Posts Tagged ‘Russ Ackoff’

Guest Post: Skip Walter

January 5, 2012 Comments off

The author of our first guest blog post is Skip Walter, a serial entrepreneur, consultant, angel investor and and affiliate faculty member in the Department of Human Centered Design and Engineering and an instructor in the Foster Business MBA program at the University of Washington.  As part of his commitment to HCDE, he serves as the Chairman of the External Advisory Board.  Skip has over forty years of experience in executive management, software product development, and new venture development.  He was the founding CEO of Attenex which was sold to FTI Consulting for $91M.  Skip and UW Bothell Professor David Socha regularly collaborate on principles for designing innovative software products and teaching human centered design.  In this blog entry, Skip shares work that he did with the University of Pennsylvania’s Russ Ackoff on “An Idealized Design for a University.”


Russ Ackoff on An Idealized Design for a University


In 1986, while managing Digital Equipment Corporation’s ALL-IN-1 $1B per year office automation development efforts, a colleague sent me a copy of Russ Ackoff’s Creating the Corporate Future (1981).  To paraphrase Russ’s famous introductory lectures on how he came across the process he turned into his Idealized Design methodology through his work with Bell Labs (the story is an introduction to his book Idealized Design:  How to Dissolve Tomorrow’s Crisis …Today), I really wished she had not sent me the book as I spent most of the next year interacting with Russ and his team at the Wharton School instead of doing what I was supposed to do at DEC.

After reading the book and a previous book The SCATT Report:  Designing a National Scientific and Technical Communication System (1976), I immediately called Russ and asked if I could visit him to learn more about his methods and his way of systems thinking.  I shared with him many of the challenges we were facing at Digital Equipment with our rapid growth and with the dramatic impact that the PC revolution and the networking revolution were having on our business.  He graciously agreed to meet and the next day I went to Philadelphia to meet him at the University of Pennsylvania’s Wharton School.

For most of the next year, I consumed all of Russ’s publications and the many videotapes of his corporate seminars.  In addition, Russ introduced me to several of his corporate clients and included me in some of his consulting engagements.  I was able to see his systems thinking and idealized design methods come to life with his corporate clients as frameworks turned into profitable action.  Along this journey, Russ and I discovered that we were both frustrated with the institution called the university.  He always reminded me that if I wanted to understand the university that I had to realize that it was designed for the professors, not for the students.  I shared with him that my most robust learning at Duke University was my part-time job programming computers in a psychophysiology laboratory in the medical center and with my peer students, not the dull and drab lecture environments in the formal courses I attended.

Out of this shared frustration, we realized that there was an opportunity at Digital Equipment Corporation (then known as DEC which  was acquired by Compaq and then acquired by HP) to revive the falling revenues and profits of our Educational Services business by rethinking both corporate educational units and the university.  I found funding in my budget to hire Russ and his team of graduate students to work on an Idealized Design of a University.  I was not sure whether DEC would be open to the results of the design, but I knew that my extended staff would learn a lot about thinking differently about our enterprise software business.

The final report that Russ and his team provided for the project was completed in January 1987.  As you skim through the document, you can see that the thoughts are somewhat dated.  Yet, between this work and the previous two books mentioned, the foundational thinking for the world we find ourselves in today with the Internet has come to pass.  This foundational thinking is similar to the large scale Idealized Design that Russ performed with the Bell System in the early 1950s that led to almost all of the telecommunications advancements we’ve experienced in the last 60 years.

As I re-read this report, the introduction is as fresh today as it was 25 years ago:

“One who attempts to improve existing universities is very likely to become preoccupied with removing current deficiencies. Unfortunately, getting rid of what one does not want does not necessarily yield what one does want. This is apparent to those who get rid of television programs they do not want by changing channels. They have a high probability of getting programs they want even less. Therefore, effective design of a university must be directed at getting what one wants. not at getting rid of what one does not want.”

“Moreover, improving the performance of parts of a system taken separately – and universities are systems – does not necessarily improve the performance of the system taken as a whole. The performance of a system is never the sum of the performances of its parts; it is the product of their interactions. Therefore, efforts to improve universities should begin with preparation of a comprehensive design of what one would like a university to be ideally.”

“We cannot predict accurately how many of each type of college graduate will be required a decade from now. Even if we could, we would still have the problem of allocating these requirements to individual autonomous institutions. Our ability to forecast manpower requirements is not likely to improve because the rate of technological change will continue to increase.  This will augment an already considerable tendency of college graduates to switch fields after completing their formal education. For example, almost 30 years ago W. G. Ireson (in Peirson, 1959) reported that surveys over a period of thirty years revealed ‘that more than 60 percent of those persons who earned engineering degrees in the United States, either became managers of some kind within ten to fifteen years or left the engineering profession entirely to enter various kinds of business ventures …’ ” (p. 507).

Last spring, I had the pleasure of teaching 80 MBA students a class on technology commercialization.  I really enjoyed the energy and enthusiasm of the students who had come up with new business ideas the previous quarter in their entrepreneurship class and entered their plans into the UW Business Plan competition.  I spent a great deal of time outside of class working with ten of the teams and it was clear that they learned far more in this activity then they were learning in my formal class.  I was excited that a new crop of exciting entrepreneurs were interested in starting their own companies.

I took an informal survey and found  that 75% of the students were using the program to give them the skills to leave their current large employer to start their own company.  It hit me that these companies were spending ~$70,000 to send their employees to a program that was energizing them to leave their company.  What is wrong with this picture – for both the university and for the corporations?

In parallel with the discussions with David and Alan,  I am having discussions with a Seattle Venture Capitalist about how broken the startup funding model is.  One of the things that we’d both observed is how the amount of money to start a successful company continues to drop.  Ten years ago when we founded Attenex (sold to FTI Consulting for $91M in 2008), we needed $12M to get to a cash flow positive state.  Today, with advancements in Open Source Software and cheap cloud computing, we could recreate the same company for $1-2M.  It occurred to me that the cost of starting a company is falling rapidly while the cost of a university education (particularly private >$200K) continues to rise rapidly.  We are not far from a cross over point where it costs more to go to university than it does to start a company.

Recently, I’ve shared the Ackoff design with several academic and business professionals.  One of their criticisms is “Well, this might work for professional degrees, but it will never work for an undergraduate degree or a student interested in liberal arts.”  I used to think that as well.  However, in the last several months consulting for a high technology client, I have had the opportunity to interact with their pool of “research analysts.”  These analysts do the background research on markets and products and companies for the rest of the organization.  It turns out that in this very technical company, this group of employees are all very recent graduates of Bay Area schools.  None of them has a technical degree.  They are all history, English, political science and other liberal arts degreed students.  They were hired for their ability to research, think and write.  They are far better than technically trained analysts I’ve worked with in other companies.

I enjoy straddling the university and industry worlds.  I view my teaching in the Human Centered Design and Engineering (HCDE) Department at UW and the Foster Business School as a way to “pay it forward” in return for all of the wonderful mentors who have given me so much over the years.  Yet, as we’ve started re-kindling the “Idealized Design of a University” ideas, I started thinking about how the financial model of a university is so broken in the world of the Internet.  Why do we continue to invest in bricks and mortar when we have the ability to narrowcast any video any time any place?  I made the mistake last week of looking out on my HCDE class and realizing that the students were collectively paying $65,000 to take my class, and my compensation as a part time lecturer was $5,000.  Then it occurred to me that there are several excellent user experience (UX) design studios (not being used in the evening) around Seattle that would be a much better environment to teach in than any generic UW classroom for far less money than a university building.

While the capabilities of the Internet are certainly shaping new ways of thinking about a “university without walls”, there is another not so subtle change occurring all around us.  It is the switch from the content centered world of previous media (in the McLuhan sense) like books, music, TV and movies, to the app centered world of the iPhone, Android, and iPad.  Our content is now becoming dynamic, socialized, and contextualized by becoming an app.  Our content is now alive in ways that those of us who have grown up in a text based world have a hard time coming to grips with.  I now keep asking myself “are we finally seeing the death of the linear book?”

What would the world of work and learning be if at every turn we had “alive” content in context that is easily socialized and distributed?  What if we had expert mentors available for in context consulting for immediate problems and for longer term “degrees”?Fortunately, there are terrific professionals not just thinking about these ideas but testing them and putting them into action.  Cathy Davidson, Duke University, is researching, writing and practicing several of the core ideas related to innovation and the future of learning and work.


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