During this course we will explore the answers to three big questions:
- what do ocean waves, flu viruses and fashion trends have to do with how business works;
- why does spending on technology make up more than half of all capital expenditure; and
- what is the role of law, entrepreneurs and venture capital in this mix.
Our first question concerns an area of academic study, three decades in the making, which explains business behavior not just in terms of supply and demand economics, but by looking at the common behavioral characteristics of different systems - biological, social, etc. It turns out these very different systems exhibit strikingly similar behavior.
Here's an example. During the innovation of the automobile hundreds of companies fought to become Ford, but only a few became dominant. The same process played itself out again in the television industry, the semiconductor industry and in the PC business. This pattern of behavior is strikingly similar to the process of species diversification and weeding out that occurs in evolutionary systems. Indeed, you can be certain that the same process will play itself out again in the green revolution, the wireless industry and all other innovation cycles that follow.
The second question we will tackle is the widely accepted notion that companies which successfully embrace technology as a competitive differentiator are more likely to win. Ford, which dominated their industry by embracing a new technology called the assembly line and Wal-Mart, whose supply chain innovations were enabled by technology, are just two of the examples we'll study.
Finally, we will consider how new technologies, brought to market by entrepreneurs and venture capitalists, become part of how businesses function. From the first glimpse of an innovation, to broad acceptance in the marketplace - we will study each step of the business and legal process and why its role in our economy is vital to growth.
This class is quite different from others you might have taken. We do not use case studies; we do not read academic texts. Instead, we draw upon two books. The Tipping Point by Malcolm Gladwell, which explains how trends start, why broken windows cause more crime and why yawns are contagious. We also read Complexity by Mitchell Waldrop, a book which some believe explains everything. In addition to this material, we utilize a number of business articles and in-class exercises. During the course of the semester various guest speakers will present their views on the topics covered in class.