I am a believer that the pathway to innovation must end with putting a product or service into the market that provides economic value to customers, economics the branch of knowledge concerned with the production, consumption, and transfer of wealth. Innovation is about economics and economics is about value creation. It’s about the 4M’s…Make Me More Money!
Products or services that never reach the market may have been great ideas, but you can’t pay the mortgage or buy your Venti Chai…Continue
Added by Bill Schmarzo on February 3, 2020 at 6:30am — No Comments
The Economic Value Curve is a measure of the relationship between a dependent variable and independent variables to achieve a particular outcome such as retain customers, increase operational uptime, or optimize inventory. The Economic Value Curve measures the impact that increasing or decreasing one of the independent variables has on the dependent variable. In Figure 1, for example, if we want to improve the dependent variable “Uptime %” then we need to spend more on the independent…Continue
Added by Bill Schmarzo on January 30, 2020 at 11:30am — No Comments
I am always looking for examples to bolster my University of San Francisco “Economic Value of Data” research efforts, and I think I’ve found a good one. The NHO article “Is value creation with data something Norway can live off of?” states that Norway believes that 1) the financial or economic value that Norway will be able to extract from data is on a par with the oil, while 2) the value of data is even more important than oil when considering the broader society…Continue
Added by Bill Schmarzo on January 26, 2020 at 5:00am — No Comments
Sometimes it just takes a simple, provocative statement to kick-off the innovation process – to remove an everyday given like driving a car or possessing a landline phone or centralizing all of your data in the cloud – to fuel the innovation process. Henrik Christensen, director of University San Diego's Contractual Robotics Institute, issued such a provocative statement:
“My own prediction is that kids born today will never get to drive a car.”
I have recently been…Continue
Added by Bill Schmarzo on January 23, 2020 at 1:30pm — No Comments
Imagine this scenario:
You enter your dentist’s office as a follow-up visit to the 6-month checkup you had last week. You’re nervous because the checkup revealed bleeding in your gums and cracks in your fillings, all things that require your dentist’s repair on this occasion.
So, you’re there nervously fidgeting in the lobby waiting for your name to be called, envisioning all sorts of dentistry implements of torture that will soon be…Continue
Added by Bill Schmarzo on January 17, 2020 at 12:30pm — No Comments
Maybe the biggest challenge we face as a society is our ability to unlearn – to let go of – outdated concepts and beliefs in order to adopt new approaches. Our everyday lives are dominated by outdated concepts: change the oil every 3,000 miles, don’t wear white before Memorial Day, only senior management has the best ideas, don’t eat dessert until you’ve cleaned your plate, trade wars are easy to win, leeches work wonders on headaches, etc.
Well, I’m going to throw down the gauntlet…Continue
Added by Bill Schmarzo on January 13, 2020 at 6:00am — No Comments
Will Artificial Intelligence (AI) create an environment where design thinking skills are more valuable than data science skills? Will AI alter how we define human intelligence? Will AI actually force humans to become more human?
Okay, sounds questions one might expect from an episode of Rod Serling’s TV series “Twilight Zone” (which I preferred over the meaningless college football bowl games on New Year’s…Continue
2019 was a year full of outstanding customer engagements and provocative teaching experiences across numerous universities. My eyes were opened to many new opportunities to integrate economics, design thinking, big data and data science (AI / ML / DL) to further my case for a Nobel Prize in Economics (which I’d prefer not to be awarded posthumously). That includes helping organizations:
Added by Bill Schmarzo on January 2, 2020 at 5:30am — No Comments
Several of my friends have challenged me to get involved in the AI ethics discussion. I certainly do not have any special ethics training. But then again, maybe I do. I’ve been going to church most Sundays (and not just on Christmas Eve) since I was a kid and have been taught a multitude of “ethics” lessons from the Bible. So, respectively, let me take my best shot at sharing my thoughts about the critical importance of the AI Ethics topic.
Added by Bill Schmarzo on December 31, 2019 at 12:30pm — No Comments
In a recent blog I stated that “Crossing the AI Chasm" is primarily an organizational and cultural challenge, not a technology challenge. That “Crossing the AI Chasm” not only requires organizational buy-in, but more importantly, necessitates creating a culture of adoption and continuous learning fueled at the front-lines of customer and/or operational engagement (see Figure 1).…Continue
Ah, it’s that time of year when everyone is making predictions about next year and extrapolating from the previous year’s trends to create logical, pragmatic predictions. I’ve already made my own predictions for 2020 in the article, “AI, Analytics, Machine Learning, Data Science, Deep Learning Technology Main Developments in 2019 and Key Trends for 2020,”where I predicted the following
Main 2019 Developments:
Added by Bill Schmarzo on December 19, 2019 at 7:00am — No Comments
AI is a game changer. Period. And being a data and analytics guy, I could not be more excited about it.
The McKinsey research study “Notes from the AI frontier: Applications and value of deep learning” provided some valuable insights into where and how Artificial Intelligence (i.e., Deep Learning / Neural Networks (CNNs, RNNs, GANs), Reinforcement Learning and Deep Reinforcement Learning) will derive and drive new sources of customer, product and…Continue
Added by Bill Schmarzo on December 15, 2019 at 11:58am — No Comments
“If you buy a Tesla today, I believe you're buying an appreciating asset, not a depreciating asset” – Elon Musk
OK, I realize it’s on me for not explaining it well. Let me try again at explaining this game-changing concept of leveraging massive amounts of operational data with Artificial Intelligence (AI) and Deep Learning to create assets that appreciate, not depreciate, in value through usage.
What Elon Musk is saying is that Tesla…Continue
Added by Bill Schmarzo on December 8, 2019 at 6:30am — No Comments
Data is a unique economic asset; it never depletes, never wears out and can be used across an unlimited number of use cases at near zero marginal cost. Data in the hands of management and operational leadership can be used to drive material, financial, operational and customer impact. And maybe the best part of this winning data equation? You already own the data! But unfortunately, data is the Rodney Dangerfield of corporate assets – it gets no respect!
To exploit the…Continue
Added by Bill Schmarzo on December 6, 2019 at 5:30am — No Comments
Sustaining industry averages and benchmarks are the antithesis of innovation and a great way to ensure average performance. Doing whatever everyone else is doing is a “paving the cow path" management mentality, lacking aspirational goals which are critical for organizations to fuel innovation and create customer and market differentiation. Which brings me to why I teach.
As my students and I work through their “Thinking Like a Data Scientist” exercises together, I always learn…Continue
Added by Bill Schmarzo on November 30, 2019 at 12:00pm — No Comments
“If you buy a Tesla today, I believe you're buying an appreciating asset, not a depreciating asset.” – Elon Musk
Think about that statement for a second…you’re buying an appreciating asset, not a depreciating asset. And what is driving the appreciation of that asset? It’s likely courtesy of Tesla’s FSD (Full Self-Driving) Deep…Continue
Added by Bill Schmarzo on November 23, 2019 at 6:42pm — No Comments
There, I said it. I said the “R” word. And no, I’m not talking the political “R” word. I’m talking about the potential of a… r-e-c-e-s-s-i-o-n. There are many indicators pointing to the potential of a worldwide recession, and unfortunately during a recession, many organizations hunker down, cut spending, and try to ride it out – all the wrong things to do if you want to actually avoid a recession.…Continue
Added by Bill Schmarzo on November 14, 2019 at 6:10am — No Comments
One of the biggest threats to our world economy (outside of climate change, social inequality, unregulated proliferation of weapons and the rise of Terminators), is the retirement of the technician and engineering expertise that is necessary to keep our factories, hospitals, cities, trains, airports and other operational entities running effectively. Deloitte’s 2018 skills gap in manufacturing study found that the skills gap may leave an estimated 2.4 million positions unfilled…Continue
Added by Bill Schmarzo on November 11, 2019 at 2:30pm — No Comments
I continue to be infatuated with the potential of autonomous entities that self-monitor, self-diagnose, self-fix and self-learn without human intervention. The vision of leveraging new digital technologies, growing reams of customer, product and operational data, and advanced analytics to create autonomous entities – farms, oil fields, factories, airports, theme parks, vehicles, ships, trains, etc. – seems like science fiction.
Fortunately, the “3 Horizons of…Continue
Added by Bill Schmarzo on November 4, 2019 at 9:03am — No Comments
In the early 2000’s, IBM Deep Blue was on the lookout for its next Grand Challenge. It had achieved an exhilarating win over chess grand master Garry Kasparov in 1997. But that was a game with deterministic outcomes where superior processing power gave Deep Blue a significant advantage over even a human grand champion. IBM needed a challenge commiserate with its Artificial Intelligence aspirations, and the wildly popular TV game show…Continue
Added by Bill Schmarzo on October 26, 2019 at 2:17am — No Comments