Category Archives: Current in Entrepreneurship

Don’t Predict the Future of Work; Prepare for It.

Rothstein, Arthur, photographer. Mowing hay. Ada County, Idaho. Ada County Idaho United States, 1936. May. Photograph. Retrieved from the Library of Congress, https://www.loc.gov/item/2017760640/. (Accessed April 04, 2018.)

Rothstein, Arthur, photographer. Mowing hay. Ada County, Idaho. Ada County Idaho United States, 1936. May. Photograph. Retrieved from the Library of Congress, https://www.loc.gov/item/2017760640/. (Accessed April 04, 2018.)

Imagine telling a farmer in 1900, that the number of people working in agriculture in the U.S. would decrease from 40 percent to 2 percent in the next 100 years. Professor David Autor posed this hypothetical scenario during a TED talk in 2016. What kind of jobs are those people going to do? Will there be enough food?

There would be no way to predict employment in jobs that don’t exist, especially in industries that didn’t exist (computers, aviation, television, etc.). Even with the power of hindsight, the transformation is almost impossible to comprehend and fully appreciate. Our predictions of the future are often rooted in extensions of the edge of what currently exists, so it’s very hard to imagine a world more than a couple of decades away.

Why Worry? The dreamers, makers and doers will design the future of jobs by simply ‘being.’

So, how is it that we have more people working today than 100 years ago? How did we prepare workers for jobs that didn’t exist? The high school movement was key in preparing Americans for this new work. Economists will refer to this as investing in human capital, but it’s probably more accurate to think of this as better preparing people for jobs.

But, how did we create those jobs? No one person saw the future in its entirety, but hundreds of thousands of entrepreneurs—the dreamers, the makers, the doers—created the future by adding their vision to our collective existence.

I do not know what jobs we will have 100 years from now, and that’s okay. Future generations of entrepreneurs will figure that out along the way as they innovate and improve the human condition with their endeavors. Each entrepreneur succeeding or failing by trying out new ideas advances society without coordination. If anything, interventions in this process may create barriers that stifle innovation and stagnate growth.

The Future of Ambiguity: Forget the conventional structure of full-time work and educate for an entrepreneurial mindset.

What if 100 years from now much of the work is once again available in jobs and industries that don’t currently exist? How do we prepare people for that? Once again, I think the answer will be through education. More specifically, it should be education that better prepares Americans for the future of work.

So what is the future of work? Instead of firms and jobs we should be thinking of people and work. Instead of rebuilding infrastructure tied to formal work arrangements, we need to decouple health care, retirement, and status from traditional full-time jobs. We must prepare people to work under ambiguity, be agile, and use technology to augment rather than replace.

Hero of Our Own Story: This digital revolution gives us the opportunity to stand on the shoulders of technology, not be trampled under it.

David Autor, in that same TED Talk, asks why automation hasn’t killed the jobs of bank tellers. Their numbers have roughly doubled since the ATM was introduced. The fact is, the efficiency of ATMs freed up tellers to be relationship builders, sales people and problem solvers. Their roles shifted and banks opened more locations to better serve customers.

That same technologic efficiency is being applied to radiology. Artificial intelligence can enhance the role of radiologists by reading radiographs, MRIs and CT scans flagging what radiologists should examine in seconds. The time saved gives radiologists more capacity to examine and analyze results, for example, while the efficiency itself improves client care, service and costs.

And let’s be real, these are familiar jobs enhanced by technology. There are emerging jobs like XRP Markets retail infrastructure manager we couldn’t have imagined five years ago, let alone the jobs yet to be imagined.

We must focus on what makes us human. Humans must create, learn, trust, connect, make, dream, and love. These are the attributes of successful entrepreneurs today, but they will be the necessary attributes for everyone to achieve economic independence in the future. Simply put, we must change education and training to empower everyone to be entrepreneurs.

Technology is changing work, but it is on us to prepare people for work by changing mindsets and increasing the entrepreneurial capabilities for everyone.

Technology can replace us, but it can also empower us by augmenting human activity. We can let technology stand on our shoulders or we can stand on its shoulders. I’ll take the latter. It’s probably easier to get a glimpse at the next 100 years from up there anyway.

By Derek Ozkal 04/05/18 Courtesy of the Kauffman Foundation

Eviscerating Excuses and Busting Business Myths.

Watch Jon Taffer Unforgettable Talk

Want to know the secret of success? Just ask Jon Taffer. “Appreciate the power of knowledge. Seek knowledge. Knowledge is confidence. Confidence drives success. I have always been very confident,” he told Entrepreneur in advance of his keynote address at Entrepreneur Live, a day-long conference held this past week in Los Angeles.

To say that Taffer dropped knowledge on the Entrepreneur Live audience would be an understatement. He promised the audience that he would pull their brains out of their heads, twist them up and shove them back in, and he delivered. Over the course of his hour-long talk, Taffer busted business myths, eviscerated excuses and sent people to the doors excited to transform their businesses.   (Courtesy entrepreneur.com/articles/304758)

Jon Taffer, star of Paramount Network’s “Bar Rescue,” has hired thousands of people over his 35-year career as an entrepreneur. He has owned 17 different hospitality businesses, founded consulting firm Taffer Dynamics, and even helped create the NFL’s “Sunday Ticket.” As an expert in managing people, Taffer says he doesn’t look for the candidates with the most impressive resumes when he’s selecting new staff.

“I’m the type of employer who will hire based on personality, based on potential,” he tells CNBC Make It. “If you put the resume before the personality you’re going to fail. “The wrong personality with the greatest resume in a business will not grow that business,” explains Taffer, author of “Don’t Bulls— Yourself!: Crush the Excuses That Are Holding You Back.” “The right personality with a weak resume can be filled in. That’s the employee who will become great.”

CA Entrepreneurship Educators Conference 12-14 April.

At the California Entrepreneurship Educators Conference for 2018, San Diego State University, we have included the “creative disruptors” in the field and they will share what they are learning, teaching and researching with respect to entrepreneurship. This conference will be highly interactive, creating an environment to learn, share and collaborate. Attendees will  interact with their peers and examine how to teach entrepreneurship and conduct research today and brainstorm how to “creatively disrupt” entrepreneurship education for our students of today and tomorrow.  Participants will learn how San  Diego State’s Lavin Center organized and runs its highly successful campus incubator: The Zahn Innovation Platform Launchpad.

The conference will explore the research and pedagogy process and receive valuable insights from leading entrepreneurship researchers and educators. It will consist of interactive days dedicated to entrepreneurship in the classroom, looking at how educators can “creatively disrupt” research and pedagogy in interesting ways.  Your editor will be in attendance and report upon completion.

Where Did the Workers Go?

Mercedes Benz factory creates an auto.

You won’t see a person until the car is assembled.  Robotics will displace massive workers in the coming years.  From Robohub http://robohub.org/estimating-the-impact-of-robots-on-productivity-and-employment/:

To discover the impact of robots on the average manufacturing worker, we analysed their effect in 14 industries across 17 developed countries from 1993 to 2007. We found that industrial robots increase labour productivity, total factor productivity and wages. While they don’t significantly change total hours worked, they may be a threat to low- and middle-skilled workers.

Robots’ capacity for autonomous movement and their ability to perform an expanding set of tasks have captured writers imaginations for almost a century. Recently, robots have emerged from the pages of science fiction novels into the real world and discussions of their possible economic effects have become ubiquitous (see e.g. The Economist 2014, Brynjolfsson and McAfee 2014). But a serious problem inhibits these discussions: there has – so far – been no systematic empirical analysis of the effects that robots are already having.

In recent work, we begin to remedy this problem (Graetz and Michaels 2015). We compile a new dataset spanning 14 industries (mainly manufacturing, but also agriculture and utilities) in 17 developed countries (including the European nations, Australia, South Korea, and the US). Uniquely, our dataset includes a measure of the use of industrial robots employed in each industry, in these countries, and how it has changed from 1993-2007. We obtain information on other economic performance indicators from the EUKLEMS database (Timmer et al. 2007).

We find that industrial robots increase labour productivity, total factor productivity and wages. At the same time, while industrial robots had no significant effect on total hours worked, there is some evidence that they reduced the employment of low skilled workers, and, to a lesser extent, middle skilled workers.

What exactly are industrial robots? Our data comes from the International Federation of Robotics (IFR). The IFR considers a machine to be an industrial robot if it can be programmed to perform physical, production-related tasks without the need for a human controller. (The technical definition refers to a “manipulating industrial robot as defined by ISO 8373: An automatically controlled, reprogrammable, multipurpose manipulator programmable in three or more axes, which may be either fixed in place or mobile, for use in industrial automation applications”).

Industrial robots dramatically increase the scope for replacing human labour, compared to older types of machines, since they reduce the need for human intervention in automated processes. Typical applications for industrial robots include assembling, dispensing, handling, processing (cutting, for instance) and welding – all of which are prevalent in manufacturing industries – as well as harvesting (in agriculture) and inspection of equipment and structures (common in power plants).

Rapid technological change reduced the price of industrial robots (adjusted for changes in quality) by around 80 percent during our sample period. Unsurprisingly, robot use grew dramatically: from 1993-2007, the ratio of the number of robots to hours worked increased, on average, by about 150 percent. The rise in robot use was particularly pronounced in Germany, Denmark, and Italy and among producers of transportation equipment, chemical and metal industries.

(more…)

Invention Puts FL Community College Alumnus in Spotlight.

From State College of Florida (SCF, a NACCE* member), Bradenton, Fla. March 29, 2018.      

When someone claiming to be from Google calls, most people go on guard. Google just doesn’t call people. So, it’s no surprise that Ka Shun “Sean” Chan was skeptical, even though he had already gotten a call from James Cameron’s production team (Yes, that James Cameron) about his invention.

Chan, who graduated from Manatee Community College, now State College of Florida, Manatee-Sarasota (SCF), in 2009 and has spent the last few years inventing and building a gyro-stabilized electric unicycle dubbed the Uno Bolt, is now rubbing virtual elbows with A-listers and Silicon Valley executives. A prototype of his electric unicycle will be seen on the big screen this year when James Cameron’s futuristic film, “Alita: Battle Angel,” is released. Cameron’s production team bought all the original prototypes, even though Chan warned them they weren’t perfected. But they were perfect for the film which contains a heavy dose of computer-generated images (CGI).

Chan’s still waiting to hear when the Discovery Channel will feature his invention. Producers recently visited Venice to film Chan putting his invention through its paces and then pushing it to its limits. The testing and filming were designed to see how well his invention works and whether it can be improved. They learned that the computer chip isn’t as responsive as it could be when pushed to its limits.

Now Google, which is diving deep into competition on the smart technology front, may be interested in collaborating on the latest version of his invention. “Everything is happening faster than I expected,” Chan said.

When Chan started school at SCF his parents were urging him to become a doctor or a lawyer, he said.  Chan wasn’t sure what he wanted to do, but was able to explore his options at SCF.

Chan said his time at SCF gave him a solid start to his life’s ambitions. “I definitely loved the experience,” he said. “The smaller classes allowed me to have better communication with the teachers. There was more one-on-one and I really liked that.”

He said attending classes at SCF also helped him financially, allowing him to live at home while starting college. “It was great that I started there,” he added. “Going straight into a university, I think I would have had a tough time.”

By the time he got his Associate in Arts degree in 2009, Chan had decided he wanted to go into environmental engineering. He transferred to the University of South Florida and ended up in information technology.

“I’m a modern-day hippie,” Chan said. “I love being outdoors, but I do love computers.”

Pairing the two led to his invention which is based on a vehicle in Dragon Ball anime. It runs on a rechargeable battery, has one fat tire and is gyro-stabilized for easy maneuvering. “It’s eco-friendly in that it leaves a small carbon footprint, it’s revolutionary, and it’s made for the outdoors,” he said.

Chan, who was born in Hong Kong and moved to the United States when he was 3-years-old, has a family friend and partner in China where the Uno Bolts are produced using the same type of gyro-stabilizing technology that the Segway uses. The pair are developing the latest versions of the Uno Bolt, which are smaller, weigh less and are less expensive. He’s hoping they will sell on college campuses where parking is a premium and in big cities where they could get through the traffic faster.

While he is perfecting his invention, Chan is also running LED Impressions and Computer Solutions, a business he started in Venice, where he works with his father making LED signs.

To see Sean Chan in action, visit youtube.com/watch?v=5ATCX_C1Qfc.

*NACCE is the National Association for Community College Entrepreneurship, http://www.nacce.com/

 

What Went Wrong: The Demise of Toys R Us.

In the end, nostalgia couldn’t save Toys R Us. The once mighty retailer, which has struggled to keep up with changing trends in consumer behavior and childhood play, told a U.S. bankruptcy court on Thursday that it must liquidate its operations, meaning the likely closure of hundreds of stores.

The former leader of the toy industry, Toys R Us filed for Chapter 11 bankruptcy in September after years of slipping sales and mounting debt. While intense price competition from mass retailers Walmart, Amazon and Target has contributed to the company’s woes, experts place the blame squarely on the shoulders of management. They said Toys R Us has failed to innovate its business model, incorporate technology or adapt to changing consumer behavior.

The day of reckoning may have been delayed through a $7.5 billion leveraged buyout in 2005 by private investors Bain Capital Partners, Kohlberg Kravis Roberts and Vornado Realty Trust. But the debt payments proved to be too much for the company, which hoped robust holiday sales would buoy its bottom line and keep it afloat a while longer. The company announced in January it would close 180 of its roughly 800 stores in the U.S. No buyers have stepped up to take over the chain, and the end seems to be in sight. Prior to the liquidation announcement, Toys R Us had announced that it would shutter all 100 of its stores in the United Kingdom.

Wharton marketing professor Barbara Kahn, Denise Dahlhoff, research director at Wharton’s Jay H. Baker Retailing Center, and Mark Cohen, a former retail executive who is director of retail studies at Columbia University’s Graduate School of Business, talked to Knowledge@Wharton about where Toys R Us went wrong. Dahlhoff and Cohen made their comments during a segment on the Knowledge@Wharton show, which airs on Wharton Business Radio on SiriusXM channel 111.

The following are key points from the conversations. (Listen to the full podcast with Dahlhoff and Cohen using the player at the top of this page.)

The End Comes as No Surprise

The dissolution of New Jersey-based Toys R Us, which traces its roots to a baby-furniture store opened in 1948, comes as no surprise to industry watchers. That’s because Toys R Us hasn’t been able to tread water as the tides have shifted in the vast retail ocean.

Cohen described the chain as “guilty of serial mismanagement.”

“Retailers today, especially in any kind of fashion or trend segment, have to progress,” he said. “They have to morph, they have to modify. They have to represent the changes in the marketplace and their customers’ behavior. Toys R Us has never been able to wrap their arms around the changes necessary, and this is the inevitable outcome.”

He said the stores were too big, jammed full of inventory, poorly merchandised, and customer service was virtually nonexistent. A poor shopping experience won’t entice busy consumers who would rather grab a toy from Target while they fill their carts with groceries, school supplies and the rest of life’s necessities.

“Toys R Us never made a concerted effort to bring that experiential opportunity into the stores,” Cohen said. “I think once they went private, they could have cleaned up their act a little bit. But there was no consequential effort to re-imagine themselves, to present themselves in a more engaging and attractive way.”

Instead, he said, the company was still trading on the view that it was “the center of the universe for the toy industry,” which was no longer true. “This failure began before they went private,” Cohen noted. “The company was doing poorly. That’s why the private equity trio swooped in … thinking they could fundamentally improve their performance. Frankly, they put someone in the job who had no capacity to do that and didn’t do that.”

Dahlhoff agreed with Cohen’s assessment, adding that Toys R Us didn’t defend itself against a number of external threats.

“The competition has changed so much. Also, the consumer has changed so much,” she said. “Kids spend way more time playing online video games. You don’t have to go to a Toys R Us store for those. In addition, the shopping experience has moved online, and Toys R Us hasn’t been the strongest in that area. Competitors like Amazon, Walmart and Target have been very strong online, so that also added to the difficulties.”

….Meanwhile, Cohen said, Toys R Us “did nothing but load the shelves with goods, and that isn’t good enough.”

Dahlhoff wondered about the future of play. She predicted that old-fashioned toys will come back into vogue as a sort of backlash to technology. That could be just the opening an innovative toy seller needs to carve out a new niche in the marketplace.

“It could also force them to cut costs and cut their assortments to just focus on the bestsellers and sell them to your big retail partners. However, that reduces variety and price competition between retailers,” she said. “Maybe the off-price channel will benefit from that. Maybe that’s a new channel to explore because that’s been a growing sector.”

Courtesy of Knowledge at Wharton 3/14/2018; listen to the podcast – http://knowledge.wharton.upenn.edu/article/the-demise-of-toys-r-us/

 

Entrepreneurship and the US Economy: Concerns and Implications

Newswise — Why has the rate of U.S. entrepreneurship been on a steady decline for the past decade, and what does it mean for the U.S. economy? Sean Carr, Ph.D., executive director of Darden’s Batten Institute for Entrepreneurship and Innovation speaks with Professor John Haltiwanger from the University of Maryland and the National Bureau of Economic Research (NBER), whose research has played a major role in our understanding the determinants of firm-level job creation, job destruction, firm dynamics and economic performance. Following are excerpts from their recent conversation at UVA Darden School of Business:

Entrepreneurship and the Economy: A Symbiotic Relationship

SEAN CARR: We often hear that entrepreneurs are the engines of job creation and economic growth, but recent data suggest that the rate of entrepreneurship in the U.S. has been on a steady decline. What’s going on here?

JOHN HALTIWANGER: The argument that entrepreneurs are key to job creation and innovation and productivity growth is exactly right. But it’s also important to remember that in the post-2000 period, the U.S. economy has actually been quite sluggish. What we find in our evidence is that entrepreneurs play an outsize role in terms of productivity growth, job creation and innovation, but unfortunately that process has slowed down. We would argue that part of the reason the U.S. economy has had anemic productivity growth in the post-2000 period is this slow down in entrepreneurship.

SC: While entrepreneurship overall in the U.S. has been declining, what about startup activity in the high-tech, high-growth sector?

JH: When we look in the data, we see post-2000, there’s been a decline, one, in startups in high tech and, two, a decline in high-growth startups in high tech. We’re just not seeing businesses in the post-2000 period that enter high tech take off in the same way that the 1990s cohort, in particular, did.

Rates of Growth and the Techno-Optimist View

SC: Your recent talk at UVA was titled “Declining Business Dynamism of Entrepreneurship in the United States: Cause for Concern.” Is it a cause for concern?

JH: I would say yes, precisely because of what we see in high tech. We’re still seeing businesses out in the right tail of the productivity distribution, but they’re not growing in the same way as before. I’m not saying they’re not growing at all, they’re just not growing as rapidly, and that’s kind of what you need for the high-tech, high-impact entrepreneurs. We’ve even looked regionally: Is a Silicon Valley doing what it was doing back in the 1990s? The answer is no, it’s just not. We’re just not seeing it in the jobs and the productivity data.

SC: Do you think there could be a lag? Could it be that the impact of today’s innovations and new technologies are not yet apparent in the productivity data, for instance?

JH: Sure. There could be potentially a lag. The diffusion process for new technologies can be a slow one. If you talk to the techno-optimists, they’ll tell you, “Look, driverless cars are right around the corner. … AI is going to completely change the way we organize businesses.” But it’s still going take somebody to figure out how to bring this into the market. So, are we in that phase where this is about to happen? Here’s the thing: Entry tends to be a leading indicator for innovation, and we’re just not seeing it.

Next Steps: Implications for Policy and Study

SC: What would you recommend that a policy maker or legislator take away from these observations?

JH: I think it’s good to start by asking: Why has the U.S. become a less attractive place for entrepreneurs, particularly in these key innovative sectors like high tech, to start up a new business? I do worry about the regulatory environment. And I think we ought to be asking ourselves what happened to the financial markets. [But] I don’t think that’s the whole story.

The U.S. is the magnet around the world for graduate education. We don’t make it easy for all these doctoral students that we’ve trained or MBAs that we’ve trained, who come from around the world, to stay in the United States. Is there evidence that this group plays a critical role for high-growth entrepreneurship? The answer is absolutely. Yes. So, if you’re trying to stimulate or keep up the pace of high-impact entrepreneurship, the pool that you want to attract and retain are exactly the people we’re bringing into the United States right now to our doctoral programs and our master’s programs — but we’re not retaining [them].

SC: One last question to wrap up. What’s the next phase of work that you feel really needs to be done in entrepreneurship?

JH: We don’t understand very well the career paths of entrepreneurs. Why might it be for the person who’s thinking about creating the next big thing, why aren’t they doing these [things]? We’ve got to remember, much of what I talked about is entrepreneurs as businesses, but actually entrepreneurs are individuals. And we don’t know nearly as much as you’d like about the individuals.