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Trying more new things and focusing more – Good news from San Francisco

31.03.2017

What companies can learn from the spirit and development of Silicon Valley.

It is clearly evident why so much is being written about it, especially by visitors: Silicon Valley provokes an opinion.

You have no other choice than to take a position in terms developments. And then share your ideas with others. Also because sharing ideas there is modus operandi.

Some points that I noticed:

Silicon Valley is an eternal flame of inspiration, motivation and new contacts. What is special about it is its openness. Everyone is exchanging ideas and contacts and they share their knowledge big time. Everyone sees the overarching opportunities that sharing affords. It goes without reason that the Burning Man Festival symbolizes this paradigm. Silicon Valley for me is a "Sharing Economy of ideas and contacts". I have two special explanations for this:

  1. Everything is simply happening too quickly for someone to hold back their ideas.
  2. The exchange of ideas is systematic. Nothings is as important as fast, massive and real feedback. Every comment received from potential customers, potential investors, potential partners or merely your neighbor in the coworking space makes one's own business model better. Every startup is in constant mortal danger. The sole opportunity lies in the hyperfast adoption and adaptation of one's own business idea. This is the nuclear reactor of startup development.

Silicon Valley vs. Berlin

The atmosphere and willingness for openness is just as much in place in Berlin as it is in Silicon Valley. Only Silicon Valley is one hundred times bigger (and more expensive) than Berlin. The Next Big Thing is not going to come from Germany. The concentration of capital, personal networks, talent and infrastructure is just too massive. Opportunities for Germany however can be found in startups that don't start out by trying to appeal to a target group of billions. Here the industrial collaboration of startups and groups has much to offer and much potential.

Learning machines

If fast learning is a central part of our DNA, it comes as no surprise that now virtually all startups in Silicon Valley are betting on fast machine learning as a technology. Deep learning: 100-fold combined neural networks connected with new massive data sources.

A contact once said to me: "Everything that a human can think about in one second, can be done by AI (artificial intelligence) today."

Bots are the new apps

Actually, artificial intelligence (AI) and machine learning are the dominating trends. The overwhelming majority of startups are involved in this environment. Conversely, the five largest/most valuable US companies are also the largest players in the field of AI and machine learning.

Microsoft for instance is pursuing the goal of the "democratization" of AI, i.e. users can now already integrate AI routines at power-user levels in just a few steps and thus for example, benefit from massive computing power for text and voice recognition without having to deal with the structure or details. "Bots are the new applications" is therefore now the new credo.

The force of prognosis

In Silicon Valley, many discussions are often about technological prognoses. A current popular discussion is about the prognosis that within two years, 50% of the vehicles in San Francisco will drive autonomously. For us however I have come to the following conclusion: No matter what happens in two or five years – prognoses, even the ones that irritate us, should be taken seriously and we should already act on them. Because prognoses in Silicon Valley are not truth relevant, but they are decision relevant.

Virtual worlds

Closely related to this are the developments in the field of Augmented Reality. As has frequently been the case before, the gaming industry is an interesting example. Gamers see 3D avatars through their data goggles and can talk to them in natural language. In this vein, Siemens has just recently acquired a game manufacturer. And that's no coincidence.

Finally now the three insights that interest me the most:

1. Uncertainty as an opportunity

The saying "We are living in VUCA times" is everywhere. (Volatility, Uncertainty, Complexity, Ambiguity). And in Silicon Valley it is a very welcome one. Uncertainty and ambiguity are positive virtues. Because the dice have not yet fallen. What might seem like a threat to many in Europe is seen as an opportunity.

2. Innovation close to the customer

Customer feedback is not a task, it's a state. A state of mind. Business and design schools send their freshman students out into the streets to potential customers, the relevant targets groups.  This is also an approach prevailing in startups. Feedback is not obtained just once, but constantly – one's own business model is adapted to key customer needs virtually on a daily basis. And ultimately, this attitude will also be adopted by the big companies.

This is how a software manufacturer describes their own innovative process: We only develop if a customer has a relevant business problem and also has the necessary data, plus an executive from their own company. Only once all three of these components come together do we complete an initial design sprint – in 7 weeks and in collaboration with the customer. If this results in a promising solution, the next design sprint starts, however with the involvement of at least 5 customers. If the sharpened solution still appears to be promising, discussions commence on the actual development project. In summary: quick to the customer and then stay with the customer permanently.

3. Fast or not at all

Speed is above everything else. You can do anything, but you have to do it fast. Discussions with new partners or contacts take place quickly or not at all. Thinking is good, but thinking without fast implementation is not.

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Conclusion

What does this now mean for us? Should we do something differently? Yes! Actually, it's very simple: try more things –  focus more –  adapt more – accelerate more.

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