. “Hermès as we have built it is a unique company,’’ Mr. de Seynes said, referring to a saddlery founded after his ancestor was awarded a Napoleonic warrant to make what in the equestrian world is termed horse furniture. “We have a specific history and a strong belief that in the hands of any other group it would be another company,’’ he added, referring to ongoing efforts by LVMH chairman Bernard Arnault, whose stake hold in Hermès is the subject of a lawsuit brought this week in French court, to snap up the storied French label, making it a jewel in crown of the multinational Moet Hennessey Louis Vuitton group. “It is not a recipe just anyone can follow,’’ Mr. de Seynes added, as waiters circulated with trays of bite-size chicken Caesar Napoleon canapés. Asked whether ownership of the French house, which posted a first half profit gain of 15.2 percent in 2012 with sales of $420.1 million, was more secure now than a year ago, Mr. des Seynes gave an enigmatic Gallic shrug and tipped up his glass of Champagne. <Hermès to explain luxury history, craftsmanship through London exhibit> French fashion empire Hermès is further emphasizing the hand craftsmanship and strong history behind the brand through a new 272

exhibit to open in London. The Hermès Leather Forever exhibit will open May 8 at the galleries at 6 Burlington Gardens in London. Indeed, Hermès has recently been putting a lot of effort into emphasizing its high-quality craftsmanship likely to convince affluent consumers that the price points are fair for the products. “The exhibition is a poetic and playful celebration of the very special relationship between Hermès and leather, said Thierry Outin, London-based managing director of Hermès Britain. “Hermès was founded as a harness and saddle-maker Paris, 175 years ago this year and ever since, our craftspeople have worked to tame leather into many different extraordinary and beautiful objects,” he said. Not horsing around The Leather Forever exhibit aims to explain the story of Hermès founder Thierry Hermès. Hermès was founded in Paris in 1837 as a harness-maker and saddlery. Indeed, Hermès evolved from leather saddles to leather goods and beyond, but the founding values have remained the same and recognizable in modern products. For example, many of the products still feature saddle buckles and prints that contain references to the equestrian world. Hermès is looking to take the visitor on a journey that explores the founder’s love of fine materials, according to the brand. Leather Forever will feature items from Hermès history such as products commissioned by the Duke of Windsor for his wife as well as some of the brand’s latest creations. Additionally, current Hermès artisans will be present at the exhibit to showcase their passion and skills. In fact, the artisans will be creating items on site to give visitors the chance to see exactly how much detail is put into each product. “We would like as many people as possible in [Britain] to discover the story of Hermès craftsmanship and it’s passion for leather,” Mr. Outin said.


“To see and be inspired by the wonders that we have created,” he said. However, Hermès is not stopping with educating the affluent consumer. The brand has also created four limited-edition bags that celebrate Britain to be sold at the exhibit. Proceeds from the bags will be donated to the Royal Academy of Arts. “Affluent consumers will be intrigued because it’s luxury as art,” said Chris Ramey, president of Affluent Insights, Miami. “Passion elevates product to a higher level, so for Hermès [this exhibit] is a natural,” he said. Heartfelt effort Hermès has been placing an emphasis on its hand craftsmanship and the people behind responsible for it. For example, it has created a microsite called Hearts and Crafts that showcases the detailed craftsmanship and quality of its products through inside glimpses into the making of its branded products.

<An artisan at the brand> Hermès’ Hearts and Crafts site features videos and interviews with the designers and employees behind the brand, from leathercutters to silk-drawers.


The Web site also features a full-length movie that was first shown in select movie theaters and museums this past fall (see story). Hermès is likely looking to explain to consumers why its prices are so high because of the current economy and faltering consumer confidence. Even affluent consumers who may not be directly affected by the economic instability are beginning to question the quality behind some of the prices they pay. Additionally, luxury customers often feel guilty about spending high amounts on products, especially with an unstable economy. Therefore, the charitable action will likely help justify the purchase in their minds. Plus, the limited-edition quality of the bag will likely make it extremely desirable amongst Hermès customers. “Rarity is an integral element of luxury,” Mr. Ramey said. “Special edition bags contribute to the art and experience of the event. “[Additionally], authenticity is one of the platforms for luxury,” he said. “Hermès will continue to emphasize their craftsmanship, history and quality because it’s part of their DNA.” <Behind The Scenes With Hermès> Hermès is hosting the Festival des Métiers, a showcase of the century-old manufacturing skills carefully tended by the 175-yearold brand. For the event, Hermès imported craftsmen and women from its workshops in France to demonstrate the techniques they use to create luxury items like leather handbags, silk scarves and gold jewelry. It’s like a national celebration of the artisanal quality that has been associated with the house since 1837. I spoke with Guillaume de Seynes, the executive vice president of Hermès International and a sixth-generation member of the Hermès family, about the familial responsibility to protect such high levels of skill. He said it plays a significant role in why they’re fighting so hard to remain independent. Watch the video for more details. In it, you’ll see men in white lab coats screening silk scarves and how exquisitely delicate mechanical watches look while they are assembled. You’ll also see the head of Hermès saddlery hard at work–the company 275

makes only 500 saddles per year, which are sourced from special hide and have been hammered, tacked and sewn the same way for centuries. And watch the woman who makes those famous diamondencrusted Hermès cuffs. Each cuff takes four months just to have its stones set. Once you see the final product, I bet you’ll agree it’s worth the wait. 2. Creative Ideas in Implementation a. How can you demonstrate your craftsmanship <Hermès to Demonstrate Craftsmanship at Festival des Métiers in London> Have you ever wondered about how Hermès makes it bags or its legendary silk scarves and what makes these and other products bearing its brand so pricey and valuable? Have you ever wondered about the men and women behind the construction of these Hermès goods and how they are able to come up with exquisite designs and then execute these designs to perfection? Well, if you have asked about these things in your head and if you happen to be in London next week, then you have a way of finding out the answer! How? The French luxury brand is bringing a special team of craftspeople to London who will demonstrate their bag-making skills in a free public exhibition. These artisans will show people the handcrafting expertise that comes with creating the brand’s famous Birkin bags and its other iconic products, too. Not only will you be able to get a glimpse of how a Hermès workshop looks like, see how prints and designs beautifully evolve behind the scenes, and witness the creative masters as they weave magic into the brand’s well-known handbags, silk scarves, watches, and even fine jewelry, but you will also have the opportunity to interact with them and ask them relevant questions. The exhibit, called 'Festival des Métiers,' is traveling from Beijing and Shenyang in China and is making a London stop for only a week. It will take place from May 21 to 27, 2013, at the Saatchi Gallery, on King’s Road in Chelsea, London. After London, its next stop will be the German city of Düsseldorf. 276

Festival des Métiers is presented in a contemporary set-up by world-renowned designer Paola Navone. This exhibit aims to allow visitors to better understand the unique creative processes that come with creating these high-end and superior-quality goods. Festival des Métiers is open for everyone, so there should not be any excuse for Hermès lovers not to drop by the Saatchi Gallery! However, for those who cannot make it to the Hermès exhibit, you will still have another chance to see what happens behind the scenes of other luxury brands. The LVMH luxury group, which has brands Louis Vuitton, Fendi and Givenchy under its wings, will have its Journées Particulières events this year on June 15 to 16, wherein people will get to see these atéliers at Christian Dior in Paris, as well as visit the Hennessy cellars in Cognac. 3. Practical Project a. How to produce a product that shows your craftsmanship


Exercise: 1. Research on individual or company to overcome critical crisis in Culture & Art Contents Industry a. 2 domestic, 2 Asian, 2 American, 2 European products/companies b. Analyze how people overcame crisis


Website to Look @: Luxury Society Luxury Fashion Brands Using Craftsmanship in Video



Chapter X. Crisis and Crisis Management

<Fig. 10. 1. Crisis happens. But, the matter is how to handle it.> <In this chapter…> 1. How to overcome crisis / how to recover from failure a. Must-win Situation Driven from Failure, “The Pursuit of Happyness” featuring Will Smith b. Ironies of Failure Due to Success 2. Creative Ideas in Implementation a. When crisis turns to opportunity 3. Practical Project a. How to turn crisis into opportunity


Crisis and Crisis Management A crisis (from the Greek κρίσις - krisis; plural: "crises"; adjectival form: "critical") is any event that is, or is expected to lead to, an unstable and dangerous situation affecting an individual, group, community, or whole society. Crises are deemed to be negative changes in the security, economic, political, societal, or environmental affairs, especially when they occur abruptly, with little or no warning. More loosely, it is a term meaning 'a testing time' or an 'emergency event'. <Economic Crisis> An economic crisis is a sharp transition to a recession. See for example 1994 economic crisis in Mexico, Argentine economic crisis (1999–2002), South American economic crisis of 2002, Economic crisis of Cameroon. Crisis theory is a central achievement in the conclusions of Karl Marx's critique of Capital. A financial crisis may be a banking crisis or currency crisis. <Crisis Management> Crisis management is the process by which an organization deals with a major event that threatens to harm the organization, its stakeholders, or the general public. The study of crisis management originated with the large scale industrial and environmental disasters in the 1980s. Three elements are common to a crisis: (a) a threat to the organization, (b) the element of surprise, and (c) a short decision time. Venette argues that "crisis is a process of transformation where the old system can no longer be maintained." Therefore the fourth defining quality is the need for change. If change is not needed, the event could more accurately be described as a failure or incident. In contrast to risk management, which involves assessing potential threats and finding the best ways to avoid those threats, crisis management involves dealing with threats before, during, and after they have occurred. It is a discipline within the broader context of management consisting of skills and techniques required to identify, assess, understand, and cope with a serious situation, especially from the moment it first occurs to the point that recovery procedures start. Crisis management consists of different aspects including; Methods used to respond to both the reality and perception of crises. Establishing metrics to define what scenarios constitute a crisis and should consequently trigger the necessary response mechanisms. Communication that occurs within the response phase of emergencymanagement scenarios. 282

Crisis-management methods of a business or an organization are called a crisis-management plan. Crisis management is occasionally referred to as incident management, although several industry specialists such as Peter Power argue that the term "crisis management" is more accurate. A crisis mindset requires the ability to think of the worst-case scenario while simultaneously suggesting numerous solutions. Trial and error is an accepted discipline, as the first line of defense might not work. It is necessary to maintain a list of contingency plans and to be always on alert. Organizations and individuals should always be prepared with a rapid response plan to emergencies which would require analysis, drills and exercises. The credibility and reputation of organizations is heavily influenced by the perception of their responses during crisis situations. The organization and communication involved in responding to a crisis in a timely fashion makes for a challenge in businesses. There must be open and consistent communication throughout the hierarchy to contribute to a successful crisis-communication process. The related terms emergency management and business-continuity management focus respectively on the prompt but short lived "first aid" type of response (e.g. putting the fire out) and the longer-term recovery and restoration phases (e.g. moving operations to another site). Crisis is also a facet of risk management, although it is probably untrue to say that crisis management represents a failure of risk management, since it will never be possible to totally mitigate the chances of catastrophes' occurring. Types of Crisis During the crisis management process, it is important to identify types of crises in that different crises necessitate the use of different crisis management strategies. Potential crises are enormous, but crises can be clustered. Lerbinger categorized eight types of crises 1. 2. 3. 4. 5. 6. 7. 8.

Natural disaster Technological crises Confrontation Malevolence Organizational Misdeeds Workplace Violence Rumours Terrorist attacks/man-made disasters

Natural crises Natural crises, typically natural disasters considered as 'acts of God,' are such 283

environmental phenomena as earthquakes, volcanic eruptions, tornadoes and hurricanes, floods, landslides, tsunamis, storms, and droughts that threaten life, property, and the environment itself. Example: 2004 Indian Ocean earthquake (Tsunami) Technological crises Technological crises are caused by human application of science and technology. Technological accidents inevitably occur when technology becomes complex and coupled and something goes wrong in the system as a whole (Technological breakdowns). Some technological crises occur when human error causes disruptions (Human breakdowns). People tend to assign blame for a technological disaster because technology is subject to human manipulation whereas they do not hold anyone responsible for natural disaster. When an accident creates significant environmental damage, the crisis is categorized as megadamage. Samples include software failures, industrial accidents, and oil spills. Examples: Chernobyl disaster, Exxon Valdez oil spill Confrontation crisis Confrontation crisis occur when discontented individuals and/or groups fight businesses, government, and various interest groups to win acceptance of their demands and expectations. The common type of confrontation crisis is boycotts, and other types are picketing, sit-ins, ultimatums to those in authority, blockade or occupation of buildings, and resisting or disobeying police. Example: Rainbow/PUSHâ&#x20AC;&#x2122;s (People United to Serve Humanity) boycott of Nike Crisis of malevolence An organization faces a crisis of malevolence when opponents or miscreant individuals use criminal means or other extreme tactics for the purpose of expressing hostility or anger toward, or seeking gain from, a company, country, or economic system, perhaps with the aim of destabilizing or destroying it. Sample crisis include product tampering, kidnapping, malicious rumors,terrorism, and espionage. Example: 1982 Chicago Tylenol murders Crises of organizational misdeeds Crises occur when management takes actions it knows will harm or place stakeholders at risk for harm without adequate precautions. Lerbinger specified three different types of crises of organizational misdeeds: crises of skewed management values, crises of deception, and crises of management misconduct. Crises of skewed management values Crises of skewed management values are caused when managers favor short284

term economic gain and neglect broader social values and stakeholders other than investors. This state of lopsided values is rooted in the classical business creed that focuses on the interests of stockholders and tends to disregard the interests of its other stakeholders such as customers, employees, and the community Example: Sears sacrifices customer trust It has 4 stages -precrisis -acute -chronic and -conflict resolution Crisis of deception Crisis of deception occur when management conceals or misrepresents information about itself and its products in its dealing with consumers and others. Example: Dow Corning’s silicone-gel breast implant Crises of management misconduct Some crises are caused not only by skewed values and deception but deliberate amorality and illegality. Workplace violence Crises occur when an employee or former employee commits violence against other employees on organizational grounds. Example: DuPont’s Lycra Rumors False information about an organization or its products creates crises hurting the organization’s reputation. Sample is linking the organization to radical groups or stories that their products are contaminated. <Models and Theories Associated with Crisis Management> Crisis Management Model Successfully defusing a crisis requires an understanding of how to handle a crisis – before they occur. Gonzalez-Herrero and Pratt found the different phases of Crisis Management. There are 3 phases in any Crisis Management as shown below 1. The diagnosis of the impending trouble or the danger signals. 2. Choosing appropriate Turnaround Strategy. 3. Implementation of the change process and its monitoring. Crisis Management Planning No corporation looks forward to facing a situation that causes a significant 285

disruption to their business, especially one that stimulates extensive media coverage. Public scrutiny can result in a negative financial, political, legal and government impact. Crisis management planning deals with providing the best response to a crisis. Contingency planning Preparing contingency plans in advance, as part of a crisis-management plan, is the first step to ensuring an organization is appropriately prepared for a crisis. Crisis-management teams can rehearse a crisis plan by developing a simulated scenario to use as a drill. The plan should clearly stipulate that the only people to speak publicly about the crisis are the designated persons, such as the company spokesperson or crisis team members. The first hours after a crisis breaks are the most crucial, so working with speed and efficiency is important, and the plan should indicate how quickly each function should be performed. When preparing to offer a statement externally as well as internally, information should be accurate. Providing incorrect or manipulated information has a tendency to backfire and will greatly exacerbate the situation. The contingency plan should contain information and guidance that will help decision makers to consider not only the short-term consequences, but the long-term effects of every decision. Business continuity planning When a crisis will undoubtedly cause a significant disruption to an organization, a business continuity plan can help minimize the disruption. First, one must identify the critical functions and processes that are necessary to keep the organization running. Then each critical function and or/process must have its own contingency plan in the event that one of the functions/processes ceases or fails. Testing these contingency plans by rehearsing the required actions in a simulation will allow for all involved to become more sensitive and aware of the possibility of a crisis. As a result, in the event of an actual crisis, the team members will act more quickly and effectively. Structural-functional systems theory Providing information to an organization in a time of crisis is critical to effective crisis management. Structural-functional systems theory addresses the intricacies of information networks and levels of command making up organizational communication. The structural-functional theory identifies information flow in organizations as "networks" made up of members and "links". Information in organizations flow in patterns called networks. Diffusion of innovation theory Another theory that can be applied to the sharing of information is Diffusion of Innovation Theory. Developed by Everett Rogers, the theory describes how innovation is disseminated and communicated through certain channels over a period of time. Diffusion of innovation in communication occurs when an 286

individual communicates a new idea to one or several others. At its most elementary form, the process involves: (1) an innovation, (2) an individual or other unit of adoption that has knowledge of or experience with using the innovation, (3) another individual or other unit that does not yet have knowledge of the innovation, and (4) a communication channel connecting the two units. A communication channel is the means by which messages get from one individual to another. Role of apologies in crisis management There has been debate about the role of apologies in crisis management, and some argue that apology opens an organization up for possible legal consequences. "However some evidence indicates that compensation and sympathy, two less expensive strategies, are as effective as an apology in shaping people’s perceptions of the organization taking responsibility for the crisis because these strategies focus on the victims’ needs. The sympathy response expresses concern for victims while compensation offers victims something to offset the suffering." Crisis leadership James identifies five leadership competencies which facilitate organizational restructuring during and after a crisis. 1. 2. 3. 4. 5.

Building an environment of trust Reforming the organization’s mindset Identifying obvious and obscure vulnerabilities of the organization Making wise and rapid decisions as well as taking courageous action Learning from crisis to effect change.

Crisis leadership research concludes that leadership action in crisis reflects the competency of an organization, because the test of crisis demonstrates how well the institution’s leadership structure serves the organization’s goals and withstands crisis. [10] Developing effective human resources is vital when building organizational capabilities through crisis management executive leadership. Unequal human capital theory James postulates that organizational crisis can result from discrimination lawsuits. James’s theory of unequal human capital and social position derives from economic theories of human and social capital concluding that minority employees receive fewer organizational rewards than those with access to executive management. In a recent study of managers in a Fortune 500 company, race was found to be a predictor of promotion opportunity or lack thereof. Thus, discrimination lawsuits can invite negative stakeholder reaction, damage the company's reputation, and threaten corporate survival. Social media and crisis management 287

Social media has accelerated the speed that information about a crisis can spread. The viral affect of social networks such as Twitter means that stakeholders can break news faster than traditional media - making managing a crisis harder. This can be mitigated by having the right training and policy in place as well as the right social media monitoring tools to detect signs of a crisis breaking. Social media also gives crisis management teams access to real-time information about how a crisis is impacting stakeholder sentiment and the issues that are of most concern to them. The crisis management mantra of Lanny Davis, former counsellor to Bill Clinton is to “Tell it Early, Tell it All, Tell it Yourself”. A strategy employed at the Clinton White House 1996 – 1998, to any breaking organisations should have a planned approach to releasing information to the media in the event of a crisis. A media reaction plan should include a company media representative as part of the Crisis Management Team (CMT). Since there is always a degree of unpredictability during a crisis, it is best that all CMT members understand how to deal with the media and be prepared to do so, should they be thrust into such a situation. In 2010 Procter & Gamble Co called reports that its new Pampers with Dry Max caused rashes and other skin irritations "completely false" as it aimed to contain a public relations threat to its biggest diaper innovation in 25 years. A Facebook group called "Pampers bring back the OLD CRUISERS/SWADDLERS" rose to over 4,500 members. Pampers denied the allegation and stated that only two complaints had been received for every one million diapers sold. Pampers quickly reached out to people expressing their concerns via social media, Pampers even held a summit with four influential “mommy bloggers,” to help dispel the rumour. Pampers acted quickly and decisively to an emerging crisis, before competitors and critics alike could fuel the fire further. There is no truth. There is only perception. <10 Rules of Crisis Management> 1. Being Unprepared Is No Excuse. My father was an officer of the U.S. Army. Although I was never an active Boy Scout, their motto “Be Prepared” was drilled into my head at an early age. As I’ve toiled in this industry for the past two decades, it has amazed me how many companies are totally unprepared to deal with a real crisis. Most either have a crisis plan that hasn’t seen the light of day for at least a decade, or the plan is so complicated it would require an army of engineers to figure it out. Sorry to say, far too many organizations have found more important items to address, leaving their crisis plans as to-do items until the day the stuff hits the fan. They say it takes a lifetime to build a reputation and only a few hours to destroy it. You’re almost guaranteed the latter, if you fail to plan. Being unprepared is no excuse; it’s just a reflection of the importance you place on your reputation. 2. You Know The Threats – Get Ready For Them. In every crisis training session I 288

conduct, I ask the audience if they can identify the top five threats facing their company. At first, you see a lot of heads bobbing up and down, but after a little prodding, they begin to develop the list. “So if you know the threats,” I ask, “how can you be unprepared for them?” (See Rule 1.) Crisis management is about speed. The faster you respond, the fewer problems you will face. In order to get out of the door quickly, you need to have fill-in-the-blank, preapproved, stand-by statements ready to go. I had one client develop standby statements and key messages regarding her top five threats in an afternoon. It doesn’t have to be time intensive, but it does have to be a priority. 3. Know What You Want To Say Before They Ask. Knowing the risks is just part of the battle. Preparing for the questioning is another matter. The first step in getting ready for any crisis is identifying your worst nightmare questions. No sugar coating is allowed, you need to be critical – just pretend you’re Mike Wallace. If you understand the kinds of questions you’re likely to face, preparing good key messages is much easier. This exercise should take no more than 20 minutes for each of your top threats. Within two hours, you can knock off your worst nightmare questions and develop the key messages for each of the five top threats facing your company. 4 . Admit That You Are Wing-It-Challenged. In the 20 years I’ve been media training executives (1,000+), I’ve probably run across one or two who can handle almost anything with little or no preparation. Based on my math, that means the vast majority of us, or .998 percent to be more precise, are wing-itchallenged. There is nothing wrong with being wing-it-challenged. In fact, you are in the majority. It simply means that you have to prepare before you choose to stand in front of reporters whose job it is to tear you apart. All it takes is a few dry runs. Before you face the cameras, have your colleagues fire some difficult questions at you. You will find that it’s much easier if you have already heard the questions before. 5. Three Key Messages For Every Crisis. In all of the years I’ve been working in crisis management, I have come to understand the true power of the rule of three. As a journalist, I used it all the time, but it took me nearly a decade to see how it applies to crisis management. If you remember nothing else from these crisis rules, remember this: there are three key messages you can depend on in the first 48 hours of any crisis. It doesn’t matter what the crisis is, these messages apply: “We have a plan to deal with …” You really do need to have a plan – that is why creating a crisis plan in Rule 1 is so important. “Our hearts and prayers go out to those …” You need to show compassion for those that have been killed, hurt or simply inconvenienced. “We immediately began our own investigation to make sure that we …” You need to commit to finding out what went wrong and taking the necessary steps to ensure that it doesn’t happen again. 289

For these messages to work, it is critical that you back them up with actions. Saying you care about your employees doesn’t work if you don’t demonstrate it. Over the next two weeks, read the quotes from those facing a crisis and ask yourself if one of these key messages would have worked just as well. 6. Beware Of The Court Of Public Opinion. Lawyers play a very important part in any crisis. Their counsel on legal matters is paramount and should help guide the response. However, there are two courts in this world, and the court of public opinion is just as powerful as the court of law. The biggest challenge crisis leaders face is balancing their decisions based on these two courts. What may work in one, doesn’t always work in the other. The real question that needs to be addressed is quite simple – what is the smartest thing I can do to protect my brand? Winning in a court of law won’t necessarily restore the public trust you may have lost in the court of public opinion. Both are important – choose wisely. 7. You’ve Got 48 Hours. The first 48 hours of any crisis are crunch time. If you are not ahead of the crisis by that timeframe, it’s likely it will run you over. The reason many companies fail to manage a crisis properly is because they fail to recognize one simple fact: when something happens, a communications void is created. If you don’t fill it, someone will, and the information they share is often inaccurate or incomplete. Overcoming a negative perception is nearly impossible, thus the reason to get out there as fast as you can and as frequently as you can. It’s impossible to over communicate in a crisis. You can say the wrong thing, but you can never over communicate. 8. Divide And Conquer. In the midst of a crisis, time flies. A common mistake I see during crisis drills is the concept of team decisions – for everything. I’m not saying that teamwork isn’t important in a crisis. But, the truth is, in order to stay ahead of the crisis, you need to divide and conquer. Once the team agrees on a direction and the key messages, it’s up to the individuals to execute. They will need to re-group from time to time, but if each member of the team remains focused on their core area of responsibility and executes flawlessly, your chance of success grows dramatically. 9. Get Outside Help. When a crisis strikes, seeking an outsider’s perspective is paramount. Internal politics tend to take over in the middle of a major problem as people become more focused on keeping their jobs, rather than what is best for the company. Good leaders expect these internal politics and counter them by bringing in someone from the outside who can look at the issues without bias. This individual’s role is not to call all the shots. His or her role is to provide counsel to a team leader – a perspective that few inside the company can offer. They are free to look at things that many tend to overlook because of their internal biases. Just because you bring in outside counsel doesn’t mean you can’t handle the crisis. It means you recognize your weaknesses and are smart enough to do something about it. 10. Every Crisis Is An Opportunity. Smart leaders understand that in the midst of 290

crisis, there is opportunity. Don’t be afraid to seize the moment. Yes, there is risk involved, but that is true with every opportunity. 1. How to overcome crisis / how to recover from failure a. Must-win Situation Driven from Failure, “The Pursuit of Happyness” featuring Will Smith

The Pursuit of Happyness is a 2006 American biographical drama film based on Chris Gardner's nearly one-year struggle with homelessness. Directed by Gabriele Muccino, the film features Will Smith as Gardner, an on-and-off-homeless salesman-turned stockbroker. Smith's son Jaden Smith co-stars, making his film debut as Gardner's son, Christopher Jr. The screenplay by Steven Conrad is based on the best-selling memoir written by Gardner with Quincy Troupe. The film was 291

released on December 15, 2006, by Columbia Pictures. For his performance, Smith was nominated for an Academy Award and a Golden Globe for Best Actor. The unusual spelling of the film's title comes from a sign Gardner saw when he was homeless. In the film, "happiness" is incorrectly spelled as "happyness" outside the daycare facility Gardner's son attends. <Plot> In 1981 San Francisco, Chris Gardner (Will Smith) invests his entire life savings in portable bone-density scanners which he demonstrates to doctors and pitches as a handy quantum leap over standard X-rays. While he is able to sell most of them, the time lag between the sales and his growing financial demands enrage his already bitter and alienated wife Linda (Thandie Newton), who eventually leaves him and moves to New York. After Linda bluntly says she is incapable of being a single mother, she agrees that their son Christopher (Jaden Smith) will remain with his father. While downtown trying to sell one of the scanners, Chris meets Jay Twistle (Brian Howe), a manager for Dean Witter and impresses him by solving a Rubik's Cube during a short cab ride. Chris does not have enough money for the cab fare and flees into a subway station where he barely escapes the angry cab driver but loses one of his bone scanners in the process. This new relationship with Twistle earns him the chance to become an intern stockbroker, employee. Despite arriving at his new office unkempt and shabbily dressed due to being arrested the previous day for unpaid parking tickets (and having had to paint his apartment, as his landlord grudgingly says he will give Chris and his son a little more time living there if they get the place ready for an incoming tenant before they depart), Chris is offered the internship. Chris is further set back when his bank account is garnished by the IRS for unpaid income taxes, and he and his young son are evicted. Chris becomes broke and has less than thirty dollars in his bank account. As a result they are homeless, and are forced at one point to stay in a restroom at a subway station. Motivation drives him to find the Glide Memorial United Methodist Church, which has a homeless shelter for single mothers and their children. The church's owner will not allow him to stay there and Chris will not agree to leave Christopher there alone, although she tells him about a local church that also provides shelter, but has very limited space. Due to demand for the limited rooms, Chris must frantically race from his internship work early each afternoon in order to land a place in line. Chris finds the bone scanner that he lost in the subway station from a demented man who had been carrying it around, believing it to be a time machine, and 292

the scanner is now damaged, but Chris finally repairs it and is able to sell it. Disadvantaged by his limited work hours, and knowing that maximizing his client contacts and profits is the only way to earn the one paid position that he and his 19 competitors are fighting for, Chris develops a number of ways to make phone sales calls more efficiently. He also reaches out to potential high value customers, defying protocol. One sympathetic prospect who is a top-level pension fund manager even takes him and his son to a San Francisco 49ers game. Regardless of his challenges, Chris never reveals his lowly circumstances to his co-workers, even going so far as to lend one of his bosses five dollars for a cab, a sum he can't afford. Concluding his internship, Chris is called into a meeting with his managers. One of them notes he isn't wearing a new suitâ&#x20AC;&#x201D;and then smiles and says he should wear one tomorrow, letting him know he has won the coveted full-time position. Fighting back tears, he rushes to his son's daycare, hugging him. They walk down the street, joking with each other and are passed by a man in a business suit (the real Chris Gardner in a cameo appearance). The epilogue reveals that Chris went on to become a successful man and to form his own multi-million dollar brokerage firm. <Reception> Critical Response The film was received generally positively by critics. Film review site Rotten Tomatoes calculated a 66% overall approval based on 166 reviews. In the San Francisco Chronicle, Mick LaSalle observed, "The great surprise of the picture is that it's not corny . . . The beauty of the film is its honesty. In its outlines, it's nothing like the usual success story depicted on-screen, in which, after a reasonable interval of disappointment, success arrives wrapped in a ribbon and a bow. Instead, this success story follows the pattern most common in life â&#x20AC;&#x201D; it chronicles a series of soul-sickening failures and defeats, missed opportunities, sure things that didn't quite happen, all of which are accompanied by a concomitant accretion of barely perceptible victories that gradually amount to something. In other words, it all feels real." Manohla Dargis of The New York Times called the film "a fairy tale in realist drag . . . the kind of entertainment that goes down smoothly until it gets stuck in your craw . . . It's the same old bootstraps story, an American dream artfully told, skillfully sold. To 293

that calculated end, the film making is seamless, unadorned, transparent, the better to serve Mr. Smith's warm expressiveness . . . How you respond to this man's moving story may depend on whether you find Mr. Smith's and his son's performances so overwhelmingly winning that you buy the idea that poverty is a function of bad luck and bad choices, and success the result of heroic toil and dreams." Peter Travers of Rolling Stone awarded the film three out of a possible four stars and commented, "Smith is on the march toward Oscar . . . [His] role needs gravity, smarts, charm, humor and a soul that's not synthetic. Smith brings it. He's the real deal." In Variety, Brian Lowry said the film "is more inspirational than creatively inspiredâ&#x20AC;&#x201D;imbued with the kind of uplifting, afterschoolspecial qualities that can trigger a major toothache . . . Smith's heartfelt performance is easy to admire. But the movie's painfully earnest tone should skew its appeal to the portion of the audience that, admittedly, has catapulted many cloying TV movies into hits . . . In the final accounting, [it] winds up being a little like the determined salesman Mr. Gardner himself: easy to root for, certainly, but not that much fun to spend time with." Kevin Crust of the Los Angeles Times stated, "Dramatically it lacks the layering of a Kramer vs. Kramer, which it superficially resembles . . . Though the subject matter is serious, the film itself is rather slight, and it relies on the actor to give it any energy. Even in a more modest register, Smith is a very appealing leading man, and he makes Gardner's plight compelling . . . The Pursuit of Happyness is an unexceptional film with exceptional performances . . . There are worse ways to spend the holidays, and, at the least, it will likely make you appreciate your own circumstances." In the St. Petersburg Times, Steve Persall graded the film B- and added, "[It] is the obligatory feel-good drama of the holiday season and takes that responsibility a bit too seriously . . . the film lays so many obstacles and solutions before its resilient hero that the volume of sentimentality and coincidence makes it feel suspect . . . Neither Conrad's script nor Muccino's redundant direction shows [what] lifted the real-life Chris above better educated and more experienced candidates, but it comes through in the earnest performances of the two Smiths. Father Will seldom comes across this mature on screen; at the finale, he achieves a measure of Oscar-worthy emotion. Little Jaden is a chip off the old block, uncommonly at ease before the cameras. Their real-life bond is an inestimable asset to the on-screen characters' relationship, although Conrad never really tests it with any conflict." 294

National Review Online has named the film #7 in its list of 'The Best Conservative Movies'. Linda Chavez of the Center for Equal Opportunity wrote, "this film provides the perfect antidote to Wall Street and other Hollywood diatribes depicting the world of finance as filled with nothing but greed." b. Ironies of Failure Due to Success <Can Success Lead To Failure?> Robert Lambert asked an interesting question in his contribution to the Invasive and Introduced Plants and Animals book I’ve been reading: “Will the returned native ‘aliens’ become so abundant, so commonplace, so much a part of our cherished urban and rural landscapes, that we will no longer care enough to glance upwards, or queue at a telescope at a long-established public viewing point?”. He was specifically talking about the success of reintroduced birds of prey in Britain and the potential loss of tourist dollars, but it got me thinking about the beaver in Sweden. After the first reintroduction in Bjurälvdalen, Jämtland, in 1922, reintroductions came fast and furious: 13 more places by 1935 had bought beavers from Norway and let them loose in Sweden. Although WWII seems to have bought the activities to a standstill, they started up again in the 1950 and 1960s — I’ve seen long lists of reintroductions in Västerbotten and Norrbotten from those decades. All of this was immensely successful: a nationwide survey in 1977 estimated 40,000 beavers in Sweden. A ban on beaver hunting had been instituted in 1873 (ironically, 2 years after the last known beaver in Sweden was killed), so the reintroduced beavers could not be hunted. But the reintroduction had been so successful that in 1976, the law was changed to allow beaver hunting over the winter (October – 15 May in northern areas in Jakttidsförordning (1976:432)). A survey done at the end of the 1980s/early 1990s estimated a Swedish beaver population of 100,000 (!), so it was still going up. Beavers have become visible members of the landscape. There are beaver safaris in Sweden, like one on the Vindel River near Umeå where I live, which shows that the beaver has public appeal, at least for tourists. Hunters also take an interest in beavers; according to the Jägareförbundet statistics, 888 beavers were killed in the county of Västerbotten alone last season. Other than the limited season for hunting, there are no bag limits on beavers (you can kill as many as you want).


But although some people take an interest in them, I wonder if the beaver’s star status has decreased as it became common after the last reintroductions of the 1960s. Will people notice if a common rural animal starts decreasing in number unless the decrease is drastic? Yesterday I read a Swedish article by Dan Frendin that compared two surveys of the beaver population in an area of Värmland from 1976-77 and 2006-7. This area had 4 reintroductions in the 1920s and one in the 1960s. Frendin found a dramatic decrease in beavers – there were 61 beaver homes in 1976-77 and only 16 in 2006-7 – which he attributed to a change in vegetation regime. But as far as I can tell, the only reason we know about this is because Frendin personally wanted to follow up on his survey from 30 years before. He hadn’t expected the decrease; apparently no one had noticed it. I don’t want to imply that this decrease shows a larger problem with the beaver population in Sweden, but Frendin’s findings in combination with Lambert’s comment made me ponder how becoming common might make the beaver more invisible. While becoming common once again was the goal of the beaver reintroduction, could being too successful lead to failure in the long run as the beaver moves from rare conservation object to common hunting object? Could the beaver be hunted to extinction again because everyone thinks there must be more of them somewhere else, as they did in the mid-1800s? Nothing that dramatic is likely since we have better ecosystem monitoring now than we did then, but it’s worth thinking about the potential cost of success. <Can Too Much Success Lead To Failure?> A strange phenomenon has arisen as a result of the recession. The most successful companies – those which are used to having the most money and more opportunities - may very well be the ones which need to make the most radical changes in their thinking in order to weather this current storm. As a colleague in one such successful company told me, "Whenever we get to a decision point where we have to choose between investing in one project or another in the past we have tended to find a way to choose both by expanding the budget a bit. We have also had the strategy to compete in every market or segment, at every price point, for every sales channel. This means that the typical leadership decision making model has been 'find a way to do it all'. We try to do everything and some of it works." The current financial situation suggests that a change is needed in the competencies to run a successful business, particularly in terms of decision- making. 296

Do these successful companies lack people who have the courage to say "NO" and can see the need for pro-actively making a painful decision? Or more importantly, who can look at a situation and think differently about how a decision should be made? For example, decisions to kill an activity, pull out from a market upfront in order to secure the remaining activities, or to look at a completely different way of attracting business? Take the US auto makers who for many years ignored the growing worldwide trend toward smaller, more economic and environmentally friendly vehicles. Using out-dated decision making, they were still able to make large profits. Now, despite their current financial difficulties, their decision making still appears to be based on false premises. When sales are down, traditional decision making would suggest "reduce prices". But when customers do not have the money or are unwilling to buy, no price reduction will encourage sales (one dealer even offered a "two for the price of one" deal, which may have brought short term results but perhaps at the expense of long term survival). Enlightened decision makers on the other hand, instead of looking from their own perspective (of trying to increase sales) might say, "Why are people not buying cars at the moment?". True, some cannot afford to. However, there are many people who have the resources but are unwilling to purchase at the moment. "Why are these people unwilling?" One car maker took a totally different decision making approach with stunning results. In answer to the question "Why are people unwilling to buy?", they discerned that "people are in fear of losing their jobs, hence they are unprepared to make a commitment to buy a new vehicle irrespective of a price reduction". So, instead of massive price discounting, they offered a "returns policy". The policy covers every buyer of a leased or financed vehicle who involuntarily loses a job, becomes physically disabled, loses a driver's licence for medical reasons, is transferred to another country, is self-employed and files for bankruptcy or dies in an accident. They guarantee to let buyers return their vehicles at no cost and with no loss of their credit rating should they lose their job or income within a year. As a result of this type of decision making, Hyundai increased sales in the US by 14% in January (year on year) and the sales of their 297

Sonata model increased by a staggering 85%! Taking a different decision making approach, Hyundai answered the needs of the buyers' concerns for job security and increased sales against all the trends. At the heart of the Hyundai decision making approach, is the oftquoted, but not so often used, principle of "what's in it for them?". In other words, before looking at one's own needs, identify the needs, interests or concerns of the other party first. And then, "how will satisfying the needs of this stakeholder meet our own needs?" As my colleague cautioned "Now we have tougher times and different decisions are needed. It's my feeling that we have to consciously pull out of some markets and focus on the key areas in order to maximise return on more limited investment ... but I see huge challenges for people to make the shift in decision making mindset that would make that possible." And therein lies the rub â&#x20AC;&#x201C; the ability of people to shift their decision making mindset. Perhaps help is at hand. In a new book, Think Again: Why good Leaders Make Bad Decisions and How to Keep it From Happening to You (McGraw-Hill 2009), authors Finkelstein, Whitehead, and Campbell, suggest that for many of us the fault lies not so much in our own errors of judgment, but rather in the brain's processes that help create these errors of judgment. They quote many famous cases (including the US auto makers) of managers and leaders who have made poor decisions. They attribute these to the brain's agility in linking the current situation to previous misleading experiences; its ability to relate current situations to our pre-judgments of similar situations; its inability to separate the situation from personal self-interests; and a tendency to draw an inappropriate emotional link between current stakeholders and those for whom we have strong personal feelings. The authors suggest some rules to help overcome possible decision-making errors. These are not the typical governance rules. Rather, they are tailored defences against the particular red flags in a given situation. The authors advise leaders to design, for each important decision, a decision process based on an understanding of the red flags that are present at that moment. So, perhaps the answer for improving the decision making mindset 298

of leaders and managers is twofold: first, they need to identify the needs, concerns and interests of the other stakeholders; and second, make sure each decision making situation is assessed in terms of the possibility of one or more of the four "red flags". Would such a mindset overcome my colleague's concerns, when as he says "Every day I deal with people who have a long list of things that 'we cant even discuss' (when considering cost savings) for various strategic reasons and they believe this almost religiously... "I see a huge danger in this kind of thinking as it prevents some necessary discussions and some difficult decisions from being made when in my opinion this is the time to throw away all these ideas that were formed in a different financial climate and take a totally fresh look at how we want to compete or even survive in the current situation." 2. Creative Ideas in Implementation a. When crisis turns to opportunity <Encouragement Poem> Success is failure turned inside out Author Unknow When things go wrong as they sometimes will, When the road you’re trudging seems all up hill, When the funds are low and the debts are high And you want to smile, but you have to sigh, When care is pressing you down a bit, Rest if you must, but don’t you quit. Life is queer with its twists and turns, As every one of us sometimes learns, And many a failure turns about When he might have won had he stuck it out; Don’t give up though the pace seems slow– You may succeed with another blow, Success is failure turned inside out– The silver tint of the clouds of doubt, And you never can tell how close you are, It may be near when it seems so far; So stick to the fight when you’re hardest hit– It’s when things seem worst that you must not quit.


<What if the secret of Success Is Failure?> Dominic Randolph can seem a little out of place at Riverdale Country School — which is odd, because he’s the headmaster. Riverdale is one of New York City’s most prestigious private schools, with a 104-year-old campus that looks down grandly on Van Cortlandt Park from the top of a steep hill in the richest part of the Bronx. On the discussion boards of, workedup moms from the Upper East Side argue over whether Riverdale sends enough seniors to Harvard, Yale and Princeton to be considered truly “TT” (top-tier, in UrbanBabyese), or whether it is more accurately labeled “2T” (second-tier), but it is, certainly, part of the city’s private-school elite, a place members of the establishment send their kids to learn to be members of the establishment. Tuition starts at $38,500 a year, and that’s for prekindergarten. Randolph, by contrast, comes across as an iconoclast, a disrupter, even a bit of an eccentric. He dresses for work every day in a black suit with a narrow tie, and the outfit, plus his cool demeanor and sweep of graying hair, makes you wonder, when you first meet him, if he might have played sax in a ska band in the ’80s. (The English accent helps.) He is a big thinker, always chasing new ideas, and a conversation with him can feel like a one-man TED conference, dotted with references to the latest work by behavioral psychologists and management gurus and design theorists. When he became headmaster in 2007, he swapped offices with his secretary, giving her the reclusive inner sanctum where previous headmasters sat and remodeling the small outer reception area into his own open-concept work space, its walls covered with whiteboard paint on which he sketches ideas and slogans. One day when I visited, one wall was bare except for a white sheet of paper. On it was printed a single black question mark. For the headmaster of an intensely competitive school, Randolph, who is 49, is surprisingly skeptical about many of the basic elements of a contemporary high-stakes American education. He did away with Advanced Placement classes in the high school soon after he arrived at Riverdale; he encourages his teachers to limit the homework they assign; and he says that the standardized tests that Riverdale and other private schools require for admission to kindergarten and to middle school are “a patently unfair system” because they evaluate students almost entirely by I.Q. “This push on tests,” he told me, “is missing out on some serious parts of what it means to be a successful human.” The most critical missing piece, Randolph explained as we sat in his office last fall, is character — those essential traits of mind and 300

habit that were drilled into him at boarding school in England and that also have deep roots in American history. “Whether it’s the pioneer in the Conestoga wagon or someone coming here in the 1920s from southern Italy, there was this idea in America that if you worked hard and you showed real grit, that you could be successful,” he said. “Strangely, we’ve now forgotten that. People who have an easy time of things, who get 800s on their SAT’s, I worry that those people get feedback that everything they’re doing is great. And I think as a result, we are actually setting them up for long-term failure. When that person suddenly has to face up to a difficult moment, then I think they’re screwed, to be honest. I don’t think they’ve grown the capacities to be able to handle that.” Randolph has been pondering throughout his 23-year career as an educator the question of whether and how schools should impart good character. It has often felt like a lonely quest, but it has led him in some interesting directions. In the winter of 2005, Randolph read “Learned Optimism,” a book by Martin Seligman, a psychology professor at the University of Pennsylvania who helped establish the Positive Psychology movement. Randolph found the book intriguing, and he arranged a meeting with the author. As it happened, on the morning that Randolph made the trip to Philadelphia, Seligman had scheduled a separate meeting with David Levin, the co-founder of the KIPP network of charter schools and the superintendent of the KIPP schools in New York City. Seligman decided he might as well combine the two meetings, and he invited Christopher Peterson, a psychology professor at the University of Michigan, who was also visiting Penn that day, to join him and Randolph and Levin in his office for a freewheeling discussion of psychology and schooling. Levin had also spent many years trying to figure out how to provide lessons in character to his students, who were almost all black or Latino and from low-income families. At the first KIPP school, in Houston, he and his co-founder, Michael Feinberg, filled the walls with slogans like “Work Hard” and “Be Nice” and “There Are No Shortcuts,” and they developed a system of rewards and demerits designed to train their students not only in fractions and algebra but also in perseverance and empathy. Like Randolph, Levin went to Seligman’s office expecting to talk about optimism. But Seligman surprised them both by pulling out a new and very different book, which he and Peterson had just finished: “Character Strengths and Virtues: A Handbook and Classification,” a scholarly, 800-page tome that weighed in at three and a half pounds. It was intended, according to the authors, as a “manual of the sanities,” an attempt to inaugurate what they described as a “science of good character.”


It was, in other words, exactly what Randolph and Levin had been looking for, separately, even if neither of them had quite known it. Seligman and Peterson consulted works from Aristotle to Confucius, from the Upanishads to the Torah, from the Boy Scout Handbook to profiles of Pokémon characters, and they settled on 24 character strengths common to all cultures and eras. The list included some we think of as traditional noble traits, like bravery, citizenship, fairness, wisdom and integrity; others that veer into the emotional realm, like love, humor, zest and appreciation of beauty; and still others that are more concerned with day-to-day human interactions: social intelligence (the ability to recognize interpersonal dynamics and adapt quickly to different social situations), kindness, self-regulation, gratitude. In most societies, Seligman and Peterson wrote, these strengths were considered to have a moral valence, and in many cases they overlapped with religious laws and strictures. But their true importance did not come from their relationship to any system of ethics or moral laws but from their practical benefit: cultivating these strengths represented a reliable path to “the good life,” a life that was not just happy but also meaningful and fulfilling. Six years after that first meeting, Levin and Randolph are trying to put this conception of character into action in their schools. In the process, they have found themselves wrestling with questions that have long confounded not just educators but anyone trying to nurture a thriving child or simply live a good life. What is good character? Is it really something that can be taught in a formal way, in the classroom, or is it the responsibility of the family, something that is inculcated gradually over years of experience? Which qualities matter most for a child trying to negotiate his way to a successful and autonomous adulthood? And are the answers to those questions the same in Harlem and in Riverdale? Levin had believed in the importance of character since KIPP’s inception. But on the day of his trip to see Seligman, he was feeling a new urgency about the subject. Six years earlier, in 1999, the first group of students to enter KIPP Academy middle school, which Levin founded and ran in the South Bronx, triumphed on the eighth-grade citywide achievement test, graduating with the highest scores in the Bronx and the fifth-highest in all of New York City. Every morning of middle school they passed a giant sign in the stairwell reminding them of their mission: “Climb the Mountain to College.” And as they left KIPP for high school, they seemed poised to do just that: not only did they have outstanding academic results, but most of them also won admission to highly selective private and Catholic schools, often with full scholarships. But as Levin told me when we spoke last fall, for many students in 302

that first cohort, things didn’t go as planned. “We thought, O.K., our first class was the fifth-highest-performing class in all of New York City,” Levin said. “We got 90 percent into private and parochial schools. It’s all going to be solved. But it wasn’t.” Almost every member of the cohort did make it through high school, and more than 80 percent of them enrolled in college. But then the mountain grew steeper, and every few weeks, it seemed, Levin got word of another student who decided to drop out. According to a report that KIPP issued last spring, only 33 percent of students who graduated from a KIPP middle school 10 or more years ago have graduated from a four-year college. That rate is considerably better than the 8 percent of children from lowincome families who currently complete college nationwide, and it even beats the average national rate of college completion for all income groups, which is 31 percent. But it still falls well short of KIPP’s stated goal: that 75 percent of KIPP alumni will graduate from a four-year college, and 100 percent will be prepared for a stable career. As Levin watched the progress of those KIPP alumni, he noticed something curious: the students who persisted in college were not necessarily the ones who had excelled academically at KIPP; they were the ones with exceptional character strengths, like optimism and persistence and social intelligence. They were the ones who were able to recover from a bad grade and resolve to do better next time; to bounce back from a fight with their parents; to resist the urge to go out to the movies and stay home and study instead; to persuade professors to give them extra help after class. Those skills weren’t enough on their own to earn students a B.A., Levin knew. But for young people without the benefit of a lot of family resources, without the kind of safety net that their wealthier peers enjoyed, they seemed an indispensable part of making it to graduation day. What appealed to Levin about the list of character strengths that Seligman and Peterson compiled was that it was presented not as a finger-wagging guilt trip about good values and appropriate behavior but as a recipe for a successful and happy life. He was wary of the idea that KIPP’s aim was to instill in its students “middle-class values,” as though well-off kids had some depth of character that low-income students lacked. “The thing that I think is great about the character-strength approach,” he told me, “is it is fundamentally devoid of value judgment.” Still, neither Levin nor Dominic Randolph had a clear vision of how to turn an 800-page psychology text into a practical program. After that first meeting in Seligman’s office, Levin and Randolph kept in touch, calling and e-mailing, swapping articles and Web links, and they soon discovered that they shared a lot of ideas 303

and interests, despite the very different school environments in which they worked. They decided to join forces, to try to tackle the mysteries of character together, and they turned for help to Angela Duckworth, who at the time was a graduate student in Seligman’s department (she is now an assistant professor). Duckworth came to Penn in 2002 at the age of 32, after working for a decade as a teacher and a charter-school consultant. When she applied to the Ph.D. program at Penn, she wrote in her application essay that her experiences in schools had given her “a distinctly different view of school reform” than the one she started out with in her 20s. “The problem, I think, is not only the schools but also the students themselves,” she wrote. “Here’s why: learning is hard. True, learning is fun, exhilarating and gratifying — but it is also often daunting, exhausting and sometimes discouraging. . . . To help chronically low-performing but intelligent students, educators and parents must first recognize that character is at least as important as intellect.” Duckworth’s early research showed that measures of self-control can be a more reliable predictor of students’ grade-point averages than their I.Q.’s. But while self-control seemed to be a critical ingredient in attaining basic success, Duckworth came to feel it wasn’t as relevant when it came to outstanding achievement. People who accomplished great things, she noticed, often combined a passion for a single mission with an unswerving dedication to achieve that mission, whatever the obstacles and however long it might take. She decided she needed to name this quality, and she chose the word “grit.” She developed a test to measure grit, which she called the Grit Scale. It is a deceptively simple test, in that it requires you to rate yourself on just 12 questions, from “I finish whatever I begin” to “I often set a goal but later choose to pursue a different one.” It takes about three minutes to complete, and it relies entirely on self-report — and yet when Duckworth took it out into the field, she found it was remarkably predictive of success. At Penn, high grit ratings allowed students with relatively low college-board scores to nonetheless achieve high G.P.A.’s. Duckworth and her collaborators gave their grit test to more than 1,200 freshman cadets as they entered West Point and embarked on the grueling summer training course known as Beast Barracks. The military has developed its own complex evaluation, called the Whole Candidate Score, to judge incoming cadets and predict which of them will survive the demands of West Point; it includes academic grades, a gauge of physical fitness and a Leadership Potential Score. But at the end of Beast Barracks, the more accurate predictor of which cadets persisted and which ones dropped out turned out to be Duckworth’s 12-item grit questionnaire.


Levin and Randolph asked Duckworth to use the new methods and tools she was developing to help them investigate the question of character at KIPP and Riverdale, and she and a handful of Penn graduate students began making regular treks from Philadelphia to New York. The first question Duckworth addressed, again, was the relative importance of I.Q. and selfcontrol. She and her team of researchers gave middle-school students at Riverdale and KIPP a variety of psychological and I.Q. tests. They found that at both schools, I.Q. was the better predictor of scores on statewide achievement tests, but measures of self-control were more reliable indicators of report-card grades. Duckworth’s research convinced Levin and Randolph that they should try to foster self-control and grit in their students. Yet those didn’t seem like the only character strengths that mattered. The full list of 24, on the other hand, felt too unwieldy. So they asked Peterson if he could narrow the list down to a more manageable handful, and he identified a set of strengths that were, according to his research, especially likely to predict life satisfaction and high achievement. After a few small adjustments (Levin and Randolph opted to drop love in favor of curiosity), they settled on a final list: zest, grit, self-control, social intelligence, gratitude, optimism and curiosity. Over the course of the next year and a half, Duckworth worked with Levin and Randolph to turn the list of seven strengths into a two-page evaluation, a questionnaire that could be completed by teachers or parents, or by students themselves. For each strength, teachers suggested a variety of “indicators,” much like the questions Duckworth asked people to respond to on her grit questionnaire, and she road-tested several dozen of them at Riverdale and KIPP. She eventually settled on the 24 most statistically reliable ones, from “This student is eager to explore new things” (an indicator of curiosity) to “This student believes that effort will improve his or her future” (optimism). For Levin, the next step was clear. Wouldn’t it be cool, he mused, if each student graduated from school with not only a G.P.A. but also a C.P.A., for character-point average? If you were a collegeadmissions director or a corporate human-resources manager selecting entry-level employees, wouldn’t you like to know which ones scored highest in grit or optimism or zest? And if you were a parent of a KIPP student, wouldn’t you want to know how your son or daughter stacked up next to the rest of the class in character as well as in reading ability? As soon as he got the final list of indicators from Duckworth and Peterson, Levin started working to turn it into a specific, concise assessment that he could hand out to students and parents at KIPP’s New York City schools twice a year: the first-ever character report card. 305

Back at Riverdale, though, the idea of a character report card made Randolph nervous. “I have a philosophical issue with quantifying character,” he explained to me one afternoon. “With my school’s specific population, at least, as soon as you set up something like a report card, you’re going to have a bunch of people doing test prep for it. I don’t want to come up with a metric around character that could then be gamed. I would hate it if that’s where we ended up.” Still, he did think that the inventory Duckworth and Peterson developed could be a useful tool in communicating with students about character. And so he has been taking what one Riverdale teacher described as a “viral approach” to spreading the idea of this new method of assessing character throughout the Riverdale community. He talks about character at parent nights, asks pointed questions in staff meetings, connects like-minded members of his faculty and instructs them to come up with new programs. Last winter, Riverdale students in the fifth and sixth grades took the 24-indicator survey, and their teachers rated them as well. The results were discussed by teachers and administrators, but they weren’t shared with students or parents, and they certainly weren’t labeled a “report card.” As I spent time at Riverdale last year, it became apparent to me that the debate over character at the school wasn’t just about how best to evaluate and improve students’ character. It went deeper, to the question of what “character” really meant. When Randolph arrived at Riverdale, the school already had in place a character-education program, of a sort. Called CARE, for Children Aware of Riverdale Ethics, the program was adopted in 1989 in the lower school, which at Riverdale means prekindergarten through fifth grade. It is a blueprint for niceness, mandating that students “Treat everyone with respect” and “Be aware of other people’s feelings and find ways to help those whose feelings have been hurt.” Posters in the hallway remind students of the virtues related to CARE (“Practice Good Manners . . . Avoid Gossiping . . . Help Others”). In the lower school, many teachers describe it as a proud and essential part of what makes Riverdale the school that it is. When I asked Randolph last winter about CARE, he was diplomatic. “I see the character strengths as CARE 2.0,” he explained. “I’d basically like to take all of this new character language and say that we’re in the next generation of CARE.” In fact, though, the character-strength approach of Seligman and Peterson isn’t an expansion of programs like CARE; if anything, it is a repudiation of them. In 2008, a national organization called the 306

Character Education Partnership published a paper that divided character education into two categories: programs that develop “moral character,” which embodies ethical values like fairness, generosity and integrity; and those that address “performance character,” which includes values like effort, diligence and perseverance. The CARE program falls firmly on the “moral character” side of the divide, while the seven strengths that Randolph and Levin have chosen for their schools lean much more heavily toward performance character: while they do have a moral component, strengths like zest, optimism, social intelligence and curiosity aren’t particularly heroic; they make you think of Steve Jobs or Bill Clinton more than the Rev. Martin Luther King Jr. or Gandhi. The two teachers Randolph has chosen to oversee the school’s character initiative are K.C. Cohen, the guidance counselor for the middle and upper schools, and Karen Fierst, a learning specialist in the lower school. Cohen is friendly and thoughtful, in her mid-30s, a graduate of Fieldston, the private school just down the road from Riverdale. She is intensely interested in character development, and like Randolph, she is worried about the character of Riverdale students. But she is not yet entirely convinced by the seven character strengths that Riverdale has ostensibly chosen. “When I think of good character, I think: Are you fair? Are you honest in dealings with other people? Are you a cheater?” she told me. “I don’t think so much about: Are you tenacious? Are you a hard worker? I think, Are you a good person?” Cohen’s vision of character is much closer to “moral character” than “performance character,” and so far, that vision remains the dominant one at Riverdale. When I spent a day at the school in March, sitting in on a variety of classes and meetings, messages about behavior and values permeated the day, but those messages stayed almost entirely in the moral dimension. It was a hectic day at the middle school — it was pajama day, plus there was a morning assembly, and then on top of that, the kids in French class who were going on the two-week trip to Bordeaux for spring break had to leave early in order to make their overnight flight to Paris. The topic for the assembly was heroes, and a halfdozen students stood up in front of their classmates — about 350 kids, in all — and each made a brief presentation about a particular hero he or she had chosen: Ruby Nell Bridges, the African-American girl who was part of the first group to integrate the schools in New Orleans in 1960; Mohamed Bouazizi, the Tunisian fruit vendor whose self-immolation helped spark the recent revolt in that country; the actor and activist Paul Robeson. In the assembly, in classes and in conversations with different 307

students, I heard a lot of talk about values and ethics, and the values that were emphasized tended to be social values: inclusion, tolerance, diversity. (I heard a lot more about black history at Riverdale than I did at the KIPP schools I visited.) One eighth-grade girl I asked about character said that for her and her friends, the biggest issue was inclusion — who was invited to whose bat mitzvah; who was being shunned on Facebook. Character, as far as I could tell, was being defined at Riverdale mostly in terms of helping other people — or at least not hurting their feelings. Randolph told me that he had concerns about a character program that comprised only those kind of nice-guy values. “The danger with character is if you just revert to these general terms — respect, honesty, tolerance — it seems really vague,” he said. “If I stand in front of the kids and just say, ‘It’s really important for you to respect each other,’ I think they glaze over. But if you say, ‘Well, actually you need to exhibit self-control,’ or you explain the value of social intelligence — this will help you collaborate more effectively — then it seems a bit more tangible.” When I spoke to Karen Fierst, the teacher who was overseeing the character project for the Riverdale lower school, she said she was worried that it would be a challenge to convince the students and their parents that there was anything in the 24 character strengths that might actually benefit them. For KIPP kids, she said, the notion that character could help them get through college was a powerful lure, one that would motivate them to take the strengths seriously. For kids at Riverdale, though, there was little doubt that they would graduate from college. “It will just happen,” Fierst explained. “It happened to every generation in their family before them. And so it’s harder to get them to invest in this idea. For KIPP students, learning these strengths is partly about trying to demystify what makes other people successful — kind of like, ‘We’re letting you in on the secret of what successful people are like.’ But kids here already live in a successful community. They’re not depending on their teachers to give them the information on how to be successful.” At KIPP Infinity middle school, which occupies one floor of a school on West 133rd Street, across from the M.T.A.’s giant Manhattanville bus depot, report-card night last winter fell on a cold Thursday at the beginning of February. Report-card night is always a big deal at KIPP schools — parents are strongly urged to attend, and at Infinity, almost all of them do — but this particular evening carried an extra level of anxiety for both the administrators and the parents, because students were receiving their very first character report cards, and no one knew quite what to expect.


Logistically, the character report card had been a challenge to pull off. Teachers at all four KIPP middle schools in New York City had to grade every one of their students, on a scale of 1 to 5, on every one of the 24 character indicators, and more than a few of them found the process a little daunting. And now that reportcard night had arrived, they had an even bigger challenge: explaining to parents just how those precise figures, rounded to the second decimal place, summed up their children’s character. I sat for a while with Mike Witter, a 31-year-old eighth-grade English teacher, as he talked through the character report card with Faith Flemister and her son Juaquin Bennett, a tall, hefty eighth grader in a gray hooded sweatshirt. “For the past few years we’ve been working on a project to create a clearer picture for parents about the character of your child,” Witter explained to Flemister. “The categories that we ended up putting together represent qualities that have been studied and determined to be indicators of success. They mean you’re more likely to go to college. More likely to find a good job. Even surprising things, like they mean you’re more likely to get married, or more likely to have a family. So we think these are really important.” Flemister nodded, and Witter began to work his way down the scores on Juaquin’s character report card, starting with the good news: every teacher had scored him as a perfect 5 on “Is polite to adults and peers,” and he did almost as well on “Keeps temper in check.” They were both indicators for interpersonal self-control. “I can tell this is a real strength for you,” Witter said, turning to Juaquin. “This kind of self-control is something you’ve developed incredibly well. So that makes me think we need to start looking at: What’s something we can target? And the first thing that jumps out at me is this.” Witter pulled out a green felt-tip marker and circled one indicator on Juaquin’s report card. “ ‘Pays attention and resists distraction,’ ” Witter read aloud, an indicator for academic self-control. “That’s a little lower than some of the other numbers. Why do you think that is?” “I talk too much in class,” Juaquin said, a little sheepishly, looking down at his black sneakers. “I sometimes stare off into space and don’t pay attention.” The three of them talked over a few strategies to help Juaquin focus more in class, and by the end of the 15-minute conversation, Flemister seemed convinced by the new approach. “The strong points are not a surprise,” she said to Witter as he got up to talk to another family. “That’s just the type of person Juaquin is. But it’s good how you pinpoint what he can do to make things 309

easier on himself. Then maybe his grades will pick up.” A month later, I returned to KIPP to visit Witter’s classroom. By that point in the school year, character language had permeated Infinity. Kids wore T-shirts with the slogan “Infinite Character” and Seligman’s 24 character strengths listed on the back. The walls were covered with signs that read “Got self-control?” and “I actively participate!” (one indicator for zest). There was a bulletin board in the hallway topped with the words “Character Counts,” where students filled out and posted “Spotted!” cards when they saw a fellow student performing actions that demonstrate character. (Jasmine R. cited William N. for zest: “William was in math class and he raised his hand for every problem.”) I came to Witter’s class to observe something that Levin was calling “dual-purpose instruction,” the practice of deliberately working explicit talk about character strengths into every lesson. Levin wanted math teachers to use the strengths in word problems; he explained that history teachers could use them to orient a class discussion about Harriet Tubman and the Underground Railroad. And when I arrived in Witter’s class at 7:45 on a Thursday morning in March, he was leading a discussion about Chinua Achebe’s novel “Things Fall Apart.” Above Witter’s head, at the front of the class, the seven character strengths were stenciled in four-inch-high letters, white on blue, from optimism to social intelligence. He asked his students to rank Okonkwo, the protagonist, on his various character strengths. There was a lot of back and forth, but in the end, most students agreed that Okonkwo rated highest on grit and lowest on self-control. Then a student named Yantzee raised his hand. “Can’t a trait backfire at you?” he asked. “Sure, a trait can backfire,” Witter said. “Too much grit, like Okonkwo, you start to lose your ability to have empathy for other people. If you’re so gritty that you don’t understand why everyone’s complaining about how hard things are, because nothing’s hard for you, because you’re Mr. Grit, then you’re going to have a hard time being kind. Even love — being too loving might make you the kind of person who can get played.” There was a ripple of knowing laughter from the students. “So, yes, character is something you have to be careful about. Character strengths can become character weaknesses.” Though the seven character strengths aren’t included in every lesson at KIPP, they do make it into most conversations about discipline. One day last winter, I was speaking with Sayuri Stabrowski, a 30-year-old seventh-and-eighth-grade reading teacher at KIPP Infinity, and she mentioned that she caught a girl chewing gum in her class earlier that day. “She denied it,” 310

Stabrowski told me. “She said, ‘No, I’m not, I’m chewing my tongue.’ ” Stabrowski rolled her eyes as she told me the story. “I said, ‘O.K. fine.’ Then later in the class, I saw her chewing again, and I said: ‘You’re chewing gum! I see you.’ She said, ‘No, I’m not, see?’ and she moved the gum over in her mouth in this really obvious way, and we all saw what she was doing. Now, a couple of years ago, I probably would have blown my top and screamed. But this time, I was able to say: ‘Gosh, not only were you chewing gum, which is kind of minor, but you lied to me twice. That’s a real disappointment. What does that say about your character?’ And she was just devastated.” Stabrowski was worried that the girl, who often struggled with her behavior, might have a mini-meltdown — a “baby attack,” in KIPP jargon — in the middle of the class, but in fact, the girl spit out her gum and sat through the rest of the class and then afterward came up to her teacher with tears in her eyes. “We had a long conversation,” Stabrowski told me. “She said: ‘I’m trying so hard to just grow up. But nothing ever changes!’ And I said: ‘Do you know what does change? You didn’t have a baby attack in front of the other kids, and two weeks ago, you would have.’ ” To Tom Brunzell, who as the dean of students at KIPP Infinity oversaw the implementation of the character report card, what is going on in character conversations like that one isn’t academic instruction at all, or even discipline; it’s therapy. Specifically, it’s a kind of cognitive behavioral therapy, the very practical, nuts-andbolts psychological technique that provides the theoretical underpinning for the whole positive psychology field. Cognitive behavioral therapy, or C.B.T., involves using the conscious mind to understand and overcome unconscious fears and self-destructive habits, using techniques like “self-talk” — putting an immediate crisis in perspective by reminding yourself of the larger context. “The kids who succeed at KIPP are the ones who can C.B.T. themselves in the moment,” Brunzell told me. Part of the point of the character initiative, as he saw it, was to give their students the tools to do that. “All kids this age are having mini-implosions every day,” he said. “I mean, it’s middle school, the worst years of their lives. But the kids who make it are the ones who can tell themselves: ‘I can rise above this little situation. I’m O.K. Tomorrow is a new day.’ ” For Randolph, the experience that Brunzell was describing — the struggle to pull yourself through a crisis, to come to terms on a deep level with your own shortcomings and to labor to overcome them — is exactly what is missing for so many students at academically excellent schools like Riverdale. And perhaps surprisingly, it may turn out to be an area where the students at KIPP have a real advantage over Riverdale kids. On the 311

professional development day in February when I visited Riverdale, Randolph had arranged a screening for his entire faculty of “Race to Nowhere,” a movie about the stresses facing mostly privileged American high-school students that has become an underground hit in many wealthy suburbs, where one-time showings at schools, churches and community centers bring out hundreds of concerned parents. The movie paints a grim portrait of contemporary adolescence, rising in an emotional crescendo to the story of an overachieving teenage girl who committed suicide, apparently because of the ever-increasing pressure to succeed that she felt both at school and at home. At Riverdale, the film seemed to have a powerful effect on many of the staff; one teacher who came up to Randolph afterward had tears in her eyes. “Race to Nowhere” has helped to coalesce a growing movement of psychologists and educators who argue that the systems and methods now in place to raise and educate well-off kids in the United States are in fact devastating them. One central figure in the movie is Madeline Levine, a psychologist in Marin County who is the author of a best-selling book, “The Price of Privilege: How Parental Pressure and Material Advantage Are Creating a Generation of Disconnected and Unhappy Kids.” In her book, Levine cites studies and surveys to back up her contention that children of affluent parents now exhibit “unexpectedly high rates of emotional problems beginning in junior high school.” This is no accident of demographics, Levine says, but instead is a direct result of the child-raising practices that prevail in well-off American homes; wealthy parents today, she argues, are more likely to be emotionally distant from their children, and at the same time to insist on high levels of achievement, a potentially toxic blend of influences that can create “intense feelings of shame and hopelessness” in affluent children. Cohen and Fierst told me that they also see many Riverdale parents who, while pushing their children to excel, also inadvertently shield them from exactly the kind of experience that can lead to character growth. As Fierst put it: “Our kids don’t put up with a lot of suffering. They don’t have a threshold for it. They’re protected against it quite a bit. And when they do get uncomfortable, we hear from their parents. We try to talk to parents about having to sort of make it O.K. for there to be challenge, because that’s where learning happens.” Cohen said that in the middle school, “if a kid is a C student, and their parents think that they’re all-A’s, we do get a lot of pushback: ‘What are you talking about? This is a great paper!’ We have parents calling in and saying, for their kids, ‘Can’t you just give them two more days on this paper?’ Overindulging kids, with 312

the intention of giving them everything and being loving, but at the expense of their character — that’s huge in our population. I think that’s one of the biggest problems we have at Riverdale.” This is a problem, of course, for all parents, not just affluent ones. It is a central paradox of contemporary parenting, in fact: we have an acute, almost biological impulse to provide for our children, to give them everything they want and need, to protect them from dangers and discomforts both large and small. And yet we all know — on some level, at least — that what kids need more than anything is a little hardship: some challenge, some deprivation that they can overcome, even if just to prove to themselves that they can. As a parent, you struggle with these thorny questions every day, and if you make the right call even half the time, you’re lucky. But it’s one thing to acknowledge this dilemma in the privacy of your own home; it’s quite another to have it addressed in public, at a school where you send your kids at great expense. And it’s that problem that Randolph is up against as he tries to push forward this new kind of conversation about character at Riverdale. When you work at a public school, whether it’s a charter or a traditional public school, you’re paid by the state, responsible, on some level, to your fellow citizens for the job you do preparing your students to join the adult world. When you work at a private school like Riverdale, though, even one with a long waiting list, you are always conscious that you’re working for the parents who pay the tuition fees. Which makes a campaign like the one that Randolph is trying to embark on all the more complicated. If your premise is that your students are lacking in deep traits like grit and gratitude and self-control, you’re implicitly criticizing the parenting they’ve received — which means you’re implicitly criticizing your employers. When I asked Randolph to explain just what he thought Riverdale students were missing out on, he told me the story of his own scholastic career. He did well in boarding school and was admitted to Harvard, but when he got to college, he felt lost, out of step with the power-tie careerism of the Reagan ’80s. After two years at Harvard, Randolph left for a year to work in a low-paying manual job, as a carpenter’s helper, trying to find himself. After college, he moved for a couple of years to Italy, where he worked odd jobs and studied opera. It was an uncertain and unsettled time in his life, filled with plenty of failed experiments and setbacks and struggles. Looking back on his life, though, Randolph says that the character strengths that enabled him to achieve the success that he has were not built in his years at Harvard or at the boarding schools he attended; they came out of those years of trial and error, of taking chances and living without a safety net. And it is precisely those kinds of experiences that he worries that 313

his students aren’t having. “The idea of building grit and building self-control is that you get that through failure,” Randolph explained. “And in most highly academic environments in the United States, no one fails anything.” Most Riverdale students can see before them a clear path to a certain type of success. They’ll go to college, they’ll graduate, they’ll get well-paying jobs — and if they fall along the way, their families will almost certainly catch them, often well into their 20s or even 30s, if necessary. But despite their many advantages, Randolph isn’t yet convinced that the education they currently receive at Riverdale, or the support they receive at home, will provide them with the skills to negotiate the path toward the deeper success that Seligman and Peterson hold up as the ultimate product of good character: a happy, meaningful, productive life. Randolph wants his students to succeed, of course — it’s just that he believes that in order to do so, they first need to learn how to fail. 3. Practical Project a. How to turn crisis into opportunity <Turning Crisis into Opportunity> Crises come into our lives, no matter how we may try to avoid them. They are troubling, unwanted experiences or events that take us out way out of our comfort zone. Typically, crises result in some type of loss. The very nature of crisis is antithetical to our core values of certainty and predictability as they vanish in an instant. We desperately try to restore order to our lives, as chaos seems to prevail. Yet, if we learn to reframe how we see crisis, we might actually take advantage of it. There is the potential for alchemy as the crisis unfolds into a gain, provided we learn to stop resisting the unwanted change. The crisis may be of a financial, relationship, health or spiritual nature. Those crises that are internally driven tend to be relational, psychological or emotional. Ordinarily, we try to avoid these upsets as best we can. Yet, upheavals are at times leveled upon us and may not be of our making. We may feel like victims of the circumstances, as we struggle to hold on to life as we knew it. Typically, personal change requires our motivation and intention to serve as the catalyst to power the transition. Crisis, on the other 314

hand, removes the self-motivating requirement as it places us squarely outside of our familiar zone. The crisis literally removes the boundaries that have circumscribed us. It is as if a tornado has swept in, and when we open our eyes, everything has changed. The maelstrom places us well beyond the bounds of the known. We typically find ourselves wanting desperately to get back inside the comfort of the known. But the crisis precludes that option. There is no going back. But that is where the opportunity lies. Breaking Free Growth and fundamental levels of change only tend to occur when we are out of our comfort zone. We can refer to this as being far from equilibrium, where certainty and predictability no longer reign supreme. So we might look at the crisis as a blessing in disguise, albeit an unwanted one. Steve Jobs might have felt self-defeated and victimized himself after he was fired from Apple many years ago. He chose otherwise. After his dismissal, he grasped crisis by the horns, seeing opportunity where others did not. He went on to lead a small animation company and turn it into the juggernaut that is now Pixar. When The Walt Disney Company bought Pixar in 2006, Jobs immediately became the largest shareholder in Disney. The moral of the story is unwanted change happens; look beyond it and embrace the discomfort. The crisis is but a snapshot of a moment in time, and one weâ&#x20AC;&#x2122;d prefer to avoid. But to achieve self-empowerment requires looking beyond that snapshot and envisioning what door of potential has just flung open. The individual whose spouse initiated divorce or left them for another person feels betrayed and perhaps heartsick. After a time though, they may in fact come to feel thankful to be freed from an unworthy and inauthentic relationship. This is particularly true if they evolve through the loss and benefit from a new and healthier relationship. I fervently believe that every crisis presents an opportunity. Crisis and opportunity are merely differing aspects of the process. Do we choose to focus on the crisis and freeze in fear, or do we inquire as what the opportunity may be? Letâ&#x20AC;&#x2122;s take a deeper look at the phenomena of crisis. Illuminating Crisis Crises tend to present themselves as either acute or chronic circumstances. For example, there is an economic upheaval that 315

is driving the United States and the world economy into highly volatile perturbations, with both wealth and employment literally disappearing. In the lives of most people, this is an external crisis raining upon them, typically not of their own making. Yet, through these losses, many people are coming to reflect on their values and choices and are making adjustments – due to the crisis – that actually benefit them. A high-powered Wall Street executive, with whom I was working, had hardly a spare moment for his family, as he was ever consumed with achieving more and more. The loss of his job at first paralyzed him with fear. After a time, however, he was able to reevaluate his priorities. He now works from home in a small business he founded, and his family and he have greatly benefited. An unexpected health issue or the death of a loved one may bring anxiety and/or loss. However painful and stressful these challenges and losses may be, the opportunity to be in the moment and value life from a differing perspective can prevail. Chronic crises are more personal as they manifest thematically throughout one’s life. One’s relationship struggles or battles with self-esteem or depression tend to recur throughout life. These patterns are perpetual mini-crises awaiting a more fundamental resolution. Learning to look at the larger themes and patterns that set up these challenges will help develop a vantage point from which you may break through the struggle. In other words, what are the recurring stories of your life? What is your participation in this storyline? Likewise, relationship difficulties tend to self-perpetuate until a turning point is reached. Often the relationship crisis launches the couple into new territory, whereby growth may finally be achieved. The pain endured through the crisis may actually enable this gain. For example, infidelity can be a horrific experience, but it may also open the door to a more authentic examination of the marriage and the possibility of a hopeful resolution. I have assisted a number of couples as they worked through this travail and transformed their relationships in a healthy way. Where Is the Opportunity? Let’s delve a bit deeper into the opportunity that prevails through these hardships. Crisis is defined in Webster’s Dictionary as: “A crucial or decisive point or situation; a turning point.” If we focus on the phrase “turning point,” we might ask ourselves, “Toward where are we turning?” It is in this non-reactive contemplation 316

that we may elect to seek opportunity. This potentiality becomes obscured when we are mired in the loss of the familiar as opposed to venturing into the new. This tipping point is precisely where transformation occurs. Do we gaze into the unfolding potential of change, or do we focus on the loss of the familiar? Your answer reveals your relationship between loss and opportunity. Ultimately the question is whether we choose to freeze in the panic of the unfamiliar or we seek to opportunize the new territory that’s unfolding for us. The former presents anxiety and retreat, the latter evokes growth. Release your hold on loss and embrace your relationship with opportunity. They are inversely correlated. The only constant in the universe is flow. What we call crisis is simply the occurrence of change. We are not the masters of change, and if we release our need to control it, we can ride the waves of change and often turn it into opportunity. As George Harrison sang, “Sunrise doesn’t last all morning.” Change happens. Prepare for it.


Exercise: 1. Research on creative product utilizing converged idea in Culture & Art Contents Industry a. 2 domestic, 2 Asian, 2 American, 2 European products/companies b. Analyze how converged idea was and how it was differentiated from other products


Website to Look @: Crisis Management Institute



Chapter XI. Convergence & Interdisciplinary Collaboration

<Fig. 11. 1. Wearable computer is a product of converged technologies. Interdisciplinary collaboration has made this dream of creating a small wearable computing system that can give us better future. In near future, bulky computers will be replaced by wearable devices.> <In this chapterâ&#x20AC;Ś> 1. Future Conversion & Interdisciplinary Collaboration a. Advanced Technology Created by Future Convergence b. Samsung Vs. LG c. E-Book Industry: E-Book Utilizing Haptic d. E-Publication: Smartphone Vs. E-Reader e. Futurist Ray Kurzweil f. Interactive Billboards: Displaying the Right Advertising For the Customer Passing by g. Technologies for Silver Industry 2. Creative Ideas in Implementation a. Brainstorming: Smart Restroom


The past (and future) of convergence Convergence is not a new idea. In the mid-90s the cable industry was buzzing about how multiple services could be delivered over a single coaxial cable running into your house. Imagine – one cable for video, voice and data (in 2013, it’s hard to express how lofty this idea once seemed). By early 2003, the cable industry had become leaders in providing internet services and had indeed accomplished convergence for residential voice, video and data in most of their footprint. But making convergence work in that era wasn’t trivial. Although the services were delivered through the same pipe, the radio frequency (RF) channel technologies that were delivering video were different from the proprietary RF modems that were delivering voice, which were yet again different from the IP-creating DOCSIS cable modems that were delivering data. In more technical terms: digital services using different data link layer (OSI layer 2) protocols were being transported over the same pipe alongside analog channels. You might even call the protocols used to deliver these services heterogeneous. That was our notion of convergence – one bill, three services. 99.5% of the population didn’t care that it was a heterogeneous implementation – they just knew it worked. Fast forward to 2013: The data era. IP is everywhere. IP delivers voice. IP delivers video in many forms (super short – like Vine, bearably short – like YouTube, feature film – like Netflix, or live-event – like ESPN). IP delivers “social” data in multiple forms. IP delivers video calls, highly sensitive personal data, location data, pictures, telemedicine, fitness data and so on. The plethora of devices using IP has created what network operators are calling an “unprecedented demand for data”. For mobile network operators, this demand is driving capital investment and putting a strategic focus on the customer experience for the foreseeable future. For cable operators, the rewards of a decade of network builds and digital services evolution are being leveraged with innovations in personalized apps and greater connectedness with their subscribers. And this demand is creating something that all network operators are clamoring to get right – subscribers want quality, personalized, trustable IP services delivered now to the device of their choice, wherever they are. Heterogeneous networks appear to be the solution (this seems familiar). Unlicensed Wi-Fi meets licensed small cell – it’s easy to agree with AT&T’s John Donovan that these technologies are made for each other. HotSpot 2.0 is one of the right ideas and promises to make Wi-Fi as easy and secure as cellular.


DOCSIS 3.1 increases the capacity of the cable infrastructure in ways that ensure it will be a worthy part of the backbone for years to come. And one thing is for sure, Wi-Fi will provide new opportunities and options for “co-opetition” among “frenemies” in the network service provider space. Looking back at the history, one important insight stands out: The slow-learned lesson of cable’s broadband rise was that customers consume experience – not technology. Today, convergence is about delivering 21st-century customer experiences by integrating real-time, policy-enabled IP services across the access networks that are relevant to the subscribers. Services that aren’t policy-enabled can’t be differentiated (and will someday be abandoned). Policy solutions that aren’t open and standards-based don’t work because they don’t play well with others – they can’t be used when negotiating and working with coopetition partners. This means that openness, standards, interoperability and vendor independence not only matter, they are critical to delivering today’s (and tomorrow’s) customer experiences. <Convergence Is The Future Of Marketing> “The Future is already here – It’s just not very evenly distributed.” - William Gibson Con·ver·gence 1. an act or instance of converging. 2. a convergent state or quality. 3. the degree or point at which lines, objects, etc., converge. Television, telephones, computers, and games have come a long way since the early days of the 21st century. As technology advanced, each type of media has evolved to become more portable and interactive. And we as consumers have loved every minute of it. Interestingly, these different types of media and platforms have also quickly merged together. For instance, mobile phones are not just communication handsets – they’re also computers, HD televisions, and gaming devices, all rolled into one. It’s a logical progression, feeding our insatiable appetite for technology and for progress. And as technology has advanced, so have the worlds of advertising, marketing, branding, PR, public affairs, content, publishing and business strategy. It’s all melting together. The lines have blurred. Brands and marketers are now looking for ideas that are deeply connected to culture, which can 323

align with societal changes and help shape them. As a result, companies are now starting to converge to offer a new model and to enjoy the same benefits. It’s a natural result of the media convergence we’ve seen happening for decades. Coupled with the global economic crisis, convergence is key for firms wishing to remain profitable and successful when everyone is spending less and cutting costs and looking for greater, lasting impact. Convergence is also about excellence and creating lasting quality while forging ahead with a better model. If you are a little philosophical, you would say we must evolve. It’s part reality, part dream…but in the end the result is something smarter and better. Fragmentation is the new norm. Systems of the past aren’t the systems of the future. While the new thing is social media, you can’t breakout and beat your competition simply by focusing on Facebook and Twitter. Social is certainly one important part. The edge, however, is the complete opposite of the traditional advertising industry. It may seem complicated—strange even, but it is really not. It is a new approach based on a new model for marketing in revolutionary times, something which I call “Movement Marketing“. So which firms are examples of this new convergence? Well, you could point to Nokia teaming up with Microsoft to form a strategic alliance for the smartphone world. That made complete sense when you consider how computer technology is now completely intertwined with mobile communications. Lumia has received great reviews, and I love the interface. Andrew Knight of Nokia recently told me that the Lumia has been a great success, surpassing expectations. An early leaper in the world of convergence is of course AOL Time Warner, which recently added Huff Post (a revolutionary new model of journalism). There are a lot of examples. And it’s not just the convergence of media and platforms that encourages business to come together. My own advertising agency StrawberryFrog recently joined forces with the global stakeholder engagement and business strategy firm APCO Worldwide to leap ahead to what’s next. We’re a meeting of minds and see APCO as a strong cultural and strategic fit with our own team. By coming together, we hope to fulfill our ambition to be deeply active on the global stage in a new and original way. And of course, we hope to further power our philosophy of cultural movements as we move forward. And we’re not alone. Businesses throughout the world are discovering that ‘convergence’ is fast-becoming a key business model – one that will help them to stay lean, focused and as profitable as possible without compromising on quality. You only have to look at the technology we use today to see why it makes complete sense to converge. After all, it’s just a logical progression, feeding our insatiable appetite for 324

technology and for progress. <The future through Samsung convergence technology> Imagine a home where life is as simple as it could possibly be, a home where the family and friends can spend quality time with one another without having to worry about the little things. Envision a mother having more time to help her son with his homework without having to worry about the laundry because she doesn’t need to spend hours ironing clothes from her fabric-caring washing machine. Picture a son sharing his latest trip photos with his family through their Smart TV directly from his phone. Imagine a father who controls both the airconditioner and the music on the speakers with his phone so as not to disturb the daughter, comfortable and asleep on his lap. Is it an ideal home? Yes. It is a dream home? Yes. But is such a home even possible? Certainly. A leader in digital convergence technology, Samsung has made this dream home a reality thanks to its devices that can be easily controlled and programmed to interact with one another. Through Samsung’s unyielding passion for excellence, innovations that were previously thought to be decades away from fruition are now available and at our fingertips with Samsung Smart TVs, Smartphones, Smart cameras, Bluetooth and NFCenabled speakers, laptops and Wi-Fi capable printers and air-conditioners found in Samsung’s extensive and top-of-the-line technological repertoire. Samsung takes its commitment to inspiring the world and creating the future to a new level with their upcoming SM Appliance Center Convergence launch. Eager to show the community how Samsung’s convergent technology contributes to a better world and a richer experience for all, the company will be launching the S-Path, the epitome of a Samsung Convergent ecosystem. The S-path Samsung encourages consumers to see what these items can do to improve life and lessen worries when used together in an optimal ecosystem. Demonstrating a Samsung lifestyle through convergent technology, the S-Path is a replica of a home that functions with convenience through convergent appliances and gadgets from Samsung. A walk through the S-Path gives consumers a taste of these appliances and gadgets in a much more engaging, interactive and interesting manner. Think of it as a way to step into the possibilities of your future, as you see with your own eyes how much more fruitful and enjoyable a family’s life is when supported by a Samsung world. Samsung recently unveiled the S-Path and the new look of the SM Appliance Center for the very first time in the Philippines last July 1 at the SM Appliance Center Makati. Those present at the event saw the enhanced look of the SM Makati Appliance Center and the unveiling of the S-Path.


<Will Web and Television Converge?> When we talk of convergence between computers and television, we need to be careful to specify what we mean. In the case of this debate, we specifically mean the convergence of television and computers, both the media and the devices. To that end the debate will center around two main issues: 1. Computers and Televisions will be able to display the same media: The unique thing about television is that television is both a medium and a transmission system. That is to say that television is used to refer to the screen that you watch, as well as what you see on that screen. The Internet on the other hand is a system for transmitting bits, and is different from the device which receives those bits, the computer. For this debate we will consider the content of the Internet to be primarily World Wide Web style content and an extension thereof. In other words, you will have multimedia pages with dynamic content including audio and video clips. So, when we say that the media will converge, we mean that current television shows will merge into a hybrid with World Wide Web style content. Television shows will have other types of media like text merged into them, and World Wide Web pages will begin to be temporal entities that tell a story. Another way of looking at this is that both your television and your computer will be running a similar super browser which will allow the same content to be viewed on both devices. Also, to say that the two converge it is not enough to say that you will be able to watch television on your computer-- that merely means that television content is a sub-set of computer content and is already possible today. For the two to truly converge the content that can be received by both devices should be the same. When we say that the media will not converge, we mean that television shows and world wide web content will remain distinct media forms, and that you will use your television for watching television shows, and your computer to view and browse web content. While both media types may have evolved, they will remain different from one another. 2. People will cease distinguishing between computers and televisions: The second topic for the debate will be that the computers and televisions as devices will merge. In this case the argument is that sometime in the future there won't be "televisions" and "computers", but some new device that encapsulates the behavior of both. This "viewer" will come in different sizes and shapes, but will be thought of as one item, just like little TVs and big TVs in people's minds are considered one type of device. While you may be more inclined to use the "viewer" on your desk to browse the web, and the "viewer" in the home theater to 326

watch movies, you would be willing to do either task on either device. In other words, if you were at your desk working on a "viewer" and a friend called up telling you to check out a show, you would just switch the "viewer" to that show, rather than going into another room to find a "TV viewer". Non-convergence in this case is the argument that, while TVs may take on some computer-like functionality and vice versa, fundamentally the two will be thought of as different devices. Doing research and browsing the web will be done on a computer, and watching shows and movies will be done on a television. 3. Finally, it is important to make one final point on the debate framework. There are always extreme points in the adoption of technology. Since there is no technical reason why a television can't have the same functionality as a computer, or vice versa, it is quite likely that both computer powered TVs and computers that can display television will be around in the future. In fact even today the Gateway 2000 Destination series is a computer powered TV and computers can have TV boards and are able to watch television content. There will certainly be some small number of people that adopt this technology. On the other hand there will also be some people that will keep their 1968 television and just add a DTV decoder box. Neither of these extremes are very interesting. On account of this, the debate will center around what functionality the majority of televisions and computers will have, and what types of media will be broadcast for a majority of broadcast hours. The main question we consider is whether televisions and computers will come to be more similar on average as time goes on, or whether they will evolve along mostly independent paths. <The Argument for Convergence> Media Convergence: In order for the media to converge, two main things need to occur. First, computers and televisions must be able to be content interchangeable. That is, computers must be able to view and use television content, and televisions must be able to view and receive Internet content. Second, people must be sufficiently interested in being able to view the same content on both device to make implementation of this interoperability commercially viable. The two are clearly interrelated, since the amount of interest in interoperability people have determines how much they are willing to pay for that functionality. Before determining whether it is possible to make television and computers interoperable, we need a list of what sorts of content both can, or will be able 327

to receive. To start, here is a list of some of the content we might see on both the web and digital television in the future: •

Television Content: o Television shows o Movies o Commercials World Wide Web Content: o Media presentations (scripted presentations of various media objects including text, 3-D graphics, audio and video) o Games (non-scripted temporal presenation of various media objects with which the user/viewer can interact) o Information blocks (collections of media objects through which the user/viewer can browse)

The Computer It is easiest to first answer the question of whether a computer will be able to receive television content. The types of content that are broadcast over television currently, and will continue to be broadcast if the two media do not converge, are audio/video streams. Since the computer media already includes audio and video streams, it should be able to decode the streams with no extra equipment. The possible exception to this is the addition of a tuner card to decode the analog signal into the digital stream, but this should be of marginal additional cost considering the cost of purchasing a computer. So, a computer will be able to receive television content for little extra cost. Since the cost difference between a machine with this capability and a machine without this capability will be low, even if there is little consumer interest in this, machines will still come with this capability. The Television The more difficult question is whether a television will be able to display world wide web content. It is pretty clear that you can put enough hardware into a television to make it able to display the media that a computer can display. Essentially you would need to add a reasonable sized hard disk, some memory, and a fairly fast general purpose processor. How much would this add to the cost of the television? I will guess at the prices of items six years from now if they are shipping in large quanties. •

10 Gig hard drive - $10 o From 1994 to 1997 1 Gig drives fell from $1000 to $100, 1/10 the cost in three years. A 10 Gig drive is now $300, so in six years it should be $3. I am allowing for some parts cost which may not change based on drive capacity and saying $10.

64 MB Memory - $ 2 328

o From 1992 to 1998 1 MB of memory fell from $30 to $1, a 30-fold decrease in six years. A megabyte of RAM should cost 1/30 of $1 in 6 years, or a little more than 3 cents •

Fast Processor (including 3D processor) - $20 o This one I am guessing on, but fast 3D chips run around $20 today, so I am guessing a reasonably fast processor (as fast as the fastest of todays processors) won't cost more than $20. If you can get a 486/66 for $20 today this seems reasonable.

The total additional cost to televisions shipping in quantity to make them fast enough to read computer content would then be about $50. The question to answer now is whether the average consumer would be willing to pay $50 extra for this functionality. If so, then broadcasters would be likely to merge the content, and manufacturers to include the extra functionality. This is a difficult question to answer without actually trying out the system with a test group. In the past interactive TV trials where more robust media and interactivity is included in the television have been a failure (ie. Time Warner's Orlando test-bed). The difference now is that the new television screens will have sufficient resolution to display text based materials without being blurry and out of focus. What specifically might people be interested in doing on these new improved systems? •

Advanced Commercials: Broadcasters could send six commercial streams during commercial breaks of HDTV shows, and the viewer could determine which one to watch. A 'X' on the remote could be hit to kill a commercial, or another could be hit to indicate it is somewhat interesting. Over time the set could build up a preference profile allowing users to see the commercials they most prefer (or least hate). If hypertext is included with each commercial, people could browse through downloaded information instead of watching more commercials. The hard disk could also be used to buffer the show so you wouldn't miss anything if you were browsing. This would be a more interesting model for commercials for viewers, advertisers and broadcasters. A Movie Previews Channel: One channel of a station (or sub-stream) could be a movie channel which downloads HTML like content with information on various movies in theaters including reviews, local show times, and trailers. By clicking on a trailer you could watch the trailer in all of its glory in your home theater. A News Channel: Instead of having an anchor cycle through stories continuously, a continually updated news web site could be broadcast on one channel. It could have local, national and international stories as well as traffic and weather updates. Given stories can have the full video clip story (live or delayed), as well as background text and photos 329

for those interested in more in depth information. This could also be received in your car to get traffic reports which could be read to you based on your cars current location. There are many other possibilities including much enhanced travelogue, home improvement and cooking shows. Is this worth $50 more in initial investment for the average consumer though? If the TV is kept for 5 years, the cost is less than $1 per month, which seems like something any consumer would be willing to pay for this increased functionality. So, if computers will be able to view television content, and people will be willing to pay for television that can display computer content, there is no reason that the two media will not converge. Device Convergence With the convergence of media, we expect the emergence of appliances that will be able to display some sort of standardized media format. These devices will most likely vary in size, intended placement (living room, kitchen, bedroom), and functionality, but will have the common capability of being able to interpret the given converged media format. Since media will most likely converge to some sort of digital stream with packets of information embedded in it, these information appliances will be able to provide a richer environment for viewing and interaction. This means that the television in the living room will no longer be just a television, but it will be an "information" appliance. In addition to being able to display video streams, it will also be able to present other types of informationweb pages, on-line stock quotes, interactive city maps, virtual lectures, etc.that are encapsulated in the media stream. This type of scenario has several implications: â&#x20AC;˘


For video playback, this means the possibility of introducing different encoding and compression schemes into the stream. This may serve to save resources because the entire uncompressed video signal will no longer have to be broadcast. It can also be used to broadcast content at different resolutions, allowing the viewer to choose depending on the characteristics of the viewing device. So a large, entertainment device in the living room may receive a movie in wide-screen format with Dolby Surround Sound, while a smaller device in the kitchen used to get the morning news may only receive the bare essentials. Consider the idea of private vs. public space. With converged media, one can imagine a scenario in which a user is creating or modifying content on a small "information" appliance like a PDA while sitting in a meeting (private space). Since the device is using converged media, the user will then be able to instantly upload this work into a public display, like a large video wall in a conference room, for presentation. 330

When giving multimedia presentations that contain both digital information and video information, it is not uncommon to use a computer to display the slides and a VCR to play a video tape. Convergence would push for media and devices that would be able to easily accommodate both formats, so that switching hardware during the middle of a talk will no longer be necessary. Right now, too many forms of media exist. Consider the genre of audio. There are tapes, CD?s, MiniDiscs, RealAudio, MP3?s, and more. Each format requires it?s own special device and switching from format to format is very difficult. One needs a radio to get content broadcast over the air; a CD player is required to play songs on a CD; a computer is needed to play MP3?s. With media convergence, it is likely that you can take a mix of your favorite songs and be able to play it at home, in the car, and at work, since you are using a common media format that can be read by many devices. Audio equipment manufacturers are creating devices that have the capability to play more and more audio formats (some stereos have built in tape decks, radio receivers, MiniDisc players, and CD players). This seems to be analogous to the idea of device convergence and an argument for it. For content providers, the switch to convergent media may initially be expensive, as they will have to invest in new equipment. But in the long run, it will open up more possibilities. As of now, television advertisements are usually very elaborate, but the experience is passive. Viewers cannot simply click on them if they want more information or want to purchase the item being mentioned as they can on the Internet. With converged media, it would be possible to integrate both types of advertisement into one, allowing for both elaborate presentations and complex interactions. For content providers, media convergence also implies that creative content will only have to be created once, not several times for the varying media formats. This too, will save content providers time and money in the long run. The addition of informational bits to the media stream, in combination with these all-in-one devices, will allow content to be more customized to the viewer?s needs and wants. The device may have some sort of filtering agent that only displays advertisements that are of interest to the viewers.

<The Argument Against Convergence> • •

TVs are consumer-level devices, which mean that they have to be cheap (for the average Joe) Being able to display the vast number of media types available today on the web (Macromedia, pdf, ps, RealAudio, RealVideo) will be expensive and challenging - you need a general-purpose CPU and stuff like RAM, OS, etc. People will not be willing to pay, especially if they?re not really going to use it. Perhaps Java will save convergence. At this point in time, the TV and the WWW are fundamentally different 331

TV is a broadcast medium, with virtually zero interactivity, while the WWW is a "pull" medium, with a high degree of user interactivity required. Things will stay this way - in the short- and medium-term, people are not going to treat the TV and computer interchangeably. So, is the media going to merge and drive the convergence? TV programs with interactivity? Ads, maybe. Education, maybe. But entertainment? People fundamentally go to the living room to be entertained - movies don?t lend themselves well to interactivity. Nor does the broadcast model. Even with a back-channel, 19.2Mbits/s is a one->many transmission. You can hack one-to-one transmission, of course, but why? Another reason why WWW and TV content will not merge is the proliferation of handheld, portable, wireless devices that let you take the WWW (= information + entertainment) wherever you are. The presence of such "lite" devices will drive media development away from integrated content and into "lite" content that deliver concentrated doses of information. See Diamond?s new Rio player & Cyrix?s new WebPad - instead of converging into a single super-powerful appliance that is used for everything, people will gravitate towards small, specific solutions Personal vs. public - TV is an audience-based thing - many people can watch one movie together. On the other hand, the WWW, and interactivity in general, is personal. One person may have very different responses compared to another, making it difficult for more than one person to surf the web together for extended periods, or participate in an interactive program, unless specifically designed for multiple players. The two mediums, broadcast (TV) and WWW, are sufficiently different, not in technical terms, but human ones, that a merger of the content is highly unlikely. Naturally there will be some overlap & intersection, but it will be minor. There will be no fundamental revolution and/or integration of content.

<The Future of Technology: Total Convergence and the "Media Explosion"> The Consumer Electronics Show in Las Vegas and the Macworld fair in San Francisco marked "Tech Week" -- a highlight of the year for hightech freaks in the United States. Both Bill Gates and Steve Jobs put on spectacular shows -- and predicted the increasingly networked character of the digital world. Las Vegas is madness, but there's method to it. Hardly any other place in the United States is more neon-lit, gaudy and loud. Whoever wants to attract attention in the gambler's paradise -- open 24 hours a day, the year round -has to put on a good show. And Robert Iger knows it. The man has led the Walt Disney Company for about a year -- the boss of an international media empire that comprises everything from Donald Duck to blockbuster films like "Pirates of the Carribean." Relaxed and self-confident, Iger strides onto the stage of the stadium-sized 332

congressional center on the fifth floor of the Venetian casino complex. More than 3,000 representatives of the media, computer and telecommunications industries have assembled before him in the hall -- and Iger is doing what everyone here is making their best effort to do: He's praising himself. TV, cinema, music, Broadway shows -- his corporation is number one in each of these fields, Iger boasts. And that's especially important now, since the world is facing a "media explosion," he adds. The Venetian is one of the biggest casinos here -- a fun machine with 4,000 suites and dozens of luxury boutiques and gambling halls. Hordes of uninhibited office workers spend day and night roaming this world of cheap facades, an imitation of the famous canal city in northern Italy, complete with its own St. Mark's Square, Rialto Bridge and replicas of historical statues. Pretty women arrive from out of town, dressed in full feather. They stuff dollar notes into slot machines, surrounded by the sound of jackpot fanfares. It's a surreal blend of thrill seekers and the timeless yearning for the big money. Iger fits right in. He knows about artificial worlds -- after all, he's in charge of five Walt Disney amusement parks, complete with their own imitations of the Eiffel Tower and European castles. The man from Hollywood is one of the keynote speakers at the Consumer Electronics Show (CES), which is celebrating its 40th anniversary this year -- and its speedy rise to success. The CES began as a somewhat boring tradeshow for products like TV sets and record players. Even as recently as five years ago, the CEO of Walt Disney would never have turned up here. Back then, Hollywood was still refusing to have anything to do with the threatening world of the Internet, riddled as it was with criminal product pirates. Total convergence Those days are over. The film industry can no longer ignore the digital revolution. And so Iger's speech had just one topic -- the unrestrained merging of computers, the Internet, cinema, television, mobile phones and a handful of other products. This total convergence is what Iger means when he speaks of an "explosion." It's a kind of Big Bang, expected to yield a new entertainment universe that will make films, music and games available not just to every living room, but to every pocket. The other presentations were all devoted to one and the same goal too: Every piece of content should become available on every piece of electronic equipment, at any time. The times when TV sets were used only to watch television, when mobile phones were used only to talk and when MP3 players were used only to listen to music will soon be over for good. The most prominent speaker appearing at CES, Bill Gates, wasn't able to resist this trend either, even though the Microsoft founder devoted most of his opening speech to advertising the new Windows Vista system and the Xbox games console. 333

But then he went on to dream a little about what a "connected experience" could look like -- meaning the total networking of everyday life. In order to do that, Gates had a kitchenette set up on stage. It made recipe suggestions on the basis of the food available. For example, the system tells Gates -- who confessed to not being much of a cook -- that the flour in the cupboard can be used to make the Italian bread focaccia and tells him exactly how to bake it. Gates also presented room-size wallpaper that doubles as a monitor. It could allow Grandma to keep an eye on her dog while she is away. Before anyone had a chance to ask who was going to feed the animal in her absence there was hysterical applause from the corner of the hall where Microsoft's employees were seated. In general, the CES is now considered the main indicator of where the computer business is going -- more than any other tradeshow in the world. When the country's technophiles assembled here for the first time, in 1967, Jimi Hendrix was playing on the radio. Only one out of six US households owned a color TV set. The average apartment contained only 1.3 personal electronic items, usually radios -- and that was it. These days, the average US household has 25 such items. So it's no surprise the CES boasts an impressive number of visitors -- both exhibitors and consumers: 150,000 people travel to the desert city for the few days of the show. Las Vegas's casino hotels dramatically increase their rates. The wait for a taxi takes at least 30 minutes -- and yet everyone is happy the technology sector has recovered following the stock market crash in the late 1990s. Twenty-five mobile phones are sold the world over every second. One out of three people in the world is already using such a phone. "Gaga for Gadgets" is how one specialist journal describes the CES. And many producers use the "Tech Week" -- as it's also called in the United States -- to make announcements, usually riddled with superlatives. For example, Sharp presented the largest flat-screen TV in the world -- with a 108 inch monitor. The OQO company, on the other hand, presented the smallest Subnotebook in the world, fully compatible with the Windows Vista system and only the size of a pocketbook. Meanwhile Michael Dell, whose corporation is swamping the world with personal computers, praised his own company's recycling program. Motorola CEO Ed Zander even came cycling onto the stage on a yellow bicycle in order to present a new invention he's especially proud of: a dynamo that can charge a mobile phone battery, for use in rural regions in India or Africa. There was just one thing missing in Las Vegas -- and it became conspicuous by its absence. Just like every other year, every one listened intently on the Tuesday of CES week, as the news from San Francisco, a city 700 kilometers (435 miles) away, arrived via Blackberry.


Gates vs. Jobs It was here that the Apple Corporation's rivalling electronics community selfconfidently organized its own conference. Just as in earlier years, the high point of the Macworld trade fair was the speech by CEO Steve Jobs, who is revered in an almost cult-like fashion by the Apple community. And Jobs more than satisfied his audience's expectations, made all the greater by the absolute secrecy cultivated before his appearance. He presented the first Apple iPhone, a mobile phone that impressively confirms the trend towards the total digital blending of all media. It's a phone, a music and video player, a digital camera, a navigation tool, an organizer and an Internet browser -- all in the form of a slim plaything that has just one pushbutton. Speaking about how the iPhone would revolutionize the way telephones are used, Jobs was as cocky as ever. Apple has left its rival RIM, the producer of the Blackberry, five years behind, he said. The corporation has been confident it can do almost anything ever since its iPod became a sensational success. On the other hand, the new gadget will be quite expensive -- between $499 and $599. And it will probably only reach 1 percent of the world's phone market, at best. With one symbolic step, Apple has provided all those still in doubt about the general trend of today's times with the proof they need: In its thirty-first year, the corporation is dropping the word "computer" from its name. It will henceforth simply be called Apple Inc. In an age in which everything blends with everything else, the corporation with the apple logo no longer wants to be seen just as a computer producer. The "explosion" Iger spoke of in Las Vegas affects not just the form of the products, but their content as well. That became clear when the Disney Company CEO presented the imminent re-launch of the Disney Web site, complete with jazzed up multimedia features called "Xtreme Digital" (XD), on giant screens. These features are meant to do more than just entice users with plain-old film downloads. On the new site, the fan of a particular series will be drawn into a virtual dream world where he will discover games, like-minded people -- and of course even more new Disney products. When they begin a new project, the Hollywood studios systematically plan its distribution across all media channels. Successful film producer and CES visitor Jerry Bruckheimer isn't just working on the third part of "Pirates of the Carribean," for example. New interactive features for high-resolution storage media, an extensive update of the computer game of the same name and a unique pirate world for the new XD Web site are being developed in parallel. The distinctions are becoming increasingly blurred: In terms of their aesthetics, high definition (HD) computer games already resemble animated films, and corporate Web sites increasingly feature moving images, interactive features and games.


Germany looks on From the German point of view, the merging of the various media and their fancy accessories has left a bitter aftertaste. The Germans are heavily active as consumers, but they're of practically no importance as producers. The bankruptcy of BenQ, saw the disappearance of one of the last companies producing mobile phones in Germany. Economics Minister Michael Glos has lamented the decline of his country's film industry. And the once highly respected German camera producers are facing extinction. Only 15 of the 2,700 exhibitors are from Germany -- and they're mostly small companies. The nation that coined the phrase "Progess through technology" ("Vorsprung durch Technik") is practically absent from the conference program. And the modern radios featuring the logo of the Grundig company are not actually produced in Germany, but in the USA -- by up-and-coming radio producer Etรณn, a company that started out 20 years ago as the US licensee for Grundig. And the Cebit trade fair in Hannover isn't doing too well either. True, it still draws more visitors than the CES, but the exhibitors' interest is fading from one year to the next. "Cebit has just developed in the wrong direction. It was a mistake to surrender Cebit Home," says Marco Bรถrries, for example. He's responsible for Yahoo's newly created "mobile communication" division and enjoys the droll title of "Senior Vice President Connected Life." During the mid-1980s, Bรถrries challenged powerful industry giant Microsoft with his Star office software, developed in Hamburg. But a few years ago he moved to California with his family. Now a top manager at Yahoo, the allpowerful Google has become his new rival, one he's challenging with a new mobile-phone-compatible search engine called oneSearch. The German government's recent proposal of a substantially state-financed German search engine called "Theseus" just makes the Yahoo man laugh. But concern that digital progress could one day begin to slow down is spreading not just in Germany, but the world over. "Current legislation makes it far too easy for the big corporations to financially crush smaller, innovative companies with legal trials," Mitchell Stoltz complains, a serious young man standing at one of the most interesting stands of the entire trade fair. Digital (un-)freedom "Digital Freedom" reads a large poster. There's not a single product to be seen here -- just heated discussions between visitors to the trade fair. The discussions are about the concerns and aspirations of product inventors and developers and small entrepreneurs, all of whom are watching the forward march of the entertainment corporations with mixed feelings. The XM company, for example, records local radio programs and transmits them to even the most remote regions via satellite: Customers can receive and store the broadcasts on little satellite radios. But the music industry has sued the company, and a 336

billion-dollar lawsuit is threatening to shoot the music satellites out of the sky. That's the way new ideas can easily be nipped in the bud, Stoltz warns: "Socalled pirates, such as Napster, were in fact the first to prove customers want online music. And it was only thanks to this knowledge that Apple could develop its legendary iPod, thereby creating an entire industry sector." At first, the information booth looks as if it had been set up by a grassroots citizen's initiative. But a closer look reveals that the organizer is none other than the Consumer Electronics Association, which organizes the CES itself. The association knows that a trade fair such as the CES can only continue to prosper in a climate that permits innovation. But reality almost always looks different. Many exhibitors prefer to compete for market sectors, thereby often blocking progress and innovation. The controversy over the storage medium for high-resolution television, which has been ongoing for more than a year, provides a clear example of this. Sony and some of its partners are betting on a technology knows as Blu-ray-Disc, while Microsoft and Toshiba are pushing the rival HD-DVD technology. Both systems provide razor-sharp images -- but they're not compatible with one another. Battle of the formats The two camps have holed up at two separate corners of the exhibition space. The HD-DVD lobby has set up its headquarters in a black trailer. Their main argument is that the technology advocated by them means affordable display devices and new interactive features. For example, Microsoft is selling an external disc drive (one that was really just meant to go with the Xbox games console ) for â&#x201A;Ź200 ($260) -- at least for as long as there are no delivery problems. Almost 300 films are currently available in this format: Lara Croft, Harry Potter and King Kong are fighting on the side of HD-DVD. Pirate flags have been raised in another corner of the hall. This is where the Bluray consortium has set up camp; Carribean pirate imagery is the main part of its advertising campaign. "Blu-ray is just the better format," they say. "Blu-ray's victory is just a question of time." In fact, Blu-ray's 50 gigabyte storage capacity has given it the advantage for now. But the HD-DVD advocates are striking back: At the CES, they announced the introduction of a disc with even more data space -- 51 gigabytes. Consumers are the ones who end up suffering from these kinds of ridiculous marketing battles. Many will have only just purchased an expensive, HDcompatible device -- only to discover that high-resolution television is still virtually non-existent. So an HD player would be just the right item to buy next. But which system does the future belong to? At the moment, many Hollywood producers don't even release their films in both formats. The long hoped-for agreement wasn't reached at CES. If anything, the hostility 337

between the two camps has increased. At least LG Electronics will soon offer the first player that is compatible with both formats. But the sales price is a hefty $1,200. It's an open question as to who will win this war of the formats. The winner may even turn out to be an entirely different technology. One possible candidate is the very technology that lies behind so many of the innovations presented at the CES -- a technology that enabled the large-scale integration of all media forms and formats in the first place: the Internet. It's long been possible to receive high-resolution films on the Internet -- even using Xbox, as Bill Gates proudly demonstrated. Perhaps that will the big issue at the next CES: the demise of CDs and DVDs. <Public, private cloud convergence to be the future> While public cloud solutions have been implemented on a broad scale across the business world, decision-makers are beginning to recognize that this technology may not be as all-encompassing as they once thought. In fact, many enterprise executives are choosing to converge public and private clouds into a single, unified infrastructure in an effort to maximize efficiency and optimize the budget. A recent Vanson Bourne study of 400 business employees and managers highlighted this trend, revealing that 60 percent of respondents have moved or are thinking about migrating applications and information away from public-only cloud environments. Another 60 percent of individuals said they recognize the hybrid cloud as the culmination of their cloud projects, suggesting that it will likely have a lasting impact on the corporate landscape as a whole. While the adoption of hybrid cloud strategies is not necessarily a guarantee in the business world, it is becoming an increasingly popular move. "The findings of our study indicate that the hybrid cloud is the next cloud for many organizations," cloud expert John Engates said. "They may have started with a public cloud-only architecture, but have come to realize the limitations of this approach as they've continued on their cloud journey." Why adopt a hybrid cloud plan? Although public cloud computing technologies can be highly scalable, their multi-tenant characteristics often make it more difficult to implement effective cloud security and management guarantees. Conversely, the private cloud is commonly recognized for its protection and maintenance benefits, suggesting that a merger of the two offerings can be highly advantageous for organizations that go about doing so correctly. The survey echoed these opportunities, noting that 54 percent of organizations 338

experienced better security when converging public and private offerings, while another 59 claimed to have better control over their infrastructure. A separate Gartner report suggested that hybrid cloud and other IT initiatives will likely be the future of the corporate technological landscape, as utilizing both in-house and off-site solutions simultaneously introduces a wide variety of benefits throughout the organization. Many analysts believe hybrid cloud technologies will continue to have a lasting impact on the business world as a whole, especially as organizations continue to search for customizable disaster recovery and other critical initiatives to improve their chances of experiencing long-term success. 1. Future Conversion & Interdisciplinary Collaboration a. Advanced Technology Created by Future Convergence


New trend in musical is to utilize advanced technology, such as hologram and 3D mapping on the stage. “Sahljahgi Opseoye” uses various technologies and provides audience more to watch. b. Samsung Vs. LG <Samsung & LG Producing World’s Most Energy Efficient Televisions> In the first ever SEAD Global Efficiency Medal competition for flatpanel televisions, Samsung and LG took the top awards for producing televisions 33 percent to 44 percent more energy efficient than similar competitors. SEAD stands for the Super-efficient Equipment and Appliance Deployment initiative, which is seeking to “transform the global 340

market for efficient equipment and appliances.” The global awards program seeks to encourage the production and sale of highly energy-efficient technology, and aims to spur innovation among manufacturers as well as encourage consumer adoption of highly efficient appliances. The first competition identified the most energy efficient and commercially available flat-panel television in three size markets, as well as one television which is the most energy efficient emerging technology. The awards were given to televisions that use 33 percent to 44 percent less energy than their technologically comparable competitors, while the emerging technology winner is 59% more efficient than comparable televisions on the market today. “We have seen drastic improvements in TV energy efficiency over the last years, but the winning manufacturers demonstrate that the potential for improvement remains large,” says Peter Bennich of the Swedish Energy Agency. SEAD Global Winners • •

• •

The Samsung UN26EH4000F received the SEAD Global Efficiency Medal in the small-size (less than 29 in.) category. Two Samsung models, the UE40EH5000W and UN40EH5000F, tied as the global winner in the medium-size (29 in. to less than 42 in.) category. The LG 47LM670S received the SEAD Global Efficiency Medal in the large-size (42 in. and above) category. An LG 47-inch backlit LCD prototype TV won the SEAD Global Efficiency Medal in the emerging technology category.

c. E-Book Industry: E-Book Utilizing Haptic <haptics> Haptics (pronounced HAP-tiks) is the science of applying touch (tactile) sensation and control to interaction with computer applications. (The word derives from the Greek haptein meaning "to fasten.") By using special input/output devices (joysticks, data gloves, or other devices), users can receive feedback from computer applications in the form of felt sensations in the hand or other parts of the body. In combination with a visual display, haptics technology can be used to train people for tasks requiring hand-eye coordination, such as surgery and space ship maneuvers. It can also be used for games in which you feel as well as see your interactions with images. For example, you might play tennis with another computer user somewhere else in the 341

world. Both of you can see the moving ball and, using the haptic device, position and swing your tennis racket and feel the impact of the ball. A number of universities are experimenting with haptics. The Immersion Corporation offers a joystick product that is used in laboratories and in arcade games. Haptics offers an additional dimension to a virtual reality or 3-D environment. <Haptics and Habitats of Reading> Today I want to share with you my exploration of the role of haptics in book reading. Haptics, or the study of touch as a means of communication, has also lead me to consider habitats of reading behaviors. (1) HAPTIC LEGACY inherent in book reading Pre-human legacy relevant to the haptics of the book includes both primate dexterity and projectile skills of hominids. As an attribute of primate dexterity the hands prompted the mind, even conveying properties of inertial and tactile investigations into neurological development of the hominid brain. Hominid learning was based on tactile investigation of the environment. Frank Wilson in his recent book titled The Hand, notes that we overlook the role of dexterity in human evolution. “There is growing evidence that H. sapiens acquired in its new hand not simply the mechanical capacity for refined manipulation and tool using skills but, as time passed and events unfolded, an impetus to the redesign, or reallocation, of the brains circuitry. The new way of mapping the world was an extension of ancient neural representations that satisfy the brain’s need for gravitational and inertial control of locomotion. a new physics would eventually have to come into this brain, a new way of registering and representing the behavior of objects moving and changing under the control of the hand. It is precisely such a representational system – a syntax of cause and effect, of stories and of experiments, each having a beginning, a middle, and an end – that one finds at the deepest levels of the organization of human language.” Grasp a concept Primate dexterity adapted us to convey concepts in physical objects. The word comprehend blends grasping and understanding and the manipulator actions of paper book reading exemplify such an ergonomic of understanding.


Acts of manipulated navigation in book reading involve the vertical page, moving in position with a previous and next page and in recto/verso relationship and these pages handled in a mobile, bound structure which provides the mechanism for delivering and timing concepts. Fingers tend to start the lift of a leaf during the page read and tend to concluding motions at the page turn. Paper grain, paper thickness and other tactile features such as book weight are continually mapped against an emergent meaning. An embedded learning path of hands prompting the mind is at work as we read a book. The meaning is delivered and exemplified by a manipulated physical object. We are supposed to believe that digital information will deliver conceptual works directly, that is via an electronic transmission not that different from neural transmission. Actually the traditional physical media may be more apt for such conceptual transmission. We are physical bodies and we negotiate our consciousness in those terms. What ends up being mapped in the sensory regions of the brain and what emerges in the mind, in the form of an idea, corresponds to some structure of the body, in a particular state and set of circumstances. Reading a physical book is just such a particular state and set of circumstances. Toss out an idea Even more alluring as a just so story, the early hominid trait of projectile throwing may have predestined homo sapiens to convey concepts via physical objects, such as the book. Evolutionary psychology indicates that as adaptations are provoked, the developing conceptual skills then diverge from the initial neurological need. Just such neurological cross-functioning is at work when we use language or invent books for cultural transmission. So, is calculation, accurate throwing and successful stunning still at work as we publish? Projectile predation, or throwing rocks at other animals, quickly presented survivability advantages at the same time that it opened an immense ecological niche. The long practiced throwing of stones via single arm launching also promoted asymmetrical development of the brain as evidenced by our species unique right and left handedness. While lateralization is associated with many subsequent specialized behaviors propagated from lateral centers for language and vision, this strange trait of brain asymmetry emerged with the strange trait of single arm projectile predation or rock throwing. Lateral skills of one arm throwing later enabled subsequent lateral skills such as hand writing. (2) BOOK INTERFACE of hand held reading devises 343

All hand held reading devises, those based on electronic display and those based on reflected light, provide eye readable content and manipulated navigation. Is it possible that the contest between the paper book and the screen book, is not in terms of image resolution, but in comparative haptics of their features of manipulated navigation? Print-on-demand technologies engages attributes of digital creation, production and distribution without crossing the threshold to on-line reading and without haptic compromise. This small step projecting print production via digital print-on-demand technologies opens prospects for the traditional paper book as the real e book. Disconcerted e-book promoters complain that people just don't like to read from a screen. Actually, people love to read from a screen as the popularity of the Web indicates. I suggest that resistance to the e-book is not related to screen resolution, but to impaired haptic features. In contrast to the manual punctuation of the page and the physical clock of content of the codex, the on-line page is manipulated with impaired haptic feedback. The previous/next click, the cursor slider and scroll tabs utilize grip and finger motion directed to the mouse and keyboard, but not to the substrate of the text. At least two other layers of interruption intervene. There is the electrified, rather than manual, instigation and an indirect interfacing via the navigational software. (3) READING MODES consisting of parents and composites Various ways of reading, or reading modes, have a history and future. Different reading modes emerged at different times in history, but once emerged, they are not abandoned. In stead, they accumulate and compile progressively into reading habitats. So what are the reading modes? There seem to be three parent reading modes which can be called the verbal/visual mode, the writing mode and the print mode. The verbal/visual accommodates the reading like interpretation we do while listening to a person speaking. There is also reading done as we listen to music which is reason to include aural communication in the first mode. The writing mode accommodates the transaction of messages between writer and a recipient, which can be one or more persons. We read letters from someone else, and then read our own reply before we send it back. The writing mode of reading is exemplified by email.


The print mode obviously refers to printed matter, but, because of print technology's ability to produce copies, its essence is the reading of relations between conceptual works themselves as represented by library organization. These three parent reading modes have emerged over time and have progressively converged and combined in various ways. Each reading mode is filled with wide gradations of expression and content and an infinity of inter-layerings are possible. Sometimes we find ourselves reading in various modes at the same time or at a single website. This would suggest a composite, screen based reading habitat enabled by the advent of digital technologies and digital communications in which the parent modes are merged so effectively that text, texting, viewing, listening, ranting (or silent shouting) between someone and anyone are all intermingled. Digital transmission also has enabled many more delivery scenarios between and from the parent reading modes. Each reading mode can now be discretely delivered to each of the others. The model for compiling reading modes into fluid behavior is not in media studies, but in developmental psychology and evolutionary neurology. Recent theory in these fields begins with development of independent conceptual domains (with specific locations in the brain) which are only subsequently connected to provide integrated conceptualization. Perhaps, a recent compounding of these permutations of delivery, from each mode to the others, is mistaken for an increased rate of change styled as a digital communication revolution. As likely, the current rate of change across the whole history of reading modes, is slowing. Presently we are only filling in all the inevitable compilations between established parent modes. A cell phone with voice mail, thumb texting and a digital camera does not necessarily indicate either a revolution or an accelerated rate of change in the history of messages. It is fair to understand the 19th century reading environment as supported by the skilled integration of meaning from each of the parent modes, verbal, written and print, without the aid of a technology that could integrate and compile these modes. The technologies needed to merge and deliver all the reading modes to a single screen based interface are only recently achieved. But if parent reading modes have been progressively converging over a long history is this a real paradigm shift? Perhaps the underlying shift of digital connectivity is the transaction of information and knowledge via a non-haptic interface. Such a development would signal the advent of a truly different reading 345

habitat. (4) reading FORMATS associated with the book reading How do books relate to the reading modes? Well, a strange thing is that the book predates multi-mode reading. The earliest books were scroll format. The scroll format is associated with recitation or reading confined to the verbal or spoken mode. During late Antiquity the writing mode of reading intensified with an increasing exchange of letters. These letters, written on papyrus and folded into a rectangular format and tied closed, provided an immediate prototype for the codex. So the scroll to codex transition can be associated with the advent of a second reading mode based on writing. This is as plausible a scenario as the standard explanations based on religious injunction and reading efficiency, that taken together, remain inconclusive. The pre-Christian sectarians realized their dependence on the writing and copying of letters. As a result, Christianity was the high-tech religion of late Antiquity, using the written word resourcefully to create and shape itself. But, while sectarians were early adopters of the codex, the classical cultures were, subsequently, no less comprehensive in their adoption of the format. Everyone adopted the codex as the writing mode was compiled into reading behaviors. Then, for a thousand years prior to the advent of printing, books were used in the writing mode of reading and in an initial habitat of the first two reading modes. This was the manuscript era of books. Careers such as that of Augustine of Hippo, illustrate the interaction and compiling of reading behaviors across both the verbal/visual reading mode and the writing mode of reading. With the advent of printing the book format began to provide even greater functionality for the reader. The printed copies were arranged in various ways with other copies producing a readership of the juxtapositions themselves. Implications of the relations of conceptual works defined new disciplines, while the arrangement of books in libraries provided a searchable database. Reading across two or more topics engendered unique perspective and the two activities of organization for learning and organization for information retrieval in libraries converged. With the advent of the print reading mode the book performed in all three parent modes and was poised to operate in a fully composite reading habitat. But is the book poised to operate in association with a non-haptic, or automatic, reading mode?


(5) haptic vs. NON-HAPTIC reading MODE Ultimately, the haptics of the physical book may be invalidated, but only after reading itself is automated. Katherine Hayles summarizes the situation; Although these visions differ in degree and kind of interfaces they imagine, they concur that the posthuman implies not only a coupling with intelligent machines but a coupling so intense and multifaceted that it is no longer possible to distinguish meaningfully between the biological organism and the information circuits in which the organism is enmeshed. A zone of bots, spiders and crawlers is quickly evolving. Such an impression accords with a concept that evolution is now proceeding in the domain of technology while our static species provides the medium for this different vitality. A familiar example of non-haptic, reading would be a Google search. Here, after another kind of readership, the result just pops-up. You can easily feel the presence of new synthetic ideas in any mining of referrers or in any wandering after the germinated links. So the future of the physical book is linked with the fate of bionic reading. The desert of search engines and free-text searching may not yet be considered a reading habitat and its output may not yet be considered an act of reading. But it is. Rich permutations of reading behaviors are emerging as thresholds between parent modes are dissolved and delivery technologies enable every possible cross-mode conversion. The permutations are only increased by the promise of joint haptic and non-haptic reading behaviors. These continuing compilations into reading habitats seem to integrate automatically in front of the reader in an authentic emergence. But, ultimately, automatic reading may require new haptic accessories, not just visual interactivities, to assure a grasp of what is read. One of these inevitable haptic accessories is the physical book. d. E-Publication: Smartphone Vs. E-Reader <Does it still make sense to buy an e-reader?> With tablet prices dipping lower and lower, there's an argument to be made that the e-reader's days are numbered. Should they be? I've been an e-book fan for as long as I can remember. Ever since I found myself stuck on a slow-moving mountain train with nothing but my PalmPilot and an e-book, I've been hooked on digital reading. Flash-forward some 15 years and e-books are everywhere, thanks 347

in no small part to the Amazon Kindle -- a dedicated e-reader with a special "e-ink" screen that I still consider a marvel of modern technology. (Know why Kindles and other e-ink devices have such phenomenal battery life? Because every pixel on the screen is either "on" or "off" until it needs to change. And only when you make a change -- like, say, for turning a page -- does the screen consume any power. Extraordinary!) Remember when the Kindle cost $399, and you couldn't even get one for the first six months? That was a mere five years ago; today you can get a Kindle for as little as $69, assuming you prefer to it any number of competing Kobo Readers, Nooks, and the like. Heck, as of yesterday, the touch-screen-enabled Barnes & Noble Nook Simple Touch now sells for just $79. Tempting as those prices may be, it's time to start debating whether these devices really have a future. Given that most people already own a smartphone, and more and more are buying tablets every day, does it still make sense to buy an ereader? It probably goes without saying that you can read e-books on your phone. Just install the Kindle app, Nook app, Kobo app, and so on, or use something like Apple's iBooks or Google's Play Reader. Although you may balk at the idea of reading on such a comparatively small screen, it's really not bad once you get used to it. Plus, smartphone screens are getting larger all the time -iPhone 5 or Samsung Galaxy S3, anyone? Needless to say, tablets are just as versatile when it comes to reading (unless they're running a specialized version of Android, in which case you may be limited to specific e-book apps). And for the deal to beat, look no further than Amazon's $159 Kindle Fire, which was state-of-the-art just a year ago and is still plenty powerful. Indeed, it's a full-blown tablet, capable of everything from apps and games to music and video -- all displayed on its lovely 7-inch color screen. Compare that with, say, the $119 Kindle Paperwhite, which has a 6-inch grayscale screen and really serves only one function: books. For just $40 more, it's like making the leap from bicycle to Ferrari. There are, of course, plenty of points in favor of the humble ereader. Battery life, for one: your average e-reader can last weeks between charges, not days like most tablets. Many book lovers also prefer the gentle look of the e-ink screen to the harsh glare of a backlit tablet. (The former is also vastly 348

superior for outdoor reading.) What's more, e-readers don't distract you with games, apps, e-mail, and other attentiongrabbers the way tablets do. And say what you will about price: $69 or $79 is still half (or less than half) the cost of a Kindle Fire, to say nothing of a $199 Google Nexus 7, $269 Nook HD+, or $329 iPad Mini. If you're on an e-book budget, a simple e-reader will leave you with extra cash for actually buying books. All that being said, I can see a time in the not-too-distant future when Amazon and B&N abandon e-readers in favor of an alltablet lineup, because, let's face it, tablets are sexy, and they do a lot more than just e-books. So now I'll turn the discussion over to you. Does it still make sense to buy an e-reader? Or should you invest a few dollars more in a tablet? Personally, I'm in the latter camp, as I've been reading on tablets for years and don't mind their supposedly eye-unfriendly screens. And when I'm caught up in a really good book (like I am now with "Gone Girl"), no amount of app distractions can tear me away. Tablets FTW! <Why Smartphones Have the E-Reader Advantage> The advantages of smartphones over dedicated e-readers like Amazon's Kindle I'm a big fan of ebooks. I was a fan of the idea of reading on a digital device back in the nineties before such things were cool. In the nineties, I read out of print books on a laptop, a Palm OS powered Handspring Visor, and a BlackBerry. At the time, out of print books were the only options. In 1996, before most people had even discovered the Internet, I bought a used PowerBook Duo (Apple's first foray into the subnotebook market and an early pre-cursor to the MacBook Air) and loaded it with classics for my mom while she was recuperating from abdominal surgery. Needless to say, the explosion of the e-book reader market has been something of a delight to me. The Kindle, Nook, Kobo Reader, and iPad all bring e-books to anyone anywhere. I love the concept of these devices â&#x20AC;&#x201C; I own an iPad and I'm planning to give multiple family members a Kindle or a Nook for Christmas this year (haven't quite decided which device is best for a couple of relatives yet). But, dedicated e-readers and tablet devices aren't my preferred way to read books. My favorite e-reader is my iPhone. Much like the devices I read from in the nineties, the iPhone has one crucial advantage â&#x20AC;&#x201C; it's 349

always with me. Yes, the Kindle, Nook, and iPad are all extremely portable. My iPad is great when I travel (books, movies, apps – all good things on a train from upstate New York to the city or on a plane), but I didn't have it with me last month when I was waiting for a flu shot, or when I met a colleague for coffee last week, or when I'm being green and taking a bus rather than driving (which I try to do as often as possible). But my iPhone was in my pocket each of those times. Perhaps what's more important (and where Amazon and Barnes & Noble were brilliant in their approach to the Kindle) was that I had access to more than Apple's iBook store. With the iBooks, Kindle, and Nook apps, I had a broad range of options and prices at my fingertips. In fact, Leatherbound offers a way to find the best prices on e-books from all three stores. And that's the advantage that a smartphone (be it an iPhone, Android phone, or BlackBerry) has over dedicated devices like the Kindle or Nook. You have access to a lot more sources (books, magazines, Wikipedia, the entire Internet) and chances are that you always have it with you. And it's why I may be giving ereaders to my non-smartphone-owning family (my father thinks anything beyond calling is too much to have in a phone), but I'm sticking with my iPhone as my main way of reading. e. Futurist Ray Kuzwell Raymond "Ray" Kurzweil (/ˈkɜrzwaɪl/ kurz-wyl; born February 12, 1948) is an American author, inventor, futurist, and a director of engineering at Google. Aside from futurology, he is involved in fields such as optical character recognition (OCR), text-to-speech synthesis, speech recognition technology, and electronic keyboard instruments. He has written books on health, artificial intelligence (AI), transhumanism, the technological singularity, and futurism. Kurzweil is a public advocate for the futurist and transhumanist movements, as has been displayed in his vast collection of public talks, wherein he has shared his primarily optimistic outlooks on life extension technologies and the future of nanotechnology, robotics, and biotechnology. Kurzweil was the principal inventor of the first CCD flatbed scanner, the first omni-font optical character recognition, the first print-to-speech reading machine for the blind, the first commercial text-to-speech synthesizer, the first music synthesizer capable of recreating the grand piano and other orchestral instruments, and the first commercially marketed large-vocabulary speech recognition. Kurzweil received the 1999 National Medal of Technology and 350

Innovation, America's highest honor in technology, from President Clinton in a White House ceremony. He was the recipient of the $500,000 Lemelson-MIT Prize for 2001, the world's largest for innovation. And in 2002 he was inducted into the National Inventors Hall of Fame, established by the U.S. Patent Office. He has received nineteen honorary doctorates, and honors from three U.S. presidents. Kurzweil has been described as a "restless genius" by The Wall Street Journal and "the ultimate thinking machine" by Forbes. PBS included Kurzweil as one of 16 "revolutionaries who made America" along with other inventors of the past two centuries. Inc. magazine ranked him #8 among the "most fascinating" entrepreneurs in the United States and called him "Edison's rightful heir". Kurzweil has authored seven books, five of which have been national bestsellers. The Age of Spiritual Machines has been translated into 9 languages and was the #1 best-selling book on Amazon in science. Kurzweil's book The Singularity Is Near was a New York Times bestseller, and has been the #1 book on Amazon in both science and philosophy. His latest bestseller is How to Create a Mind: The Secret of Human Thought Revealed. Kurzweil speaks widely to audiences public and private and regularly delivers keynote speeches at industry conferences like DEMO, SXSW and TED. His website catalogs his public speaking, publications and media appearances. He has his own website, called KurzweilAI, which has over two million readers annually. <Futurist Ray Kurzweil predicts in-body computers and a potential war with machines> If you worry that the Internet, computers and other electronics play an outsized role in daily life, futurist Ray Kurzweil has one message for you: This is only the beginning. Kurzweil, who will speak Sunday night at the Smith Center for the Performing Arts as part of the Audi Speaker Series, predicts a hightech society that makes today's lifestyle look straight out of the Stone Age. As he sees it, people will have tiny computing devices in their bodies, more powerful brains and longer lives. Simply put, the world will be dominated by artificial intelligence. The 64-year-old entrepreneur is the leading evangelist of â&#x20AC;&#x153;Singularity,â&#x20AC;? the idea that machines will spontaneously adopt humanlike characteristics, become vastly more intelligent than people and change mankind forever. One possibility is they'll turn on us and wipe out humanity.


Kurzweil has pegged the transformation for 2045. “The nonbiological intelligence created in that year will be 1 billion times more powerful than all human intelligence today,” he says on Kurzweil has written several books and founded a number of technology companies, including FatKat, which develops patternrecognition systems for financial markets, and Kurzweil Applied Intelligence, which was launched in 1982 and developed a voiceactivated word processor. He recently was hired as director of engineering for Google. You have said that by the 2030s, people will have blood cell-sized computing devices in their bloodstreams and brains that connect directly to off-site computer data servers. What makes you think that? We already have computerized devices that are placed inside the body and even connected into the brain, such as neural implants for Parkinson’s disease and cochlear implants for the deaf. These devices can already wirelessly download new software from the cloud. Technology is shrinking at an exponential rate, which I’ve measured at about 100 in 3D volume per decade. At that rate, we will be able to introduce blood cell-sized devices that are robotic and have computers that can communicate wirelessly by the 2030s. How would such devices be regulated to ensure that outside forces can’t manipulate people’s thoughts and actions through the Internet? Privacy and security are already very significant issues, considering the personal and intimate things that people do with their computers. This is an issue we will never be able to cross off our “concern list,” but we’re actually not doing that badly. Relatively few people today complain that they have been significantly damaged by privacy and security breaches. I believe we will be able to keep up with the increasing sophistication of the technology. What kind of new capabilities could brain connectivity bring to humans? How would it affect people's intelligence, athletic abilities, life spans, reproductive capacity? We are already much smarter and more productive because of the brain extenders we have, ranging from Google to Wikipedia. When these services went on strike for one day last year to protest the federal Stop Online Piracy Act legislation, I felt like a part of my 352

brain had gone on strike. We are going to literally expand the scope and scale of our neocortex, which is where we do our thinking. Thinking bigger and bolder thoughts will ultimately enable us to overcome the major challenges that our civilization faces. You have said that you want to bring your father, who died in 1970, back to life. How and when could that be accomplished? The idea is to create an avatar that looks and acts like my father, based on the information we have about him, or anyone else. The more information we have about that person, the better the job we can do. The goal would be to pass a “Fredric Kurzweil Turing test,” that is for the avatar to be indistinguishable from the original person to the people who knew that person. In the case of my father, that is becoming an easier test as our memories of him are fading. Do you believe that humans, using technological advances, could achieve immortality? If so, how? And when? The goal is to achieve a tipping point where science is adding more time than is going by. That’s not a guarantee of immortality, but it would change the metaphor of the sands of time running out. I believe we are about 15 years away from such a tipping point. Could there be a time, as Google co-founder Larry Page said in 2004, that people simply think of a question and their smartphone tells them the answer? My project at Google is to help create a technology that will become familiar with your concerns and will find information that will meet your needs without your having to ask for it. For example, it might pop up and present — in your field of view using augmented reality — “you expressed concern about whether vitamin B12 is being absorbed by your cells, here is research released 12 seconds ago that shows a better way to do this.” A December story in Bloomberg Businessweek described you as a “quasi-religious figure” because of your role as the leading advocate for Singularity. A May 2009 Newsweek article about you and Singularity said the “last thing humanity needs right now is an apocalyptic cult masquerading as science.” How do you respond to those descriptions and accusations? My research has been a scientific study of technology trends, and my books, such as “The Singularity is Near,” have thousands of scientific citations. It is a thesis based on empirical data and 353

analysis. Of course, any scientific insight will have philosophical implications, but that is not where I started. These sorts of accusations are content-free ad-hominem attacks by people who simply donâ&#x20AC;&#x2122;t like the conclusions but are unable to criticize my actual arguments. Will the technological advances you predict change the way we are born? For instance, will be people be born smarter with computerlike brains already in place? Thatâ&#x20AC;&#x2122;s not likely to be an early development, just as we wait now at least a little while before introducing computers to children. But eventually we will probably augment brains at an early age. Do you think there could be a time when machines take on minds of their own and wage war with humans? If so, when? And who would win? I think human and computer intelligence will be mixed together just as it is now. We have conflicts today between groups of humans that are both enhanced by intelligent technology. A war between a group that used the latest technology and a group of humans who eschewed modern technology would be a very short war. f. Interactive Billboards: Displaying the Right Advertising For the Customer Passing by

Overview of Interactive Billboards 354

Text to vote. You choose the design. Youâ&#x20AC;&#x2122;re going how fast? All of these simple statements can be in the control of todayâ&#x20AC;&#x2122;s society due to the presence of interactive billboards. Interactive billboards are billboards that get consumers and onlookers alike, involved in their advertisement techniques. These billboards pull in consumers in order for them to have to do something in order for the advertisement to be effective, whether this be utilizing their smart phone or being in the right place at the right time. Reasons for Using Interactive Billboards Interactive Billboards are the latest and greatest craze in outdoor media. They are eye catching and make the onlooker feel as if they are part of the company and becoming one with the product. This is imperative to companies because it makes the person interacting with the billboard feel as if they are important and making important impacts on the future of the product. Limitations of Interactive Billboards At this point, the opportunities within interactive billboards seem endless. With technological advances popping up in society daily, any desire for the premium interaction between consumers and companies can be reached. A drawback to this emerging media is the pretty penny it costs to use them. Most of these billboards are digital, therefore the cost is very high. Also, since these billboards normally require some sort of technology from the consumer side, standard text messaging rates could apply to the consumer, therefore being a turn off to some people. Also, many companies choose to pair their digital billboards with Mobile Phone Applications, which can sometimes cost money to download. Another downfall to these advertisements is that they only reach the people in the vicinity of the billboard and who can see them. Although the smart phone applications can be brought around wherever the phone is, the most exciting and enticing time to use them is when a consumer is standing in front of the board, seeing the result of his/her interaction. Cost of Interactive Billboards The heftiest cost to interactive billboards is the actual billboard itself. With billboards already available, the price would be evaluated just as if you are buying a space to run an advertisement on television. Prices vary according to a sign's size and location, but the cost of advertising on a digital billboard runs from $1,200 to $10,000 a month, and the ad campaigns are typically not expensive to create (Goldstein, 2008). 355

Reach and Frequency of Interactive Billboards Times Square Domination is a newly formed company in New York City that is hoping to pair with advertising companies in the area that advertise in Times Square, in order to correlate the most extravagant digital billboards the city has to provide. Companies that have billboards such as, Clear Channel's Spectacolor HD sign, ABC SuperSign, the Nasdaq monitor and News Corporation's Astrovision sign, all hope to come together and use these billboards to the best of their ability. Times Square Domination is referred to as the nation's largest out-of home venue that reaches 565,000 people each day, multiple times during commute. These advertisements will air in selected slots and work in conjunction with marketing, mobile messaging and contests, again getting the consumer involved (Bachman 2009). Schedule Strategies for Interactive Billboards With any type of advertising, scheduling is imperative and this is no exception for interactive billboards. Interactive Billboards can change at any time because they are mostly digital. Smart Phone Applications that pair with interactive billboards normally work at all times, the thing that changes is what you will be able to see on the billboard. “There are a lot of people out there with a lot of good ideas who either don’t have access to funding, especially now, or don’t have access to the people that can make that happen,” he said. “And this gives them an opportunity to be in front of executives at a company like Coinstar, who can do all of the above, if they believe the idea is worth rolling out, and really take it to the next level.” (Cooper, 2009) General Impact of Interactive Billboards The appearances of these billboards are increasing at a lightning fast rate. The Outdoor Advertising Association of America, an industry trade group, projects that the number of digital billboards in the U.S. will expand at a rate of several hundred per year (Goldstein, 2008). With these billboards popping up every second it seems like, they will become a part of consumers life and buying decisions. These boards are captivating and always show that there are no limits to advertising. Audience Qualities of Interactive Billboards The general audience for interactive billboards depends on which company is advertising. Mostly, these advertisements target 356

people with smart phones in order to get them involved, but can also span down to children using the phone to get involved in a game to older adults, texting to vote, because theyâ&#x20AC;&#x2122;ve never been able to do this before. Responsiveness of Audience to Interactive Billboards The response of interactive billboards has hit the roof in the past couple of years. People are not used to what these billboards provide, therefore the newness of these boards are capturing and get people involved. These billboards capture â&#x20AC;&#x153;the promise of some flashy uses: slick iPhone or iPad apps; fancy mobile loyalty or coupling opportunities on check-in services,â&#x20AC;? (Karpinski, 2010) all things that get the consumer involved and more willing to buy. Interesting Qualities of Interactive Billboards Interactive Billboards are the first thing that has made it possible for the consumer to get fully involved in the advertising process through smart phones. The advertisement can be taken wherever the phone goes, making it very easy for companies to contact each downloader at anytime. This can increase frequency, while also making it fun for the consumer. Also, these billboards get the consumer involved immediately when they are in the vicinity of the advertisement. These interactive billboards are extremely enticing and in a place such as Times Square, always looked at to see what the latest and greatest technology is, capturing the consumer, when at times, they do not even know it. Successful Use of Interactive Billboards


g. Technologies for Silver Industry <High-tech devices to meet housing and care needs of older people> Smart vests, ‘granny pods’ and robot friends: is this the future for our ageing population? Predicting the future is a precarious business but if the cuttingedge research being carried out around the globe is a clue then today’s baby boomers will be spending their dotage in mobile “pods” parked in a relative’s back garden, with a robot to fetch and carry, and a fluffy seal toy which responds to voice and touch for company. Older people – as the UK charity Age UK refers to the over-65s – and how to house them are issues that have come to the forefront of scientific exploration because the world is undergoing a momentous demographic shift. People are living longer and the result, according to the UN, is that there will be two billion people aged over 60 worldwide by 2050. Many will not have an extended family to care for them, and the current options of care homes and nursing homes are neither appealing nor able to cope with the sheer numbers involved. Enter the robot – or at least a spectrum of technology to make independent living easier, safer and even companionable in a weird, techie way. 358

Ken Dupin, who is based in Virginia, US, first began considering this problem a decade ago, while studying for a PhD in international development. As he travelled around Asia, South America and the Middle East talking to families and older people, he saw at first hand how disparate cultures care for older relatives. “In many of those places the entire family participated in care, whereas here we have a system of nursing homes and assisted living institutions,” he says. “Nobody really wants to go to these institutions and they are very expensive. I began to think about other options.” Dupin’s solution is the MEDcottage – or “granny pod” – a mobile home with 288 sq ft of living space. It can be parked in a relative’s backyard (or shuttled between family members), giving both the older person and their family privacy, while ensuring help is close at hand. The pod is fitted with sensors to monitor for practical problems like water leaks. If a leak is detected, an email or text is sent to a designated family member. Family members or carers can keep an eye on a MEDcottage dweller via a CCTV system which is positioned to cover an area about 12 inches above floor level. Positioning monitors at this level may seem unusual but the idea is that an occupant’s fall will be noticed while their general activities remain private. In the first year of operation three MEDcottages have been sold, priced between $40,000 and $100,000-plus, depending on the specification. Another three are on order. Much of the technology on offer to older people is, like the MEDcottage, available in North America and focused mainly on remotely monitoring health and safety within a sheltered housing environment. Residents of the Stephen Foster Senior Apartments in Louisville, Kentucky, for example, hold teleconferences with their doctors via their television sets, while an on-site nurse is on hand to carry out any necessary tests. At Eskaton Village, in Roseville, California, which is home to 115 older people, apartments are fitted with motion sensors which respond to anomalies in residents’ regular routines. If someone appears to be getting up through the night more than usual, for example, staff on site will be alerted to check on them. But at the cutting-edge, scientists are increasingly interested in how to retrofit homes to allow older people to retain their independence within familiar surroundings. 359

Dr Thomas Linner, based at the Technische Universität München in Germany, is developing what he describes as a “wonderwall” to assist with everything from monitoring blood pressure to finding lost glasses. In reality, the wonderwall looks more like a cupboard. It is designed to stand in a hallway, to complete the domestic camouflage, and it comes fitted with a mirror and coat pegs as well as smart technology. The wonderwall is an ideal home help and, indeed, there may be many able-bodied young people who could do with one. It issues an alert if residents start to leave the house without taking their keys from a built-in holder. In addition, an “indoor positioning system” can help to locate important items like glasses or anything else which tends to trigger the irritating “where-are-mygloves/keys/boots” panic. The objects in question simply have to be fitted with an identification chip. Tactfulness is an unexpected dimension of this system. Instead of a raucous alarm, the wonderwall will allow its owner to know about lost items with an inconspicuous signal of the owner’s choice. “The alert can be musical or a light coming on so that other people in the room do not know that the elderly person has forgotten something,” says Linner. He hopes a version of the wonderwall will be on the market within five years. In future he plans to augment it with a voice-activated mobile robot to carry out chores like turning on lights or carrying shopping. He has also designed an armchair that acts as a mobile gym – it is fitted with cross-trainer-style levers instead of armrests, and bio sensors that monitor blood pressure. Another in-home solution is being engineered by Maged N. Kamel Boulos, associate professor of health informatics at Plymouth University, southwest England. He has created a “smart vest”, designed to be worn under clothing, embedded with sensors to monitor vital signs. If a problem is detected, a distress signal is sent to a central monitoring station staffed by medics who will contact the wearer or a family member. The vest is also fitted with GPS technology which can locate the wearer if they get lost. All of which leaves two important questions about this gadgetry: will older people be able to get to grips with it, and will such reliance on technology lead to loneliness and isolation? 360

Stuart Greenbaum, vice-president of Eskaton, the company which runs Eskaton Village, has been pleasantly surprised by the willingness of many residents to tackle new technology – so long as they are offered plenty of sympathetic face-to-face support. “We have to appreciate that it is going to take older adults a little longer to feel comfortable with this sort of technology,” he says. “Providing technical support by people who are going to be more patient with them, and who will encourage them to make notes so they can remember how to do things, is very important.” The question of social isolation is more complex, however. A slightly unsettling project by Japan’s National Institute of Advanced Industrial Science and Technology has led to the development of Paro, a “therapeutic robot” disguised as a fluffy toy. Paro, who looks like a baby seal, is aimed specifically at older people and is covered in sensors which respond to sound and touch. Studies at a day care centre found that older clients who petted and spoke to the toy experienced benefits in terms of reduced stress, greater motivation and better socialisation with staff and carers. There has, however, been no significant research into the impact of technology on older people’s emotional wellbeing. Dr Matthew Norton, social and economic research manager at Age UK, a charity dedicated to helping older people, believes technology does have a role. But he has a proviso. “It has to be implemented in the correct way, in conjunction with the older person, and it must be introduced as part of a care package,” he says. “Older people are accepting of technology so long as it does not take away things that they value, such as help from social care professionals. “It can often be the family which pushes the technology on the older person, and they can fear it will mean they do not see them as much.” Norton points out that if an older person learns to use Skype or online forums, it can increase contact with the outside world. However, he cautions that it is too soon to tell whether remote or robotic contact can make up for a lack of human contact. Back in Virginia, Dupin is also considering the emotional welfare of 361

future granny pod residents. He is developing an avatar, provisionally named Sidney, who would appear on a flatscreen TV to chat to the resident. Sidney would be able to remind them to take their medicine and ask questions such as what they would like to watch on TV or what music they would like to hear. Having a digital avatar for company sounds rather Brave New World. But in a country where fewer older people can rely on traditional – family – support, Dupin considers Sidney as a best alternative. “Other cultures see old age as a celebrated time and not a difficult time, which often disappoints me about the United States,” he says. “But it is a hard message to get across in a culture which so worships youth.” 2. Creative Ideas in Implementation a. Brainstorming: Smart Restroom How can you make a restroom smart? Try to think about current technologies we use on a daily basis and implement them to create a “smart” restroom.


Exercise: 1. Individual business plan and proposal for Gwangju a. In 3 pages (A4) b. Follow formal business plan form


Website to Look @: National Convergence Technology Center

10 Brilliant Interactive Billboards [VIDEOS]


Chapter XII. Entrepreneurship in Culture & Art Contents Industry

<Fig. 12. 1. Startups are companies set up to test business models developed around new ideas. Typically they have fewer than fifty employees. Startups are usually made up of developers and designers â&#x20AC;&#x201C; people who write code and those who can design a consumerfriendly interface. To build their idea startups work with investors. Investors are drawn to startups because the cost is low and despite higher risk, can offer significantly higher returns if the idea becomes popular. Once funded, startups can grow quickly while maintaining low costs and limited labor.> <In this chapterâ&#x20AC;Ś> 1. Forms and documents for Entrepreneurship 2. Business proposal review a. How to write a business proposal b. Dilemmas in Entrepreneurship c. Revision of Business Proposal 3. Entrepreneurship in Culture & Art Contents Industry a. Form a business (L.L.C.) b. Getting a business license


Startup Company A startup company or startup is a company, a partnership or temporary organization designed to search for a repeatable and scalable business model. These companies, generally newly created, are in a phase of development and research for markets. The term became popular internationally during the dot-com bubble when a great number of dot-com companies were founded. Evolution of a startup company Startup companies can come in all forms. A critical task in setting up a business is to conduct research in order to validate, assess and develop the ideas or business concepts in addition to opportunities to establish further and deeper understanding on the ideas or business concepts as well as their commercial potential. A company may cease to be a startup as it passes various milestones, such as becoming publicly traded in an IPO, or ceasing to exist as an independent entity via a merger or acquisition. Companies may also fail and cease to operate altogether. Investors are generally most attracted to those new companies distinguished by their risk/reward profile and scalability. That is, they have lower bootstrapping costs, higher risk, and higher potential return on investment. Successful startups are typically more scalable than an established business, in the sense that they can potentially grow rapidly with limited investment of capital, labor or land. Startups encounter several unique options for funding. Venture capital firms and angel investors may help startup companies begin operations, exchanging cash for an equity stake. In practice though, many startups are initially funded by the founders themselves. Factoring is another option, though not unique to startups. Some new funding opportunities are also developing in crowd funding. Startup culture Startups utilize a casual attitude in some respects to promote efficiency in the workplace, which is needed to get their business off of the ground. In a 1960 study, Douglas McGregor stressed that punishments and rewards for uniformity in the workplace is not necessary, as some people are born with the motivation to work without incentives. This removal of stressors allows the workers and researchers to focus less on the work environment around them, and more at the task at hand, giving them the potential to achieve something great for their company. This culture has evolved to include larger companies today aiming at acquiring the bright minds driving startups. Google, amongst other companies, has made strides to make purchased startups and their workers feel right at home in their offices, even letting them bring their dogs to work. The main goal 366

behind all changes to the culture of the startup workplace, or a company hiring workers from a startup to do similar work, is to make the people feel as comfortable as possible so they can have the best performance in the office. Co-founders Co-founders are people involved in the cultivation of startup companies. Anyone can be a co-founder, and an existing company can also be a cofounder, but frequently co-founders are entrepreneurs, engineers, hackers, venture capitalists, web developers, web designers and others involved in the ground level of a new, often high tech, venture. There is no formal, legal definition of what makes somebody a co-founder. The right to call oneself a co-founder can be established through an agreement with one's fellow co-founders or with permission of the board of directors, investors or shareholders of a startup company. When there is no definitive agreement, disputes about who the co-founders were can arise. One example of such a dispute was a lawsuit against Elon Musk by a co-founder of Tesla Motors. Martin Eberhard alleged that Musk did not have the right to consider himself a co-founder merely because he provided a large amount of capital and was instrumental in saving the company from bankruptcy. Internal startups Large or well-established companies often try to promote innovation by setting up "internal startups", new business divisions that operate at arm's length from the rest of the company. Examples include Target Corporation (which began as an internal startup of the Dayton's department store chain) and threedegrees, a product developed by an internal startup of Microsoft. Trends and obstacles If a company's value is based on its technology, it is often equally important for the business owners to obtain intellectual property protection for their idea. The newsmagazine The Economist estimated that up to 75% of the value of US public companies is now based on their intellectual property (up from 40% in 1980).Often, 100% of a small startup company's value is based on its intellectual property. As such, it is important for technology oriented startup companies to develop a sound strategy for protecting their intellectual capital as early as possible. Startup companies, particularly those associated with new technology, sometimes produce huge returns to their creators and investors â&#x20AC;&#x201C; a recent example of such was Google, whose creators became billionaires through their stock ownership and options. However, the failure rate of startup companies is very high. While there are startup businesses created in all types of businesses, and all over the world, some locations and business sectors are particularly associated 367

with startup companies. The Internet bubble of the late 1990s was associated with huge numbers of internet startup companies, some selling the technology to provide internet access, others using the internet to provide services. Most of this startup activity was located in Silicon Valley, an area of northern California renowned for the high level of startup company activity: The spark that set off the explosive boom of “Silicon startups” in Stanford Industrial Park was a personal dispute in 1957 between employees of Shockley Semiconductor and the company’s namesake and founder, Nobel laureate and co-inventor of the transistor William Shockley... (His employees) formed Fairchild Semiconductor immediately following their departure... After several years, Fairchild gained its footing, becoming a formidable presence in this sector. Its founders began to leave to start companies based on their own, latest ideas and were followed on this path by their own former leading employees... The process gained momentum and what had once began in a Stanford’s research park became a veritable startup avalanche... Thus, over the course of just 20 years, a mere eight of Shockley’s former employees gave forth 65 new enterprises, which then went on to do the same... Recently the patent assets of failed startup companies are being purchased by what are derogatorily known as "Patent trolls" who then take the patents from the companies and assert those patents against companies that might be infringing the technology covered by the patent. <Startup = Growth> A startup is a company designed to grow fast. Being newly founded does not in itself make a company a startup. Nor is it necessary for a startup to work on technology, or take venture funding, or have some sort of "exit." The only essential thing is growth. Everything else we associate with startups follows from growth. If you want to start one it's important to understand that. Startups are so hard that you can't be pointed off to the side and hope to succeed. You have to know that growth is what you're after. The good news is, if you get growth, everything else tends to fall into place. Which means you can use growth like a compass to make almost every decision you face. Redwoods Let's start with a distinction that should be obvious but is often overlooked: not every newly founded company is a startup. Millions of companies are started every year in the US. Only a tiny fraction are startups. Most are service businesses—restaurants, barbershops, plumbers, and so on. These are not startups, except in a few unusual cases. A barbershop isn't designed to grow fast. Whereas a search engine, for example, is. When I say startups are designed to grow fast, I mean it in two senses. Partly I 368

mean designed in the sense of intended, because most startups fail. But I also mean startups are different by nature, in the same way a redwood seedling has a different destiny from a bean sprout. That difference is why there's a distinct word, "startup," for companies designed to grow fast. If all companies were essentially similar, but some through luck or the efforts of their founders ended up growing very fast, we wouldn't need a separate word. We could just talk about super-successful companies and less successful ones. But in fact startups do have a different sort of DNA from other businesses. Google is not just a barbershop whose founders were unusually lucky and hard-working. Google was different from the beginning. To grow rapidly, you need to make something you can sell to a big market. That's the difference between Google and a barbershop. A barbershop doesn't scale. For a company to grow really big, it must (a) make something lots of people want, and (b) reach and serve all those people. Barbershops are doing fine in the (a) department. Almost everyone needs their hair cut. The problem for a barbershop, as for any retail establishment, is (b). A barbershop serves customers in person, and few will travel far for a haircut. And even if they did the barbershop couldn't accomodate them. Writing software is a great way to solve (b), but you can still end up constrained in (a). If you write software to teach Tibetan to Hungarian speakers, you'll be able to reach most of the people who want it, but there won't be many of them. If you make software to teach English to Chinese speakers, however, you're in startup territory. Most businesses are tightly constrained in (a) or (b). The distinctive feature of successful startups is that they're not. Ideas It might seem that it would always be better to start a startup than an ordinary business. If you're going to start a company, why not start the type with the most potential? The catch is that this is a (fairly) efficient market. If you write software to teach Tibetan to Hungarians, you won't have much competition. If you write software to teach English to Chinese speakers, you'll face ferocious competition, precisely because that's such a larger prize. The constraints that limit ordinary companies also protect them. That's the tradeoff. If you start a barbershop, you only have to compete with other local barbers. If you start a search engine you have to compete with the whole world. The most important thing that the constraints on a normal business protect it from is not competition, however, but the difficulty of coming up with new ideas. If you open a bar in a particular neighborhood, as well as limiting your 369

potential and protecting you from competitors, that geographic constraint also helps define your company. Bar + neighborhood is a sufficient idea for a small business. Similarly for companies constrained in (a). Your niche both protects and defines you. Whereas if you want to start a startup, you're probably going to have to think of something fairly novel. A startup has to make something it can deliver to a large market, and ideas of that type are so valuable that all the obvious ones are already taken. That space of ideas has been so thoroughly picked over that a startup generally has to work on something everyone else has overlooked. I was going to write that one has to make a conscious effort to find ideas everyone else has overlooked. But that's not how most startups get started. Usually successful startups happen because the founders are sufficiently different from other people that ideas few others can see seem obvious to them. Perhaps later they step back and notice they've found an idea in everyone else's blind spot, and from that point make a deliberate effort to stay there. But at the moment when successful startups get started, much of the innovation is unconscious. What's different about successful founders is that they can see different problems. It's a particularly good combination both to be good at technology and to face problems that can be solved by it, because technology changes so rapidly that formerly bad ideas often become good without anyone noticing. Steve Wozniak's problem was that he wanted his own computer. That was an unusual problem to have in 1975. But technological change was about to make it a much more common one. Because he not only wanted a computer but knew how to build them, Wozniak was able to make himself one. And the problem he solved for himself became one that Apple solved for millions of people in the coming years. But by the time it was obvious to ordinary people that this was a big market, Apple was already established. Google has similar origins. Larry Page and Sergey Brin wanted to search the web. But unlike most people they had the technical expertise both to notice that existing search engines were not as good as they could be, and to know how to improve them. Over the next few years their problem became everyone's problem, as the web grew to a size where you didn't have to be a picky search expert to notice the old algorithms weren't good enough. But as happened with Apple, by the time everyone else realized how important search was, Google was entrenched. That's one connection between startup ideas and technology. Rapid change in one area uncovers big, soluble problems in other areas. Sometimes the changes are advances, and what they change is solubility. That was the kind of change that yielded Apple; advances in chip technology finally let Steve Wozniak design a computer he could afford. But in Google's case the most important change was the growth of the web. What changed there was not solubility but bigness.


The other connection between startups and technology is that startups create new ways of doing things, and new ways of doing things are, in the broader sense of the word, new technology. When a startup both begins with an idea exposed by technological change and makes a product consisting of technology in the narrower sense (what used to be called "high technology"), it's easy to conflate the two. But the two connections are distinct and in principle one could start a startup that was neither driven by technological change, nor whose product consisted of technology except in the broader sense. Rate How fast does a company have to grow to be considered a startup? There's no precise answer to that. "Startup" is a pole, not a threshold. Starting one is at first no more than a declaration of one's ambitions. You're committing not just to starting a company, but to starting a fast growing one, and you're thus committing to search for one of the rare ideas of that type. But at first you have no more than commitment. Starting a startup is like being an actor in that respect. "Actor" too is a pole rather than a threshold. At the beginning of his career, an actor is a waiter who goes to auditions. Getting work makes him a successful actor, but he doesn't only become an actor when he's successful. So the real question is not what growth rate makes a company a startup, but what growth rate successful startups tend to have. For founders that's more than a theoretical question, because it's equivalent to asking if they're on the right path. The growth of a successful startup usually has three phases: 1. There's an initial period of slow or no growth while the startup tries to figure out what it's doing. 2. As the startup figures out how to make something lots of people want and how to reach those people, there's a period of rapid growth. 3. Eventually a successful startup will grow into a big company. Growth will slow, partly due to internal limits and partly because the company is starting to bump up against the limits of the markets it serves. Together these three phases produce an S-curve. The phase whose growth defines the startup is the second one, the ascent. Its length and slope determine how big the company will be. The slope is the company's growth rate. If there's one number every founder should always know, it's the company's growth rate. That's the measure of a startup. If you don't know that number, you don't even know if you're doing well or badly. When I first meet founders and ask what their growth rate is, sometimes they 371

tell me "we get about a hundred new customers a month." That's not a rate. What matters is not the absolute number of new customers, but the ratio of new customers to existing ones. If you're really getting a constant number of new customers every month, you're in trouble, because that means your growth rate is decreasing. During Y Combinator we measure growth rate per week, partly because there is so little time before Demo Day, and partly because startups early on need frequent feedback from their users to tweak what they're doing. A good growth rate during YC is 5-7% a week. If you can hit 10% a week you're doing exceptionally well. If you can only manage 1%, it's a sign you haven't yet figured out what you're doing. The best thing to measure the growth rate of is revenue. The next best, for startups that aren't charging initially, is active users. That's a reasonable proxy for revenue growth because whenever the startup does start trying to make money, their revenues will probably be a constant multiple of active users. Compass We usually advise startups to pick a growth rate they think they can hit, and then just try to hit it every week. The key word here is "just." If they decide to grow at 7% a week and they hit that number, they're successful for that week. There's nothing more they need to do. But if they don't hit it, they've failed in the only thing that mattered, and should be correspondingly alarmed. Programmers will recognize what we're doing here. We're turning starting a startup into an optimization problem. And anyone who has tried optimizing code knows how wonderfully effective that sort of narrow focus can be. Optimizing code means taking an existing program and changing it to use less of something, usually time or memory. You don't have to think about what the program should do, just make it faster. For most programmers this is very satisfying work. The narrow focus makes it a sort of puzzle, and you're generally surprised how fast you can solve it. Focusing on hitting a growth rate reduces the otherwise bewilderingly multifarious problem of starting a startup to a single problem. You can use that target growth rate to make all your decisions for you; anything that gets you the growth you need is ipso facto right. Should you spend two days at a conference? Should you hire another programmer? Should you focus more on marketing? Should you spend time courting some big customer? Should you add x feature? Whatever gets you your target growth rate. Judging yourself by weekly growth doesn't mean you can look no more than a week ahead. Once you experience the pain of missing your target one week (it was the only thing that mattered, and you failed at it), you become interested in anything that could spare you such pain in the future. So you'll be willing for example to hire another programmer, who won't contribute to this 372

week's growth but perhaps in a month will have implemented some new feature that will get you more users. But only if (a) the distraction of hiring someone won't make you miss your numbers in the short term, and (b) you're sufficiently worried about whether you can keep hitting your numbers without hiring someone new. It's not that you don't think about the future, just that you think about it no more than necessary. In theory this sort of hill-climbing could get a startup into trouble. They could end up on a local maximum. But in practice that never happens. Having to hit a growth number every week forces founders to act, and acting versus not acting is the high bit of succeeding. Nine times out of ten, sitting around strategizing is just a form of procrastination. Whereas founders' intuitions about which hill to climb are usually better than they realize. Plus the maxima in the space of startup ideas are not spiky and isolated. Most fairly good ideas are adjacent to even better ones. The fascinating thing about optimizing for growth is that it can actually discover startup ideas. You can use the need for growth as a form of evolutionary pressure. If you start out with some initial plan and modify it as necessary to keep hitting, say, 10% weekly growth, you may end up with a quite different company than you meant to start. But anything that grows consistently at 10% a week is almost certainly a better idea than you started with. There's a parallel here to small businesses. Just as the constraint of being located in a particular neighborhood helps define a bar, the constraint of growing at a certain rate can help define a startup. You'll generally do best to follow that constraint wherever it leads rather than being influenced by some initial vision, just as a scientist is better off following the truth wherever it leads rather than being influenced by what he wishes were the case. When Richard Feynman said that the imagination of nature was greater than the imagination of man, he meant that if you just keep following the truth you'll discover cooler things than you could ever have made up. For startups, growth is a constraint much like truth. Every successful startup is at least partly a product of the imagination of growth. Value It's hard to find something that grows consistently at several percent a week, but if you do you may have found something surprisingly valuable. If we project forward we see why.


A company that grows at 1% a week will grow 1.7x a year, whereas a company that grows at 5% a week will grow 12.6x. A company making $1000 a month (a typical number early in YC) and growing at 1% a week will 4 years later be making $7900 a month, which is less than a good programmer makes in salary in Silicon Valley. A startup that grows at 5% a week will in 4 years be making $25 million a month. Our ancestors must rarely have encountered cases of exponential growth, because our intuitions are no guide here. What happens to fast growing startups tends to surprise even the founders. Small variations in growth rate produce qualitatively different outcomes. That's why there's a separate word for startups, and why startups do things that ordinary companies don't, like raising money and getting acquired. And, strangely enough, it's also why they fail so frequently. Considering how valuable a successful startup can become, anyone familiar with the concept of expected value would be surprised if the failure rate weren't high. If a successful startup could make a founder $100 million, then even if the chance of succeeding were only 1%, the expected value of starting one would be $1 million. And the probability of a group of sufficiently smart and determined founders succeeding on that scale might be significantly over 1%. For the right peopleâ&#x20AC;&#x201D;e.g. the young Bill Gatesâ&#x20AC;&#x201D;the probability might be 20% or even 50%. So it's not surprising that so many want to take a shot at it. In an efficient market, the number of failed startups should be proportionate to the size of the successes. And since the latter is huge the former should be too. What this means is that at any given time, the great majority of startups will be working on something that's never going to go anywhere, and yet glorifying their doomed efforts with the grandiose title of "startup." This doesn't bother me. It's the same with other high-beta vocations, like being an actor or a novelist. I've long since gotten used to it. But it seems to bother a lot of people, particularly those who've started ordinary businesses. Many are annoyed that these so-called startups get all the attention, when hardly any of 374

them will amount to anything. If they stepped back and looked at the whole picture they might be less indignant. The mistake they're making is that by basing their opinions on anecdotal evidence they're implicitly judging by the median rather than the average. If you judge by the median startup, the whole concept of a startup seems like a fraud. You have to invent a bubble to explain why founders want to start them or investors want to fund them. But it's a mistake to use the median in a domain with so much variation. If you look at the average outcome rather than the median, you can understand why investors like them, and why, if they aren't median people, it's a rational choice for founders to start them. Deals Why do investors like startups so much? Why are they so hot to invest in photosharing apps, rather than solid money-making businesses? Not only for the obvious reason. The test of any investment is the ratio of return to risk. Startups pass that test because although they're appallingly risky, the returns when they do succeed are so high. But that's not the only reason investors like startups. An ordinary slower-growing business might have just as good a ratio of return to risk, if both were lower. So why are VCs interested only in high-growth companies? The reason is that they get paid by getting their capital back, ideally after the startup IPOs, or failing that when it's acquired. The other way to get returns from an investment is in the form of dividends. Why isn't there a parallel VC industry that invests in ordinary companies in return for a percentage of their profits? Because it's too easy for people who control a private company to funnel its revenues to themselves (e.g. by buying overpriced components from a supplier they control) while making it look like the company is making little profit. Anyone who invested in private companies in return for dividends would have to pay close attention to their books. The reason VCs like to invest in startups is not simply the returns, but also because such investments are so easy to oversee. The founders can't enrich themselves without also enriching the investors. Why do founders want to take the VCs' money? Growth, again. The constraint between good ideas and growth operates in both directions. It's not merely that you need a scalable idea to grow. If you have such an idea and don't grow fast enough, competitors will. Growing too slowly is particularly dangerous in a business with network effects, which the best startups usually have to some degree. Almost every company needs some amount of funding to get started. But startups often raise money even when they are or could be profitable. It might seem foolish to sell stock in a profitable company for less than you think it will 375

later be worth, but it's no more foolish than buying insurance. Fundamentally that's how the most successful startups view fundraising. They could grow the company on its own revenues, but the extra money and help supplied by VCs will let them grow even faster. Raising money lets you choose your growth rate. Money to grow faster is always at the command of the most successful startups, because the VCs need them more than they need the VCs. A profitable startup could if it wanted just grow on its own revenues. Growing slower might be slightly dangerous, but chances are it wouldn't kill them. Whereas VCs need to invest in startups, and in particular the most successful startups, or they'll be out of business. Which means that any sufficiently promising startup will be offered money on terms they'd be crazy to refuse. And yet because of the scale of the successes in the startup business, VCs can still make money from such investments. You'd have to be crazy to believe your company was going to become as valuable as a high growth rate can make it, but some do. Pretty much every successful startup will get acquisition offers too. Why? What is it about startups that makes other companies want to buy them? Fundamentally the same thing that makes everyone else want the stock of successful startups: a rapidly growing company is valuable. It's a good thing eBay bought Paypal, for example, because Paypal is now responsible for 43% of their sales and probably more of their growth. But acquirers have an additional reason to want startups. A rapidly growing company is not merely valuable, but dangerous. If it keeps expanding, it might expand into the acquirer's own territory. Most product acquisitions have some component of fear. Even if an acquirer isn't threatened by the startup itself, they might be alarmed at the thought of what a competitor could do with it. And because startups are in this sense doubly valuable to acquirers, acquirers will often pay more than an ordinary investor would. [14] Understand The combination of founders, investors, and acquirers forms a natural ecosystem. It works so well that those who don't understand it are driven to invent conspiracy theories to explain how neatly things sometimes turn out. Just as our ancestors did to explain the apparently too neat workings of the natural world. But there is no secret cabal making it all work. If you start from the mistaken assumption that Instagram was worthless, you have to invent a secret boss to force Mark Zuckerberg to buy it. To anyone who knows Mark Zuckerberg that is the reductio ad absurdum of the initial assumption. The reason he bought Instagram was that it was valuable and dangerous, and what made it so was growth. If you want to understand startups, understand growth. Growth drives everything in this world. Growth is why startups usually work on technologyâ&#x20AC;&#x201D; 376

because ideas for fast growing companies are so rare that the best way to find new ones is to discover those recently made viable by change, and technology is the best source of rapid change. Growth is why it's a rational choice economically for so many founders to try starting a startup: growth makes the successful companies so valuable that the expected value is high even though the risk is too. Growth is why VCs want to invest in startups: not just because the returns are high but also because generating returns from capital gains is easier to manage than generating returns from dividends. Growth explains why the most successful startups take VC money even if they don't need to: it lets them choose their growth rate. And growth explains why successful startups almost invariably get acquisition offers. To acquirers a fastgrowing company is not merely valuable but dangerous too. It's not just that if you want to succeed in some domain, you have to understand the forces driving it. Understanding growth is what starting a startup consists of. What you're really doing (and to the dismay of some observers, all you're really doing) when you start a startup is committing to solve a harder type of problem than ordinary businesses do. You're committing to search for one of the rare ideas that generates rapid growth. Because these ideas are so valuable, finding one is hard. The startup is the embodiment of your discoveries so far. Starting a startup is thus very much like deciding to be a research scientist: you're not committing to solve any specific problem; you don't know for sure which problems are soluble; but you're committing to try to discover something no one knew before. A startup founder is in effect an economic research scientist. Most don't discover anything that remarkable, but some discover relativity. 1. Forms and documents from Entrepreneurship To start a company, many legal forms and documentations are required. Whatâ&#x20AC;&#x2122;re required vary depending on where you want to form a company. But, typical forms required are as the following: Profit and Loss Statement - This is a general Statement of Profits and Losses for a company. It lists in detail, all profits, or gains, as well as all losses the business may have suffered. This form can be used by any type of company, whether a corporation or a sole proprietor. General Trademark License Agreement - This form is a Trademark License Agreement. The licensor is the owner of certain trademarks and the licensee desires to use the trademark on the terms and conditions set forth in the agreement. The licensor agrees to grant to the licensee an exclusive worldwide right and license to use the trademark in connection with the licensee's product. Assignment of Member Interest in Limited Liability Company - This form may be used to transfer the interest of a member in a LLC to another party. An assignment of this interest does not dissolve the company or entitle the assignee to become or to exercise any rights of a member. 377

An assignment entitles the assignee to receive, to the extent assigned, the distributions of cash and other property and the allocations of profits, losses, income, gains, deductions, credits, or similar items to which the assignee's assignor would have been entitled. The Assignor ceases to be a member upon assignment of all the assignor's membership interest. Resolution of Meeting of LLC Members to Sell or Transfer Stock - This form is a resolution of meeting of LLC members to sell or transfer stock. Notice of Meeting of LLC Members - General Purpose - This form is a Notice of Meeting of LLC members for the purpose as stated in the form. Limited Liability Company LLC Operating Agreement - This form is a Limited Liability Company Agreement. The parties have agreed to form a limited liability company upon the terms listed in the agreement. However, the form also lists the actions or events which would result in the termination of membership in the limited liability company. Resolution of Meeting of LLC Members to Authorize Contract - This form is a resolution from a meeting of LLC members to authorize a contact. Provisions are included to describe the purpose of the contract. Job Invoice-Short - This form is a job invoice form. It contains provisions for a job description, starting date, completion date, date and hours worked, list of materials and costs, and an itemized statement of total due for materials, labor, and other. Employment Agreement - General - This form is used when an Employee agrees to be employed by Employer, and the Employer agrees to employ the Employee, for the purpose of performance by and on behalf of Employer services as may be reasonably requested from time to time by the Employer. The agreement contains provisions for compensation, confidentiality, non-competition and breach of contract. Employment Agreement with Covenant Not to Compete - This form is used when an Employee agrees to be employed by an Employer, and the Employer agrees to employ the Employee, for the purpose of performance by and on behalf of the Employer as may be reasonably requested from time to time by the Employer. This agreement contains a covenant not to compete clause. Self-Employed Independent Contractor Employment Agreement General - A company agrees to hire a contractor to perform work on the terms and conditions set forth in the agreement. The contractor agrees that all financial and accounting records will remain the confidential property of the company. The form also provides that the company will reimburse the contractor for all reasonable and necessary expenses incurred by the contractor with the performance of his/her 378

duties. Secrecy, Nondisclosure and Confidentiality Agreement by Employee or Consultant to Owner - The first party has possession of proprietary information and know-how relating to an idea, product or service, and wishes to employ the second party but desires that the second party agree not to disclose information learned by second party during such employment. Both parties agree that all information, ideas, products or services, processes, written material, samples, models and all other information of any type, whether written or oral, submitted to the second party by the first party is now, and will remain, the property of first party. Drug Testing Policy Disclosure and Consent Form - This form explains the drug testing policies of a particular company and includes a consent form. Employee Permission to Do a Background Check - This is a form signed by an employee or prospective employee granting an employer permission to do a background check. Employment Position Announcement - This form is a business type form that is formatted to allow you to complete the form using Adobe Acrobat or Word. This form allows an employer to announce that applicants for a position with the company are being sought. Consultant Agreement - This form is a Consultant Agreement for use with consultants exposed to commercial trade secrets or other confidential information as part of their work with a business. Internet Use Policy - This agreement is to be signed by an employee upon the request of a company concerning the proper uses of internet access. The agreement defines acceptable uses and states that the inappropriate use of the Internet may lead to denial of access or other action by the company. Also you might need: Employment Termination Agreement, Cash Disbursements and Receipts, Check Request form, Daily Accounts Receivable, Yearly Expenses by Quarter, Petty Cash Form and Purchasing Cost Estimate 2. Business proposal review a. How to write a business proposal <How to Write a Business Proposal> To write a business proposal that gets the business requires plenty of preparation and work. The most common mistake made by 379

business proposal writers is a lack of understand of the client’s business, industry and challenges. Because the business proposal process can be time consuming, it’s easy to want to take the short cut and create a simple template for submitting a proposal. Yet, this quick cut and paste methodology is a path to getting your proposal tossed and your bid out of the running. To write a business proposal worthy of your clients attention and able to solve their most vexing problems requires information. You need to clearly understand the issues the client is facing while leaving your own assumptions and immediate solutions on the table. If you want your business proposal to stand out in the sea of competing firms, the essential step is to thoroughly interview your client. The First Step in Writing a Business Proposal Getting a client’s business is all about one thing… selling. The best sales person does less talking and more listening. Craft a list of essential questions to understand your potential customer’s business. Here are some questions to help you build your interview question list: • • • • • • • • • • • •

What is the current challenge your business is facing? What is the greatest challenge your industry is facing? When did you first determine this business problem existed? What have you done in the past to address this issue and what was the outcome? What is the best outcome you wish to achieve with this project? What current information does your company have to solve this problem? Will our firm have full access to the stake holders involved in this project to ensure success? Is your company looking for recommendations or also help in the implementation of those recommendations? When do you want this project completed? To implement our recommendations, what obstacles will be necessary to overcome? Do you have a set budget for this project? Formulating a list of potential questions to ask prior to the meeting will help save any misunderstanding and create the foundation for a successful business partnership.

Before you meet your potential customer, take a few deep 380

breaths and remember they are seriously interested in what your business can offer. Otherwise, they wouldnâ&#x20AC;&#x2122;t have taken the time to meet with you. Once you have engaged the client and extracted the necessary information, you now can write a business proposal that has much greater odds in closing the deal. <Tips for Writing a Business Proposal> Business in the nineties means fierce competition, aggressive marketing and strategic alliances. The extent to which a business succeeds or fails often depends upon that business's ability to be awarded contracts or to attract other businesses into Joint Ventures or strategic alliances. To accomplish either one usually requires two key items: good ideas and the ability to present those good ideas in a superbly developed business proposal. Business proposals are developed for one of two possible reasons. (1) A business entity has called for tenders or has invited you to submit a RFP (Request for Proposal). In this case, your goal is to be "short listed," meaning that you will be one of the three or four bidders who is awarded an interview. Your proposal must stand among possibly dozens of submissions. (2) You have an idea, concept or project that you want to propose to someone with the goal of gaining support, funding or an alliance. In this case, there is no competitive bidding process. However, your proposal must make a favorable impression and must explain all aspects of your proposed concept clearly and quickly. A document that is vaguely written, difficult to understand or that presents more questions than answers will likely be discarded promptly. The following eleven tips are guidelines that I keep in mind when I develop a business proposal for a client of my writing service: 1. Clarity. Before you begin to write the proposal, summarize the concept in 2-3 sentences, then show it to a lay person and check for understanding. If they don't grasp the basic idea, rewrite until they do. Until you can do this, you are not ready to start writing the proposal. How many times have you received a document that you had to read over and over before you comprehended the meaning? When this happens, it may be because your comprehension skills are under- developed, but it's more likely that 381

the writer substituted clarity of thought and good document structure with sloppy thinking, wordy, rambling explanations, vague descriptions and heavy reliance on buzzwords and jargon. It's worth saying once again: If you can't summarize it in 2-3 sentences, you are not ready to start writing. 2. Strive to communicate, not to impress. If you have a good idea and you communicate that idea clearly and effectively, the recipients will be impressed. If you try to baffle them with your brilliance, you'll lose ground. 3. Error Free: Your proposal will be competing with proposals prepared by professional writers, graphic designers and desktop publishers. You may not have those resources at your disposal, but you can be fastidious about checking for typing, spelling and grammatical errors. Spell checkers can only go so far; the rest is up to you. Ask someone else to check your document for errors before you submit it, or wait a few days before rereading it. If you have worked on a document intensely, you will "learn" to interpret errors as being correct. It takes a fresh eye to spot the typos. 4. Print and Bind: Print your document on good quality, heavy- bond paper, using either a laser printer or a good-quality bubble jet. Take it to an office service for backing and binding. For less than $10, you can produce a nicely done, professionally presented package. 5. Layout: When laying out your document, format it so the body of the text appears in the right two-thirds of the page. The one-third of the page to the left contains titles and white space. The white space to the left allows the reader to make notes. This sounds like a trivial matter, but it elicits positive reactions from recipients. 6. Visual Elements: Include visual elements sporadically throughout your document. Logos, clip art, graphs, charts, tables and other elements greatly enhance the visual appeal of your document and make it easier for many people to read and comprehend. Pages of pure text are tiring to the eye and a challenge to the attention span. Additionally, many people are visually oriented, meaning the preferred method of learning is through imagery and not text.


7. Title Page. Begin with a Title Page that includes images (graphics, pictures, etc.), the name of the proposal recipient, the name of the project, your company name and address, the date, and your copyright symbol. 8. Be Politically Correct. Whether you support political correctness or whether you don't, the issue here is to avoid offending the people who will receive your proposal document. Avoid any language that can be construed as offensive to any group of people - including women, men, persons with disabilities, persons belonging to visible minorities, senior citizens, and so on. If you're not certain of correct terminology, consult with someone knowledgeable before submitting your proposal. 9. Write for Global Audiences: Emerging technologies, immigration policies and agreements like NAFTA have produced a global marketplace. Documents nowadays should be written with the understanding that they may be evaluated by persons living in other countries or by persons for whom English is a second language. Even if you are submitting your proposal to a local business, they may well have joint ventures with international companies, and these companies may be asked to peruse your document. Unless your proposal is local to a specific geographic area, avoid references that would not be understood by persons living in other areas (or explain these references if you must use them). Also, avoid the use of slang or expressions from pop culture. When persons from other cultures study the English language, they are taught to speak formal, correct English. They are often unfamiliar with the use of slang terms. 10. Jargon Free: Every industry has its own particular "language" - words, terms and expressions that are common to that industry but foreign to people from other industries. Avoid the use of jargon, or if you must use it, explain it. For example, expressions like "branding," "turnkey solution," "E-commerce" are not necessarily understood by everyone who is doing business. Also remember that your proposal may go to a committee that is comprised of people from various walks of life. Make sure they understand what you are talking about. 11. Technology. 383

What was just said about jargon goes double for technology. If your proposed project involves the use of technologies, be very careful with your explanation. The persons reading the document may have little or no technological background. Therefore, in the body of the proposal, it's usually recommended that you explain your technology in terms of what it will do - i.e. "A data base that members can use to search for information about your products." There is a place for detailed information about the technology that you are proposing - and that spot is the appendix. In many cases, a non-technically oriented business will engage a technology consultant to review your proposed technology. This person can use the detailed explanations that you include in the appendix while other readers will be able understand the proposal itself. Keep these guidelines in mind and you will be off to a good start with your next business proposal! b. Dilemmas in Entrepreneurship <The Entrepreneur's Dilemma: Focus, Focus, Focus -- But on What?> Somewhere there is an entrepreneurial graveyard filled with stories of “I needed more time” and “I needed more money.” Sorry, I have no sympathy — any entrepreneur launching a new company knows what they’ve signed up for in this game. Successful entrepreneurs know, even embrace, that no startup ever has enough time or money. The longer it takes for you to align a company with a market need — that’s where you lose your business. You have to get there quickly and the key is FOCUS. When we started AppFirst our co-founder and CTO stated from his experience that start-ups rarely fail from their teams not working hard enough; they fail from their people working on the wrong things. FOCUS: Working on stuff that doesn’t matter will never get you to the promised land. Every team member in every role should be thinking ‘what am I working on that will bring success? What am I working on that customers will value us for?’ The business world is rife with methodologies – for building a business, selling a product, developing technology – but Steve Blank, a Silicon Valley guru who found some real entrepreneurial 384

success, developed a methodology for customer development. He states that a successful startup must focus on customers and market from Day One. Why? Because more startups fail from a lack of customers than a failure of product development. Your product or service must be just-in-time and tightly aligned to measurable customer pain points. Cycle your product development and your business with early adopting customers, that I call “design partners”, but don’t go after solving every problem in the market-space. You’ll end up losing focus on a bunch of one-off solutions. You must pick the pain areas you want to address and work with the customers that best represent the market pain. When you’ve solved their pain, not only will they buy it, others will want it too. FOCUS: Build your company around a market need with customers in the front seat. We built AppFirst this way. We knew we could meet needs beyond the solutions available so we sat down with CTOs of SaaS companies and asked What hurts? What do you wish you had? We heard a variety of answers – some said capacity planning, some said faster problem identification and troubleshooting. (And some VCs were telling us we were too focused that working with SaaS companies was too limited of an initial market.) Our foundational data can solve a number of things so we tried to meet multiple needs – however by focusing on the right things such as how people were engaging with our product, what was working and what wasn’t, red flags came up on our capacity planning solution. We knew within a few weeks of launch and made the tough call to remove this feature. FOCUS: Don’t fall so in love with what you’re doing that you overdo it. “If you review your first site version and don’t feel embarrassment, you spent too much time on it.” Who said this? Reid Hoffman, an entrepreneur who found some pretty good success with a little company he started called LinkedIn LNKD -2.51%. Reid recently published a book called The Start-up of You which makes for interesting reading on this topic. Don’t over-do your first release. If your product release is perfect, then you’re probably late to market. This is tricky, because as a builder and inventor we fall in love with what we’re doing and take great pride in executing it perfectly. However, the business world prefers agility and speed – it’s willing to work through imperfections to gain advancement, so you must live on the 385

edge. Oh sure, we get our critics. People ask, “How dare you not strive for perfection?” To which I say, “Fine, go pay a million dollars for that other product, then try and endure the further costs & pain to implement it.” Don’t let anyone bear hug the product to the point where you’re delivering more than people need. Your users will let you know if they need more than you gave them, I promise…they won’t be shy! FOCUS: Make clear to everyone what is needed and how it’s mapped to the company’s progress. It just takes one person to decide a series of extra features will make the product better, and then go beyond what’s required, to impact everything and everybody in the company. Build a culture so that if anyone is unclear on deliverables, it’s easy for them to ask the right person. On the marketing side, understand that your target users typically solve problems & share best practices amongst each other – the forums, the conferences, the Wiki sites. People love getting geeky at their own watering holes. But at the watering hole, you won’t find a gazelle hanging out next to the lion – it’s not good for life preservation. Who’s around your company’s watering hole? To gain the love of the gazelle, you have to help them stay away from the lion. FOCUS: Making them want it: Be the lifesaver at the watering hole. We all make mistakes; some things still take longer; focus is hard. But the absolute smartest things you can work through as an entrepreneur are those that narrow your focus. Even though you’re giving up something that seems important, know that you’re gaining something in return. You’ll get to your millions of users, but possibly in groups of thousands a time. Don’t be another stone in the entrepreneurial graveyard. Focus. c. Revision of Business Proposal <When To Revise A Business Plan> Before we even talk about wholesale revision of a plan, we have to first establish that without regular review -- monthly or at least quarterly review of plan vs. actual results, with practical analysis of the reasons for variance -- planning is likely to be a waste of time. Real planning requires regular reviews just as much as navigation requires knowing where you are as well as where you were and 386

where you wanted to go. So every real plan needs to be full of specific dates, budgets, forecasts, and management responsibilities. People involved have to know there will be tracking and following up on specifics. Then that plan must be reviewed against results, and those reviews should produce course corrections and fine tuning. Generally a business hopes for a consistent long-term strategy built on short-step incremental changes, not major revisions. Consistency is important to strategy, and the business should avoid the temptation to jump around from one strategy to another so quickly that no strategy is ever really implemented. Remember that even a mediocre strategy well and consistently implemented is much better than a brilliant strategy that wasn't implemented. However, businesses do come to crossroads demanding major revisions. There are some signs that indicate its time to review: â&#x20AC;˘ Major changes in market situation â&#x20AC;˘ Look especially for changing market factors, changing market behavior. â&#x20AC;˘ Have your underlying business assumptions changed? For a wealth of easy examples, the Internet has changed the business landscape so enormously that in some industries almost any plan that was developed without a view of the Internet may need revisions. That may not be true for a landscape architect or restaurant, but for a travel agent, graphic artist, or market researcher it's obvious. Do you have new competition? Have new competitors emerged, or existing competitors changed the business landscape so much that you need to review and revise? Has the product or service picture changed? For example a new technology may have emerged, changing the market perception of what you sell. There may be new products or services offering related solutions to the same user needs you satisfy. Major changes in internal situation. The most obvious major changes are changes in ownership, which are frequently the result of changing partnerships, divorces, deaths, and investment. The company takes on new partners, or sells out to a larger company. On a more ominous note, the company suffers significant declines in sales, profits, and financial health. Always keep the revision in perspective. While you do want to 387

review and correct constantly, you don't want to change a strategy unless you are sure it isn't working or you see real changes in the underlying assumptions that formed the foundations of strategy. 3. Entrepreneurship in Culture & Art Contents Industry a. Form a business (L.L.C.) <How to Form an LLC> Forming an LLC (limited liability company) is not as hard as most people think. Here are the steps you need to take to make your LLC a legal reality. • •

• • •

Choose an available business name that complies with your state's LLC rules. File formal paperwork, usually called articles of organization, and pay the filing fee (ranging from about $100 to $800, depending on your state's rules). Create an LLC operating agreement, which sets out the rights and responsibilities of the LLC members. Publish a notice of your intent to form an LLC (required in only a few states). Obtain licenses and permits that may be required for your business.

Choosing a Name for Your LLC The name of your LLC must comply with the rules of your state's LLC division. (Typically, this office is combined with the corporations division within the secretary of state's office.) While requirements differ from state to state, generally: • •

the name cannot be the same as the name of another LLC on file with the LLC office the name must end with an LLC designator, such as "Limited Liability Company" or "Limited Company," or an abbreviation of one of these phrases (such as "LLC," "L.L.C.," or "Ltd. Liability Co."), and the name cannot include certain words prohibited by the state, such as Bank, Insurance, Corporation or City (state rules differ on which words are prohibited).

Your state's LLC office can tell you how to find out whether your proposed name is available for your use. Often, for a small fee, you can reserve your LLC name for a short period of time until you file your articles of organization.


Besides following your state's LLC naming rules, you must make sure your name won't violate another company's trademark. Once you've found a legal and available name, you don't usually need to register it with your state. When you file your articles of organization, your business name will be automatically registered. Filing Articles of Organization After settling on a name, you must prepare and file "articles of organization" with your state's LLC filing office. While most states use the term "articles of organization" to refer to the basic document required to create an LLC, some states call it a "certificate of formation" or "certificate of organization." Filing Fees One disadvantage of forming an LLC instead of a partnership or a sole proprietorship is that you'll have to pay a filing fee when you submit your articles of organization. In most states, the fees are modest -- typically around $100. A few others take a bigger bite: California, for example, charges an $800 annual tax on top of its filing fee. Required Information Articles of organization are short, simple documents. In fact, you can usually prepare your own in just a few minutes by filling in the blanks and checking the boxes on a form provided by your state's filing office. Typically, you must provide only your LLC's name, its address, and sometimes the names of all of the owners -- called members. Generally, all of the LLC owners may prepare and sign the articles, or they can appoint just one person to do so. Registered Agent You will probably also be required to list the name and address of a person -- usually one of the LLC members -- who will act as your LLC's "registered agent," or "agent for service of process." Your agent is the person designated to receive legal papers in any future lawsuit involving your LLC. Creating an LLC Operating Agreement Even though operating agreements need not be filed with the LLC filing office and are rarely required by state law, it is essential that you create one. In an LLC operating agreement, you set out rules for the ownership and operation of the business (much like a partnership agreement or corporate bylaws). A typical operating 389

agreement includes: • • • • • • •

the members' percentage interests in the business the members' rights and responsibilities the members' voting power how profits and losses will be allocated how the LLC will be managed rules for holding meetings and taking votes, and "buy-sell" provisions, which determine what happens if a member wants to sell his or her interest, dies, or becomes disabled.

Publication Requirements In a few states, you must take an additional step to make your company official: You must publish a simple notice in a local newspaper, stating that you intend to form an LLC. You are required to publish the notice several times over a period of weeks and then submit an "affidavit of publication" to the LLC filing office. Your local newspaper should be able to help you with this filing. Licenses and Permits After you've completed the steps described above, your LLC is official. But before you open your doors for business, you need to obtain the licenses and permits that all new businesses must have to operate. These may include a business license (sometimes also referred to as a "tax registration certificate"), a federal employer identification number, a sellers' permit, or a zoning permit. b. Getting a business license <How to Obtain a Business License> Your business needs to be licensed to legally operate. Depending on the nature of your business and where you live, you may need to be licensed at the federal, state and/or local level. Regulations vary, so it's very important to understand the licensing rules where your business is located—failure to comply can have serious consequences. Fortunately, getting a business license is neither very expensive, nor very time consuming. 1. Visit the U.S. Small Business Administration (SBA). Whether you are just starting out in business, or are firing up a new venture, the SBA has a wealth of information, not just on rules and regulations, but on everything from how to name your business to how to get funding.


2. Locate your business type. You may need nothing more than a simple Assumed Business Name (often called a DBA), or you may want to start a corporation. Whatever you are searching for, your state will undoubtedly have a form for it. There, you may be asked to narrow down your location by city or county, or you may be presented with a list of links and information relevant to obtaining any of the licenses and registrations you need to conduct virtually any type of business. In some cases, you may be required to create an account and sign in before proceeding. For our example, we will select "Business Registration" from the list of links. 3. Locate the correct form. You will be presented with an extensive list of business entity types for your state. Locate the one that is most applicable to your needs. For example, we will choose a Limited Liability Company (LLC). Find the link to the the necessary forms. Follow the links to your form, reading any important information that may be presented along the wayâ&#x20AC;&#x201D;including descriptions, fees, requirements, etc. Fill out the form online, or download and fill out offline. Some states make provisions for performing these functions directly online, but will generally require you to create an account before being able to do so. Whichever way is more effective for you will be fine. 4.Send in your form. Either using the online forms, or U.S. mail, send in your completed form to the Secretary of State's business registration office. The time it takes to process your license will vary, depending on the type of business entity you are creating. For example, a DBA might take just a couple days, whereas a corporation could take up to 2 weeks. Each state will vary. 5.Research while you wait. While waiting for your business license, take a long look at the SBA website and your state's business websites. There is a ton of valuable information there that will help you make your new venture a success. Good luck!


Exercise: 1. Business proposal revision a. In 10 pages (A4) b. Use visual aids c. Revision, Revision, Revision!


Website to Look @: Center For New Ventures And Entrepreneurship



Chapter XIII. Domestic and International Marketing in Culture & Art Contents Industry

<Fig. 13.1. Word Clouds for Entrepreneurship> Entrepreneurship doesnâ&#x20AC;&#x2122;t come easy as everyone mentions. You might hear the word everyday, but successful entrepreneurship requires various skillsets, including, but not limited to, organizational skill, management skill, planning skill, presentation skills, and so on. In 21st century, an entrepreneur is considered as an individual who organizes and operates a business or businesses, taking on financial risk to do so. To be successful, an entrepreneur should be an innovative renaissance man who can do everything well. <In this chapterâ&#x20AC;Ś> 1. Entrepreneurship a. How to start start-up business b. How to get government assistantship c. Examples of Entrepreneurs d. Venture Capital 2. Other things to consider: a. Marketing strategies b. Concept of e-business c. Online shopping mall d. 3 popular online shopping mall e. International trading f. Marketing in Asia


Why Entrepreneurship? Is it for me? Entrepreneurship is a tool or mechanism that can be used to open the minds of individuals and organizations. It is the added-value of Creativity and Innovation which focuses on investing in human capital by enhancing and fostering the can-do attitude. It is not only business start-ups, SMEs, the profit and social enterprise sectors. Entrepreneurship is ‘an individual’s ability to turn Ideas into Action’ and its value to society cannot be underestimated or dismissed. Entrepreneurship includes: • • • • • •

creativity, innovation and risk taking ability to plan and manage projects in order to achieve objectives support in daily life at home and in society employees being aware of the context of their work being able to seize opportunities a foundation for more specific skills and knowledge needed in establishing social or commercial activity

To address the challenges of unemployment, poverty, inequality, globalization and climate change the benefits of entrepreneurship must be shared, with Ideas being turned into Actions. The economies, the wealth creation, the employment markets and the future of the planet reside in the hands of entrepreneurs – those capable, innovative, driven individuals and organizations that can effect change and make things happen. We believe that through communication, commitment and conscience we can create a community which speaks with one voice. Our community will share, inspire, mentor, support and celebrate. It will have the power to influence and transform relevant policy for the good of all entrepreneurs across the globe. If you are willing to contribute, happy to share, want to create a fairer society, and want to create and share wealth, then you’ve come to the right place. Social benefits – Envoys can network to improve their own social conditions as well as those of others. Working to create enabling environments and fight inequalities, their contributions and collective dedication can support health, housing, education, living standards and the social dimensions of all in the global society, whilst creating wealth and celebrating success. Economic benefits – Envoys can use the network to share ideas with others, to promote their products or to attract funds. They can also identify organizations and individuals who can help or mentor them. But as with the social benefits, 396

the economic benefits that can be gained by changing the enabling environment can have gains for all in the global society. Environmental benefits – Envoys are ‘virtual’ and work in the most environmentally friendly way possible. But they also need to be present to promote issues direct to policy makers, education and the media. The green economy and climate change mitigation is being worked on fastest and most efficiently at the grass roots level and a serious dimension of the Envoys commitment is to support this sector as there is only one planet! <Why Entrepreneurs Matter – Mid-Market Perspectives: America’s Economic Engine> Can mid-sized companies benefit from adopting entrepreneurial behavior most often attributed to start-ups? According to this fourth research report from Deloitte Growth Enterprise Services, based on results from a September 2012 survey of 652 mid-market executives, the answer is yes. Among the findings highlighted in the "Mid-market perspectives: America's economic engine - why entrepreneurs matter" report: •

• •

Companies that have become more entrepreneurial are succeeding at a faster pace. They cite organic growth in existing markets and innovative products and strategies as their highest priorities. Sixty-six percent of respondents expect job growth in the next year will come from mid-sized privately held companies and small businesses. Fifty percent of respondents say the uncertain economic outlook is their company’s main obstacle to growth; consistent with previous reports, 46 percent of executives think the level of uncertainty is higher than one year ago. Is the United States the best place for entrepreneurs to start a business? Only 59 percent of respondents said yes – a marked contrast to the 87 percent who said it was the best place to do so in the past.

1. Entrepreneurship <South Korea Fuels a New Entrepreneurial Sprit>


When South Korean President Park Geun-hye met Facebook Chief Executive Mark Zuckerberg this week she praised the social-networking company for "taking on challenges without fear of failure." Her comment resonated in South Korea's burgeoning startup culture, which is spreading a message that has long been anathema here: It's OK to fail. Steady growth in the number of startup businesses in South Korea in recent years is getting a push from government support and successful entrepreneurs reinvesting in fledgling companies. The number of startups operating in South Korea nearly doubled to 28,763 at the end of February from 15,401 in 2008 and quadrupled from a decade ago, according to the Korea Venture Business Association. Meanwhile, venture-capital investment in the U.S. has slowed. Startups raised $4.1 billion from 35 funds during the first quarter, down 34% from a year earlier and the slowest period since the third quarter of 2003, according to the U.S. National Venture Capital Association. Part of the challenge in South Korea is tackling the heavy stigma of business failure. Working in a safe, prestigious job for a large corporation or the government has long been considered a desirable career route. Business failure is particularly feared because bankruptcy laws focus on ensuring that creditors are paid, meaning that personal and business assets can be stripped away at struggling companies. â&#x20AC;&#x153;In the U.S., failing and trying again is a badge of honor. It is not in 398

Korea," says Richard Dobbs, director of the McKinsey Global Institute in Seoul. That is changing. Daniel Cho, 33 years old, quit his job at a multinational consulting firm two years ago to cofound WePlanet, a mobile-application developer. After six months, the company unveiled a personal-diary program but it came to nothing, which is typical of early-stage startups. Mr. Cho and his business partner lost money but were able to secure new investment. "Just a few years back, giving up a high-paying job at an established company to start a venture firm was foolhardy," says Mr. Cho, a graduate of the prestigious Seoul National University. "Risk taking was something to be avoided." WePlanet was among six companies that received mentoring and investments of up to $25,000 each this year from SparkLabs, a group of early-stage investors known as a startup accelerator. Kakao Corp., the developer of South Korea's popular messaging app Kakao Talk, in April started a $26.5 million startup fund and has invested in more than 10 new companies. Meanwhile, the government recently pledged $2.9 billion in funding for startups, particularly in the technology sector. It also has earmarked $89 million for entrepreneurs struggling to get back on their feet after failure. And private investors in startups receive government incentives, such as tax cuts and delayed deadlines for paying income taxes, if investors recycle their returns into new businesses. The moves are part of President Park's "creative economy" policy initiative, aimed at nurturing startups and reducing the nation's dependence on its old-line manufacturing conglomerates, which accounted for four-fifths of the country's gross domestic product last year. At their meeting on Tuesday, Facebook's Mr. Zuckerberg told Ms. Park that her government is doing a good job of encouraging startups and that he is willing to build a partnership with the country and strengthen Facebook's ties with smaller companies in South Korea, her office said. "It is hard to say how much the Korean startup ecosystem has changed under the new government. But entrepreneurs have changed," says Bernard Moon, a co-founder of SparkLabs. The climate has been helped by South Korea's advanced technology infrastructure and the decline of lifelong jobs at big companies, which 399

have been cutting staff amid the prolonged global economic slowdown. "A fast move toward a mobile-based society is creating opportunities. Even if you fail on one project, you can recover quickly with another one," says WePlanet's Mr. Cho. Still, there remain significant barriers to developing South Korea's startup culture, Mr. Moon says. "A big driver of entrepreneurship in the U.S. is generous bankruptcy laws. In Korea, your personal assets are taken in some cases. If that was the case in the U.S., half of Silicon Valley would be empty," he says. Overcoming the fear of failure is one of the biggest obstacles, but increased backing for revived startups has diminished the sense of all-ornothing risk. "We like all six companies that came through our first class" of mentoring, Mr. Moon says. "If they failed and they do another startup, we'll probably invest in them again—all of them." At WePlanet, Mr. Cho's team recently developed STEP, a revised personal-journal application. He hopes to introduce the service in the U.S. this fall with the help of SparkLabs. WePlanet also has been on a one-year, state-subsidized softwaredevelopment project, which expires soon. That means WePlanet will be under government review of the app's success. "We won't be asked to pay back if our product is judged a failure," Mr. Cho says. "But there's a penalty; the chance of getting government help will be lowered when you apply for it next time." <Future of Entrepreneurship in South Korea: Discussing a Creative Economy> On May 24, 2013, South Korean policy makers, along with top leaders in science and technology, will meet to discuss South Korean President Park Geun-hye’s “creative economy” initiative at the 2013 International Symposium hosted by the The Science and Technology Policy Institute (STEPI). STEPI is a government policy think tank devoted to research and analysis on the issues pertaining to science, technology, and innovation. The “creative economy” initiative is the Park administration’s latest agenda for growing the nation’s economy in the next five years through innovation in science and technology. Despite South Korea’s embrace of technology and an its citizens’ incredible work ethic, Koreans are still predominately conservative in their opinion of entrepreneurship and risk400

taking. The idea of a leaving a highly paid corporate job at one of South Korea’s three conglomerates for a startup goes completely against the country’s traditional definition of success. In an effort to reverse such attitudes and foster a better atmosphere for innovation, the South Korean government has launched a series of policies designed to help entrepreneurs and small businesses. Over the last few years, such initiatives have created hundreds of incubators throughout the country, offered entrepreneurs free office space, thousands of dollars in grants, and guaranteed loans, but the country has yet to succeed in nurturing the kinds of disruptive companies that are prevalent in the U.S. These are the exact challenges entrepreneurs and experts, like Google Korea Managing Director Doug Yeum, are scheduled to discuss at the upcoming 2013 International Symposium. 3 Day Startup (3DS) CEO Cam Houser will be joining the conversation with a talk about creating exportable and repeatable entrepreneurship education models. Although South Korean universities have traditionally excelled at commercializing university research, there has been very little emphasis on providing practice-based learning opportunities to help students start companies. According to a recent report conducted by the Global Entrepreneurship Monitor, over 50 percent of entrepreneurs in countries like the U.S. and in Europe and China are between the ages 18-34, indicating South Korea may need to focus more of its initiatives in helping young entrepreneurs. Houser says, “Through our work with top universities like Harvard, MIT, and Peking University, we’ve found that academic settings where students can experience the entire startup process first hand are exceedingly rare, so there is definitely a need for more hands-on programs targeted towards college students.” a. How to start start-up business <How to Start a Start-up> You need three things to create a successful startup: to start with good people, to make something customers actually want, and to spend as little money as possible. Most startups that fail do it because they fail at one of these. A startup that does all three will probably succeed. And that's kind of exciting, when you think about it, because all three are doable. Hard, but doable. And since a startup that succeeds ordinarily makes its founders rich, that implies getting rich is doable too. Hard, but doable. If there is one message I'd like to get across about startups, that's 401

it. There is no magically difficult step that requires brilliance to solve. The Idea In particular, you don't need a brilliant idea to start a startup around. The way a startup makes money is to offer people better technology than they have now. But what people have now is often so bad that it doesn't take brilliance to do better. Google's plan, for example, was simply to create a search site that didn't suck. They had three new ideas: index more of the Web, use links to rank search results, and have clean, simple web pages with un-intrusive keyword-based ads. Above all, they were determined to make a site that was good to use. No doubt there are great technical tricks within Google, but the overall plan was straightforward. And while they probably have bigger ambitions now, this alone brings them a billion dollars a year. There are plenty of other areas that are just as backward as search was before Google. I can think of several heuristics for generating ideas for startups, but most reduce to this: look at something people are trying to do, and figure out how to do it in a way that doesn't suck. For example, dating sites currently suck far worse than search did before Google. They all use the same simple-minded model. They seem to have approached the problem by thinking about how to do database matches instead of how dating works in the real world. An undergrad could build something better as a class project. And yet there's a lot of money at stake. Online dating is a valuable business now, and it might be worth a hundred times as much if it worked. An idea for a startup, however, is only a beginning. A lot of wouldbe startup founders think the key to the whole process is the initial idea, and from that point all you have to do is execute. Venture capitalists know better. If you go to VC firms with a brilliant idea that you'll tell them about if they sign a nondisclosure agreement, most will tell you to get lost. That shows how much a mere idea is worth. The market price is less than the inconvenience of signing an NDA. Another sign of how little the initial idea is worth is the number of startups that change their plan en route. Microsoft's original plan was to make money selling programming languages, of all things. Their current business model didn't occur to them until IBM dropped it in their lap five years later.


Ideas for startups are worth something, certainly, but the trouble is, they're not transferrable. They're not something you could hand to someone else to execute. Their value is mainly as starting points: as questions for the people who had them to continue thinking about. What matters is not ideas, but the people who have them. Good people can fix bad ideas, but good ideas can't save bad people. People What do I mean by good people? One of the best tricks I learned during our startup was a rule for deciding whom to hire. Could you describe the person as an animal? It might be hard to translate that into another language, but I think everyone in the US knows what it means. It means someone who takes their work a little too seriously; someone who does what they do so well that they pass right through professional and cross over into obsessive. What it means specifically depends on the job: a salesperson who just won't take no for an answer; a hacker who will stay up till 4:00 AM rather than go to bed leaving code with a bug in it; a PR person who will cold-call New York Times reporters on their cell phones; a graphic designer who feels physical pain when something is two millimeters out of place. Almost everyone who worked for us was an animal at what they did. The woman in charge of sales was so tenacious that I used to feel sorry for potential customers on the phone with her. You could sense them squirming on the hook, but you knew there would be no rest for them till they'd signed up. If you think about people you know, you'll find the animal test is easy to apply. Call the person's image to mind and imagine the sentence "so-and-so is an animal." If you laugh, they're not. You don't need or perhaps even want this quality in big companies, but you need it in a startup. For programmers we had three additional tests. Was the person genuinely smart? If so, could they actually get things done? And finally, since a few good hackers have unbearable personalities, could we stand to have them around? That last test filters out surprisingly few people. We could bear any amount of nerdiness if someone was truly smart. What we couldn't stand were people with a lot of attitude. But most of those weren't truly smart, so our third test was largely a restatement of the first.


When nerds are unbearable it's usually because they're trying too hard to seem smart. But the smarter they are, the less pressure they feel to act smart. So as a rule you can recognize genuinely smart people by their ability to say things like "I don't know," "Maybe you're right," and "I don't understand x well enough." This technique doesn't always work, because people can be influenced by their environment. In the MIT CS department, there seems to be a tradition of acting like a brusque know-it-all. I'm told it derives ultimately from Marvin Minsky, in the same way the classic airline pilot manner is said to derive from Chuck Yeager. Even genuinely smart people start to act this way there, so you have to make allowances. It helped us to have Robert Morris, who is one of the readiest to say "I don't know" of anyone I've met. (At least, he was before he became a professor at MIT.) No one dared put on attitude around Robert, because he was obviously smarter than they were and yet had zero attitude himself. Like most startups, ours began with a group of friends, and it was through personal contacts that we got most of the people we hired. This is a crucial difference between startups and big companies. Being friends with someone for even a couple days will tell you more than companies could ever learn in interviews. It's no coincidence that startups start around universities, because that's where smart people meet. It's not what people learn in classes at MIT and Stanford that has made technology companies spring up around them. They could sing campfire songs in the classes so long as admissions worked the same. If you start a startup, there's a good chance it will be with people you know from college or grad school. So in theory you ought to try to make friends with as many smart people as you can in school, right? Well, no. Don't make a conscious effort to schmooze; that doesn't work well with hackers. What you should do in college is work on your own projects. Hackers should do this even if they don't plan to start startups, because it's the only real way to learn how to program. In some cases you may collaborate with other students, and this is the best way to get to know good hackers. The project may even grow into a startup. But once again, I wouldn't aim too directly at either target. Don't force things; just work on stuff you like with people you like. Ideally you want between two and four founders. It would be hard to start with just one. One person would find the moral 404

weight of starting a company hard to bear. Even Bill Gates, who seems to be able to bear a good deal of moral weight, had to have a co-founder. But you don't want so many founders that the company starts to look like a group photo. Partly because you don't need a lot of people at first, but mainly because the more founders you have, the worse disagreements you'll have. When there are just two or three founders, you know you have to resolve disputes immediately or perish. If there are seven or eight, disagreements can linger and harden into factions. You don't want mere voting; you need unanimity. In a technology startup, which most startups are, the founders should include technical people. During the Internet Bubble there were a number of startups founded by business people who then went looking for hackers to create their product for them. This doesn't work well. Business people are bad at deciding what to do with technology, because they don't know what the options are, or which kinds of problems are hard and which are easy. And when business people try to hire hackers, they can't tell which ones are good. Even other hackers have a hard time doing that. For business people it's roulette. Do the founders of a startup have to include business people? That depends. We thought so when we started ours, and we asked several people who were said to know about this mysterious thing called "business" if they would be the president. But they all said no, so I had to do it myself. And what I discovered was that business was no great mystery. It's not something like physics or medicine that requires extensive study. You just try to get people to pay you for stuff. I think the reason I made such a mystery of business was that I was disgusted by the idea of doing it. I wanted to work in the pure, intellectual world of software, not deal with customers' mundane problems. People who don't want to get dragged into some kind of work often develop a protective incompetence at it. Paul Erdos was particularly good at this. By seeming unable even to cut a grapefruit in half (let alone go to the store and buy one), he forced other people to do such things for him, leaving all his time free for math. Erdos was an extreme case, but most husbands use the same trick to some degree. Once I was forced to discard my protective incompetence, I found that business was neither so hard nor so boring as I feared. There are esoteric areas of business that are quite hard, like tax law or the pricing of derivatives, but you don't need to know about those in a startup. All you need to know about business to run a startup are commonsense things people knew before there were business schools, or even universities. 405

If you work your way down the Forbes 400 making an x next to the name of each person with an MBA, you'll learn something important about business school. After Warren Buffett, you don't hit another MBA till number 22, Phil Knight, the CEO of Nike. There are only 5 MBAs in the top 50. What you notice in the Forbes 400 are a lot of people with technical backgrounds. Bill Gates, Steve Jobs, Larry Ellison, Michael Dell, Jeff Bezos, Gordon Moore. The rulers of the technology business tend to come from technology, not business. So if you want to invest two years in something that will help you succeed in business, the evidence suggests you'd do better to learn how to hack than get an MBA. There is one reason you might want to include business people in a startup, though: because you have to have at least one person willing and able to focus on what customers want. Some believe only business people can do this-- that hackers can implement software, but not design it. That's nonsense. There's nothing about knowing how to program that prevents hackers from understanding users, or about not knowing how to program that magically enables business people to understand them. If you can't understand users, however, you should either learn how or find a co-founder who can. That is the single most important issue for technology startups, and the rock that sinks more of them than anything else. What Customers Want It's not just startups that have to worry about this. I think most businesses that fail do it because they don't give customers what they want. Look at restaurants. A large percentage fail, about a quarter in the first year. But can you think of one restaurant that had really good food and went out of business? Restaurants with great food seem to prosper no matter what. A restaurant with great food can be expensive, crowded, noisy, dingy, out of the way, and even have bad service, and people will keep coming. It's true that a restaurant with mediocre food can sometimes attract customers through gimmicks. But that approach is very risky. It's more straightforward just to make the food good. It's the same with technology. You hear all kinds of reasons why startups fail. But can you think of one that had a massively popular product and still failed? In nearly every failed startup, the real problem was that customers didn't want the product. For most, the cause of death is listed as 406

"ran out of funding," but that's only the immediate cause. Why couldn't they get more funding? Probably because the product was a dog, or never seemed likely to be done, or both. When I was trying to think of the things every startup needed to do, I almost included a fourth: get a version 1 out as soon as you can. But I decided not to, because that's implicit in making something customers want. The only way to make something customers want is to get a prototype in front of them and refine it based on their reactions. The other approach is what I call the "Hail Mary" strategy. You make elaborate plans for a product, hire a team of engineers to develop it (people who do this tend to use the term "engineer" for hackers), and then find after a year that you've spent two million dollars to develop something no one wants. This was not uncommon during the Bubble, especially in companies run by business types, who thought of software development as something terrifying that therefore had to be carefully planned. We never even considered that approach. As a Lisp hacker, I come from the tradition of rapid prototyping. I would not claim (at least, not here) that this is the right way to write every program, but it's certainly the right way to write software for a startup. In a startup, your initial plans are almost certain to be wrong in some way, and your first priority should be to figure out where. The only way to do that is to try implementing them. Like most startups, we changed our plan on the fly. At first we expected our customers to be Web consultants. But it turned out they didn't like us, because our software was easy to use and we hosted the site. It would be too easy for clients to fire them. We also thought we'd be able to sign up a lot of catalog companies, because selling online was a natural extension of their existing business. But in 1996 that was a hard sell. The middle managers we talked to at catalog companies saw the Web not as an opportunity, but as something that meant more work for them. We did get a few of the more adventurous catalog companies. Among them was Frederick's of Hollywood, which gave us valuable experience dealing with heavy loads on our servers. But most of our users were small, individual merchants who saw the Web as an opportunity to build a business. Some had retail stores, but many only existed online. And so we changed direction to focus on these users. Instead of concentrating on the features Web consultants and catalog companies would want, we worked to make the software easy to use. I learned something valuable from that. It's worth trying very, very 407

hard to make technology easy to use. Hackers are so used to computers that they have no idea how horrifying software seems to normal people. Stephen Hawking's editor told him that every equation he included in his book would cut sales in half. When you work on making technology easier to use, you're riding that curve up instead of down. A 10% improvement in ease of use doesn't just increase your sales 10%. It's more likely to double your sales. How do you figure out what customers want? Watch them. One of the best places to do this was at trade shows. Trade shows didn't pay as a way of getting new customers, but they were worth it as market research. We didn't just give canned presentations at trade shows. We used to show people how to build real, working stores. Which meant we got to watch as they used our software, and talk to them about what they needed. No matter what kind of startup you start, it will probably be a stretch for you, the founders, to understand what users want. The only kind of software you can build without studying users is the sort for which you are the typical user. But this is just the kind that tends to be open source: operating systems, programming languages, editors, and so on. So if you're developing technology for money, you're probably not going to be developing it for people like you. Indeed, you can use this as a way to generate ideas for startups: what do people who are not like you want from technology? When most people think of startups, they think of companies like Apple or Google. Everyone knows these, because they're big consumer brands. But for every startup like that, there are twenty more that operate in niche markets or live quietly down in the infrastructure. So if you start a successful startup, odds are you'll start one of those. Another way to say that is, if you try to start the kind of startup that has to be a big consumer brand, the odds against succeeding are steeper. The best odds are in niche markets. Since startups make money by offering people something better than they had before, the best opportunities are where things suck most. And it would be hard to find a place where things suck more than in corporate IT departments. You would not believe the amount of money companies spend on software, and the crap they get in return. This imbalance equals opportunity. If you want ideas for startups, one of the most valuable things you could do is find a middle-sized non-technology company and spend a couple weeks just watching what they do with computers. Most good hackers have no more idea of the horrors 408

perpetrated in these places than rich Americans do of what goes on in Brazilian slums. Start by writing software for smaller companies, because it's easier to sell to them. It's worth so much to sell stuff to big companies that the people selling them the crap they currently use spend a lot of time and money to do it. And while you can outhack Oracle with one frontal lobe tied behind your back, you can't outsell an Oracle salesman. So if you want to win through better technology, aim at smaller customers. They're the more strategically valuable part of the market anyway. In technology, the low end always eats the high end. It's easier to make an inexpensive product more powerful than to make a powerful product cheaper. So the products that start as cheap, simple options tend to gradually grow more powerful till, like water rising in a room, they squash the "high-end" products against the ceiling. Sun did this to mainframes, and Intel is doing it to Sun. Microsoft Word did it to desktop publishing software like Interleaf and Framemaker. Mass-market digital cameras are doing it to the expensive models made for professionals. Avid did it to the manufacturers of specialized video editing systems, and now Apple is doing it to Avid. Henry Ford did it to the car makers that preceded him. If you build the simple, inexpensive option, you'll not only find it easier to sell at first, but you'll also be in the best position to conquer the rest of the market. It's very dangerous to let anyone fly under you. If you have the cheapest, easiest product, you'll own the low end. And if you don't, you're in the crosshairs of whoever does. Raising Money To make all this happen, you're going to need money. Some startups have been self-funding-- Microsoft for example-- but most aren't. I think it's wise to take money from investors. To be selffunding, you have to start as a consulting company, and it's hard to switch from that to a product company. Financially, a startup is like a pass/fail course. The way to get rich from a startup is to maximize the company's chances of succeeding, not to maximize the amount of stock you retain. So if you can trade stock for something that improves your odds, it's probably a smart move. To most hackers, getting investors seems like a terrifying and mysterious process. Actually it's merely tedious. I'll try to give an outline of how it works.


The first thing you'll need is a few tens of thousands of dollars to pay your expenses while you develop a prototype. This is called seed capital. Because so little money is involved, raising seed capital is comparatively easy-- at least in the sense of getting a quick yes or no. Usually you get seed money from individual rich people called "angels." Often they're people who themselves got rich from technology. At the seed stage, investors don't expect you to have an elaborate business plan. Most know that they're supposed to decide quickly. It's not unusual to get a check within a week based on a half-page agreement. We started Viaweb with $10,000 of seed money from our friend Julian. But he gave us a lot more than money. He's a former CEO and also a corporate lawyer, so he gave us a lot of valuable advice about business, and also did all the legal work of getting us set up as a company. Plus he introduced us to one of the two angel investors who supplied our next round of funding. Some angels, especially those with technology backgrounds, may be satisfied with a demo and a verbal description of what you plan to do. But many will want a copy of your business plan, if only to remind themselves what they invested in. Our angels asked for one, and looking back, I'm amazed how much worry it caused me. "Business plan" has that word "business" in it, so I figured it had to be something I'd have to read a book about business plans to write. Well, it doesn't. At this stage, all most investors expect is a brief description of what you plan to do and how you're going to make money from it, and the resumes of the founders. If you just sit down and write out what you've been saying to one another, that should be fine. It shouldn't take more than a couple hours, and you'll probably find that writing it all down gives you more ideas about what to do. For the angel to have someone to make the check out to, you're going to have to have some kind of company. Merely incorporating yourselves isn't hard. The problem is, for the company to exist, you have to decide who the founders are, and how much stock they each have. If there are two founders with the same qualifications who are both equally committed to the business, that's easy. But if you have a number of people who are expected to contribute in varying degrees, arranging the proportions of stock can be hard. And once you've done it, it tends to be set in stone. I have no tricks for dealing with this problem. All I can say is, try hard to do it right. I do have a rule of thumb for recognizing when 410

you have, though. When everyone feels they're getting a slightly bad deal, that they're doing more than they should for the amount of stock they have, the stock is optimally apportioned. There is more to setting up a company than incorporating it, of course: insurance, business license, unemployment compensation, various things with the IRS. I'm not even sure what the list is, because we, ah, skipped all that. When we got real funding near the end of 1996, we hired a great CFO, who fixed everything retroactively. It turns out that no one comes and arrests you if you don't do everything you're supposed to when starting a company. And a good thing too, or a lot of startups would never get started. It can be dangerous to delay turning yourself into a company, because one or more of the founders might decide to split off and start another company doing the same thing. This does happen. So when you set up the company, as well as as apportioning the stock, you should get all the founders to sign something agreeing that everyone's ideas belong to this company, and that this company is going to be everyone's only job. While you're at it, you should ask what else they've signed. One of the worst things that can happen to a startup is to run into intellectual property problems. We did, and it came closer to killing us than any competitor ever did. As we were in the middle of getting bought, we discovered that one of our people had, early on, been bound by an agreement that said all his ideas belonged to the giant company that was paying for him to go to grad school. In theory, that could have meant someone else owned big chunks of our software. So the acquisition came to a screeching halt while we tried to sort this out. The problem was, since we'd been about to be acquired, we'd allowed ourselves to run low on cash. Now we needed to raise more to keep going. But it's hard to raise money with an IP cloud over your head, because investors can't judge how serious it is. Our existing investors, knowing that we needed money and had nowhere else to get it, at this point attempted certain gambits which I will not describe in detail, except to remind readers that the word "angel" is a metaphor. The founders thereupon proposed to walk away from the company, after giving the investors a brief tutorial on how to administer the servers themselves. And while this was happening, the acquirers used the delay as an excuse to welch on the deal. Miraculously it all turned out ok. The investors backed down; we did another round of funding at a reasonable valuation; the giant 411

company finally gave us a piece of paper saying they didn't own our software; and six months later we were bought by Yahoo for much more than the earlier acquirer had agreed to pay. So we were happy in the end, though the experience probably took several years off my life. Don't do what we did. Before you consummate a startup, ask everyone about their previous IP history. Once you've got a company set up, it may seem presumptuous to go knocking on the doors of rich people and asking them to invest tens of thousands of dollars in something that is really just a bunch of guys with some ideas. But when you look at it from the rich people's point of view, the picture is more encouraging. Most rich people are looking for good investments. If you really think you have a chance of succeeding, you're doing them a favor by letting them invest. Mixed with any annoyance they might feel about being approached will be the thought: are these guys the next Google? Usually angels are financially equivalent to founders. They get the same kind of stock and get diluted the same amount in future rounds. How much stock should they get? That depends on how ambitious you feel. When you offer x percent of your company for y dollars, you're implicitly claiming a certain value for the whole company. Venture investments are usually described in terms of that number. If you give an investor new shares equal to 5% of those already outstanding in return for $100,000, then you've done the deal at a pre-money valuation of $2 million. How do you decide what the value of the company should be? There is no rational way. At this stage the company is just a bet. I didn't realize that when we were raising money. Julian thought we ought to value the company at several million dollars. I thought it was preposterous to claim that a couple thousand lines of code, which was all we had at the time, were worth several million dollars. Eventually we settled on one million, because Julian said no one would invest in a company with a valuation any lower. What I didn't grasp at the time was that the valuation wasn't just the value of the code we'd written so far. It was also the value of our ideas, which turned out to be right, and of all the future work we'd do, which turned out to be a lot. The next round of funding is the one in which you might deal with actual venture capital firms. But don't wait till you've burned through your last round of funding to start approaching them. VCs are slow to make up their minds. They can take months. You don't want to be running out of money while you're trying to negotiate 412

with them. Getting money from an actual VC firm is a bigger deal than getting money from angels. The amounts of money involved are larger, millions usually. So the deals take longer, dilute you more, and impose more onerous conditions. Sometimes the VCs want to install a new CEO of their own choosing. Usually the claim is that you need someone mature and experienced, with a business background. Maybe in some cases this is true. And yet Bill Gates was young and inexperienced and had no business background, and he seems to have done ok. Steve Jobs got booted out of his own company by someone mature and experienced, with a business background, who then proceeded to ruin the company. So I think people who are mature and experienced, with a business background, may be overrated. We used to call these guys "newscasters," because they had neat hair and spoke in deep, confident voices, and generally didn't know much more than they read on the teleprompter. We talked to a number of VCs, but eventually we ended up financing our startup entirely with angel money. The main reason was that we feared a brand-name VC firm would stick us with a newscaster as part of the deal. That might have been ok if he was content to limit himself to talking to the press, but what if he wanted to have a say in running the company? That would have led to disaster, because our software was so complex. We were a company whose whole m.o. was to win through better technology. The strategic decisions were mostly decisions about technology, and we didn't need any help with those. This was also one reason we didn't go public. Back in 1998 our CFO tried to talk me into it. In those days you could go public as a dog food portal, so as a company with a real product and real revenues, we might have done well. But I feared it would have meant taking on a newscaster-- someone who, as they say, "can talk Wall Street's language." I'm happy to see Google is bucking that trend. They didn't talk Wall Street's language when they did their IPO, and Wall Street didn't buy. And now Wall Street is collectively kicking itself. They'll pay attention next time. Wall Street learns new languages fast when money is involved. You have more leverage negotiating with VCs than you realize. The reason is other VCs. I know a number of VCs now, and when you talk to them you realize that it's a seller's market. Even now there is too much money chasing too few good deals. 413

VCs form a pyramid. At the top are famous ones like Sequoia and Kleiner Perkins, but beneath those are a huge number you've never heard of. What they all have in common is that a dollar from them is worth one dollar. Most VCs will tell you that they don't just provide money, but connections and advice. If you're talking to Vinod Khosla or John Doerr or Mike Moritz, this is true. But such advice and connections can come very expensive. And as you go down the food chain the VCs get rapidly dumber. A few steps down from the top you're basically talking to bankers who've picked up a few new vocabulary words from reading Wired. (Does your product use XML?) So I'd advise you to be skeptical about claims of experience and connections. Basically, a VC is a source of money. I'd be inclined to go with whoever offered the most money the soonest with the least strings attached. You may wonder how much to tell VCs. And you should, because some of them may one day be funding your competitors. I think the best plan is not to be overtly secretive, but not to tell them everything either. After all, as most VCs say, they're more interested in the people than the ideas. The main reason they want to talk about your idea is to judge you, not the idea. So as long as you seem like you know what you're doing, you can probably keep a few things back from them. Talk to as many VCs as you can, even if you don't want their money, because a) they may be on the board of someone who will buy you, and b) if you seem impressive, they'll be discouraged from investing in your competitors. The most efficient way to reach VCs, especially if you only want them to know about you and don't want their money, is at the conferences that are occasionally organized for startups to present to them. Not Spending It When and if you get an infusion of real money from investors, what should you do with it? Not spend it, that's what. In nearly every startup that fails, the proximate cause is running out of money. Usually there is something deeper wrong. But even a proximate cause of death is worth trying hard to avoid. During the Bubble many startups tried to "get big fast." Ideally this meant getting a lot of customers fast. But it was easy for the meaning to slide over into hiring a lot of people fast. Of the two versions, the one where you get a lot of customers fast is of course preferable. But even that may be overrated. The idea is to get there first and get all the users, leaving none for competitors. But I think in most businesses the advantages of 414

being first to market are not so overwhelmingly great. Google is again a case in point. When they appeared it seemed as if search was a mature market, dominated by big players who'd spent millions to build their brands: Yahoo, Lycos, Excite, Infoseek, Altavista, Inktomi. Surely 1998 was a little late to arrive at the party. But as the founders of Google knew, brand is worth next to nothing in the search business. You can come along at any point and make something better, and users will gradually seep over to you. As if to emphasize the point, Google never did any advertising. They're like dealers; they sell the stuff, but they know better than to use it themselves. The competitors Google buried would have done better to spend those millions improving their software. Future startups should learn from that mistake. Unless you're in a market where products are as undifferentiated as cigarettes or vodka or laundry detergent, spending a lot on brand advertising is a sign of breakage. And few if any Web businesses are so undifferentiated. The dating sites are running big ad campaigns right now, which is all the more evidence they're ripe for the picking. (Fee, fie, fo, fum, I smell a company run by marketing guys.) We were compelled by circumstances to grow slowly, and in retrospect it was a good thing. The founders all learned to do every job in the company. As well as writing software, I had to do sales and customer support. At sales I was not very good. I was persistent, but I didn't have the smoothness of a good salesman. My message to potential customers was: you'd be stupid not to sell online, and if you sell online you'd be stupid to use anyone else's software. Both statements were true, but that's not the way to convince people. I was great at customer support though. Imagine talking to a customer support person who not only knew everything about the product, but would apologize abjectly if there was a bug, and then fix it immediately, while you were on the phone with them. Customers loved us. And we loved them, because when you're growing slow by word of mouth, your first batch of users are the ones who were smart enough to find you by themselves. There is nothing more valuable, in the early stages of a startup, than smart users. If you listen to them, they'll tell you exactly how to make a winning product. And not only will they give you this advice for free, they'll pay you. We officially launched in early 1996. By the end of that year we had about 70 users. Since this was the era of "get big fast," I worried about how small and obscure we were. But in fact we were doing exactly the right thing. Once you get big (in users or 415

employees) it gets hard to change your product. That year was effectively a laboratory for improving our software. By the end of it, we were so far ahead of our competitors that they never had a hope of catching up. And since all the hackers had spent many hours talking to users, we understood online commerce way better than anyone else. That's the key to success as a startup. There is nothing more important than understanding your business. You might think that anyone in a business must, ex officio, understand it. Far from it. Google's secret weapon was simply that they understood search. I was working for Yahoo when Google appeared, and Yahoo didn't understand search. I know because I once tried to convince the powers that be that we had to make search better, and I got in reply what was then the party line about it: that Yahoo was no longer a mere "search engine." Search was now only a small percentage of our page views, less than one month's growth, and now that we were established as a "media company," or "portal," or whatever we were, search could safely be allowed to wither and drop off, like an umbilical cord. Well, a small fraction of page views they may be, but they are an important fraction, because they are the page views that Web sessions start with. I think Yahoo gets that now. Google understands a few other things most Web companies still don't. The most important is that you should put users before advertisers, even though the advertisers are paying and users aren't. One of my favorite bumper stickers reads "if the people lead, the leaders will follow." Paraphrased for the Web, this becomes "get all the users, and the advertisers will follow." More generally, design your product to please users first, and then think about how to make money from it. If you don't put users first, you leave a gap for competitors who do. To make something users love, you have to understand them. And the bigger you are, the harder that is. So I say "get big slow." The slower you burn through your funding, the more time you have to learn. The other reason to spend money slowly is to encourage a culture of cheapness. That's something Yahoo did understand. David Filo's title was "Chief Yahoo," but he was proud that his unofficial title was "Cheap Yahoo." Soon after we arrived at Yahoo, we got an email from Filo, who had been crawling around our directory hierarchy, asking if it was really necessary to store so much of our data on expensive RAID drives. I was impressed by that. Yahoo's market cap then was already in the billions, and they were still worrying about wasting a few gigs of disk space. 416

When you get a couple million dollars from a VC firm, you tend to feel rich. It's important to realize you're not. A rich company is one with large revenues. This money isn't revenue. It's money investors have given you in the hope you'll be able to generate revenues. So despite those millions in the bank, you're still poor. For most startups the model should be grad student, not law firm. Aim for cool and cheap, not expensive and impressive. For us the test of whether a startup understood this was whether they had Aeron chairs. The Aeron came out during the Bubble and was very popular with startups. Especially the type, all too common then, that was like a bunch of kids playing house with money supplied by VCs. We had office chairs so cheap that the arms all fell off. This was slightly embarrassing at the time, but in retrospect the grad-studenty atmosphere of our office was another of those things we did right without knowing it. Our offices were in a wooden triple-decker in Harvard Square. It had been an apartment until about the 1970s, and there was still a claw-footed bathtub in the bathroom. It must once have been inhabited by someone fairly eccentric, because a lot of the chinks in the walls were stuffed with aluminum foil, as if to protect against cosmic rays. When eminent visitors came to see us, we were a bit sheepish about the low production values. But in fact that place was the perfect space for a startup. We felt like our role was to be impudent underdogs instead of corporate stuffed shirts, and that is exactly the spirit you want. An apartment is also the right kind of place for developing software. Cube farms suck for that, as you've probably discovered if you've tried it. Ever notice how much easier it is to hack at home than at work? So why not make work more like home? When you're looking for space for a startup, don't feel that it has to look professional. Professional means doing good work, not elevators and glass walls. I'd advise most startups to avoid corporate space at first and just rent an apartment. You want to live at the office in a startup, so why not have a place designed to be lived in as your office? Besides being cheaper and better to work in, apartments tend to be in better locations than office buildings. And for a startup location is very important. The key to productivity is for people to come back to work after dinner. Those hours after the phone stops ringing are by far the best for getting work done. Great things happen when a group of employees go out to dinner together, talk over ideas, and then come back to their offices to implement them. So you want to be in a place where there are a lot of 417

restaurants around, not some dreary office park that's a wasteland after 6:00 PM. Once a company shifts over into the model where everyone drives home to the suburbs for dinner, however late, you've lost something extraordinarily valuable. God help you if you actually start in that mode. If I were going to start a startup today, there are only three places I'd consider doing it: on the Red Line near Central, Harvard, or Davis Squares (Kendall is too sterile); in Palo Alto on University or California Aves; and in Berkeley immediately north or south of campus. These are the only places I know that have the right kind of vibe. The most important way to not spend money is by not hiring people. I may be an extremist, but I think hiring people is the worst thing a company can do. To start with, people are a recurring expense, which is the worst kind. They also tend to cause you to grow out of your space, and perhaps even move to the sort of uncool office building that will make your software worse. But worst of all, they slow you down: instead of sticking your head in someone's office and checking out an idea with them, eight people have to have a meeting about it. So the fewer people you can hire, the better. During the Bubble a lot of startups had the opposite policy. They wanted to get "staffed up" as soon as possible, as if you couldn't get anything done unless there was someone with the corresponding job title. That's big company thinking. Don't hire people to fill the gaps in some a priori org chart. The only reason to hire someone is to do something you'd like to do but can't. If hiring unnecessary people is expensive and slows you down, why do nearly all companies do it? I think the main reason is that people like the idea of having a lot of people working for them. This weakness often extends right up to the CEO. If you ever end up running a company, you'll find the most common question people ask is how many employees you have. This is their way of weighing you. It's not just random people who ask this; even reporters do. And they're going to be a lot more impressed if the answer is a thousand than if it's ten. This is ridiculous, really. If two companies have the same revenues, it's the one with fewer employees that's more impressive. When people used to ask me how many people our startup had, and I answered "twenty," I could see them thinking that we didn't count for much. I used to want to add "but our main competitor, whose ass we regularly kick, has a hundred and forty, so can we have credit for the larger of the two numbers?"


As with office space, the number of your employees is a choice between seeming impressive, and being impressive. Any of you who were nerds in high school know about this choice. Keep doing it when you start a company. Should You? But should you start a company? Are you the right sort of person to do it? If you are, is it worth it? More people are the right sort of person to start a startup than realize it. That's the main reason I wrote this. There could be ten times more startups than there are, and that would probably be a good thing. I was, I now realize, exactly the right sort of person to start a startup. But the idea terrified me at first. I was forced into it because I was a Lisp hacker. The company I'd been consulting for seemed to be running into trouble, and there were not a lot of other companies using Lisp. Since I couldn't bear the thought of programming in another language (this was 1995, remember, when "another language" meant C++) the only option seemed to be to start a new company using Lisp. I realize this sounds far-fetched, but if you're a Lisp hacker you'll know what I mean. And if the idea of starting a startup frightened me so much that I only did it out of necessity, there must be a lot of people who would be good at it but who are too intimidated to try. So who should start a startup? Someone who is a good hacker, between about 23 and 38, and who wants to solve the money problem in one shot instead of getting paid gradually over a conventional working life. I can't say precisely what a good hacker is. At a first rate university this might include the top half of computer science majors. Though of course you don't have to be a CS major to be a hacker; I was a philosophy major in college. It's hard to tell whether you're a good hacker, especially when you're young. Fortunately the process of starting startups tends to select them automatically. What drives people to start startups is (or should be) looking at existing technology and thinking, don't these guys realize they should be doing x, y, and z? And that's also a sign that one is a good hacker. I put the lower bound at 23 not because there's something that doesn't happen to your brain till then, but because you need to 419

see what it's like in an existing business before you try running your own. The business doesn't have to be a startup. I spent a year working for a software company to pay off my college loans. It was the worst year of my adult life, but I learned, without realizing it at the time, a lot of valuable lessons about the software business. In this case they were mostly negative lessons: don't have a lot of meetings; don't have chunks of code that multiple people own; don't have a sales guy running the company; don't make a high-end product; don't let your code get too big; don't leave finding bugs to QA people; don't go too long between releases; don't isolate developers from users; don't move from Cambridge to Route 128; and so on. But negative lessons are just as valuable as positive ones. Perhaps even more valuable: it's hard to repeat a brilliant performance, but it's straightforward to avoid errors. The other reason it's hard to start a company before 23 is that people won't take you seriously. VCs won't trust you, and will try to reduce you to a mascot as a condition of funding. Customers will worry you're going to flake out and leave them stranded. Even you yourself, unless you're very unusual, will feel your age to some degree; you'll find it awkward to be the boss of someone much older than you, and if you're 21, hiring only people younger rather limits your options. Some people could probably start a company at 18 if they wanted to. Bill Gates was 19 when he and Paul Allen started Microsoft. (Paul Allen was 22, though, and that probably made a difference.) So if you're thinking, I don't care what he says, I'm going to start a company now, you may be the sort of person who could get away with it. The other cutoff, 38, has a lot more play in it. One reason I put it there is that I don't think many people have the physical stamina much past that age. I used to work till 2:00 or 3:00 AM every night, seven days a week. I don't know if I could do that now. Also, startups are a big risk financially. If you try something that blows up and leaves you broke at 26, big deal; a lot of 26 year olds are broke. By 38 you can't take so many risks-- especially if you have kids. My final test may be the most restrictive. Do you actually want to start a startup? What it amounts to, economically, is compressing your working life into the smallest possible space. Instead of working at an ordinary rate for 40 years, you work like hell for four. And maybe end up with nothing-- though in that case it probably won't take four years.


During this time you'll do little but work, because when you're not working, your competitors will be. My only leisure activities were running, which I needed to do to keep working anyway, and about fifteen minutes of reading a night. I had a girlfriend for a total of two months during that three year period. Every couple weeks I would take a few hours off to visit a used bookshop or go to a friend's house for dinner. I went to visit my family twice. Otherwise I just worked. Working was often fun, because the people I worked with were some of my best friends. Sometimes it was even technically interesting. But only about 10% of the time. The best I can say for the other 90% is that some of it is funnier in hindsight than it seemed then. Like the time the power went off in Cambridge for about six hours, and we made the mistake of trying to start a gasoline powered generator inside our offices. I won't try that again. I don't think the amount of bullshit you have to deal with in a startup is more than you'd endure in an ordinary working life. It's probably less, in fact; it just seems like a lot because it's compressed into a short period. So mainly what a startup buys you is time. That's the way to think about it if you're trying to decide whether to start one. If you're the sort of person who would like to solve the money problem once and for all instead of working for a salary for 40 years, then a startup makes sense. For a lot of people the conflict is between startups and graduate school. Grad students are just the age, and just the sort of people, to start software startups. You may worry that if you do you'll blow your chances of an academic career. But it's possible to be part of a startup and stay in grad school, especially at first. Two of our three original hackers were in grad school the whole time, and both got their degrees. There are few sources of energy so powerful as a procrastinating grad student. If you do have to leave grad school, in the worst case it won't be for too long. If a startup fails, it will probably fail quickly enough that you can return to academic life. And if it succeeds, you may find you no longer have such a burning desire to be an assistant professor. If you want to do it, do it. Starting a startup is not the great mystery it seems from outside. It's not something you have to know about "business" to do. Build something users love, and spend less than you make. How hard is that? b. How to get government assistantship


<Financing Your Startup: Are Government Grants an Option?> This is one of the most commonly asked questions posted by entrepreneurs and owners of young businesses in the SBA Community. And, in most cases, the answer is “no.” However, some small businesses, particularly those engaged in “high-tech” innovation or scientific research and development, can benefit from government grants. Here are some facts about government grants for small businesses, including who is eligible and how you can go about finding them: Can I Get a Government Grant to Start a Business? No doubt you’ve seen ads purporting to offer access to “free money” to start your business. While it’s not unreasonable to expect that the government may provide grants to small businesses, it’s wise to take most of these claims with a grain of salt. Why? The fact is, government grants are funded by tax dollars, and, as such, there are very stringent rules about how that money is spent. In short, despite what you may have heard in obscure ads or late night TV infomercials, federal and state governments don’t provide grants for any of the following: • • •

Starting a business Paying off debt Covering operational expenses

That being said, there are certain types of grants available. However, these are limited to specific industries and causes, such as scientific and medical research and (more on this below). Your state government is another source of potential grants, often known as “discretionary incentive grants.” Again, these are closely tied to government objectives and tend to be restricted to larger employers or have strict eligibility requirements that often exclude small businesses. Small Businesses May Qualify for Research and Development (R&D) Grants One business venture that does attract government grant funding is scientific research and development. Federal initiatives, like the Small Business Innovation Research (SBIR) program, award grants to hi-tech small businesses or startups to carry out R&D and bring innovative technological products to market. Companies 422

like Symantec, Qualcomm and ViaSat all got a step up thanks to the SBIR program. How to Find Grants If you think you might be eligible for a government grant or aren’t sure about the validity of some of the claims you hear in the media, check out This is a searchable directory of more than 1,000 federal grant programs. Use the Advanced Search tool to search for a grant by eligibility (e.g., for-profits or small business), by issuing agency, or category (e.g., environment or science and technology). The Bottom Line The truth is that for most entrepreneurs, starting a business needn’t break the bank. The latest data from the SBA Office of Advocacy shows that up to 40 percent of startups get established with very little financing, often less than $5,000, while up to 25 percent don’t use any startup financing at all. So before you get pulled down the rabbit hole of “free money”, assess your funding needs. This includes your capital assets like a laptop, printer, web hosting costs, office space or inventory stock – as well as the amount of cash flow you need to keep you afloat until your business is meeting your revenue goals and you are making a profit. If you think you’ll need financing at some point, be sure to fully develop and test your product or offering so that it’s as complete and ready-for-market as it can be before marketing it or seeking financing. <5 Great Financial Grants for Small Businesses and Entrepreneurs> Grants are like free money for small businesses: Unlike loans and other debt, grants don’t typically require you to pay anyone back. Of course, finding and qualifying for public or private funds takes some effort. To help make the process a bit easier, here are five potential sources of grants for small enterprises and entrepreneurs. State and Local Agencies — The federal government doesn’t make general grants to small businesses, but your state or local government may offer other financial-assistance programs, such as low-interest loans. Contact your state’s economic development agency as a starting point. This online directory lists local and international agencies, too. 423

Uncle Sam — As noted, the Feds won’t send you general grant money just for starting or expanding a business. However, the U.S. government does offer specific funding programs, many of which are available to small businesses and entrepreneurs that meet certain criteria. Examples include health-related research and green product offers a comprehensive search tool for federal monies. Opportunity Fund — This California nonprofit offers a mix of microloans, microsavings, and commercial real estate financing to small businesses in the San Francisco Bay Area. Its 2012 Start-Up Funding Challenge awards grants of $2,000 to $5,000 — but you’ll have to hurry, as the application deadline is April 15. Located elsewhere? Look online or ask around in your community about nonprofit organizations that promote entrepreneurship and business ownership through similar programs. Amber Grants — Sometimes a modest amount of money can have a major impact. The Amber Foundation Grants have been supporting women entrepreneurs since 1998. The grants, usually $500 to $1,000 each, are intended to help with “the small but essential expenses that can often make the difference between getting started or being forever stalled.” Love a Local Business — Intuit’s Love a Local Business grant competition has given more than $1.1 million to winning small businesses since its inception. Nominations are a great way for fans — customers, employees, vendors, and others — to recognize and reward your business. This month, one small business will win a $25,000 hiring grant. Of course, grants aren’t the only means of securing additional funds. To explore other financing options (beyond traditional bank loans), check with The SBA and services such as the Intuit Loan Finder and c. Examples of Entrepreneurs <The 12 Greatest Entrepreneurs of Our Time> From dreamers to doers When Jeff Bezos came up with the idea for what would become, he went on a stroll in Central Park with his boss at the time to share his epiphany. Bezos, in 1992, was a senior vice president for the New York hedge fund D.E. Shaw. He described his dream to create a company that would sell books on the Internet. His boss listened intently 424

before offering a bit of advice: "That sounds like a really good idea, but it would be an even better idea for someone who didn't already have a good job." Big ideas of the ground-shifting variety are rare -- and hard to pull off. But that's the difference between the dreamer and the doer. It took Bezos all of 48 hours to decide to quit his job and get started. Some 18 years later, he's still at the helm of, which has redefined the way people buy almost everything, employs 56,200 people, and is valued at more than $80 billion. Having spent years studying Bezos and others like him as an author, senior writer, and editor at both Business Week and Fast Company, I can tell you that Bezos is one of those rare birds who have made a meaningful mark on our economy and our world. He would certainly be on anyone's list of the 12 greatest entrepreneurs of my generation. Who else should make that cut? After spending the better part of the past year pondering that question for a new book, World Changers: 25 Entrepreneurs Who Changed Business as We Knew It (Portfolio Penguin), I was asked by Fortune who deserves to be on that list -- and what we can learn from each of them. Many are obvious -- from the late Steve Jobs, who helped make Apple the hottest and most valuable company on the planet, to Mark Zuckerberg, who will take Facebook public in what is anticipated to be the biggest IPO of all time (at a value of more than $80 billion). But there will be a few surprises too, such as N.R. Narayana Murthy, the visionary founder of Infosys who has built one of the largest companies in India, helping to transform that economy and put it on the world stage. Another surprise: Not a single woman makes the list of the top 12 -at a time when women have gathered more influence and power in business than ever before. Oprah Winfrey has leveraged her celebrity into a formidable media empire, and the late Body Shop founder Anita Roddick proved that you could market products by being socially and environmentally responsible. They clearly warrant honorable mention but have not, in my view, transformed the face of business or society in as profound a way as those singled out here. Admittedly this list of the world's greatest entrepreneurs is subjective. I based it largely on social and economic impact; the world-changing vision of a founder who has inspired employees and other entrepreneurs alike; a record of innovation; and the actual performance of their companies over time. These founders created and then nurtured healthy, sustainable organizations that now have a combined market value of more than $1.7 trillion. 425

They directly employ more than 3 million people, ranging from a high of 2.1 million at Wal-Mart to just over 3,000 at Facebook. Yet those numbers only touch the surface. Each of their companies sits at the nucleus of a thriving ecosystem that has cultivated and nurtured dozens if not hundreds of other enterprises. Small companies have thrived as suppliers, for example, to Whole Foods, which, among other things, buys produce from more than 2,000 local farms. So the power of each of these organizations extends far beyond its own walls. Here are my choices: 1. Steve Jobs

Company: Apple Sales: $108.2 billion Market Value: $546 billion Employees: 63,300 Advice: Say no to focus groups and market research. Though he could be abusive and mean-spirited to people who threw themselves into their work on his behalf, Steve Jobs has been our generation's quintessential entrepreneur. Visionary. Inspiring. Brilliant. Mercurial. Perhaps the most astonishing fact about Jobs was his view that market research and focus groups only limited your ability to innovate. Asked how much research was done to guide Apple when he introduced the iPad, Jobs famously quipped, "None. It isn't the consumers' job to know what they want. It's hard for 426

[consumers] to tell you what they want when they've never seen anything remotely like it." Instead, it was Jobs' own intuition, his radar-like feel for emerging technologies and how they could be brought together to create, in his words, "insanely great" products, that ultimately made the difference. For Jobs, who died last year at 56, intuition was no mere gut call. It was, as he put it in his often-quoted commencement speech at Stanford, about "connecting the dots," glimpsing the relationships among wildly disparate life experiences and changes in technology. It's a safe bet to assume that none of Apple's blockbuster products, from the Macintosh to the iPod and iTunes, from the iPhone to the iPad, would have come about if Jobs had relied heavily on consumer research. Fittingly enough, on the day Jobs launched the Macintosh, a reporter from Popular Science asked him what type of studies Apple had conducted to ensure there was a market for the computer. In a nearly offended tone, Jobs retorted, "Did Alexander Graham Bell do any market research before he invented the telephone?" 2. Bill Gates


Company: Microsoft Sales: $69.9 billion Market Value: $273.5 billion Employees: 90,000 Advice: Find very smart people and create small teams. Bill Gates is one of the very few extraordinary entrepreneurs who have had the opportunity to change the world twice in one lifetime: First, as the world's most influential geek, he helped usher in the personal computer revolution. Now he is tackling the stubbornly difficult challenges of global health and public education as the world's most generous philanthropist. If there is a similarity between how he led Microsoft and how he is leading the Bill & Melinda Gates Foundation as its cochair, it's a focus on hiring very smart people and putting them to work in small teams to solve big issues. "There is no way of getting around that," he has said. "In terms of IQ, you've got to be very elitist in picking the people who deserve to write software." Once asked what his best business decision was, Gates replied without hesitation that it came down to picking people. "Deciding to go into business with Paul Allen is probably at the top of the list, and subsequently hiring a friend, Steve Ballmer [Gates' successor as CEO at Microsoft]. It's important to have someone who you totally trust, who is totally committed, who shares your vision, yet who has a little bit different set of skills and who also acts as something of a check on you." Says the 56-year-old Gates about Ballmer: "Some of the ideas you run by him, you know he's going to say, `Hey, wait a minute. Have you thought about this or that?' The benefit of speaking off somebody who's got that kind of brilliance is that it not only makes business more fun, but it really leads to a lot of success." 3. Fred Smith


Company: FedEx Sales: $39.3 billion Market Value: $30 billion Employees: 255,573 Advice: Rely on "first-level" managers. Despite the story that Fred Smith came up with the idea for Federal Express in a term paper for a Yale University class, it was this entrepreneur's experience during the Vietnam War that really allowed Smith to glimpse the future. From 1967 through 1969 he served two tours of duty, first as a rifle platoon leader in the U.S. Marines and later as an air controller. It was a profoundly formative experience. For one thing, Smith got to see up close the awe-inspiring logistical efforts of the military, effectively mobilizing more than half-a-million troops and millions of tons of supplies. The discipline, training, and leadership experience would stick with the Marine captain. "When people ask me what principles have guided me since I started FedEx Corp. years ago," he says, "my answer often startles them: It's the leadership tenets that I learned in the U.S. Marine Corps during my service in Vietnam." In the Marine Corps it was not heretical to have ground and air groups together. "When you come ashore in landing boats, you don't have any artillery, so the Marine Corps is the branch of the service that actually invented close air support, 429

dropping ordnance close to you. So I made Federal Express an integrated air-ground system. It had its own pickup and delivery operations on the ground that were integral to the hub-and-spoke air operation." Smith's leadership handbook draws heavily upon his Marines experience. "We tell our executives that the key to their success is to rely on their first-level managers [the company's counterparts to noncommissioned officers], to set an example themselves, and to praise in public when someone has done a good job. All those are standard operating procedure in the Marines." Ultimately Smith, 67, gave many small businesses the customer reach that had long been the province of far larger companies. It was a game-changing innovation for FedEx, but also for the broader entrepreneurial economy. 4. Jeff Bezos

Company: Amazon Market Value: $84.0 billion Sales: $48.1 billion Employees: 56,200 Advice: Take regular mini-retreats. After ignoring his boss' advice and quitting his job in New York, Jeff Bezos drove across the country to Seattle, drawn by the city's large population of software developers. Once he launched Amazon in 1994, it took the e-commerce company more than six years to report its first quarterly profit. 430

He was in no hurry then and he is in no hurry now to boost profits at the expense of building "an important and lasting company." Bezos has long resisted entreaties from an often frustrated Wall Street to manage his company for profit instead of revenue growth and customer service. Leading a closely watched, high-growth company can be frenetic. One of the biggest problems: finding the time to be pro-active rather than reactive. But Bezos, at the end of each quarter, solves this by just going away. His solo retreats have been put to good effect, resulting in several new ideas and products, including Amazon's fulfillment center for third-party sellers. As he has explained it, "I just lock myself up. There are no distractions from the office. No phones ringing. It's just because with a little bit of isolation I find I start to get more creative. I do spend a lot of time web surfing during those two or three days and just looking at what hobbyists and hackers are doing. What are the sorts of things that are on the cutting edge?" Bezos, 48, will then write up two- or three-page memos, sometimes to himself, other times to his executive team. "What I find is, by the time that process is done, I'm never really sure if I invented something or not, because it starts here and ends up there. That's what you want if you have a bunch of smart people. Somebody says, `Well, that will never work because you forgot x, y, andz.' And then you step back and recognize that's true and then it morphs and builds." 5. Larry Page and Sergey Brin


Company: Google Sales: $37.9 billion Market Value: $203.2 billion Employees: 32,500 Advice: Spare no expense on innovation. Just like Paul McCartney, who says he literally dreamed the melody to "Yesterday," one of the most covered songs in the history of recorded music, Larry Page recalls the night in 1996 when he was 23 years old and had vividly dreamed about downloading the entire web onto computers. "I grabbed a pen and started writing," says Google co-founder and CEO Page. "I spent the middle of that night scribbling out the details and convincing myself it would work." It certainly did. For the first time ever, in the final three months of 2011, Google exceeded $10 billion in quarterly revenue. Every day people around the world now use Google for an astounding 2.5 billion searches. But in all the gee-whiz statistics one could cite about the ubiquity of the company on the web, one statistic is even more telling: Page, 39, and co-founder Sergey Brin, 38, have spent $11.8 billion on research and development in the past three years. That money fuels an innovation machine second to none, one that has moved Google well beyond its dominating lead in the search engine business. Staying innovative while scaling into a behemoth organization is often the most difficult passage for any growth company. For Page, who became CEO last year, and Brin, it comes down to what they call the 70-20-10 rule. "About 70% try to work on the core efforts of the company," explains Brin, "about 20% goes to adjacent areas and expansion, and for the 10%, anything goes. As we have expanded our breadth of offerings, it's actually harder and harder to find the 10% out there. But I think that's important -- to let people be really creative and think outside the box." 6. Howard Schultz


Company: Starbucks Sales: $11.7 billion Market Value: $40 billion Employees: 149,000 Advice: Always challenge the old ways. In the darkest days of the Great Recession, many analysts and media pundits had written off Starbucks as an overreaching victim of changing consumer habits. Howard Schultz, who regained his job as CEO in early 2008 after an eight-year hiatus, would have none of it. When he returned, Starbucks' profits and revenues were tanking. The stock price had fallen so severely that at one point he feared the company could be taken over. Starbucks had become a brand that had been stretched beyond its demography. But Schultz did what few builders of companies are known to do -- but what all of the greatest entrepreneurs always do: He brought financial discipline, bottom-line efficiency, and a back-to-basics focus to the company. Growth and success had covered up a lot of mistakes and led to a tremendous amount of waste. The world's dominant purveyor of chai lattes, for example, had been losing tens of millions of dollars a year by pouring excess steamed milk down the drain. By simply putting a serrated internal ring inside a pitcher to guide how much milk a barista should use for a latte, Starbucks saved millions. "You wouldn't think a steaming pitcher could be sexy," says Schultz. "But it became very sexy at Starbucks." 433

As with Steve Jobs at Apple, the second coming of Howard Schultz saved Starbucks from being just another also-ran. And in turning around an iconic brand, Schultz, now 58, demonstrated that he could do what most founders are said not to do: challenge the old way of doing things. 7. Mark Zuckerberg

Company: Facebook Sales: $3.71 billion Market Value: $75 billion-$100 billion (estimate) Employees: 3,200 Advice: Embrace paranoia. By the time Mark Zuckerberg celebrates his 28th birthday this May, Facebook will in all likelihood have gone public and become the biggest IPO of all time. The long-anticipated event will create hundreds of millionaires, result in a valuation of an Internet company that will approach $100 billion, and make the geek who dropped out of Harvard University his generation's Bill Gates. Yet it has been only eight years since the social-networking site was launched from Zuckerberg's dorm room at Harvard. It would be easy to chalk a good bit of his success to luck and timing. But that would be a serious mistake. What's helped make Facebook the world's dominant social network is an obsessive entrepreneurial genius who has taken a page from another of Silicon Valley's legendary denizens, Intel's Andy Grove, who famously stated -- and lived by -- the dictum that only the paranoid survive. 434

Zuckerberg is the Valley's most paranoid entrepreneur these days, taking nothing for granted. It's why he has pushed out a constant flow of innovative changes to Facebook's platform, making it easier for developers to create applications for the community and ensuring that each new iteration keeps it ahead of the competition. It's the single most important explanation for why Facebook has yet to face any formidable rival in its space, including last year's challenge from heavyweight Google. 8. John Mackey

Company: Whole Foods Sales: $10.1 billion Market Value: $15.5 billion Employees: 56,200 Advice: Purpose inspires people. In 1978, John Mackey and his then-girlfriend Renee Lawson opened their first vegetarian food store in an old Victorian home in Austin. They had modest ambitions: to make a living, have fun, and help a few people live healthier by eating better. A bearded, shaggy-haired college dropout, Mackey had just turned 25 and thought profit was little more than a "necessary evil." 435