A new excerpt each Monday from my book, which is available here: www.scribd.com/doc/25085990/The-Art-of-Enterprise-by-Gary-Hoover-January-2010
In truth, the importance of technology is nothing new. It is an old, old story. Entrepreneurial thinkers have always made the best possible use of technology. The railroads jumped on the telegraph. Montgomery Ward made maximum use of Rural Free Delivery. Wal-Mart created its own satellite network linking the stores. BOOKSTOP had a customer loyalty program with a bar code on the membership card in the mid-80’s. Technology has always been important – important enough to deserve some discussion as a major force in the increasing wealth of the world.
But what is technology? As usual, we should use the broadest possible definition. So let’s go with “Technology is a better way of doing things.” Relax that mental lock that defines technology only in terms of computers and cell phones and maybe software. The odds are that you are right now in physical contact with some of the most revolutionary and important technology in history: the technology of woven cloth. If you don’t realize how amazing this is, go see the Historic Mills at Lowell, Massachusetts, or, better yet, the hand looms at the Churchill Weavers in Berea, Kentucky.
Another recent invention with far-reaching implications has been the development of the hub-and-spoke airline system, pioneered by Federal Express in Memphis and Delta Airlines in Atlanta. For centuries, our transportation networks were linear, linking one city to the next. Our canals, our highways, our railroads, and even our early airlines followed common paths. But with the invention of the hub and spoke, everything changed. In the US today, fewer people fly on the same plane from start to finish, but far fewer people change airlines in mid-course. You and I can board planes at adjacent gates in New York in the morning and arrive in the evening at the same time in Salt Lake City, but follow radically different routes on different airlines.
Every innovation can be viewed as a kind of technology, from cars and music to trains and the novel, from the concept of money to the concept of the ballet, from the idea of the public museum to haiku. Humans existed for hundreds of thousands of years without the wheel, without a way to measure time or temperature, without laundromats or PlayStation 2. Before the invention of the limited liability corporation – one of our most important – only kings and nobles could back risky or innovative ventures, and even they rarely did so. Today, the average wage earner has capabilities that few potentates of a century ago could boast.
Technology constantly touches us in new ways. CNN political analyst Bill Schneider points out that the Internet is making politics more diverse, is making politicians think and communicate differently. We now receive live broadcasts and emails from across the battle lines in our wars, from Baghdad to Kosovo. Bioscience is gradually producing new ways to eradicate diseases and extend lifespans. To define technology only in terms of gadgets or “high tech” is short-changing ourselves and the power of the human imagination.

Accelerating Technology

Technology is accelerating. Things are moving faster and faster. Railroads really got their start around 1820. By 1850, thirty years later, they were being built everywhere–and some of the first firms had already gone bust. A similar process took more like four to five years for the public Internet—a sixfold acceleration.
Similarly, consider how long it took for viable competitors to arise for the railroads. Trucks started taking away their freight and the airlines started taking away their passengers in the 1930s, but they did not really win until the 1950s and 1960s, when we built the interstate highways and more airports and faster planes became available. So after that 1850 first maturity, it took at least another century before the rails began to be displaced or at least to have to share their power. If that same 6-to-1 acceleration ratio applies, then we can look for the Internet to face real competitive challenges in 15 to 20 years.
After the railroads, later technologies enjoyed shorter lives as dominant technologies – thirty years for radio, for example – and the new technologies of today will also likely have short lives.

Compounding Technology

Technology compounds – that is, communication technologies speed up everything else. When someone discovered a new plant that could cure an illness a thousand years ago, news might never reach the other side of the globe. Even one hundred years ago, if someone invented a new medicine, he had to write up his findings and have them edited and published in a scientific journal, which would then by carried around the world by steamship or train – cumulatively, a matter of months if not years. When people today hear about inventions in hours instead of months, it allows the next invention to come along more quickly. As factories adjust their production quickly, as UPS and Fedex move prototypes around the world overnight, as manuscripts are emailed from authors to publishers instead of mailed, reactions (from companies and consumers) come faster and revisions and improvements come sooner.
In short, as things move faster, the accelerated pace of change in itself makes them move faster and faster. Technology compounds as we move forward.

Leapfrogging Technology

An important aspect of technology is technological leapfrogging. That is, those people and places that are behind in technology today will often be ahead tomorrow. Most Chinese people will never own a 35mm camera; their first camera will be digital. India may not take the time and trouble to wire up their nation for old-fashioned copper wire telephones, they may just skip directly to wireless phones for everyone. As recently as 1985, there were only 3.5 million telephone lines to homes and offices in China. By mid-1998, this was up to 119 million, and new customers were coming onstream at the rate of 83,000 wire lines and 30,000 mobile phones a day.
This leapfrogging can be disorienting if you think that technological progress is linear, allowing you to effortlessly stay ahead of other people and places. Instead, the future may explode somewhere that we in the advanced nations of the West least expect it. If you want to see what an American city of the future may look like, visit Singapore or the capital of neighboring Malaysia, Kuala Lumpur. Here are some of the things you will see:
¨      Electronic Road Pricing, where variable tolls are automatically deducted from a radio device on your dashboard as you travel about. Usage of a road might cost 50 cents until 7:30 a.m., a dollar till 9:15, then free through mid-day.
¨      When you are Christmas shopping at the downtown mall, you can hand your packages to a clerk the post office (which has a location in every store). They will be delivered to your house by six PM.
¨      The technologically-advanced library is the meeting place for the youth of the city, complete with coffee shop and video rentals.
¨      Pre-planned communities fully cabled with high-speed broadband fiber optic cable before the first house or office is built.
¨      Downtown airport check-in where you go through customs and check your luggage, then take a rapid transit train to your flight at the outlying airport.
As nations and cities around the world rise in wealth and can afford better infrastructure and systems, they will not look back to what we did in the US in the 1950s, 60s, or 70s. They will avail themselves of the very latest and most cost-effective methods and ideas available. In some ways, the countries that get their stuff last will also get the best. While my examples above are from Asia, technological leapfrogging will affect every part of the earth, from Boise to Bogota.

Watching Technology Evolve

Making specific predictions about which technologies will be developed most quickly is almost impossible, but looking at the overall themes in technology is helpful. Here are a few I consider particularly significant.

Seek ways in which technologies can come together–convergence.

Today, we tend to think of television sets and computer monitors as separate gadgets. But the reality is that the underlying technology is exactly the same, and there will be a time when it would be redundant to keep them separated. If you look at real human needs and the way we use our screens, there are really two needs: small screens and large screens. When you want to work on a laptop on an airplane, read a book in bed, or sit at a desk and do close work, you only need a screen of 10 to 14 inches. But when you want to watch a movie or make a slide presentation to a large group, you will want to have a bigger screen. In your home and office, you will have both. The image source might be a computer, a television receiver, a digital satellite, or broadband cable. You will have easy-to-use switches on each screen and route content wherever you want it. This is convergence in action.
In another example of convergence, it is unlikely that we will continue to carry more and more gadgets in our pockets and briefcases. The idea of a separate cell phone, PDA, and laptop computer is not likely to stand the test of time. While different products and configurations will always be available for specific users, most people will get their phone messages, their emails, their radio and TV reception on the same little portable box.
Think creatively about possible convergences. For example, the idea of disposable electronics is not crazy. Worldwide, people buy over fifty million disposable cameras a year. Yet the technology inside a camera is more complex than that inside a telephone. How soon will cell phones as disposable as diapers come into our lives?

The three key technology questions.

When you study a particular technology, you should ask three questions:
¨      What is it capable of doing?
¨      What should it be able to do?
¨      What might it stumble into?
Capability is probably the easiest issue to think about, although even here creativity is called for. For example, when people first saw the black-and-white computer printer, most people thought that would be fine forever. While it did not take much imagination (or knowledge of technology) to forecast that printers would go color, most people thought that would be a specialty with limited demand. Few foresaw the $89 high-quality color inkjets that are piled in the aisles of computer stores today.
Harder to envision is “What should it be able to do?” For example, when considering those first black-and-white dot matrix printers, it was not obvious that you could build in the intelligence to know when they had run out of paper. I remember in the early days of BOOKSTOP trying to judge how much paper a report would require so I could let it run overnight. If I misjudged, I’d get to work in the morning to find the second half of the report “printed” on the machine’s black roller, with ink slip-sliding everywhere. When printers came out that stopped printing if they were out of paper, I thought I had seen the ultimate genius!
A parallel today would be the potential use of global positioning systems (GPS) in digital cameras. This inexpensive technology (well under $100) is made by some of the same companies that make the cameras, but no one yet imbeds it into any cameras. Ultimately, people using digital cameras for real estate or aerial photography will save lots of time and money because the camera will know exactly where it was when it took the picture. (It already knows the time of day.) Add gyroscope technology so the camera knows its angle relative to the earth, and you can automate the process of building models of buildings and cities from a handful of two-dimensional pictures.

Think people first.

Every technology can be used in ways that we cannot yet imagine. But one person or group of people will imagine those uses before others do, and this insight comes more from studying people and their needs than it comes from studying the underlying science.
This is closely related to the third question, “What might this technology stumble onto?” When video camcorders first came out, no one really knew what to use them for. They were first seen as a replacement for the 8mm and 16mm movie cameras (which very few people were using).
Now consider how this technology has changed our lives.
Through most of history, scientists had almost no idea what a tornado really looked like. First, they were able to get a few snapshots, then some early local TV station footage from the 50s and 60s. But since the rise of the consumer camcorder, there are thousands of hours of tornado footage, depicting every type of tornado conceivable. For the first time, scientists have a visual database of information that enables them to really understand these monsters.
Our criminal justice system has been changed forever by the ready availability of videotape. From the Rodney King beating to footage of highway patrolmen confronting drivers, millions of Americans now have a much more vivid and accurate picture of police work than ever before. Consumer newshounds, from sites of natural disasters to war zones, have reshaped television news worldwide.
None of these trends would have seemed obvious when I first saw that clunky VHS camcorder (and paid $3000 in 1985 dollars for it). But now I can look at the high-quality, three-megapixel digital cameras on the market and learn something from my past blindness. I can predict that these solid-state devices will soon be ten times as good and cost one-tenth as much. They will be capable of being built into a wristwatch or into the lenses of my eyeglasses, so I can just blink to take a picture. And I can predict that, one day, if someone steals a wallet at the Super Bowl, there will probably be a dozen photographs of it.
Most important, by looking at convergence, I can understand that a camera is a camera is a camera, and foresee that the distinction between still cameras and video cameras will probably go away. The barriers that separate still photography and videography today – speed of capture and storage capacity – will disappear. Photographers will simply ask, “Do I want to capture just one image or 30 per second?” and adjust their cameras accordingly.
The most common mistake we make in thinking about technology is that we start with gadgets, rather than with people – what they do, how they do it, and their present and future needs and desires. The technology that evolves and becomes prevalent will not be the coolest-looking gadget with the hottest technology. It will be the coolest-looking gadget that somehow makes someone’s life easier, more productive, more interesting, or more fun.



Gateways for A Long, Broad View of Technology

The excellent Technology in America: A History of Individuals and Ideas edited by Carroll W. Pursell, Jr., contains selected stories by various writers: all the big names from George Eastman to Bell and Edison. A good overall short history of technology in the US is Technology and American Society: A History by Gary Cross and Rick Szostak. Technology in World Civilization by Arnold Pacey does the same for the whole world.
For a the history of the computer, I highly recommend A History of Modern Computing by Paul E. Ceruzzi, Herman Hollerith: Forgotten Giant of Information Processing by

Geoffrey D. Austrian (about the fellow who invented the punch card machine – which led to IBM), and Fire in the Valley: The Making of the Personal Computer by Paul Freiberger and Michael Swaine – one of the best business (and technology) history books ever written. The ultimate big picture book on how we got to “the information age” is The Control Revolution: Technological and Economic Origins of the Information Society

by James R. Beniger. Another great book that will add a long-term perspective to that cell phone in your hand is Global Communications Since 1844 by Peter J. Hugill. And, finally, a pure popular book that you can give to your kids when you are through with it: They all laughed… From Light Bulbs to Lasers: The Fascinating Stories Behind the Great Inventions That Have Changed Our Lives by Ira Flatow.



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