Unlocking Serendipity Is the Key.

 

Cracking the human genome code and other big medical advances offer a new level of hope for more effective treatments. Moving those breakthroughs from the lab to patients, however, often means confronting hefty barriers. But progress can get a huge boost through specialized management, interdisciplinary cooperation and the fostering of creativity — or serendipity – notes a new book: Managing Discovery in the Life Sciences: Harnessing Creativity to Drive Biomedical Innovation.

The authors are Lawton R. Burns and Mark Pauly, both Wharton health care management professors, and Philip Rea, a biology professor and co-director of the Penn Life Sciences & Management Program (LSM). They joined Wharton management professors Nicolaj Siggelkow and Harbir Singh on the Mastering Innovation show, which airs on Wharton Business Radio on SiriusXM channel 111, to discuss the highlights of the book. (Listen to the full podcast at the top of this page.)

    • TwitterCracking the human genome code and other big medical advances offer a new level of hope for more effective treatments. Moving those breakthroughs from the lab to patients, however, often means confronting hefty barriers. But progress can get a huge boost through specialized management, interdisciplinary cooperation and the fostering of creativity — or serendipity – notes a new book: Managing Discovery in the Life Sciences: Harnessing Creativity to Drive Biomedical Innovation.

The authors are Lawton R. Burns and Mark Pauly, both Wharton health care management professors, and Philip Rea, a biology professor and co-director of the Penn Life Sciences & Management Program (LSM). They joined Wharton management professors Nicolaj Siggelkow and Harbir Singh on the Mastering Innovation show, which airs on Wharton Business Radio on SiriusXM channel 111, to discuss the highlights of the book. (Listen to the full podcast at the top of this page.)

An edited transcript of the conversations follows.

Nicolaj Siggelkow: How did the three of you decide to write this book?

Lawton R. Burns: The genesis of this book ties back to this program. Penn is a unique place with all of these multidisciplinary majors … but this is a program where we are actually integrating knowledge from multiple disciplines and training undergraduates in dual degrees in biology and business.

We’re the only university in the world that is doing that, and this is perhaps the only school where you could do that, because they have an undergraduate business school, and then you have a phenomenal science program, you have all of the wonderful discoveries coming out of the Penn Health System and the companies they are spinning off.

And so we have this unique lab here at University of Pennsylvania where all of these different faculty from all of these different disciplines are basically two blocks apart. And so it fosters the interaction among everybody. And then you have the university putting these dual degree programs together. You have [former Merck CEO] Roy Vagelos who is funding this dual degree program in life sciences and management, and then you bring together faculty you otherwise would never meet.

Siggelkow: This book is both about the science and the management behind biomedical innovations. Now what makes your book so interesting is that you are taking a broad perspective on the innovation problem. Your book examines the interplay of scientists, managers, investors and regulators involved in this process of discovering new drugs and medical devices. Now, you open up a newspaper and most likely you will find a line like, “the big Pharma model is broken.” And you have a very nuanced answer to that question,

Burns: The Big Pharma model is not broken, it’s basically been in a steady state for the last 50 years. What is happening, though, is we are spending more money on the R&D and not getting any extra output for it, but we’re not getting any worse output for it either. So it’s a question of efficiency, not productivity, in terms of the number of new molecules coming to the market.

And Mark’s chapter goes through the incentives that were put in place because of insurance reimbursement and the fact that drug companies knew that they were going to get reimbursed for their drugs even if they weren’t top of the line or best in class. And so they had an incentive to come up with lesser quality molecules and bring them to market, and then those things don’t necessarily sell well, they may not even get approved, but maybe increase productivity. And so the incentives were put in place by the insurance system.

But in terms of productivity it has been a flat liner for the last 40, 50 years, and every year in our class we go through the latest statistics to see if there is an uptick or a downturn, and it varies year by year. Right now there’s like a two-year uptick but nobody is sure if that is going to persist.

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10 Cheapest Startup Cities are in the South

 

 

“Major coastal cities are becoming too expensive for individuals to afford, much less startups, which makes smaller cities much more desirable. Office space is cheaper and colleges in the area can help drive innovation through its local talent.”

One might expect those words to be spoken by a tech leader in Birmingham, Cincinnati or Raleigh-Durham, but less so by someone who built their career in Silicon Valley. But Randi Zuckerberg, technology executive, entrepreneur and STEM advocate, explained to Hype last year why she chose to launch her latest venture, a pop-up tech-enabled restaurant for kids, in the mid-sized municipality of Chattanooga, Tennessee.

“Chattanooga is a beacon of industry that is often overlooked because it’s not one of the more popular coastal cities. But I say people are missing out!” Zuckerberg said. “Startups, nonprofits and government entities work side-by-side, making Chattanooga the perfect city to launch an innovative and forward-thinking company.”

Chattanooga recently recorded another accolade to add to its startup star chart: the designation as the cheapest city to launch a startup, according to an analysis using data from personal finance website SmartAsset.

While the most expensive list is fairly unsurprising, with San Jose, San Francisco, Washington D.C., New York City and Boston gracing the top five, the least expensive cities were notable for a fairly concentrated regional distribution in the southeastern corner of the country.

What you already know: Office space in southern cities is cheaper. Here’s how much

Compared to $442,000 to start a company in San Jose — the cost of which factors in filing fees, 1,000 square feet of office space, utilities, legal and accounting fees and payroll for five employees — in Chattanooga that looks more like $232,000. 

In fact, Tennessee is very well-represented in the cheapest 10, with Chattanooga, Knoxville and Memphis all making the list. For many reasons, entrepreneurs are increasingly choosing the Volunteer State — from 2012 to 2016, capital investment more than doubled from $189 million to $428 million.

“We have the ability to be one of the best testing grounds right now because of the connectivity we have,” shares Ken Hayes of The Enterprise Center, an entrepreneur-focused non-profit based in Chattanooga. Chattanooga was the first city in the U.S. to implement a city-wide, high-speed fiber network. It’s free, so detract that from your upfront office costs.

“So that gives our entrepreneurs a little bit of a head start. We’re also attracting tier one researchers from around the country into Chattanooga,” Hayes says, mentioning that all of these entrepreneurial minds are drawn by access to “the gig.” The Enterprise Center, located in Chattanooga’s emerging Innovation District, also provides free or low-cost resources such as event space and help with grant applications to entrepreneurs.

The analysis says that new companies only need to spend $15,200 annually on office space in Chattanooga, about 7 percent of their total budget. 

Contrast that with a comparable office in New York, which would cost a little less than $70,000, or 17.5 percent of their budget.

“Our vision is to make Tennessee the most startup friendly state in the country,” shared Charlie Brock, CEO of public-private entity Launch Tennessee. The organization has been aggressive in pushing for state legislation to give tax credits and financial incentives to both angel investors and entrepreneurs.

What may surprise you: Founders in smaller cities might pay better

While office space may be an obvious draw for founders seeking affordability, job-seekers searching for startup employment might be deterred by what they perceive as lower salaries. However, when compared percentage-wise, founders in more affordable cities actually invest more of their total budget in their team.

For example, the analysis indicates that in New York, a startup would allocate an average of about 80 percent of their total budget to payroll. In Louisville, KY, the tenth-cheapest city, that percentage skyrockets to 91 percent. Though the actual numbers change as commiserate with cost of living, this seems to indicate that startup employees in affordable cities can expect a generous salary.

Of course, spending more on office space and other resources in the more expensive cities detracts from salary allocations. However, another reason for higher salaries in smaller cities could be the need to pay generously to attract and retain the top talent. Kela Ivonye

Founders are also more committed to their local ecosystems. Kela Ivonye, a hardware startup founder who
recently completed the prestigious 500 Startups accelerator in Silicon Valley, returned to his hometown of Louisville following the program. He explains that being in the smaller city “allows us to be well-grounded.”

He also was able to find an investor in a local manufacturing company, allowing him to manufacture his device in Louisville and cut down on shipping costs. More connected local economies can thus provide economically-beneficial partnerships and clients for startups.

Courtesy of Hypepotamus website by Holly Beilin

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.

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