More thoughts on the Scottish Independence Debate…

I recently heard Michael Marra from Five Million Questions talk on the issues surrounding Scottish independence and next year’s referendum. (“Five million” refers to the approximate population of Scotland; to be honest, there are probably a lot more questions…!) Like Jeremy Peat, it is Marra’s aim to bring a more nuanced approach to the independence debate, but looking at how the issues affect people rather than pure economics.

Clearly, many of the issues central to the debate – the currency, spilt of national debt, allocation of oil reserves, the size of the public sector, the division of pensions and associated liabilities – are economic, and as Marra pointed out, only knowable after the referendum, since the UK government has decided only to negotiate after the result is known. Similarly, the three unionist parties have all said they would support more devolution in the event of a “no” vote – be it “devo-plus” or “devo-max”, but no one is saying what they would actually do. So whether we vote yes or no, we won’t know what we’re voting for – hardly a victory for democracy, but that’s what we’ve got. (I haven’t been able to find anything on the Conservative, Labour, LibDem or Better Together websites confirming that they categorically support further devolution, but I have read it in the press and Marra referred to it; maybe I was simply not looking hard enough.)

Marra described the debate as highly complex and highly political – hardly surprising given that it is politicians leading both sides of the debate. But the result of this is that the debate is highly polarised. Better Together concentrate on the (mainly financial) risks and great uncertainty (or, less generously, fear tactics: the latest – today – being the threats to the Royal Mail and rural Post Offices); Yes Scotland are trying to minimise the perception of those risks. Each seems to benefit from a low level of debate; it is easier for them than to raise their game.

To this end, the SNP government (represented in but somewhat different from Yes Scotland) have outlined their proposition. They will be publishing details in a white paper (or perhaps two, just to maintain that uncertainty) in December (or maybe November). Marra summarised their current position (which differs from their previous positions in some key areas – after all, they weren’t in power then, so they could say anything…) as

• a shared currency with the rest of the UK (“rUK”)

• freedom of movement between Scotland and rUK
• retaining the monarchy
• competitive tax rates
• NATO membership
• EU membership

Of these six points, five are outside the Scottish government’s gift: they can only be decided in collaboration with other bodies: the Westminster government, the EU and NATO; and I guess the Queen might have a say. Only one represents a change from the current situation – the ability to set competitive tax rates.

Marra described this as “Indy lite”, and you can see why. According to the SNP, nothing much would change; it is just business as usual. Indeed, during the morning, Marra was told that the SNP proposed retaining the welfare system (at least for a while).

So if nothing is going to change, why on earth would we want to vote for independence? The SNP wants us to vote “yes”… to keep everything the same!

For me, this lack of vision on both sides is crippling the debate. Purely on economic grounds, I am a strong “no”. But if either side could set out a platform for change – a vision for a more just, equitable Scotland, a positive, radical alternative to the status quo that they currently seem to be proposing (in order not to scare the horses. Or the voters), they might be able to shake up the campaign and actually change some minds.

For instance, a complete reform of taxation might free up entrepreneurs and businesses and stimulate the economy, something Peat suggested. (I’m not a tax expert, so I can’t even imagine what this might look like – but I can’t believe that a system designed to provide funds to fight a war more than two hundred years ago is really fit for the 21st century.) It can’t be beyond the wit of man to design a welfare system that supports rather than stigmatises those unable to support themselves. (The Scottish health, education and legal systems are already separate from the rest of the UK.)

A new social model might be worth voting for; but of the options on the table, with minimal change – well, is that really the best we can do? The rare opportunity to really explore what Scotland means and what we want our country to be like is being lost.

Thoughts on Crowd-Funding

I have been thinking about crowd-funding recently, prompted by several things. First, LondonJazz had a post about Gwyneth Herbert crowd-funding her latest recording; then various projects were brought to my attention; and lastly Creative Edinburgh had a session about crowd-funding.

I have been uneasy about crowd-funding, and I haven’t really been able to understand why; it was my unease that took me to the Creative Edinburgh event: I wanted to get to grips with what concerned me about it. I love crowd-sourcing and collaborative-creation, and people using new models to get stuff done: what was so discomforting with collaborative funding? Why did I feel unwilling to help finance some of these projects when I think several of them are very worthwhile and I would (and have!) support them in other ways?

I think the post about Herbert’s work covers a lot of the area well – not least because the artist herself got involved in the debate, explaining her motives. (I should point out that I am not a fan of Ms Herbert’s work and he’s I’d not a project I would have funded – though I have a great deal of respect for her as a result of the post and how she has engaged with the discussion – pros and cons.)

Crowd-funding enables artists of all sorts to get projects done that might otherwise not happen; it allows supporters to get involved and contribute to the creative process; and both artist and supporter get something in exchange.

I think my reticence stems from two sources. The first is consumerist: I want to know what I am buying. Funding an early stage project means one doesn’t know what you’re going to get; if the target isn’t reached, the project wrong happen and you won’t get anything (though your pledge won’t be taken). Part of this is also that rewards don’t particularly interest me: if I’m contributing to a musician’s project, say, it will be because I want the music, not a signed photo (or other reward). I would pay for CDs or downloads, I would pay for gigs – but these are specific “products”; funding an early stage project is an unknown.

The second is perhaps a British reticence to discuss and get involved in money. This is mentioned in Ms Herbert’s comments on that blog post, and it was also an issue someone suggested to when we were chatting at Creative Edinburgh. It is a very personal thing; the artists know what one is providing, and how generous or stingy one has been. It just – well, doesn’t feel “right”.

The crowd-funding of creative projects is, I think, more like charitable giving than a consumer transaction. You are doing something to support a cause – albeit one that gives you something back. It is an altruistic act. One isn’t purchasing an object; and neither are you providing funding for financial return. The thing is that it isn’t a faceless charity that gets the money: it is real, flesh-and-blood (and of course connected) people. Friends. Both the speakers at Creative Edinburgh, talking from a fund-raiser’s point of view, said that one had to be prepared to be disappointed; the flipside – the donor’s view – is the feeling of peer-pressure that might keep them away.

As Herbert points out, artists have relied on patrons since time immemorial. Roman citizens funded artists in ancient Rome (“patron” is a Latin term); wealthy bankers financed the Renaissance in Florence; publication of literature was funded in Victorian Britain through subscription. Whilst writing this post, I recall several years ago making a charitable donation to support a jazz big band I admired. The one crowd funding activity I can remember participating in up to now has been to support Lloyd’s artistic endeavour because, at a very basic level, I was concerned he wouldn’t be able to eat if I (and others) didn’t! But being a patron is quite close to “patronising” – it doesn’t rest easily.

Having thought this through, then, I did decide to support a couple of projects last week. When it came down to it, it was LedBib posting worriedly on Facebook that they were close to raising what they were after but not there yet – and running out of time. When they were looking for £10,000, what I might contribute seemed a drop in the ocean; when they were looking for the final £300, a £25 contribution seemed a lot more. (As it happened, the Kickstarter website didn’t like my browser set up – specifically, I think, the various add-ons I use; though I have promised them the money, anyhow, and they passed their total without my £25.)

Having done that, I thought I should support Debbie’s sculpture project too, because I love the idea, so I’ve pledged to support that, too. (It didn’t make the total they were after, but they are going to have another go, which I will be supporting.)

[After I'd written this post, I watched Amanda Palmer's now famous TEDtalk. Palmer - and again, I'm not a fan - discusses a lot of the things I've covered here, much more eloquently than I have - and from the artist's perspective. It is a very powerful and moving video.]

The Scottish Economy and Independence.

Talking at Edinburgh University Business School earlier this month, Jeremy Peat from the David Hume Institute (and formerly head economist at RBS) reckons that the debate on independence for Scotland needs the injection of some rational thinking, so that voters can make an informed decision in the referendum next year.

His beef is that there are a lot of questions, and each side is picking its answers politically, rather than factually: for example, his institute produced a paper on the possible range of oil income; one newspaper printed only the lower limit, and the campaign for the opposing argument used only the upper limit. Neither is wrong, but both warp the discussion – and confuse people by promoting the figure which supports their argument as “fact”.

Peat set out to clarify what the questions are, and what the options might be. He doesn’t have a fixed viewpoint, and wouldn’t say whether he was pro- or anti-independence. Indeed, he believed remaining objective was key, giving access to all parties and bringing informed debate to their arguments.

He covered both macro and micro economic issues.

The main macro concern is the currency, where he saw four options:

• keep formal currency union with the UK

• use sterling as a parallel currency (just as some countries use the US dollar) without formal currency union
• join the euro
• establish a new, Scottish currency

No surprise there, then. For me, this is the crucial matter. But Peat went on to identify several issues around the currency.

Both a formal currency union and adoption of the euro would introduce strict fiscal and monetary constraints. Monetary policy would be set by either the BoE or the ECB, and Scotland would have limited influence over either.

Adopting the euro would take time to negotiate following independence (including membership of the EU and the need to meet the euro stability requirements, which could take years), and there would need to be an interim solution; similarly, the UK government has said that an independent Scotland would need to negotiate currency union. The impact on borrowing and trade under any option need to be assessed. (Peat recommended a paper by Brian Quinn, a Scot and former deputy governor of the Bank of England, on the impact of currency on an independent Scotland [PDF].)

Under any currency solution, who would be the lender of last resort? What about bank regulation? These are things that can only be decided once the result of the referendum is known, but the make a rational decision, the options and likely outcomes need to be considered.

Peat did say that Scotland wouldn’t be wholly independent inked it controlled its own monetary and fiscal policies – that is, its own currency. This may be why some of the Yes campaign have come out in favor of an independent currency, despite the SNP favouring sterling. (I couldn’t find a statement on the Yes campaign website – they do not have a search function on their website [at least not one I could find] – and the SNP doesn’t mention “sterling”, “pound” or “currency” in its vision.) There would however be significant costs transitioning from sterling, and small countries with a stable currency tend to have very rigid monetary and fiscal policies to protect the value of their currency. Any benefits of independent mindset and fiscal policies could therefore be lost.

The other major macro issue concerns the public finances. The global economic situation means that an independent Scotland would be starting from a very weak position. Public spending in Scotland is higher than the non-North Sea tax take from Scotland; the difference is generally made up by the income from oil and gas. The value of the income from the North Sea is therefore crucial, and depends on the price of hydrocarbons, the volume of production – and the basis of taxation. These are unknowable, though it is possible to estimate likely ranges. (These are the figures which Peat was irritated had been taken out of context, each side quoting the figure which supported their argument rather than the range in context.)

Much would depend on the share of government debt taken on by Scotland. There’s a lot of uncertainty about this. For instance, what comprises government debt? There’s government borrowing; a share of the RBS and HBoS bailouts; public pension liabilities. What about the decommissioning liability for nuclear power stations? The cost of decommissioning North Sea installations? Rail infrastructure? And so on. Much of this is unknowable – but of course it is possible to estimate these debts, and to model what it might mean for the economy.

The micro issues Peat discussed mostly involved the opportunities that existed for policy which an independent government would need to decide and enact. These were legion. What would competition policy look like? Financial regulation? Transport (though already a devolved power)? Energy policy? All these need regulation, as well – the competition for economists might mean a boom in wages… There would need to be the creation (or duplication!) of all sorts of institutions, including an equivalent to the Office of Budget Responsibility to keep government accountable. (Peat suggested the “Scottish Office of Budgetary Accountability” – or SoBA…)

The policy involving the non-Scottish bits of UK-wide firms represents lots of issues. How about cross-border mergers and transactions (and that is after the currency has been decided…). The interactions with the rest of the UK over all sorts of matters could become key – and might involve all sorts of transaction costs.

Once policies have been decided – government’s role – implementation and regulation would down to other bodies, operated at arm’s-length from government to reduce political interference. What others might call quangos. The establishment of these might cause a surge in the demand for skilled economists, administrators – and change managers (like me! I definitely see a way of hedging my bets here…). The SNP has set out a timetable to independence following a “yes” vote of about 18 months. Not long to get all the institutional infrastructure set up. Where will these skills come from? And what will this mean for business competing for the same talent?

One of the key benefits of independence identified by Peat would be freedom over taxation. Under devolution, the Scotland Act 2012 allows the Scottish government to set income tax and land transactions tax (currently stamp duty). An independent Scotland could completely revamp the tax system – simplifying it (and therefore saving individuals and businesses large costs in fulfilling their obligations), and designing it to meet specific policy objectives. This could be quite powerful in driving policy outcomes and the economy. (ICAS have an extensive report on the practicalities of tax devolution [PDF].)

It is hard to know how an independent Scotland would perform. David Skilling reckons that that small countries outperform larger ones, though Peat thought the jury was still out on that one. The psychological outcome of independence might be positive – the “Braveheart” factor – which could spur innovation, but of course (as so much else) this is unknowable before independence. (It would be interesting to see if there were any such boost to the economy following the start of devolution in the early 2000s.)

Peat concluded that independence was feasible, but that there were so many unanswered – and even unasked – questions that we cannot say if it would be beneficial. (Indeed, we’d have to define what “beneficial” means – there is more to this world than economics!) To get answers, we need to have a more subtle, nuanced debate, rather than the rather shabby level we’ve currently got.

We also need to think about the alternatives. A “no” vote wouldn’t mean “keep Britain and carry on”. All three unionist parties are contemplating further devolution following a “no” vote, be it “devo plus” or “devo max” (neither of which is defined). To decide if “yes” or “no” is the right choice, we need to understand the different options.

But why wait for independence? There is much that the government could do under the current conditional set up. Blaming Westminster for a lack of progress seems rather childlike – always blaming the big boys, and never taking responsibility for our own actions. The SNP have been in power for six years; what have they really achieved? (I think I’ll have to go and find out. I may be sometime.)

[The David Hume Institute has several papers relevant to the debate on its research page.]

Everything in the Garden…

When I was thinking about how the online world might change in the future, I suggested there may be some pressure for the resurrection of “walled gardens” – specialist areas of the internet where interactions happen behind password-protected access.

When I first started using the internet, back in 1995, this was common. I signed up with Compuserve (which I am amazed to see still exists!), and there were specific areas of interest curated by the the organisation; to access the internet proper, you had to click an icon to leave the walled garden. There were other, similar services, too – AOL, for instance.

Accessible browsers like Internet Explorer and Netscape – and, later, Firefox, Chrome et al – freed up the internet and enabled non-technically savvy users (like me) to get around. The walled gardens more or less died: users didn’t like being walled in, and had no reason to be so.

My reasoning for thinking walled gardens might make a return was a commercial one: suppliers of content – like Facebook, Twitter, Apple or Google – want to keep you on their site as long as possible, to sell your eyeballs to advertisers and others willing to pay them. That’s how they make their money. Part of the bargain is that we get to look at the content they provide (albeit, if they’re Facebook or Twitter, that it is created by other users). In a more competitive environment, they will set up walls to keep you there.

(A corollary was that there would also be a move to more openness, driven an increasing awareness and technical know-how.)

A couple of weeks ago I saw a demonstration of what this might be like, and I’ll admit I didn’t really get it. Kiltr is

the largest social media platform focused on connecting Scottish interests globally to create economic, cultural and social value for its members

and, believing that the only way to understand new networks is to play around with them, I signed up to join last September.

I made some connections, mostly with people I follow on other networks, looked at some brands (most of which I follow on other networks…), and I don’t think I have been back in the last three months (until just now!). The reason for my resistance is that the “exclusive” nature of Kiltr doesn’t really make sense to me: if I want to share stuff, I want to share it with my friends and contacts pretty much anywhere – many of whom may be on Kiltr, but most are not.

A couple of guys from Kiltr were demonstrating their new platform at the University business school’s Entrepreneurship Club; they are rolling it out in June, I think. It was very, very snazzy – a whole world away from the current experience. But I am not sure that an excellent new interface will make a difference to me. I think that Flipboard is an excellent app – it looks great, works very well, does what I might want. But I hardly ever use it: however good it looks, it didn’t actually add anything to my use of social media.

(They will be developing the interface for other enterprises as part of their business model.)

Similarly, I am not sure what more I will get from Kiltr that I can’t get from my existing social networks. To connect with people  and content I want, I would need to go to Kiltr in addition to the other networks. I assume that I can connect to the same people and brands elsewhere that I can on Kiltr – all it gives me, aside from a superb experience after the relaunch, is the walled garden of Scottishness.

I can see what brands and advertisers – they get access to consumers or businesses with less noise; there may be fewer eyeballs, but there will be more attention.

But for individuals, I’m not sure.

It may just be me. There are other networks I’m a member of which I rarely if ever visit. The ConnectingHR network (developed using Ning, I think) is full of interesting, like-minded people – most of whom I connect with in other ways, mostly Twitter. It is so long since I logged into the site that I have no idea what my password is; but I engaged with other members on Twitter just this morning.

I am not sure what it would take for me to use these walled gardens more effectively – what would make the loss of “shareability” with those not on a particular network worth paying.

I will certainly give Kiltr’s new site a go when it is launched in June – but I am doubtful it will be enough.

“The Dark Arts of Innovation” – Or Not?

After excellent sessions on play and improvisation, I suppose I was only setting myself up for disappointment with the third of the series of talks at the ScienceFestival that I accidentally curated for myself: “the Dark Arts of Innovation. The talk’s title hints at secret recipes or innovation-magick, but whilst interesting and engaging, on that count it didn’t deliver. There were no secret tricks or short cuts, no quick fixes – though a fair bit of common sense.

I think this in part reflects the nature of the institutions represented by the three speakers: a university, a research institute and a private sector (and privately owned) company.

Image from Olga Reznik on flickr.
Used under Creative Commons licence.

As Alan Miller, deputy principal (and responsibile for knowledge transfer) at Heriot Watt, pointed out, universities are steeped in tradition and conservative in nature; not necessarily the most innovative of institutions. Still, the Watt in Heriot Watt refers to James Watt, who whilst he didn’t invent the steam engine (that was Thomas Savery, apparently – I thought it was Newcomen, which proves that one really can learn stuff from the internet!), came up with an innovative design made greatly improved its efficiency and reduced its size, and enabled others to deploy it in many new ways – the power behind the industrial revolution.

Of course, once more the question of semantics came up. What exactly is innovation? Miller reckoned it was seeing the practical benefits of research – taking original research and creating products from it: exploiting experimental research and commercialising novelty. (As far as I recall, during my MBA the working definition of innovation we used was along the lines of seeing the potential products of new research, methods or processes, and then actually getting the product to market. Others define innovation as the generation of wealth from ideas.)

Either way, researchers are not necessarily the best innovators, and nor are universities the best at exploiting and commercialising their research. It has long been said that Britain is great at research but poor at exploiting it. Miller reckoned that Scottish universities are actually on a par with the US counterparts (a view which is consistent with this research into UK manufacturing from Southampton University). The UK parliament investigated the translation of research into commercial products last year, and produced a second report just last month. Others reckon the UK has no coherent policy on innovation. Part of the problem, I think, is whether a government can actually promote innovation specifically – they can make the economy as attractive for entrepreneurs and innovators (fat lot of success they’ve had there – though I guess they might argue the recent cut of the top rate of income tax is an effort to improve the incentives for entrepreneurs) – but I can’t help feeling that there is little governments can do to stimulate the process of innovation itself.

Heriot Watt tries to do this in various ways, though mostly by spinning off possible commercial outcomes from research into independent companies. The university doesn’t expect to to profit (though it hopes it will in the long term), but removing the removing the ties of bureaucracy and adding the profit motive seem to be beneficial.

The missing gap for me seemed to be how to identify those who were good at innvoation – clearly, not necessarily the same as those undertaking the initial research. My guess would be that most academics are motivated to a great extent by profit, but if one removes the results of their research and passes to someone else – even another (spin off) body – to commercialise, how does one recognise and reward to original researchers? Do they also profit from it?

Working out which bits of research actually have the potential also seems problematic: are there university committees assessing which bits of research might yield commercial results? Miller pointed out that the fruits of research may come a long time after the research itself – the development of transistors after WW2 relied on esoteric research into quantum mechanics decades earlier, for instance.

Fundamentally, though, Miller saw innovation as being all about people: they need to be stimulated to innovate. Unfortunately, how to actually do that doesn’t seem clear.

Lee Innes from the Moredun Institute gave some excellent examples of the way they have innovated. Firstly, they are very close to their ultimate costumers – farmers: indeed, they were established by the agricultural industry and are managed, in part, by farmers; they are aware of the issues facing farmers, and work with them on technological solutions. The profits of their innovation are channelled back into further research projects.

The institute also sifts ideas using evaluation criteria before product development and implementation – a long, and, she reckoned, potentially cruel process: you need to be willing to dump good, workable ideas if they might not come to fruition or would drain resources. “Killing the babies”, she called it.

The critical steps – necessary, even – seemed to be working in collaborative, cross-disciplinary teams, and for those teams to be small and flexible. She gave an example of a brainstorming session between the institute’s researchers and engineers from (I think) Heriot Watt where the engineers had picked up on a problem the researchers had thought of as insoluble – and a rapid diagnostic for toxoplasma is now in development. Being open to new ideas from unlikely sources seems to be beneficial – and I like the idea of innovation rising from random conversations! Spinning out potential products allows the innovators to work in flexible, dynamic, high performance teams to get the product to market – like any start up, perhaps. They are also open to unintended consequences – and exploit the novel application of them.

Promoting that sense of interdisciplinary collaboration in a high performing environment seems crucial to W L Gore. I have heard people from Gore speak before, and it has always seemed both an inspirational organisation – and completely down to earth. Gore’s Gerry Mulligan added to the passion for ideas I have seen from the firm before. It does sound like a truly innovative organisation, with a novel culture that has innovation at its core. (The first thing you see on their website is “A Commitment to Innovation Shapes Everything We Do” – quite a statement.) It eschews hierarchy and works with a minimum of bureacracy – no time sheets, for instance. Its teams are self-organising and wholly empowered; the only leaders are those who get followers (someone once said that Gore doesn’t do leadership training – they do followership training instead – though Mulligan did describe the leadership training those in senior positions get – clearly there is some recognition of hierarchy). Peers are involved in the annual review process – and are responsible for setting remuneration, too. Everyone gets 10% of time to work – or “dabble” – on their own projects.

This could also make it a harsh place to work, too – it may not be the best environment for introverts, perhaps. (I may be completely wrong, of course: if you are judged on your contribution to results by your peers, regardless of how loud you shout and how sociable you are, it could be that introverts may fly!)

It was, Mulligan said, all about the culture – and the people: without bureaucracy, hierarchy and “command and control”, innovation was able to flourish within small, flexible – and cross-disciplinary – teams based around relationships. Informal networks are key to sharing knowledge and enabling the teams to coalesce. All those conversations again…

There was long discussion about the nature of intellectual property, and who benefits from it. Gore uses patents a lot, and – in some jurisdictions – are bound to share the profits of IP with its developers (not in the UK). Mulligan described some bad experiences the firm had working with others and sharing IP, which had to be resolved in court, and felt it best to keep working relationships in house.

The speakers also felt that Scotland and the UK more generally had become risk averse: failure is a dirty word. Instead, they thought we ought to celebrate failure. At Gore, when a project closes because it fails, they have a party to celebrate. Of course, we can learn from failure – but to really learn, we need to share the knowledge of the failure. Researchers don’t publish details of experiments that fail, only those that succeed.

Condensing down what was said into that all elusive recipe for innovation, then…

• small…

• open…
• collaborative…
• flexible…
• cross-disciplinary…
• high performing…
• empowered…
• self managed teams
• minimal bureaucracy
• unafraid to fail
  And know when to stop!

But you still need to instill all that into your culture – and work with people who are creative innovators. Whoever they are.

Post Script. Whilst I have been writing this, my mind has kept returning to the Centre for Creative Collaboration, which I used to visit frequently when I was in London. C4CC acted (and, I presume, still acts!) a space promoting many of the themes of innovation that the speakers at this talk covered – particularly the open discussion and conversation. C4CC was set up in partnership with several of London’s higher education institutions, but is largely independent of them. Perhaps could be a model – only one many possible, mind – for incubation of innovation.

“Making It Up” – a discussion on (and including!) improvisation

Through no design, I seem to have picked a series of talks at the Edinburgh Science Festival that effectively hang together around a theme – first play, now improvisation (and, later, innovation).

“Making It Up” gathered together musicians and a choreographer – and all of them psychologists – to explore the nature of improvisation, and got the lively audience to indulge in both improvised music and movement to demonstrate their ideas. The basis for each contributor was that improvisation can change the way those who improvise think, and can have benefits outside of the medium being improvised: how we learn, how we think, and our creativity.

I was attracted to this talk for several reasons, both professional and personal. Fundamentally, I believe that everyone is creative, and that most jobs involve creativity in one way or another. My guess is that even those in the most mundane jobs perform their tasks differently from everyone else – if business processes allow them. And those of us who work in the “knowledge economy” probably spend a lot of their time improvising one way or another. At a personal level, I listen to a lot of improvised (free) and semi-improvised (jazz) music, and I wanted to increase my understanding of what was going on in the art form.

The discussion was chaired by Martin Parker, a musician and academic. Parker said that he thought all of us improvise much of the time – our very conversations being made up as we go along; it is, he felt, a fundamental part of being alive.

The first contributor was Peter Lovatt, a psychologist and former choreographer and dancer, didn’t necessarily agree: many of our day to day interactions follow familiar patterns which we stick to rigidly, and we need to learn how to improvise; it is hard to make things up from scratch and easier to start within an understood structure. (The use of “standards” within the musical improvisers repertoire reflects this – the standard structures with which to launch an improvisation.)

Lovatt got interested in the psychology of improvisation following improvisers discussing how their perception of the world changed following improvisation – colour and sounds would seem more intense and their perspective changed. He devised experiments to test the hypothesis that improvisation did actually change the way people think. Working initially with verbal improvisation exercises and later, to remove the possibility that the exercise itself was priming the subjects for oral tests that followed, movement exercises, he found that just twenty minutes of improvisation improved people’s functioning in divergent problem solving tests. (Divergent problem solving, I learned, is where there are many several potential answers to a question – for instance, “what uses are there for a brick?” Convergent problems are those for which there is only one answer – such as “what is the capital of France?”) Clearly although improvisation might be fundamental to our being alive, it is also something that we need to practise to get the benefits.

Lovatt went on to work successfully with Parkinson’s sufferers to correct what he described as their “divergent deficit”, resulting in a reduction of symptoms lasting several days after the course of improvisation has stopped.

Raymond MacDonald is another improviser-turned-academic, and he brought his saxophone along to give us a demonstration. He also got the audience improvising music within a structure. He started off by returning to the tension between people being natural improvisers and improvisation being something that we need to practise, reflecting Parker’s earlier comments by paraphrasing Gilbert Ryle (who apparently had a lot to say about improvisation):

“a brain that is not improvising is not alive”

maintaining that improvisation itself is part of life, and that we learn from an early age by our mistakes – making it up as we go along. (Pat Kane had made exactly this point in the session on play.)

Raymond MacDonald playing in Gateshead.
Photo by Andy Newcombe on flickr, used under Creative Commons licence

MacDonald also contended that everybody is naturally musical from a very early age (if not from birth), and that everyone can be moved by music and communicates musically – even if they are not aware of it. It was at this point that he got us improvising, something which sounded surprisingly harmonious – and it was great to see the whole audience try this out, and, apparently, enjoying it!

Children improvise through play; the difficulty is that we soon learn not to as we grow up. We are taught in music classes to play the “right” notes, and that before one can improvise, one has to have complete mastery of one’s chosen instrument. (Something MacDonald took pleasure in disproving through our attempts at harmonic improvisation!) MacDonald linked improvisation and music to health and wellbeing, saying cancer patients who had been taught (or retaught?) to improvise could communicate better and felt better.

This is where Tom Cochrane came in. He wanted to investigate the emotional state – and the awareness of the mental state – that arises from improvisation. Based on models of how we perceive the world and react to it (using cybernetics and control systems), this would require feedback loops, adjusting our awareness of our state within the world; in order to improvise, Cochrane maintained we’d need three loops: the first detecting the world and responding to it (ie developing emotions from it), the second building on the response and responding to that by playing music, and the third changing the music in response to what has been played. (I think I got that right; I’d have drawn it but the drawing programmes I have just do my head in!)

In Cochrane’s models, our emotional cognition of the world is partly constituted through music, and we can improvise our emotions to become “more powerful, more graceful and more meaningful”, creating shared emotions as others react to our music.

Using sensors and – of course – computers, Cochrane has developed a programme he calls the “mood organ”. It detects the emotional state of the subject and creates sounds based on that, which the subject can then change and influence – thereby allowing anyone to improvise, regardless of their musical expertise.

He demonstrated this with Raymond MacDonald hooked up to the “mood organ”, improvising with his saxophone along to the music created by his emotional state. The effect was quite haunting.

There were of course a lot of unanswered questions arising from the session. I was curious – obviously – to know what effect listening to improvised music had on its audiences – basically, has my mind been changed through the experience of listening to improvised music? Does the nature of the music matter – do classical musicians improvising work in the same way as jazz musicians, or rock musicians, or …? Do their brains work in the same way? What if they jump between genres? And what happens to classical musicians who are playing the music as written but improvising the mood and the emotions?

I also wanted to know about the effects of improvising movement: I am sure many people make up dances in the privacy of their own homes, dancing along to the radio – does this have the same as effect as Lovatt’s courses of improvised movement?

And there was something missing about the connection between learning, improvising and creativity – though I can’t quite work out what!

“Why We Play”…

Pat Kane gathered an interesting panel for Edinburgh International Science Festival to discuss “Why We Play”: a biologist, a social scientist – and a games creator.

It was a fascinating discussion, raising lots of questions – perhaps most importantly, “what is play?” Not fully answered, if only because once you define it, it stops being play! – and giving many answers to the implicit question of why, but that’s fine – it was thought-provoking, and for me that was the point.

There are of course problems. Defining “play” seems difficult – it is one of those behaviours that we all recognise and understand the meaning of, but can’t really define. Patrick Bateson (a biologist, and hence something of a taxonomist too) laid out five characteristics of play:

• it is intrinsically motivated – there is no or limited external reward

• it has no immediate benefit
• it is sensitive to wellbeing (to the extent, Bateson felt, of being an indicator of it)
• it most common, but not exclusively so, among the young

But these don’t seem exclusive behaviours – unless one includes activities like reading and artistic endeavours in the definition (perfectly plausible – the discussion went on to discuss creativity, so maybe art is just another, “creative” form of play?). Maybe it is best not to get lost in semantics, though as Bateson pointed out, scientists (and, presumably, other academics) need to be able to define something to study it.

Mammals play (cats, anyone? Chimps, dolphins, you name it…); birds play (and learn from it); humans play. In mammals – including us – play can be social or directed at objects, as we (and other animals) learn to manipulate the world around us.

Obligatory cat photo: cats do it…

Bateson also highlighted that “play” is a homonym: as well as play itself, we play sports, playmusic and play in the theatre. We even play with data…

He also pointed out a difference – which I am not sure I really get – between rule-based play and “playful play”. Many games are structured – particularly in competitive play and sports – and the structure brings meaning to the game. Playing chess, for instance, relies on a very complex rule structure. If one could improvise chess moves, it wouldn’t be much of a game. But “playful play”, outside the strictures of games, is apparently linked with imagination and creativity.

Alex Fleetwood, a games designer who I saw speak a couple of years ago at TEDxOrenda, discussed how it is possible to use games – and play – to generate new ideas. People can use games to help them interpret and make sense of the world, and as new technologies come along – be it clocks, printing, or virtual reality – new games have come along to help us understand the technology; in turn, games can change the way we integrate this information and the way our brains work. (I couldn’t find any references for that contention!) Interestingly, many of the games Alex’s company, Hide and Seek, develop seem to use old technologies in novel ways to make us think differently about the world and explore new behaviours.

Wendy Russell took a rather more academic approach, though focussing on games and society. There are, she said, four kinds of games and play (with what I guess are Greek names…):

• agon – competitive games and sport

• alea – games of chance
• mimesis – mimicry, make-believe and play-acting (and, perhaps, even theatre?)
• ilinx – dizzy play and disequilibrium

These form a continuum, she reckoned, from rigid, rule-bound games to turbulent, improvised anarchy – from order to disorder.

She pointed out that on of the things about play was its pointlessness; and if you try to impose a point, it threatens to become serious and – well, not fun. (Just think about how seriously people can take football matches!) All those people looking to “gamify” their processes, take note…

Those in power and in institutions like order and structure; those at the bottom of the pile like disorder, as a way to get away from their everyday lives. Society allows disorderly games, sometimes in a managed environment, so that people can let off steam: funfairs, carnivals, mardi gras, April Fool’s Day – all allow people to relax the usual conventions and escape for a while. The role of the fool and the jester do the same: the normal hierarchy is temporarily suspended.

British society is changing (or has changed!) the way we, and children, play. Parents seem to manage their children’s time much more closely, and seem scared to let children play outdoors, unattended; both adults and children can play more easily indoors, using modern technology, than outdoors, albeit socially. Russell said that architects are now trying to design space for play into new structures – perhaps just as interior designers are trying to build play-areas in workspaces.

The role of play in creativity was touched on by each of the speakers, but it seems hard to put a finger on it. Some creative processes tend towrds the anarchic – brainstorming sessions, for instance, where all ideas are equally valid and anyone can contribute. The burgeoning unconference movement (of which I am a strong advocate!) might also be seen as disorderly play, beyond the usual bound business strictures. Everyone felt that play – or a sense of play – is crucial to promoting creativity – without specifying how.

Hans Rosling on “The Big Picture”

My first event in this year’s Edinburgh International Science Festival was to hear Hans Rosling give a statistics lecture.

This wasn’t the typical kind of statistics lecture; I reckon I have had at least four stats courses over the years, and whilst I know enough to know what to do (or where to find out what to do), I think it is fair to say that I don’t really get statistics. I can do it, but it never really makes sense. And all those stats lectures were dull, dull, dull, and dry.

This one was different. Not talking so much about stats as our ignorance of stats, and largely based on data rather significance tests, Rosling was as much entertainer as statitician. (I think on of his slides described him as “edutainer”.)

He was talking about how numbers can be used to describe the world – not to the exclusion of other inputs, but to produce a rounded picture.

The bulk of his talk was about population growth and world poverty, and the causes of change in these global phenomena – largely economics. In between, he told stories of his life amongst the numbers, when to trust them and when not. (“Not” seemed to be mostly when you don’t actually have the data – he highlighted how wrong our assumptions about the world can be.)

Rather than try to reproduce what he said (without the laughs), here are some of his TEDtalks covering similar issues…

…on stats

…on poverty

…on population growth

All the data and the manipulations he used can be viewed on Gapminder, where one can play around with the data and visualisation. A great way to while away the Easter break…

“More Like People”?

My working life has been spent with organisations, in one way or another. (And of course my life before that: schools and universities are organisations too…) I love exploring the way organisations work – what makes them tick. That is why, believe it or not, I loved auditing: auditors dig into organisations, discovering the real processes and structures that enable to them to function. (Clue: it isn’t what managers tell you. And it doesn’t have anything to do with shareholders!)

When talking about organisations – something I do often – I repeatedly find myself describing them as dysfunctional. I don’t think that I have come across or worked in an organisation that couldn’t work better in one way or another, from multinational banks to small, two-man operations. I have long wondered why this is. It isn’t that people in the organisation don’t know this: one thing consultants learn very quickly is that what they tell their clients is very rarely news: organisations know what’s wrong, even if they need someone from outside to help them articulate it.

Their processes could be better, their communications could (almost always) be improved, their structures changed to help the business. Hierarchy and structures get in the way rather than enable, and people in organisations know the work arounds – big and small – to get things done.

(A caveat: “could be better” is a value statement: the corollary has to be “better for whom?” Customers? Employees? Managers? Owners? The wider population? The environment? These groups may not be exclusive, but better for one may very well not be better for all.)

Organisations could be – well, better organised. They are dysfunctional.

I have only one answer. Organisations are made up of people, not processes; people make the organisation work. And people are dysfunctional.

Despite the idea that organisations are separate from people, it is people that are the organisation. We pretend they aren’t. We even pretend that organisations are people!

The thing is that whilst some organisations behave as if they were psychotic, most large organisations’ dysfunctionality works in peculiarly non-human ways. (Small organisations’ dysfunctionality is just like the people behind the organisation!) The veil of incorporation lets everyone in an organisation hide behind the processes, hierarchy and bureaucracy that lets the organisation continue to believe they are “rational”.

Liam Barrington-Bush started a campaign to counter this and humanise organisations, “#morelikepeople“, and he’s developed some of his ideas into a book, “Anarchists in the Boardroom“. (I should declare an interest: I’ve known Liam for quite a while, we’ve discussed his ideas many times, I was involved in focus groups around his book, and I read early drafts of a couple of chapters; he and I agree on much, and probably disagree on more!)

Liam’s focus is on not-for-profits and social enterprises, but I think his ideas are relevant to all organisations. Broadly, Liam reckons (amongst other things) that new media – particularly social media – can act as a counter to the rigid hierarchies and management processes that twentieth century industrialisation created. This is a topic has interested me for a long while – Benjamin Ellis covered it particularly well in a one day conference at Cass Business School three years ago.

Using collaborative tools to develop self-organising structures and flatter structures would clearly have an impact on the nature of work and business; if large organisations were able to embrace them, they might become flexible and responsive.

More likely, I feel, is that small organisations – already more flexible than large, and often unencumbered by rigid structures and processes – that are likely to adapt faster to social media, perhaps becoming more openly networked rather than hierachical.

(Liam is using crowd sourcing to publish his book – itself an interesting example of the changing nature of business in a new, social and collaborative world; he is still looking for supporters.)

John Kay on Bankers’ High Salaries.

John Kay, economist and chair of the Government review of equity markets and long term decision making [PDF; and it's long!], was speaking to the Edinburgh University Business School, ostensibly on “Why are financial services so profitable?”, but essentially discussing remuneration in financial services. (This may because the answer to the original topic is a quick “they’re not!” – profits from the boom years were wiped out in the crash of 2007 and the ongoing global financial crisis: the profits were illusory).

Remuneration is of course a hot topic. The EU is developing proposals to cap bonuses; bankers’ salaries and bonuses regularly feature in the news.

The standard economic model of wages is that workers receive the same as their marginal unit productivity (I think!). The article in Wikipedia explains it better than I could… A big problem with this model is that it is very hard for organisations to know what the marginal productivity actually is. In large corporations through to the smallest business employing people, whilst the theory might say this is how wages are calculated, my guess is that actually no one knows. What is the marginal productivity of a waiter, a bar tender, a bank teller – or the CEO of a major company?

Kay discussed three different economic theories to explain real remuneration patterns and income distribution, each of which comes from different economic and political assumptions.

The first is that what may be perceived as excessive wages reflect political power and rent seeking. Economic rent the amount paid for a resource in excess of the amount to get that resource into productivity. In the example Kay used, the amount that Wayne Rooney is paid by Manchester United is probably far more than the minimum that Wooney would need to be paid to get him to play football: the difference is because ManU have to pay this excess to stop him moving to another club, who might pay more: in an open market, those other clubs bid up the price. (Kay may have been a little premature on this specific point, though the principal stands…)

The economic power in this case is with Rooney; similarly, successful bankers can threaten to move to another employer – or even another country. They could work anywhere – they have highly transferable skills – and their employers might worry that if they don’t pay their high salaries, they would lose access to the bankers’ skills. (I am not so sure that this threat is a problem now that much of their success has been proved to be illusory.)

The second model Kay covered is what he called “the estate agent problem”. The economics of estate agency is, according to Kay, curious: the rate of fees is generally static, with competition not acting to drive down prices. Estate agents generally charge the roughly the same fees as their competitors. This is because users want to pay for the best service; no one want to pay for an ok, but cheap, estate agent (let alone a bad but dirt cheap agent!), since the benefit accruing from paying a bit more for an excellent agent would far outweigh the cost.

Banks therefore pay for the quality they perceive they receive. They don’t want to pay for a mediocre performance when they believe they can pay a bit more and get excellent performance. Similarly, no board of directors is going to hire a CEO or MD they believe to be average: they will all want the best, and their recruitment firms will help – and bid up the price. But it is doubtful how much difference CEOs can actually make. Luck has an awful lot to do with their success or failure, as do the people they hire.

(Recruitment agencies and remuneration consultants have a lot to answer for, too. All firms want to be seen to be good payers – management roles, at least: job ads often describe roles – firms – as “top quartile pay”; I don’t think I have ever seen a role described as “bottom quartile pay”, though of course 25% of jobs, and firms, must be! Remuneration consultancies produce regular reports showing the market rate for specific jobs, which firms expect to have to pay to get the people they want – and the market rate inflates each year as firms adjust their rates to stay with the market.)

The third issue Kay identified is that of “bezzle“, a word coined by J. K. Galbraith to describe the undetected amount of corporate fraud. Before the fraud is discovered, the victims believe themselves better off than they are. Prior to the global financial crisis, we all thought we were better off than we actually were, because of those non-existent banking profits. As someone said (attributed to Nassim Nicholas Taleb), “we borrowed from the future, and now the future wants it back!”

Until a fraud is discovered, we are all better off! (Kay has writen about the global financial crisis in terms of the bezzle.)

The asymmetric information between financial institutions and their customers – that is, just about everyone – and between fraudsters (call them bankers, fund managers… people who are claiming their bonus for no special performance) and institutions are able to make excess profits. Until of course they get found out. Clearly, even though they have been found out, a great many still think they are worth it.

There was a discussion about how better to align reward and performance – locked-in long term share options, maybe – and perhaps a more apposite debate on the kind of people we want running our companies. This last is important. The traders who do the jobs in banks may do so precisely because they are attracted to the high risk, high return environment. Whilst we might benefit from people with less risky approaches, they are unlikely to be attracted to those jobs. Similarly, the CEOs we appoint might actually be wrong for the job – but less aggressive, flamboyant people aren’t going to apply. And what board would appoint a wall-flower against an alpha male bull? Maybe we get the management we deserve.

I’m not sure if any of this really explains extravagant remuneration and the bonus culture that has been laid bare by the crisis. Maybe it is simply greed, and people gaming the system: trying to get as much as they can.