1. Table of Contents (PCR Outline)

1. Table of Contents (PCR Outline)

2. Introduction

3. Archive of Course Activities

    a. Class sessions

        i. Lecture 1 - What is Innovation? (9/8)

        ii. Lecture 2 - Masters of Innovation (9/15)

        iii. Lecture 3 - Psychology of Innovation (9/22)

        iv. Lecture 4 - What Makes Organizations Innovative? (9/29)

        v. Lecture 5 - Demystifying Innovation (10/6)

        vi. Design Thinking (10/20-11/3)

            1. Empathy

            2. Define + Brainstorm

            3. Prototype + Demo

    b. Special Sessions

        i. Milton Hershey (9/7)

        ii. Cirque du Soliel (9/16-9/17)

        iii. Challenge Course (9/29)

        iv. BJ Levin (10/20)

4. Improving my Creative Confidence
5. The Necessity of Strangers
6. Improving my Discovery Skills
7. Improving my Networking
8. How "The Start-Up of You" Shaped my Career Planning
9. Assessment Center Results
10. REFLECT Results
11. Lessons from Steve Jobs
12. World Changers Book
13. Outside Class Events
    a. Marc Greenberg (10/7)
    b. NYC Trip (10/23-10/24)
    c. Walter Isaacson (11/10)
14. My Transformation - How I've Changed and What I've Learned
15. Synthesis of the Course

2. Introduction

Coming into Dr. Wellman’s BMGT289 class, I was the most lost I had ever been. First of all, I wasn’t a business major like most of the other BSE scholars students, I was in letters & sciences as an undecided major. The reason why I decided to make my major as undecided was because in high school I had no idea what I wanted and I didn’t take much action to find out what I would have liked to do. This already made me feel like I was an outsider because I wasn’t in the business school and class had barely even begun yet. Furthermore, I didn’t even know the first thing about business itself. The only reason why I even chose to be in the Business, Society, and the Economy scholars program was because I saw that the students go on lots of field trips. I was quite literally going into the class blind. Despite this, I was strangely excited to see what the class had in store and hoped that it would cause some sort of self-improvement. Coming into this class I had always thought that a company’s success was measured by how much money they make, not by how innovative they are or what processes they use to create ideas. I later found this was much more important.

What I hoped to get out of this class was a deeper understanding about the business world as well as what it means to be innovative. After talking to second-year BSE students on the annual first day of school College Park Scholars service day, I gathered that Dr. Wellman was a difficult yet amazing teacher. I liked that there were interesting books in the syllabus as part of our education. It was really refreshing to have a number of different insightful books to learn material from instead of a traditional drab textbook like every other class. I read the Steve Jobs book over the summer and it really fascinated me, so I imagined that the other books would have a similar effect and it got me excited to see what we had in store for us.

I looked forward to this class because it seemed very reflective and I recognized the urgency to develop internally if I ever wanted to decide on a major here. As far as choosing a major, I knew what I didn’t want to do (science, English, history), but there was so much that I didn’t know, leaving me feeling very uncertain about what road to take. Completing the PCR turned out to be more beneficial than I would have ever imagined. I’m hoping my blog gives an accurate portrayal of who I am as a student and how much I have learned from this class. In order to challenge myself and push boundaries, I made my PCR into the form of an online blog. I’ve always enjoyed the art of blogging but never gotten into it myself until this project. I realized how easy it actually is, and additionally I realized I had learned a new skill that I could market and put on my resume.

3a. Lecture 1 - What is Innovation? (9/8)

What We Did: What exactly is innovation? Coming into this class I honestly couldn’t tell you. But this knowledge deficiency quickly changed. Our first BMGT289 class was spent talking about innovation and what it truly was. Innovation is the process of having original ideas and insights with value, then implementing them so that they are accepted and used by many. I learned that this is truly the basis of all competition that takes place in today’s society, particularly in the U.S.

Our lecture concentrated a lot on the concept of creativity, which is what leads to innovation. Expertise and creative thinking are an individual’s raw materials. Motivation is what puts these raw materials to work. Creativity CAN be taught, learned and practiced. Creativity comes from play, passion and purpose. Additionally, I was introduced to the Innovator’s DNA. The major steps involved in the innovation process are association, questioning, observing, networking, and experimenting.

Key Takeaways and Future Applications: This first lecture served as a really good introduction to the idea of innovation and how important it really is for my future. It opened my eyes to the urgency for my generation to think ahead. In today’s age of technology, so many jobs are being automated. Therefore, we can’t keep doing what we have been in the past – its time to think outside the box.

Our country depends on innovation to have a successful economy – it drives us to the next level and allows us to remain globally competitive. Older markets are under tremendous pressure, so we need an entire generation of innovators to remain globally competitive. The first company that comes to mind when I think of U.S. innovation is Apple. Apple is able to “disrupt” the marketplace simply because of its experimentation, curiosity, and its willingness to take risks. Of course, Apple employees don’t always succeed right away; it took repeated failure and the motivation to keep trying to get them where they are today. I really admire Apple and Steve Jobs especially for being able to fail so many times but still keep trying. Fear of failure is definitely something I struggle with. At times I feel like it’s really hard for me to be positive when thinking about the future. I tend to always expect the worst possible outcome in a lot of situations. I think this is because I don’t have a set plan that I follow in life. Right now I’m just taking things day by day and that creates anxiety, because the future is so uncertain. I know that failure is inevitable somewhere down the road, and a lot of times it can be a good thing. So I’m hoping this class can help me get over this stigma of failure, or at least help me combat it in new ways.

I applied the lessons from this lecture to think differently about business. I couldn’t help but wonder what life would be without the products we accept as commonplace today. Without such brilliant minds at Apple, I wouldn’t be here typing this paper today because I would be without my precious MacBook laptop. With this observation I asked myself – what if Apple had never created the MacBook? I have a lot of trouble even imagining one day without my cherished laptop. However, if it had never been created, I would have no idea what I was missing. I think that’s the point of innovation – creating things we didn’t even know we needed, and then not knowing what we would do without them.

I was also pretty pleased when I learned that creativity actually could be taught. As of now I don’t consider myself a super creative person. I feel like I have random thoughts of brilliance, but if I was asked to come up with an inventive idea on the spot, I would have nothing. Today’s class made me optimistic because I now know that my creativity isn’t gone forever, it can be practiced, relearned and aimed toward new endeavors.

3a. Lecture 2 - Masters of Innovation (9/15)

What We Did: Today’s class focused on the wise insights from several experts that were referred to as “masters of innovation”, as well as the idea of growth mindset and creative potential. A growth mindset believes that it’s possible to learn and grow because your skills and capabilities are not set in stone. Creative potential is the limitless capacity to be creative. This involves self-efficacy and guided mastery.

We first talked about disruptive innovation, an idea coined by Clayton Christensen that explains how even top companies can be overthrown by new opponents. The belief is that disruptive firms will initially offer a product with lower performance compared to traditional market standards, but with new performance features that cause it to flourish in a different market. As the product improves, it eventually displaces the former technology. Disruptive innovations are so problematic to existing firms because at first, they aren’t seen as a threat due to the fact that they don’t supply the current market demand. They’re profitable as time goes on because they offer new technologies at lower costs, leaving behind the large companies who did not invest soon enough.

The camera and film company Kodak (represented in the graph as the blue arrow), illustrates this theory. When digital cameras started being produced, they had horrible quality and unfavorable zoom features (this is the yellow arrow, which shows how the first digital cameras were a downgrade from Kodak ones). However, when digital cameras started to improve (green arrow representing new performance trajectory), their success in the market grew at a much faster rate than Kodak’s, and eventually surpassed it.

The second innovation model we discussed was reverse innovation. This is when companies produce inexpensive goods to meet the needs of the poor, then marketing the same good to a large enough demographic of the rich. As Vijay Govindarajan explains in a TED talk, it is “a rich man wanting a poor man’s product.” Developing economies are the bulk of the consuming business (China, India, etc…) Creating a product for the worst case scenario can then cause it to be marketable anywhere. Glocalization is the opposite of reverse innovation – companies develop products at home in rich companies, and then distribute a stripped down version of it worldwide.

The third model we looked at was blue ocean strategy. Red oceans are industries with boundaries that are defined and accepted. Here, companies simply compete head-to-head by trying to outperform one another within the same business and market constraints. Blue oceans are untapped markets with little to no demand yet – basically all industries not in existence today. Demand is created rather than fought over. A company will alter its boundaries and strive to make the competition irrelevant using a completely new and unimaginable product. We can determine if a business is employing the blue ocean strategy by arranging it into a four actions framework grid, which highlights factors that are created, reduced, raised and eliminated.

The final innovation model we learned about was the company IDEO, which is one of the original design firms out there thanks to their signature design thinking process called the “deep dive”. The deep dive is the process of designing a better product with a group of diverse team members to get the job done. Ideas pour out for hours, and everyone builds on each other’s ideas. People are actually encouraged to be absurd. David Kelley, founder of IDEO, feels that is everyone suggested the same old “appropriate” ideas, nothing new would come of it and there wouldn’t be anything to narrow in on. He also believes that approaching challenges from a human perspective yields some of the richest opportunities for change. The three factors to balance in every innovation program are

1. Human factors (desirability)

2. Business factors (viability)

3. Technical factors (feasibility)

IDEO consults other firms on business management strategy, and enforces a process of inspiration, ideation, and implementation. Above is a video that shows just one (of many) examples of an IDEO design team improving an existing product under a very strict time constraint.

Key Takeaways and Future Applications: Today’s lecture gave me a plethora of new information that made my mind race. For example, it took me a very long time to wrap my head around the idea of blue ocean strategy. Until today, I had never even considered the fact that market space could just be created out of nowhere. It’s difficult for me to imagine this because “market space” is merely a social construct, and not an actual physical reality. Therefore, I needed an actual example of this idea to help me understand it. I had been to a Cirque du Soleil show a few years ago, so I knew firsthand that the shows were unlike anything else I had ever experienced. I didn’t know how innovative they really were until I thought about it. Cirque du Soleil disrupted the circus industry by being more artistic and appealing to an older and more mature audience. The shows incorporate music and theater with acrobatics and dancing. Additionally, every show has a different theme, encouraging people to come again. Traditional circuses, however, are all more or less the same. I also thought it was really interesting how the company invented their own made up language called “cirquish” which was what all the performers spoke. This allowed the company to be successful on a global scale because there were no language barriers to prevent success in different places.

I really enjoyed learning about disruptive innovation and asking myself: Why existing firms fail? Clayton Christensen’s answer is because they listened to their customers. This reminds me of the Steve Jobs biography that I read over the summer. At one point, people at Apple tossed around the idea of doing market research to make their personal computers meet the demands of consumers. Jobs wholeheartedly rejected this notion. He said that customers don’t know what they want; they need to be shown what they want. When companies only meet the demands of the consumers, they aren’t innovating. They see no financial logic in entering the next generation of technology, and this is when newer firms surpass them. I agree with

In my opinion, society needs to prioritize reverse innovation if we want to bridge the gaps in social class. Innovations for the poor will transform the rich and rebuild infrastructure of countries like the U.S. Some countries think, “a small sales revenue in India is okay,” but India is growing and on its way to becoming a major market, and companies ignoring countries like this will miss out on major success in the future. We must innovate to capture growth. Glocalization worked fine when rich companies made up most of the market and others offered little opportunity, but those days are now over. Reverse innovation is the practice of the future.

Ultimately I would have to say that the most valuable thing I learned today was design thinking. It’s a concept that I can use everyday, especially when I start my career. I hope to be a marketing executive in the future; so coming up with good ideas for products is crucial.

I decided to give the process a try using my most common daily annoyance: my UMD student ID card. This is the “inspiration” step of design thinking. I hate the inconvenience of having to swipe my card to get into any building. It’s such a pain getting my card out of my bag or pocket wherever I go, and it’s especially annoying doing this in the rain or freezing cold. I’ve also noticed that this is difficult to do when students have a lot in their hands. I can recall plenty of times (and I’m not the only one!) coming back from the diner while holding my drink and cell phone in one hand, my to-go box in the other, and trying to balance a banana on top of my box. Then, when I finally get back to my dorm, I have to put all my food down on the ground, get my ID card from inside my backpack, and let myself in. The worst part is, I have to make two trips because I can’t carry all my food inside and swipe myself in through the two barriers on the way to my room at the same time. So while I’m making my first trip inside, my remaining food is sitting outside unsupervised and getting cold.

Using all of these observations, I tried to think of a solution. This is the “ideation” step of design thinking. Through brainstorming I came up with many ideas, but a lot of them weren’t economically viable. For example, UMD will probably never be able to afford the technology for retina scanning recognition to get into a building. Therefore, I had to think realistically. My idea was an electronic ID card that would use near field communication to automatically unlock building doors when I came within a small range. Now, as long as I have the card on my person (in my pocket, in my bag, etc.), I don’t need to physically swipe it to go to my room.

Of course, I can’t really attempt the third step of design thinking (implementation) because I don’t have the means to create such a product. However, I would like to see this actually become a prototype someday because I find it to be a good solution to an existing problem. If this kind of solution can form from one person using design thinking, I can’t even imagine what would be generated with an entire design team. To achieve my goal of being more innovative, I plan on employing this process to as many daily situations as I can, as I’m a firm believer that practice makes perfect.

3a. Lecture 3 - Psychology of Innovation (9/22)

 Lecture 3: Psychology of Innovation (9/22)

What We Did: In class today we discussed the psychology of innovation and the idea that innovators aren’t born, they’re made. Innovators and entrepreneurs behave differently than the rest of us in that: they challenge the status quo and they’re willing to take risks and view their failures as lessons. We learned about the “regret minimization framework,” which basically says to do what you won’t regret when you look back at life.

“The people who are crazy enough to think

they can change the world, are the ones who do.”

One of the best ways to behave more like an innovator is to follow the Innovator’s DNA. It says that the five key steps to being innovative are associating, questioning, observing, networking, and experimenting. Part of the class discussion was fitting Steve Jobs into this model. He associated by using his knowledge of calligraphy from a college class to influence the typography on his company’s Mac computers later on. He questioned by challenging the idea that a computer needed a fan. He observed when he noticed that the average person didn’t want to have to put all their computer’s components together on their own, and thus he came up with the idea for the personal computer. He networked when teaming up with the brilliant and tech-savvy Steve Wozniak. Lastly, he experimented by building his own “blue box” and selling it.

We talked about the similarities between Steve Jobs and Elon Musk, two of the greatest entrepreneurs who exhibit the Innovator’s DNA perfectly. Both Jobs and Musk are serial disrupters; they’re not afraid to rattle their own industry to achieve something greater. The interesting thing is that both of these men aren’t necessarily inventors – they had other people to do that part. They were just excellent at connecting the parts and moving forward with a good idea. While typical executives simply focus on the numbers, these innovative entrepreneurs focused on customers. Their unique brand of genius is system-level design thinking and extraordinary conviction. Because of their unparalleled passion for their ideas, they were able to achieve amazing things. Steve Jobs was able to revolutionize the personal computer, as well as the portable music industry with the iPod and iTunes, while Musk conceived Space X, PayPal, and Tesla motors.

Key Takeaways and Future Applications: Before today, I always sort of had the notion that people were either born to do greatness or they weren’t. Sometimes I felt like I fell into the latter category, despite having an abundance of creativity when I was a little kid. I remember asking questions about everything and coming up with the most imaginative games that all my friends wanted to play. My parents like to tell a funny story about how they lost me one time in an airport. They ended up finding me with a family of Lithuanians who didn’t speak a word of English, and apparently I was introducing myself and had already become best friends with another little girl my age. I often wonder what happened to this curiosity and why I didn’t harvest it, but if there’s one thing I’ll take away from this class, it’s knowing that I still have creative potential.  We learn to conform to social norms as we get older, but this is the very cause of the unoriginality in today’s society. It never occurred to me that someone could be taught creativity or innovation skills, but the Innovator’s DNA made this seem possible. Contrary to popular belief, it requires a unique mindset, not an innate gift, to achieve innovative greatness.

I reflected on the five skills and my current performance in all of them. I would say my associating skills are relatively weak because I have a horrible memory. This makes it hard for me to dig deep into my brain to recall information and relate it to newer things. What I should start doing to improve association is write things down more often so that I don’t forget as much. I am not as good at questioning as I used to be. I remember specifically in 9^th grade I was in a math class with all kids older than me. They used to make fun of me for being dumb because I would raise my hand and ask at least 5 questions per class. However, I got almost all A’s on my test. That proves that questioning gets you more knowledge, it doesn’t mean you’re dumb. I regret listening to those bullies in 9^th grade because I think they caused me to subconsciously stop asking as many questions. From now on I’m just going to stop caring what others think of me. Asking questions only makes you smarter. I think observing is my best skill out of the five. I have always been an attentive person, and often notice things that others don’t. I especially enjoy people watching and learning things from the actions of others. Networking and experimenting are my weakest skills. However, thanks to this class I am learning a lot about how to network, and I will start to improve that by creating a Linkedin account. To get better at experimenting I think I will learn to not be as scared of failure and just live in the moment.

One company that really values failure is IDEO. One of their mottos is “fail often to succeed sooner.” Not only do IDEO offices have their successful inventions on display, they also exhibit their failed ones. Because I consider myself a perfectionist, the idea that a company could be satisfied when they have failed is so taboo to me. I figured the only way I could understand this theory would be to try it out myself. After class I went through my papers and found a very unfortunate math exam from the beginning of this semester. Similar to how my mom used to hang up my good work on the fridge, I hung my math exam on the mini fridge in my dorm. What I did was the complete opposite of the typical practice. Let’s just say this wasn’t exactly a grade that I was proud of. By hanging up my failure, it was a constant reminder of what I did badly and provided me with daily motivation to do better next time.

I am now a believer in embracing failure, that way we are more equipped to deal with it when it inevitably hits. When I become a marketing executive in the future (hopefully), I plan on applying this concept. I will take something that is usually assumed to be successful, and instead say that it will likely fail. If my company expects a brand to succeed right off the bat and it doesn’t, this can be discouraging and hinder our recovery from setbacks. If we plan to fail however, the company can build a support structure for the worst-case scenario, and an overall failure-tolerant environment that is able to bounce back into progress sooner.

3a. Lecture 4 - What Makes Organizations Innovative? (9/29)

What We Did: We often wonder: how do big companies build the code for innovation? It seems like a difficult task when there are so many people at one company. Sometimes just the process of experimenting is most important. Companies like Amazon support constant experimentation and beg to ask the question, “why not?” For example, Amazon’s Jeff Bezos employs a “two pizza team” rule, meaning each design team should be small enough to be adequately fed by 2 pizzas. This allows each employee to feel empowered and responsible for innovating. Not everybody can be good at both discovery AND delivery, which is why innovation occurs best in a team.

Dr. Wellman emphasized the importance of design teams in the workplace. People don’t feel personally responsible for innovations; they only feel responsible for “facilitating the process.” Companies need to generate ideas as well as execute them, and not everyone can be able to do both. Hence why innovation is best in a team.

The “innovation framework” is the 3P framework, which stands for people, processes, and philosophies. Every factor relies on each other. Innovation directly depends on the people who work at a company. If top executives want innovation they need to first look at themselves. They need to improve discovery skills, understand how innovation works, and sharpen their ability to foster others’ imagination. High discovery-quotient people should be in every stage of the innovation process. According to the 3P framework, processes explicitly encourage employees to associate, question, observe, network and experiment. They are also designed to hire, train, reward, and promote discover driven people. There are four philosophies of innovation; innovation is everyone’s job, not just R&D; disruption is part of our innovation portfolio; deploy small, properly organized innovation project teams; take smart risks in pursuit of innovation.

A major successful business is Virgin Group, founded by Richard Branson, who is a very unique and influential leader. The company focuses on transportation, aviation, telecommunications, financial services, leisure and hospitality, and music to name just a few. The purpose of Virgin is to question “business as usual.” Branson’s philosophy is to have Virgin be an irresistible brand that shakes things up and delivers service and experience that redefines the market. Branson gives helpful insights about creating a brand and the process of his innovation. 

•  Pick on a big guy
• Be a nonconformist
• Negotiate everything
• Have fun
• Baby your brand
• There's no such thing as bad publicity
• Small companies create big success

·    Another example we looked at in class was IDEO. Their philosophy is seeing failure as impossible to avoid and a natural part of the innovation process. They focus on creating products that reach the “sweet spot” in between desirability, viability, and feasibility. They feel that the best ideas come from fun places. Another philosophy is not having an executive pyramid. When there’s a scary boss in charge, employees won’t get half as much done. The boss won’t always have the best ideas, which is why a flat team of equal individuals gives IDEO the most success. They believe innovation teams should have complimentary discovery and delivery skills. The teams should be multidisciplinary, meaning comprised of individuals with deep expertise in different disciplines. This allows teams to get a better look at a problem from different angles. IDEO believes in creating diverse teams of people who are “T-shaped,” or deep in one area of expertise with shallow expertise in multiple other areas of knowledge.

Key Takeaways and Future Applications: I think that learning the 3P innovation model is extremely important for my future because it helps me understand that it’s okay if I am weak in a certain area of knowledge. Nobody is expected to know everything about everything and it’s refreshing to hear that knowledge is best when shared. I definitely agree that it’s best to know a lot about a little rather than a little about a lot. Apple also shares these views. I applied the 3P framework to Apple and gained a lot of insight for my own personal benefit that I could relate to. The lecture today put into perspective how important a company’s people, processes and philosophies are to their innovation.

People: The first person that comes to mind when one thinks of Apple is, obviously, Steve Jobs. As a perfectionist, Jobs had a very high standard of excellence that others have difficulty imitating. This is the reason why Apple products have transformed the user experience tenfold. Jobs used design to create products that “surprise and delight” users. His vision was joining performance, function, and beauty through design. The Apple period without Jobs (1985-1998) saw innovation premium drop to -30% because the company was lacking Jobs’ discovery-driven capacity. Thus, Apple stopped innovating and investors lost confidence in its ability to grow. From the unique people at Apple, Steve Jobs in particular, the main thing I took away was that it is adamant to have passion for your company. When new management took over Apple, the company failed because it didn’t have the same emotion behind it. It’s clear to me that a company’s success shouldn’t have to rely on R&D. It’s not about the money, it’s about the people you have and how you’re led.

Processes: Apple is successful because they mix technology and liberal arts. Employees are from all different walks of life with complimentary discovery and delivery skills, but also different expertise and diversity. For example, the Macintosh was so successful because the people working on it were musicians, poets, artists, historians, etc. Another process that Apple is known for is the element of secrecy. When other companies strive for transparency, Apple tries to keep everything under wraps. Employees are not encouraged to broaden their scope. Instead, they’re assigned to narrow bands of responsibility where they follow orders and nothing more. All new employees go to a training session where their jobs are threatened should they disclose any secret information. I now see the importance of a company’s processes in order to have success. It is essential to do things differently from others so that you stand out from the rest.

Philosophy: The central philosophy of Apple is “think different.” Instead of buying competing companies and expanding its product line, Apple focuses on doing only a few things extraordinarily well. When Jobs became CEO again in 1999, he reduced the number of products to only a few. This way, those few that remained would be the absolute best. Apple had a major focus on simplicity: making life easier by taking away what we don’t need. This is a valuable lesson that I can apply to my future endeavors. I shouldn’t spread myself too thin by trying to get involved in everything. There are so many opportunities and clubs in college that it can become overwhelming. The Apple philosophy teaches me that if I don’t need to be amazing at everything. If I focus on a few things to really excel at, I can fill the remaining gaps by networking and associating with other people.

3a. Lecture 5 - Demystifying Innovation (10/6)

What We Did: Our fifth BMGT lecture was spent exploring why some firms fail to innovate and why others succeed. I learned that there are several hindrances to innovation that lead to the failures of incumbent firms.

Þ   Costs & margins – might not make enough financial sense to take risk

Þ   Thresholds – firms have revenue benchmarks that aren’t always immediately reached

Þ   Wait and see attitude – large, successful firms afraid to try new things

Þ Acquisition – firms think they can buy small competitors’ innovations before they take off (ex: Facebook)

We also talked about the three traits of a culture of innovation.

1.     A willingness to cannibalize their existing products

• ·      “If you don’t cannibalize yourself, someone else will” – Steve Jobs
• ·      Most established firms refuse to kill their cash cows for various economic and organizational factors. This is suffering from the “incumbent’s curse” – a self-destructive culture that results from prior success.
• ·      Example: Apple releasing the iPhone ultimately led to the demise of their iPod market because now people just keep all their music on their phone in one place. Apple wasn’t afraid to cannibalize itself when its product was already doing well, and as a result, they became exponentially more successful following the iPhone’s release. They took a risk that paid off.

2.     A corporate environment that embraces risk

• ·      Incumbents view risk differently from start-ups, as they have less to gain and more to lose.
• ·      They don’t want to suffer from the “hot stove effect” (once bitten, twice shy)
• ·      Example: Facebook had dozens of offers to buy the company within the first year, but Zuckerberg declined them all knowing that he had so much more to do and banking on it all working out. He took risks in order to achieve his vision of worldwide connection

3.     An ability to focus on the future

• ·      With overwhelming evidence supporting failure, incumbents are normally less excited about future uncertain markets
• ·      Example: Kodak ruled film photography until digital cameras took off. They failed to recognize that the digital world was coming because they were too busy enjoying the finite success of their film industry.

The biggest risk a company faces is the failure to adopt unrelenting innovation. Many companies don’t do this because they are too afraid of self-cannibalization or might decide it’s too expensive. Firms can also suffer from the reflection effect (not wanting to take risks when already profiting from innovation) or the expectation effect (if no profit is made within a certain time frame, the firm may prematurely discontinue the product before it takes off. i.e. the HP tablet before the Kindle).

Our class also touched on the importance of company culture in shaping the attitudes and behaviors of employees. “Organizational culture” is defined as the shared social knowledge within organizations. There is a direct correlation between companies with established cultures and being top innovators. For example, Facebook is a unique company embracing a “hacker culture” or trying new things, as well as a philosophy that says “done is better than perfect”. The company asks questions like “What would you do if you weren’t afraid?” CEO Mark Zuckerberg strongly believes in human connections making an impact and telling a story. An interesting part of the Facebook culture is that its employees are very young; the average age is 26. This goes without saying that there are plenty of young and bright minds at the company, making it arguably the world’s most innovative company.

Key Takeaways and Future Applications: Large companies are their own worst enemies. This leads me to think about the advantages this gives to economic newcomers. In contrast, smaller and newer firms have less market to lose, giving them an incentive to take more innovative risks. Risk grows as companies do. I believe this is how new firms end up surpassing established ones. Technologies today are advancing very rapidly, meaning that the current position of any company is never certain. Leading firms in their markets are actually the most vulnerable. This is because the strong position they have at the time can mislead them into thinking they face no competition. After today’s class, I now know this is not the case.

From today’s lecture and the readings I did the night before, I actually started to get scared for the future. I never realized how many forces are working against incumbents looking to innovate. A successful firm will also have a clearly communicated culture based on missions and values. Because I eventually want to work in marketing, I figured I’d better start researching what successful firms I should mimic if I want to prosper as well.

I first studied Gillette, a leading brand of innovating champ Procter & Gamble. The reason why Gillette is able to maintain a roughly 70% share of the global men’s razor market is because it introduces new brands even when previous ones are at the top. This self-cannibalization causes them to always be on top and never fall behind, as well as making it nearly impossible for a new competitor to emerge. The introduction of new disruptive brands is a major risk because it could ruin Gillette’s older brands without the guarantee of a higher profit margin. However, it is clearly a practice that I can learn from, because Gillette has managed to remain on top.

“If you don’t cannibalize yourself,

someone else will.” – Steve Jobs

I next decided to study Amazon.com, which was launched in the late 1990’s to be the world’s largest selection of everything from books to kitchen appliances. From the very beginning, Amazon offered low prices, speedy delivery and emphasized customer satisfaction. In order to maintain a culture of remarkable customer service and mutual trust between company and customer, the very approachable CEO Jeff Bezos puts his personal email online. Amazon’s earliest innovation was one-click buying. The company then enabled book-readers to publish reviews online for others to see. This created a pioneering online community for book commentary. However, I discovered that Amazon’s most radical and admirable innovation of all was the introduction of its own product in 2007 – the Kindle. Years before, HP had developed an e-book reader in the mid 2000’s but didn’t think there was a market for it. Only until Amazon released their Kindle did HP take the market seriously, and by then it was too late. This situation is a perfect portrayal of what Clayton Christensen explained in his book, The Innovator’s Dilemma.

“When established firms wait until a new technology has become commercially

mature in its new applications and launch their own version of the technology only in response to an attack on their home markets, the fear of cannibalization

can become a self-fulfilling prophecy.” – Clayton Christensen

HP committed one of the cardinal crimes of self-destruction: too much concentration on the present and failure to focus on the future. This is a mistake I will not make in the future. I now understand that if I’m not one step ahead, I am already behind.

3a. Design Thinking (10/20-11/3)

Part 1: Empathy (10/20)

What We Did: Despite Dr. Wellman telling us for quite some time that “the classes right after the midterm are going to be a bit different,” none of us really knew what to expect until we walked in the door on the first day. Instead of Dr. Wellman teaching the class like usual, we had two fun teachers from the University of Maryland Academy of Entrepreneurship and Innovation named Frankie and Allie. They explained that they would be would be working with us for the next three classes, and our goal by the end of the last session was to come up with an innovative way to combat the stress of UMD students.

I learned a somewhat different model of design thinking compared to the other ones we have discussed in previous lectures. This process had 5 steps – empathize, define, ideate, prototype, test – but on the first day we would only be focusing on empathy. We did this by learning the importance of dialogue with potential customers, as well as tips to conduct a good interview.

The first thing to do is to introduce yourself and your purpose for conducting the interview. Many people make the mistake of not explaining why they’re asking questions, and this can cause a discrepancy between them and the subjects. By giving an overview of the purpose, there is a more honest atmosphere. Next we should proceed to build rapport with our partner by asking questions and follow up questions. It is best for the questioning to not be so rigid and instead feel like a natural conversation. This will get us the best responses and information. After breaking off into small design teams in class, we spent a few minutes generating a loose list of open-ended interview questions. We were told that eventually we should aim to evoke stories in an interview. This is the best way to learn about a unique situation and gain insight on an issue based on real emotion. Some of the questions we produced were, “How soon after you are assigned homework do you start it?” and “How do you expect to perform on an assignment if you don’t prepare?” An additional tip that we were offered was to get someone to be your note-taker during an interview. It is much better to make eye contact with our subject than to be half-listening and looking down at a notebook.

Key Takeaways and Future Applications: Our homework was to each conduct our own interview inquiring about how UMD students manage stress. Then, we were to meet up with our group and synthesize the data from all of our interviews. We had to agree on four main observations that we gathered and then make “why ladders” (example shown to the right) to dissect the behaviors. I liked the idea of why ladders because the questioning gradually builds on top of previous questions, making drawing conclusions much easier. If the opportunity presented itself, I would like to use these in the future to gain insight. I also enjoyed learning what common faults people make when interviewing and how to correct those errors. I agree that open-ended questions are much better for finding things out, as opposed to questions with yes or no answers.

The main insight we got from all of this was that college students don’t feel that there’s enough time in the day to do everything they need to, leading to stress. In addition to schoolwork, students need to have enough time to eat, exercise, and go to their jobs. However, most of them don’t end up getting to do all of this. We need to find out a way for them to manage their time better.

When Dr. Wellman said the next class was going to be different he definitely wasn’t kidding! A lot of the class involved coming up with things on the fly – something I don’t consider myself to be good at, and a drastic contrast from previous lectures. Before, we already knew what to expect in the lectures from our reading assignments. I was fine with learning about it in class, but once I was actually thrown in a hands-on situation, I felt a little overwhelmed. I didn’t think I would be able to accomplish the goal of helping my peers manage stress. Additionally, I didn’t know either of my teammates very well, so the thought of trying to be wildly imaginative with people I barely knew was intimidating. After the first session I didn’t know how I felt about design thinking thus far.

Design Thinking – Part 2: Define and Brainstorm (10/27)

What We Did: In the second design thinking class we defined our problem with our groups and then learned a way to brainstorm (ideate) possible solutions. The class began with a brainstorming activity called BrainSpin, in which there were random shapes on the board and we had to come up with as many similar-looking objects as possible.

Next, all the groups went through a number of different brainstorming challenges in order to solve our stress dilemma. Each student was given a pack of sticky notes to write everything that came to mind and then post on our design board. After the first few rounds of brainstorming, we were given special lenses to formulate ideas through. One of the lenses was that all our ideas had to cost over $1 million. Another was that all of our ideas had to be what Lady Gaga would do. Because this demanded even more creative thinking, we ended with even more creative answers.

Eventually, once we had generated about 100 ideas, we were told to choose the best one with the most potential. After several minutes of deliberating we decided on the sticky note that said, “study group at gym”. We developed this simple sticky note into our idea called “Terp Tudors”. Then for homework we were to create a comprehensive prototype and get feedback on it. Frankie told us how to create storyboard prototypes, which are the best for helping consumers visualize the product.

Key Takeaways and Future Applications: My favorite part of class was the BrainSpin ideation activity because no two answers were the same. The first shape shown was a circle with a horizontal line down the middle. What one person thought was a hamburger; someone else thought was a half-full washing machine. I wouldn’t have been able to come up with even half the ideas that I heard my classmates share around the room. It just goes to show how differently we think from one another. This activity fully convinced me that the best creative ideas would come from many, rather than just one person.

This was the first time that I had been encouraged to value quantity over quality. Frankie and Allie explained to us that there was a proven statistic about generating ideas. They said that the first few ideas were naturally going to be very bad and cliché, because that is all we’re used to. Then once we ran out of obvious answers, the ideas would start to be more original. It wouldn’t be until about the 50^th idea that they would start being really good. I didn’t really believe this when I was first told, but it turned out to be absolutely true. All of our best and outrageous ideas came at the very end when we couldn’t think of anything else.

What I took away from the second design thinking session was the importance of creating prototypes. I realized that the purpose of prototyping is to create things quickly to test with users, and then refine sooner. The good thing about creating prototypes using pen and paper like I did is that it has extremely low costs. Such minimization of costs allows for much more testing and refining. By making ideas tangible to customers, we can better facilitate important evaluation and feedback about them. I was really impressed that our simple and random idea of having study groups at the gym turned into an entire campus-wide tutoring service called Terp Tutors. The idea was that combining studying with other activities would save students time and be convenient. For example, we planned on offering cycling classes at Eppley, but with a twist. The class instructor would also be a math tutor, who would review material with students as they exercised. Being active is a fundamental stress reliever (not to mention good for our health), so when students are both working out and studying at the same time, they will associate the math as being less stressful. In addition, the students will be saving time because they won’t feel guilty for skipping schoolwork for the gym. Our idea didn’t stop at the gym either – we also planned on having occasional study nights at the diner. Each table would be for a different subject, and tutors would collaborate with students to tackle class material, all while eating healthy brain food provided by the diner. Students would sign up with a smart phone app to either be a tutor or a tutee.

The second day of our design thinking challenge turned out to be a lot more fun than the first day. I realized I was a fan of this way of thinking, plus it was fun to see my group members finally break out of their shells and be a little silly during the brainstorming. I can now see what David Kelly was saying in a video we watched a few weeks ago in class – the more outrageous and unrealistic the idea, the better. Nothing new will come from the practical ideas. We need something crazy, so that we can narrow in on it until we have something truly original and genius.

Design Thinking – Part 3: Prototype and Demo (11/3)

What We Did: The third design thinking class began with another introduction game. This time, we were instructed to write down a song on a piece of paper that we thought everyone in the room would know. Volunteers were then paired at the front of the room. One partner drew a song out of a box and was told to knock the beat of the song on the table for the other partner to guess. When each pair was giving the game a try, Frankie would write the attempted song on a piece of paper and show everyone in the class who wasn’t doing the activity. Not a single pair ended up guessing a song correctly. This was Frankie and Allie’s way of demonstrating the knowledge barrier that often exists between the creator and user of a product.

This class was spent sharing our finished products in a special PowerPoint fashion that was intended to be short, sweet and to the point. We had to present our ideas to the class in only five slides; 20 seconds each and one picture each. This way, there would be less fluff in our product debut and we would focus on delivering the most important information.

Key Takeaways and Future Applications: I gained a lot of unexpected insight from the introduction game at the beginning of class. When watching my classmates try to guess the songs, the right answers seemed so obvious to me. I couldn’t understand how they couldn’t guess the answer, but then it occurred to me that my knowledge had been primed when Frankie flashed us the names of the current songs. When I knew the correct answer, I forgot what it was like to have no idea and I just assumed that it would be just as easy for the guesser at the front of the room. When we know something and forget what it’s like not to know, this is called a “knowledge barrier.” This concept is the same in the business world. Companies create products thinking that customers will be on the same page, but that’s often not the case.

This is the very reason that we should make multiple prototypes when developing a product. The homework due for this third design thinking class was to show our prototype to different people and get feedback. In my opinion, this proved to be the best transformation of our idea. When showing our Terp Tutors idea to a room full of BSE students watching a Pittsburgh Steelers game (at commercial break of course), they suggested that the app have more features. They asked questions like, “What incentives do people have for registering to be tutors?” “How do we know the tutors actually know what they’re doing?” “How can we find where tutors are at a moments notice?” Eventually, this led us to shape our app into more of an Uber for tutors. On the app, students can check in with their locations and identify as either a tutor or a tutee. However, they can only register as a tutor if a teacher in that subject has recommended them on the app. This way, students know they’re actually getting valuable help and not wasting their time. When a student finds a tutor close to them on the map, they can send a message through the app and arrange to meet up. In addition to this student-controlled tutor service, there will also be group events like classes at the gym and tutors at the diner like originally planned. Most of the funding for tutors will come from the university. However, the first month will be free to all users of the app, then after it will cost $3 per month. This is to help pay the tutors’ wages. Also, in an effort to encourage tutors to volunteer their time, for every 5 times they agree to be a tutor, they get a coupon for a free coffee from anywhere on campus.

I am beyond pleased with the outcome of these design-thinking classes. I am always told in school to “be creative,” but never knew how to actually do that. By making the design thinking process into a challenge to overcome a relatable issue, I think it encouraged all of us to do whatever it took to make the best product possible. It’s remarkable to think how such a simple idea turned into an extremely innovative one. I’m also happy that I ventured out of my comfort zone and enjoyed it. It was especially challenging for me to do brainstorming because at first I could only think of basic cliché ideas. The first class left me feeling uneasy because I didn’t think I had the capacity to think so originally. I didn’t know how easy finding a solution would be with the help of my team and the suggestions from random people. I will definitely use these five design-thinking steps when I encounter a problem, in the future. They seem easier than ever after this hands-on operation. Lastly, I learned not to throw any idea out because it can be the beginning of something great.

3b. Milton Hershey (9/7)

What We Did: Our very first BSE field trip was spent in Hershey, PA where we visited not only the wonderful Hershey Park, but also the Hershey museum and school. Surprisingly, Milton Hershey did not always sell chocolate. He started his first business, Crystal A Caramels, in 1876 until it ended up going bankrupt after growing too fast. This was when Hershey first learned the importance of taking time developing a company.

In 1894 he experimented with chocolate making as a coating for caramels. Eventually, Hershey started to observe people completely sucking the chocolate coating off and then spitting out the caramel. It was then, in 1990, that Hershey used this association to influence his smart but risky business decision to sell his successful caramel company and focus on making chocolates. This was the first indication that Hershey was a disruptive innovator.

Hershey marketed his products by creating aesthetically pleasing window displays in his shops to attract wide audiences. The goal of mass production of chocolate was actually made it affordable to the American public. Milton Hershey was able to create a monopoly of the chocolate business. Growing demand + limited supply = opportunity.

The decision to move production back to his hometown of Derry Church was because it was much cheaper and richer in labor and natural resources. As Hershey’s success grew, he turned the town into a prosperous community based on culture, recreation, and education. Perhaps the most admirable action taken by Hershey was his commitment to give back to the community. In 1909, he established the Milton Hershey School for orphan boys. Nine years later, he donated all of his wealth and ownership of the company to the school.

Key Takeaways and Future Applications: Hershey was able to succeed because he learned how to innovate and create a name for himself. He questioned why each step in the chocolate making process was not focused on individually. This is how he came up with the idea or separating factory buildings by function. He also adopted the assembly line process after observing its success in the car making industry. He had his very own recipe for double-condensed milk, responsible for the signature Hershey milk chocolate taste. A work environment where workers could have creative input was widely advocated my Milton Hershey. This was because employees knew firsthand the challenges in production and they would have valuable ideas for making things run more smoothly.

The most important thing I learned from this outing was repeated failure can and will lead to success. Because he wasn’t schooled in the business field, he was essentially making everything up as he went along. He made sure to learn from his experiences and failures so as to know what to do differently next time. It was a relatively grueling process for Hershey to get on his feet in the candy-making world. He faced obstacle after obstacle but never gave up.  For example, he had to move his company several different times due to competitors trying to get rid of him through price restraints. Wartime rationing had a big impact on Hershey from 1942-1949 because of the value of aluminum foil. Hershey kiss production during this time was halted. Eventually, Hershey became the top chocolate company in the world. Hershey’s modesty is not something we see as often anymore. I never knew how generous he was to the community around him. Visiting the Hershey museum has definitely caused me to value good companies even more. After seeing all that Hershey gave back, there is no excuse for other successful companies to not be doing the same.