Archive for the ‘The Generativity Solution’ Series

The Generativity Perspective
1. The Financial Crisis

Posted by Bob on October 28th, 2008

The Global Financial Crisis is not at all a financial crisis. It is a psychological “avoidance mechanism” to disguise the stupidity of so-called thinkers who neglected the basic ingredients of economic growth:

  • Invention by not supporting the generative research of the R&D function;
  • Innovation by narrowing the developmental effort to things like the power and speed of IT components;
  • Investment by conspiring to redefine the function of finance from support to “the generation of wealth.”

Yes, the financial crisis is a “Crisis in Thinking.” Those who indulged in these degenerative activities would simply rather be “bailed out” than be exposed as stupid.

Indeed, these “overdetermined crises” took away all of our pride in the rights and responsibilities of enlightened citizenship, entrepreneurial enterprise, and collaborative cultural relating.

To be sure, all perpetrators converged to become what science labels “depressor variables” in “The Equation for Prosperity, Participation, and Peace:”

  • The neutralization of Entrepreneurial Capitalism;
  • The nullification of Enlightened Governance;
  • The excavation of Cultural Relating.

The Generativity Perspective
2. The Economic Crisis

Posted by Bob on October 29th, 2008

There has been an extraordinary confusion of finances and economics by academic economists, Wall Street marketers, and government bureaucrats. Before we proceed, let us see if we can clear up this confusion with simple illustrations of basic economic systems.

Basic Systems

All systems have similar operations (see Figure 1).

Generativity Solution - Generativeity Perspective Figure 01
Figure 1. Basic Systems Operations

As may be viewed, systems are operations that convert inputs into outputs as follows:

Resource inputs are converted into results outputs by transforming processes at measurable levels of performance feedback in order to meet the requirements of the conditions within which they exist.

These systems are present under all conditions of both survival and growth.

Changing Systems

For example, the changing conditions of the 21st century marketplace require continuously changing systems operations, as may be seen in Figure 2:

  • Continuous repositioning in the marketplace;
  • Continuously improving products to meet changing consumer needs;
  • Continuously realigning organizations to meet repositioning requirements;
  • Continuously elevating resources to meet product requirements;
  • Continuously improving profitability to support all other operations.

Whether or not we meet these requirements determines whether or not we are engaged in economic survival or growth operations.

Generativeity Solution - Generativity Perspective - Figure 02
Figure 2. Changing Economic Systems Operation

The New Capital Development System

The economic growth operations may be viewed in sharp relief in Figure 3. As may be viewed, our success in meeting changing marketplace requirements is found in the development of “New Capital Development” or NCD, defining “capital” as what is “most important:”

  • MCD—Marketplace Capital Development or continuous positioning to meet changing marketplace requirements.
  • OCD—Organizational Capital Development or organizational realignment to implement the positioning;
  • HCD—Human Capital Development or human processing to implement the realignment;
  • ICD—Information Capital Development or information modeling to implement human processing;
  • mCD—Mechanical Capital Development or mechanical tooling to implement information modeling.

In this context, Financial Capital Development ($) never accounted for more than 15 percent of Economic Productivity Growth or EPG, the primary component of all Economic Growth. The remaining 85 percent of the variance in EPG is attributed to the prepotent ingredients of NCD.

Generativity Solution - Generativity Perspective - Figure 03
Figure 3. The New Capital Development System

In summary, the Financial Crisis must be separated from the Economic Crisis:

  1. We are in an Economic Crisis because we have not met the requirements of a Continuously Changing Marketplace.
  2. We are in a Financial Crisis because we have tried to meet humankind’s most unsavory anti-social expression—greed!

Financial Capital was never more than a catalyst to Economic Growth—a “necessary but not sufficient” resource input that helped to start the operations of the Economic System.

Other than this catalytic effect, Financial Capital is a measurement of productivity and profitability which occurs in feedback:

Generativity Solution - Generativity Perspective - Equation 01

In other words, it is a way of “keeping score.”

In the desperation of Information Technology’s promoters to generate economic substance and operations outside of ICD, the financial people found the obvious source:

“It’s in your pocket!”

“Now if we can only get at it!”

The Generativity Perspective
3. The American Solution

Posted by Bob on October 30th, 2008

Many people are fond of saying “Creativity is thinking outside the box.” Reactively, this means that someone is trapped “inside the box” and needs to get out. Proactively, “Genera-tivity means thinking to avoid getting trapped inside the box.”

From a more operational perspective, generative thinking creates new responses. In learning theory terms, generativity creates responses that the stimulus conditions were not calculated to elicit. In other words, generativity elicits no responses that are conditioned, linear, or based upon the limitations of the Binary Code.

In the current global financial crisis, for example, the assumptions and implications are unclear. The finance people assume that they are dealing with 100% of the variance—Financial Capital.

The generative thinkers, in turn, define the New Capital Development ingredients as follows (see Figure 4):

  • Marketplace Capital or Marketplace Positioning
  • Organizational Capital or Organizational Alignment
  • Human Capital or Human Processing
  • Information Capital or Information Modeling
  • Mechanical Capital or Mechanical Tooling
  • Financial Capital or Financial Investments

These effective ingredients account for Economic Productivity Growth or EPG which is the major part of all Economic Growth.

In short, the financial people say, “It takes money to make money.”

The generative thinkers propose, “It takes ideas to generate wealth.”

The former extends The Industrial Age into overtime.

The latter introduces “The Age of Ideation.”

Generativity Solution - Generativity Perspective - 03 - figure 03
Figure 4. The Sources of Economic Productivity Growth (EPG)

As may be viewed, Financial Capital Investments account for 15% of the variance in Economic Productivity Growth or EPG. In turn, the remaining New Capital Development Systems account for 85% of EPG. Finally, Marketplace Capital accounts for the totality of EPG—100%.

What does this mean for resolving the Global Financial Crisis? It means that our limited perspective on Financial Capital is compounded by our Binary Code Thinking which allows us only “Go” or “No-Go” choices: Either we let the Free Market operate in an “unfettered fashion” or we regulate it in a “controlling fashion.”

Only when we view the crisis in the totality of its sources can we make a long-term resolution. Indeed, we can only affect a long-term economic growth resolution when we adopt “The Generativity Solution.”

Having prematurely chosen to drive our economy by Financial Services instead of Manufacturing, we erected Financial Information Systems with “Faux Interdependence.” Lacking a “Common DNA/RNA-like Interdependent Data Base,” these Financial Services operated independently and excluded human processing. The net of their data-centric operations assumed themselves to be “Sources of Wealth” rather than “Products of Wealth” or “Measurements of Wealth.”

In perspective the solution to our economic crisis is the solution to all human crises: a “Common Integrated and Interdependent Data Base” which demands “Human-Centric Interdependent Organizational Processing Systems.” This is “The Generativity Solution.” This is “The New Capitalism.”

Generating Socioeconomic Solutions
4. Relating to Images

Posted by Bob on October 31st, 2008

The principles of generativity are simple, yet profound:

  • Relate to images of phenomena;
  • Represent images of phenomena;
  • Reason with images of phenomena.

These are the effective ingredients of thinking generatively.

In reverse order, we cannot think generatively before we have represented the phenomena ideationally. Similarly, we cannot represent ideationally before we have related to images interpersonally.

The probabilities scientists have given us normal curves: nice, linear, idealized symmetrical distributions around central tendencies such as means or averages. The curves tell us something about where people and products stand in relation to this central tendency. The work of the 20th century has been based upon these probabilistic assumptions. The mission of the 20th century has been to move toward reducing our deviation from this idealized central tendency: in other words, to look more and more like the middle of the curve.

The Generativity Solution - Generating Socioeconomic Solutions - f05
Figure 5. The Normal Curve

The normal curves also attempt to tell us how people and products move through the phases of the curve. For example, the normal curve has been adopted by the marketplace to reflect the movement of products and people through market phases: opinion leaders, early adopters, middle adopters, late adopters, laggards or non-adopters (see Figure 6). While this approach has produced an extraordinary array of products and services, it has simultaneously generated apparently finite images of people who look and act and think alike.

The Generativity Solution - Generating Socioeconomic Solutions - f06
Figure 6. The Market Curve

Generating Socioeconomic Solutions
5. Representing Images

Posted by Bob on November 3rd, 2008

In fact, the market curve is not a normal curve. Indeed, nothing in God’s universes is linear, normal and symmetrical. To be sure, the so-called market curve is comprised of multiple market curves: each, in turn, is multidimensional, interdependent and curvilinear as well as asym-metrical and changeable (see Figure 7). We may view a phenomenal representation of these multi-modal market curves in the illustrations below:

  • Generating or stimulating markets;
  • Innovating or initiating markets;
  • Commercializing or making markets;
  • Commoditizing or draining markets;
  • Attenuating or breaking markets.

For our purposes, we label the acronym for these market phases GICCA. They have profound implications for their corporate cultures and their people and products.

Generativity Solution - Generating Socioeconomic Solutions - f07
Figure 7. Multi-Modal

Indeed, elevated requirements have been determined for the processing systems generated by the multi-modal curves (see Figure 16). As may be viewed, the requirements for corporate-community processing capacities align directly with the GICCA phases:

Phases Requirements
Generating—S–MP–R Marketplace Positioning * MCD
Innovating—S–OP–R Organizational Alignment * HCD
Commercializing—S–P–R Human Processing * HCD
Commoditizing—S–O–R Information Modeling * ICD
Attenuating—S–R Mechanical Tooling * mCD

In other words, at the highest levels, the multi-model processing systems require advanced generative processing systems: S–P–R, S–OP–R, S–MP–R. We are not free to generate if we are not empowered to think!

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Figure 8. Multi-Modal Processing Requirements

Generating Socioeconomic Solutions
6. Exploring Images

Posted by Bob on November 4th, 2008

The first phase of reasoning is exploring images. This means exploring or expanding alternative views of our images. For example, when we explore our image of The American Enterprise System, we discover that American corporations have settled into Innovator–Commercializer positioning (see Figure 9). This is often referred to as “The Japanese Model:” slightly innovative commercialization. It has been adopted by many American corporations such as “Microsoft.”

Generativity Solution - Generating Socioeconomic Solutions - f09
Figure 9. Innovative–Commercializer Positioning

The advantage of this position is that it usually settles in running in the “draft” of the market leaders and, thus, minimizes the expenditures of leadership. Unfortunately, since America dropped out of Research and Development leadership, there is no nation for America to follow.

Nevertheless, American companies must once again consider its historical 20th century positioning of Generative – Innovative leadership (see Figure 10). Of course, this requires an upgrading of E & T as well as R & D: Education and Training as well as Research and Development.

Generativity Solution - Generating Socioeconomic Solutions - f10
Figure 10. Generative–Innovative Positioning

Generating Socioeconomic Solutions
7. Understanding Images

Posted by Bob on November 5th, 2008

No crises are insolvable. With generativity, crises are merely opportunities for greater growth. Even the Global Financial Crises may be transformed from problematic to possibilistic.

First of all, we must analyze the assumptions involved:

  • Leaders wrongfully assumed that finances generate wealth.
  • Financial services mistakenly set out to become the market-driver and, in so doing, to displace Manufacturing.

Secondly, we must analyze the implications of their superstitious reasoning:

  • Finances are merely ways of measuring the outcomes of wealth-generating activities.
  • Financial Services mistakenly have driven Manufacturing down to 12% of GDP while building their own contribution up to 21%.

In so doing, Financial Services have already failed several times in the last two decades to establish their powerful leadership in the marketplace. They have failed because they have “over-reached” the power of their critical contribution—as a “catalytic agents”—to be invested in wealth-building activities.

The real contribution of Financial Services is as an integral part of the Organizational Resource Integration Component: the support systems that implement the Marketing Component’s Initiatives. In other words, Financial Services must get into the business of supporting others’ efforts to produce substantive wealth-generating products and services. As a member of the Resource Integration Team, Financial Services may contribute to projecting and enabling the costs and benefits over the life of the products.

One of the tangible benefits of the Global Financial Crises is the clarification of roles and functions. Another more powerful generative contribution is the evaluation of marketplace initiatives to marketplace positioning.

The prepotent breakthrough model is the Generativity Positioning System™ or GPS™ (see Figure 11). As may be noted, GPS™ implements Generative–Innovator Positioning in the Marketplace at the highest levels as follows:

Generative Positioning Functions are accomplished by
Policy-Making Components empowered by
Leadership Processes.

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Figure 11. The Generative Positioning System in the Marketplace

Generating Socioeconomic Solutions
8. Acting Upon Images

Posted by Bob on November 6th, 2008

The most critical function of this GPS™ source cell is implementing The Requirements–Capacities Matrix (see Figure 12). As may be seen, the Capacities of the organization are compared against the Requirements for Generative–Innovative Positioning in the Marketplace. Clearly, Generative Positioning is going to require the highest levels of New Capital Development to establish and continuously maintain positioning.

Generativity Solution - Generating Socioeconomic Solutions - f12
Figure 12. The GPS™ Requirements—Capacities Matrix

In GPS™, the customer may select from potentially an infinite array, those products that are (1) most closely tailored to meet the customer’s values, and (2) for which the customers are empowered by tailored capacities to meet the product’s requirements for managing.

For example, the customer may view electronic representations on Computer-Assisted Designs all kinds of products—homes, cars, equipment. The customers may then select and “tailor” those products to meet their needs.

The generative marketplace of the future will be driven by The Generativity Solution—the generativity of breakthrough initiatives and architectural designs (see Figure 13). Anything of value that can be conceived can be achieved in Generativity Positioning Systems™ of New Capital Development.

  • MCD or Continuous Marketplace Positioning for Comparative Advantage.
  • OCD or Continuous Organization Alignment with Marketplace Positioning;
  • HCD or Generative Human Processing to implement Organizational Alignment;
  • ICD or Schematic Information Modeling to reflect Generative Human Processing;
  • mCD or Operational Mechanical Tooling to implement Schematic Information Modeling.

The actual design and assembly of the products will be “farmed out” to MOHIMs for the highest levels of New Capital Development just as OEMs or Original Equipment Manufacturers currently organize their production efforts.

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Figure 13. New Capital Development Systems

Generating Socioeconomic Solutions
9. The Paradigm Shift to Generativity

Posted by Bob on November 7th, 2008

The paradigm shift to GPS™ requires that all NCD Components contribute to the substance of the products being produced and delivered. The criteria of measurement revolve around increasing the “size of the pie” rather than redistributing the “sizes of the pieces.”

In this context, we have once again placed Americans back in the leadership role:

  • The American learners with expansive acquisition of knowledge and skills;
  • The American workers with elevating levels of applications in producing products and delivering services;
  • The American entrepreneurs with escalating levels of transfer to generating wealth;
  • The American citizens with accelerating levels of enlightenment in governance and politics;
  • The American leaders with potentially infinite levels of generativity in all.

In other terms, we will have a Fulfillment of Human Generativity, Reinvigoration of The New Capitalism, and a Renaissance of Civilization.

Just as the corporate leaders on Main Street need to learn the ingredients of corporate growth, so do the national leaders in America need to learn the ingredients of socioeconomic growth.

Just as the underclass people marginalized by “The Cycle of Social Failure” need to learn how to become productive individually, so do those marginalized by “The Cycle of Financial Failure” need to learn to perform profitably in our times.

Rather than to pit Main Street versus Wall Street, we must all learn to become generative in entrepreneurial ways where each grows so that all have the opportunity to grow.

In transition, The Generativity Solution empowers us to solve all human crises. “The Generativity Solution” is “The Human Solution.”

The Generativity Solution
The Prosperity Problem

Posted by Bob on January 1st, 2010

(From the preface of Saving America: The Generativity Solution.)

As I walked past my TV on the way to work, I saw our President addressing the White House Job Summit:

“…if there are things that we’re doing here in Washington that are inhibiting you, then we want to know about it.”

It is in the air! Not just our inability to create jobs! Not only the limits on our technological innovation! Not only the attenuation of our artificially-inflated Gross Domestic Product!

All of these problems are related to the relationship between economic freedom and entrepreneurial enterprise! Here is how it works:

Under conditions of elevated economic freedom, entrepreneurs and their companies generate the technological innovation that requires job creation and contributes to escalating levels of prosperity.

Noticeably absent from all explorations of “The Prosperity Problem” were representatives of the historic role of entrepreneurial enterprise in the generation of all prosperity. Here is how the economy and the entrepreneur work synergistically together:

The more economic freedom we give the entrepreneurs, the more they contribute to technological innovation, new job creation and, ultimately, Gross Domestic Product (GDP).

Under conditions of elevated economic freedom, then:

  • Entrepreneurial enterprise generates as much as 80% of the scientific breakthroughs and technological innovations.
  • Entrepreneurial enterprise generates as much as 80% of the new jobs in implementing the follow-throughs on the technological innovations.

Indeed, the strongest case can be made for entrepreneurial enterprise as the driving engine of the American economy. Under conditions of elevated economic freedom, then:

  • Entrepreneurial enterprise generates as much as 50% of America’s GDP.

To be sure, an overwhelming case can be made for the prepotency of entrepreneurial enterprise over all other sources of economic growth:

  • Entrepreneurial enterprise dwarfs the contributions of all governmental sources, including the presidency, congress, and the federal sector that they manage.

Yet these entrepreneurial businesses are exploited by the multinational corporations which track them and trap them, “making them offers they can’t refuse.”

Moreover, the entrepreneurs are passed over by the bureaucratic czars of the public sector who favor “sole-source contracts” with “soul-less contacts, giving orders they can’t follow.”

To be sure, not all entrepreneurs are generative, capable of creating scientific “break-throughs” and innovative technologies. By our estimates, no more than one in 100 entrepreneurs are currently generative; therefore somewhere around 50,000 people out of five million small businesses qualify as “generative entrepreneurs.” In business, they may be labeled as “process engineers,” capable of designing themselves and others out of their jobs. In government, they may be characterized as “social engineers,” capable of defining spaces and empowering people to fill them.

The point is this: the other 99 of us live, learn, and work in the “draft” of their sciences, empowered by the tools of their technologies, prospering through their intelligence, their perspectives, and their good will.

January 2010
McLean, Virginia

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