Mostly Invented Somewhere Else

G. Pascal Zachary authored an article in the New York Times on March 30, 2008 entitled Thinking Outside the Company's Box.

“One of the oldest barriers to innovation is ‘Not Invented Here,’ a persistent bias of even the most creative people toward their own creations and against those of people who work for other companies. […] To help counteract N.I.H., large corporations have promoted technology alliances with rivals, as well as the concept of ‘open innovation,’ to draw on a wider circle of big brains — not on their payroll — to work on core technical problems. These efforts arise from the recognition that no single innovator or team, no matter how loyal to an employer or successful in the market, has a monopoly on wisdom.”

This is an interesting article that revolves around the steps and processes that Cisco Systems, obviously one of the big boys, is internally exercising in an attempt to overcome the NIH syndrome.

Compare Zachary's article with a presentation made by Peter N. Detkin, Founder and Vice-Chairman of Intellectual Ventures, on March 7, 2008 to the Washington State Bar Association. The presentation is entitled Investing in Invention. Here's his premise, and it's a good one:

 “Corporations are not a major source of invention …. Academics are not a major source of invention …. Startups are a source of invention …. Individuals are a .... huge source of invention.”

Detkin is a former vice president and assistant general counsel to another one of the big boys, Intel Corporation. I have no relationship with either Detkin or Intellectual Ventures. But that Detkin is an attorney, and that he talks about how to level the playing field for the little guy, probably has something to do with why I like his presentation. In it he succinctly begins his presentation by describing the significant inefficiences in the marketplace for the monetization of patents by start-ups and individuals. Then he finishes by providing hope that new business models are bringing efficiencies to the IP marketplace.

For those of you who may be interested in a more scholarly approach, also take a look at Detkin's law review article entitled, Leveling the Patent Playing Field, published by The John Marshall Review of Intellectual Property Law.

So allow me to coin a phrase I'll call the "Mostly Invented Somewhere Else" cure. Think of the MISE cure not as one single process or business model for bringing efficiencies to the IP marketplace. Think of it as an attitude. Isn't this what Cisco is trying to do? Introduce a MISE-type attitude cure for the NIH syndrome? Isn't that what Detkin is trying to do, too?

Yes, and kudos to both Cisco Systems and Detkin.

Granularity & Semantic Trust

I have received, and continue to receive, some quizzical looks and comments when I speak about Common Point Authoring in terms of granularity or granular information ownership.

Here's a wonderful parable about granularity taken from an excerpt of Automated Trust Mechanisms and the One World Market by Greg FitzPatrick. This paper was submitted to XML Europe 2001.

"Granularity .... means the breaking up [of] ideas, processes, products and services into fragments. The makeup of a set of fragments is dynamic and aspectual to ever-changing utility and circumstance. Each set represents new and unique combinations. The backside of granularity is complexity and the costs involved in extending distributed trust. Unlike Humpty-Dumpty, a granular set must be able to function as effectively as any pre-granular whole.

Imagine a group of children in a playroom. Each child has come to the room with a thousand pieces of their privately owned and highly valued collections of Lego. A teacher says to the children. "Put all your Lego pieces in the middle of the floor and build a great city." The children balk, since once the Lego is removed from their immediate possession, they can no longer identify it as their own. The teacher tells them," I will keep track of each piece and remember whose is whose. If the children trust the teacher's ability to do this they will begin to build.

To match their trust the teacher would need almost supernatural powers since Lego is known for the precision modularity of its product, mostly indistinguishable plastic blocks. The value of playing together and having so much Lego to build with is the value of the network, but the effort to maintain trust regarding individual ownership is the transaction cost.

End-to-end markets are capable of creating a considerable amount of complexity. Through Semantic trust they will admit a swarm of participants (fragments) into one and the same transaction. [....] The complexity is further exacerbated by the existence of exploratory negotiation. Agents trying to evaluate their participation in a deal would need the same transaction mechanisms as those of a firm deal. The trust mechanisms must be in place regardless."

The image of a teacher assuring these kids that they will get back 'their' exact Lego pieces is powerful.

Tim Berners-Lee in addressing XML 2000 is said to have described the Semantic test for such trust as being that "... which is passed if, when you give data to a machine, it will do the right thing with it".

Ownership Principles for Database Design

Here is one of my favorite data ownership references published by the MIT Sloan School, Cambridge, Massachusetts:

Why Not One Big Database? Ownership Principles for Database Design (by Marshall Van Alstyne, Erik Brynjolfsson and Stuart Madnick) Copyright © 1993, 1994 Van Alstyne, Brynjolfsson, and Madnick, All Rights Reserved

Some quotes I love from this publication:

“Design Principle 5 : No amount of standardization is sufficient to ensure new data availability.”

“The fundamental point of this research is that ownership matters. Any group that provides data to other parts of an organization requires compensation for being the source of that data. When it is impossible to provide an explicit contract that rewards those who create and maintain data, "ownership" will be the best way to provide incentives. Otherwise, and despite the best available technology, an organization has not chosen its best incentives and the subtle intangible costs of low effort will appear as distorted, missing, or unusable data. Decentralization concerns equipment and development, but it also concerns intangible issues of ownership and control.” (emphasis added)

If the foregoing peaks your interest, here is the abstract summary:

“This research proposes database decentralization and incentive principles which drive information sharing and ultimately system performance. Existing research has identified the benefits of centralized control while formalizing the importance of setting standards, enhancing user transparency, and reducing organization-wide data inconsistency. In practice, however, many centralization and standardization efforts have failed, typically because departments lacked incentives or needed greater local autonomy. While "ownership" has often been described as the key to providing incentives, these motivational factors have largely eluded formal characterization. Using an incomplete contracts approach from economics, we model the costs and benefits of decentralization, including critical intangible factors, by explicitly considering the role of data "ownership." There are two principal contributions from the approach taken here. First, it provides rigorous mathematical definitions and a framework for analyzing the incentive costs and benefits arising from database decentralization. Second, this theoretical framework leads to the development of a concrete model and eight normative principles for improved database design. Applications of this theory are also illustrated through case histories.” (emphasis added)

Keywords : Database Design, Centralization, Decentralization, Distributed Databases, Ownership, Incomplete Contracts, Incentives, Economic Modeling