Nordic Business Forum 2018 – recap of day 2

It was my first year that I didn’t join the parties during the evening. It seems I’m getting old. But good thing about getting old is that you wake up early and are ready for the day with full energy!

At the very beginning I met friends from up north, Miika from Flatlight Film and we changed few words and – sorry Pep – missed the start of the day two.

AIVA – artificial artist

Session started with a song called Midnight Sun, which was created by artificial intelligence and Pierre Barreau.

It was my first time that I actually listened to artificial intelligence made music. Sounded like human made.

Don Tapscott – Winning in the Second Era of the Internet

Writer of 16 books. Wow! Some books about the blockchain. And Digital Economy already in 1994. Have to be a real visionary 🙂

Speaker is a grandpa-lookin like a guy. Started the keynote with ”Hyvää huomenta” and got applause. Made some jokes about Obama. Didn’t get applause.

”Within 50 years Helsinki will have most cars autonomous.” (Actually, I hope that much quicker…)

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Now: the internet of information. —> Internet of value —> we need the Middlman to handle transactions and to create trust. 10 years ago some problems arose. Lehman Brothers crashed and it affected the trust. Middleman lost part of the trust.

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Cross border email payments is as crazy thought as paying for cross border money transaction in the future.

Bitcoin and Toshi Nakamoto solved the double spend problem.

Blockchain is the second era of internet. It created trust between people.

Miners have 20-50 times more computing power globally than Google. In order to hack the blockchain, you need to hack every single block in blockchain. It’s like making chicken nugget back to chicken again 😉 Almost impossible…

Rethinking the financial services industry

  • This is a funny machine, which is our banking system.IMG_1974.JPG

Combination of Blockchain and AI can replace everything in this picture.

ICO – Initial Coin Offering

  • Crowdfunding campaign in blockchain
  • 25% of the value of VC money

The Theory of the firm (by Nobel Prize winner)

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Transaction costs in:

  1. Search
  2. Coordination
  3. Contracting
  4. Establishing trust

With Blockchain all these transaction costs will disappear.

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Eight open networked enterprise business models

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  1. Cooperatives – creating a true sharing economy. Uber, without any company: Suber.
  2. The Rights Creators – such as Music Industry. Internet destroyed the rest of the value for musicians. In blockchain the song has a bank account and the lawyer inside the song.
  3. The Re-Intermediators – such as Western Union. Creating new value in the middle. Now you pay 10% and takes 7 days to transfer. Now it goes in seconds and with 2% costs.
  4. The Blockchain new supply chain – trade finance is done in blockchain. It becomes a cognitive network, which is learning. Such as Sweetbridge.com.
  5. Animating the Physical World – ”Fence talks to sprinklers – that is the first line of defense against burglars. IoT need ledgers.
  6. The Platform Builders – Metronome for example
  7. The Data Partners – OLD: Digital Feudalism. You create the data, but someone else owns it. Privacy is freedom. NEW: Citizen owned data. Big question for Google and Facebook.IMG_0939.JPG
  8. The New Public Sector -1) Better, cheaper government (finally). 2) Strengthening of our democratic institutions. Now a crisis of legitimacy. E-voting, Transparency, Accountability to citizens through smart contracts. New platforms for citizen engagement. 3) Reinventing Central Banks. Lighter touch on regulation.

”What an amazing time to be alive.”

Leadership for Transformation

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  • How does my company / country find leadership for change?

Starlings murmuring in the sky: there is no leader, but there is leadership. There is a code in their DNA and rules. Like ”Hit nobody and don’t crash.”

”Trust is the expectation that the other party will act with integrity.”

This keynote left me with more questions than answers. This topic needs so much more studying and learning in order to understand this.

What to change? Well… I know way too little in order to make any concrete action. So: study and learn more.

Andrew McAfee – Why We’re Still Underestimating Artificial Intelligence

Minds and Machines – How to share the work between our minds and machines?

Playing games is important – for humans and AI as well. Why?

  • We try to teach AI to be good in games created by people. When machine starts winning, something big is happening. 1997 machine won Garry Kasparov in chess. Chess is basically a search (algorithm) problem.IMG_8603.JPG
  • Game of Go. Purest strategy game human have ever created. 2014 computers were bad in it. Why? Nobody on the planet can tell you how to play Go. Even team of programmers can’t program a machine to play Go, because a good player can’t tell why some moves were made.IMG_7444.JPG
  • ”We know more than we can tell.” – Michael Polanyi – ”Polanyi’s paradox”
  • March 2016 Google’s Alpha Go AI beats GO master Lee Se-dol. Famous move 37. Commentators thought that there is a bug in the code.
  • 2015 Humans beat computer in poker match. Game has hidden information. 2017 technology won.

AI has learned it’s own way to do things. It’s not handicapped anymore by the rules programmed by humans.

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AI has learned to diagnose pneumonia better than best doctors.

AI could help us with cooling the planet.

AI in science and for example fermentation.

  • Zymergen. Technology, biology, automation, computation
  • AI finds the hidden layers in data
  • Results: old method 7% improvement in 10 years. New method: 15% improvement in 1 year. 15 suggested genome edits. 2,4x net margin improvement: 3 on pathway – 3 explainable – 6 not explainable – 3 ”no known function”IMG_8374.JPG

Will we still need minds?

  • We have a lot of cognitive biases (check for ex. Wikipedia)

 

We think yes because….

  • Common sense (example for example Uber prising during Sydney siege)
  • Asking questions ”Computers are useless, they can only give answers.” Pablo Picasso
  • Social Skills
  • Partnering with machines

In the future:

  • Machines open up new territory
  • Minds and machines explore it together

Keynote was interesting and concrete. I liked it.

What to change? Well, my attitude towards the AI. It’s not bad, it enables a lot and I, as a leader, should know a lot more about it. So, study again more!

END OF PART ONE, DAY TWO

Niklas Zennström – A Conversation on AI, Technology and Scaling from Europe

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Co-founder of Skype, which used to work before Microsoft bought it. Interview with Timo Rein. To start with, my attitude towards interviews, fireside chats and panel discussions in this level of event is slightly negative. I think that when a person is left alone on the stage for 45 minutes, you are able to create so much more energy and really dive deep into certain topic. But let’s see….

  • T: Niklas, how did you do your success?
  • N: It was mainly luck.
  • T: What drives you?
  • N: When you can make an impact, you want to make more impact. It’s a feedback loop that feeds itself.
  • N: After selling Skype, it was clear to me that I will not retire. Now one of my ambitions is the Baltic Sea. I’d like to improve the situation of the sea.
  • T: About AI… what’s changed to enable the evolution of AI?
  • N: Dotcom crash happened. That wiped out tech from Europe. Founders got burned and lost money. We had to rebuild whole thing. Today we have several tech cities around the Europe. Lot of smart graduates want’s to get into tech. And students want to be entrepreneurs. We also want to build bigger, global companies. Supercell, Spotify etc. proved that it can be done. We made so many mistakes, but all those mistakes became learnings. There is more experience around. Today almost 50% of successful founders are investors. You can make money by investing. Firms are scaling up and even pension funds are investing. Non-tech corporations are getting involved in tech, because there’s digital revolution going on. That ecosystem is now working and creating successes. This year many tech companies in Europe went public with big valuation. Scale is getting bigger. This is also encouraging scientists getting out from the labs.
  • T: What do we need more to keep this going on?
  • N: Talent. Talented people into companies. Not only engineers. Talent is the shortage. Capital is flooding in into ecosystem. Recruitment is the biggest constraint. Diversity is also a problem. Most engineers are men. Founders are men.
  • T: How do you spot opportunities? How can we learn that?
  • N: Try to look things from different angles. Try to think what things could be. Most likely outcome is failure, but you needs to be comfortable with it, because that is the way to learn. Kazaa was a failure, but without it we wouldn’t have a chance to found Skype. Build a culture of trying and failing.
  • T: Try and try and try?
  • N: Naivism is really important. You have to think like 5-year old. You have to try things almost foolishly.
  • T: Growing company goes further from the customer and their pain. How to avoid that?
  • N: Culture, where everybody in the company understands the customer. Everybody does customer service or takes part in user testings.
  • T: Can one person make this change in the organization?
  • N: It’s up to the culture of the company. CEO’s should think how do you encourage the challengers in your own company. Encourage people to destroy your own business. Don’t fall in love with your legacy technology.
  • T: You see a lot of new tech. What’s going to change the world?
  • A combination of different types of technologies. Tech build on different tech stacks. Today we use Amazon web services, open source etc. so we don’t need to concentrate on the basic technology. AI is machine learning, which is learning from big data set. Today we see lots of implementation of machine learning. IoT is not exiting by itself, but together with other technology, it is very important. Everything can be connected and fed to machine learning system. This is maybe not going to disrupt your business, but it is going to improve it a lot.
  • T: AI is not a hype?
  • N: It’s going through the hype curve, like every new technology. When it’s not mature, it falls and starts to grow again in more mature way. Singularity is quite far away, but it’s not science fiction. Question is when, not if. So much data is being collected today and it’s also scary. All of us use some kind of AI algorithms every day. We are In it, but it is now optimization.
  • T: You are a channel for the future. What is going to be in 3-5 years?
  • N: It’s too close. 3 years is in a roadmap. Let’s talk about 10 years. No one knows, to be honest. Prediction is hard. There are discussion if AI will take away jobs. We don’t know. High likelihood is that autonomous vehicles will be there. Today we have some of them. Finnish winter is hard for them. Finns are better drivers. (Applause from the audience. It’s so easy to do that: speak about Finnish rally drivers or hockey players.) There’s 3 million truck drivers in US. It’s possible, that they are out of job in the future. Automation is going to replace jobs. Technology has alway done that. Farming, industrial revolution etc. But other jobs come as old goes away. Tech might make it faster and that makes people nervous. Most jobs that will be replaces are really manual. Basic accounting is not really a good job in the future. Manufacturing, basic law etc. are not good ones in the future.
  • N: Back in the 70’s there was a lot of optimism, but now it’s different. We have to fix the global warming, or the future is not nice. We still should be optimistic about it and entrepreneurs are part of the problem solving. There is more and more founders the found companies with positive world impact

What to change? I’m not sure, if I actually learned anything new. Nice conversation, anyway.

Sheila Heen – Difficult Conversations – How to Discuss What Matters Most

Talking about blame and accountability.

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When you have conflict in your team, you will be sympathetic on the other side. But both sides contribute to the conflict. Conflict can rip the whole organization apart.

This is blaming culture. It makes collaboration hard, innovation hard and it raises risk. It has impact on trust and morale and you will loose your talent. Information flow stops. Problems get bigger. Decision-making gets hard.

It’s a disaster. So, don’t blame people… but there is couple of problems, since humans are wired to blame. And if we get rid of blame, we loose accountability.

Lack of accountability. It makes collaboration hard, innovation hard and it raises risk. It has impact on trust and morale and you will loose your talent. Information flow stops. Problems get bigger. Decision-making gets hard.

This is the dilemma. How to know what works and what not? Don’t ignore blame, but channel the energy differently.

Blame —> whose fault? Assumptions. What punishment? Purpose.  We have to change both sides of this equation.

Joint contribution —> purpose: improve together.

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Whose contribution do you see first?

  • Absorber (me)
  • Shifter (others)

Absorber get’s tired after a while to always carry the responsibility.

Common hard-to-see contributions

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  • Avoiding until now
  • Being unapproachable
  • Using a channel that doesn’t get through
  • Dominating conversation
  • Meeting after meeting they talk about you

Sometimes your coping strategy produces the behavior that you hate in the other person.

Best practices?

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What to change? Well, I have to see both sides in arguments…

 

Steven Kotler – Climbing Mount Bold: How Companies Can Level-Up Their Game Like Never Before with Accelerating Technology and the Power of the Crowd

Impossible has a formula

Moore’s law is not slowing down! In five years a laptop will have more computing power than human brains. This works with all exponential techs.

These technologies are overlapping and they are completing each other. Ellie: worlds first AI psychologist. Soldiers (for example) like more speaking to AI than to a real person and her diagnosis is 80% more precise than a doctor’s one.

Just Add Smartness Economy

Building Organizations for Speed and Scale

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New Biz models: crowd-economy, platform economics, DAO’s etc.

Extreme innovation is no longer optional

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The Average Life Expectancy of a Fortune 500 Company

Six D’s of exponential growth

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  1. Digitalization
  2. Deception
  3. Disruption
  4. Demonetization
  5. Dematerialization
  6. Democratization

Ask yourself: how my organization is going to get involved.

The third industrial revolution

  • 3D printing
  • The Bionic Man, Age 9

User friendly interfaces are coming to all technologies.

Extending Human Capability: An Exponential Mindset

  1. Appetite for disruption
  2. Massively transformative purpose

Innovation requires isolation

  • Culture —> Subculture
  • Nature —> Niche Creation
  • Organizations —> Skunk works

Flow: an optional state of consciousness

The high flow advantage: speed & scale

Crows powered tools

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”We are the ones we’ve been waiting for.” Alice Walker

Keynote was interesting, but didn’t go deep into any subject. Very superficial in many ways. I hoped for more concrete advise and ideas. Title was, however, ”How Companies Can Level-Up Their Game Like Never Before”. I got some ideas on how to leverage on the crowd powered tools, but that’s it…

What to change? I’d like to test some of the crowd powered tools. like inceptive competitions to create the best participant app!

A Moderated Conversation with President Barack Obama in discussion with Niklas Zennström

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For the first time I was waiting in the line to be among the first in the seminar hall. Miracles happen. For other speakers the big screen has been quite enough. But this speaker is mr. Barack Obama. I need to see him live – not on a screen. Again an interview, which is not my favourite way of doing these, but let’s see how Obama’s charisma work in an interview.

N = Niklas Zensström, B = Barack Obama

N: Let’s talk about basketball.

B: Great! Participating in sport teaches you important lessons. If you work, you’ll get better. Effort you put in will determine what you get out. It teaches you resilience. It teaches you putting the mission of the team ahead of your own goals. Those are important lessons. In the USA one of the greatest thing in sports has been involving women in sports. They become more confident. Well, sports made in my knees a bit sore…

N: If I look at the world, it seems that we are in a storm. We have climate change, populism etc. And at the same time, it seems leaders are more short term oriented. Business leaders look only short term benefits. World is going through a paradigm shift. As a society, how can we change this? Start thinking long term?

B: I’ll talk about these larger terms. Globalization, technology have all shrunk the planet. Changes taking place are as profound as in previous big turmoils. But now they are faster. Whenever you have great changes, it creates enormous opportunities. Now you have global market that can bring wealth. But if you only an ordinary person, suddenly you find that demands are less valuable for you.

Leaps in productivity also leads to inequality. Absolute wealth is not only important thing. In advanced economies, a lot thinks that they have been left behind. There is a strong impulse either try to stop change or fight against it. Politics look backwards, not forwards. There are people who are afraid of technology. When you get a big gap, that’s when you get into trouble. We need to reorganize ourselves. Part of this solution is going to be business recognizing opportunities. One legitimate criticism is that leaders don’t think enough how the people who were left behind, are been taking care of.

Unfortunately now, the way how voters get political information makes us think only short term. This makes us to think about reactions in social media etc.

Best thing in liberal market based democracies is that we can debate freely. Dialog takes place. It has constitutional relevance. Partly because of the problems described earlier, people turn into strong men who say ”follow me”.

We have to cultivate the institutions that allow debate and dialog to happen. Such as free press. The platform is all based on these rules and institutions.

N: You mentioned technology. Founders wan’t to create companies with positive impact on the world. They need to hire best talent. Millenials want to buy fair trade products, environmentally friendly products. But because tech gets more powerful, I think we need to have conversations about the future. AI can be good, but also negative. If we don’t have these conversations now, we will have problems. With climate change we already lost 10 years. How could leaders encage into discussions and encourage innovation and make sure the society is safe in the future.

B: Governments are slow. They are under resourced. Take AI. As a president I put together a team to solve how do ew think about these issues. Good news is that it is possible to identify these problems. But, administration is not working on these at the moment. It requires also public conversation that is not happening. You cant separate public and business environment.

Take Facebook: I believe that power to connect people is valuable and positive. But is also true that those systems were built in isolation. Oh, we’ve created oh system that facilitates hate speak, for example. This is where business leaders should always engage into discussion. Some businesses try to avoid government as long as they can. But they need to engage.

N: In FInland and in Estonia business people sit down with politicians and have a coffee…

B: Change happens from the bottom. I do think that there is a reason why Finland and Norway, Singapore is able to solve problems in more efficient way. Social cohesion comes from the smaller scale.

Oceans are big problem. You can have Finland, Sweden and Norway to agree, but that doesn’t help, if China, Russia and Brazil does what they want.

We have to create local solutions to local problems but we have to have a web that binds these together.

Finding those local units that can create models, that we can scale up. But then we have to give more power to international organizations.

N: There is also a lot of good things happening as well. Way fever people in extreme poverty etc. Are these movements going to continue?

B: I tend to be optimistic. History have been generally positive, but it’s not a straight line. We take two steps forward and then one back. We had renessaince, dark ages, WWII.

I often tell young people that if you had to choose a moment in the history when to be born, you should choose now. World is better educated, wealthier etc. than ever.

How people understand their lives, is socially dependent. It depends on who sits next to you. Poorest American now is wealthier than richest in the 17th century. But this person in 17th century felt rich.

Positives have to be harnessed by ultimately the state. Relatively speaking Finland has lowest level inequality. Poorest child in Finland can go to best school in the world, for free. Finland decided to make investment on this. This is smart policy. Takes creates higher happiness to everybody.

As positive as things are, people have to feel that they are happy. Migration has caused controversy and lot of it is economically derived. I have a phone in a village in Namibia and I can see how people in Sweden live. I could get a training and good life there. News are out. Some people are living much better than others.  People in poorer countries want what you have. But that is not sustainable way to live for everybody on the globe.

N: Let’s talk about your foundation. You are doing excellent job with working with democracies. How do you train future leaders?

B: If you empower 23-25 year olds and take them seriously. We tell them to start listening the people you wan’t to lead. In every country I saw this energy of these young people. Who instantly believed that they can mix cultures.

(At this point Obamas answer was rather complicated and I lost it… then the battery of my Mac ran out and I had to run for the train…)

What did I get from this? To be honest: nothing much. I respect Mr. Obama but I would’ve loved to see him speak about some important issue – alone on the stage. And I don’t know how much his staff decides what Mr. Zennström could ask, but I think questions could’ve been much more to todays burning topics. Now we heard discussion about empowering young leaders. OK, it’s important, but not really interesting to listen.

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