Educators’ dilemma: is neoclassical economics consistent with the laws of physics?

As educators, our most important task is to help prepare our students to lead successful professional and personal lives, for the next 40+ years, until 2060 and well beyond. While much is unknown on this time scale, we now do understand the big picture, including fundamental human needs, as well as the material basis for satisfying them, especially around biodiversity and energy – the previous blog “Reflections on 2018: complexity, messiness, progress” provides a few illustrations.

So, while we cannot provide recipes valid for half a century, we certainly can help our students develop a way of thinking, even a worldview, which will prepare them for the challenges they will face.

This means first and foremost understanding human society and the economy in “real”, biophysical terms, including the underlying energy and material flows.

We could start with biophysical economics, a school of economics based on biological and physical resources, with a strong focus on energy, especially around food production, new energy sourcing, and the concept of EROI (energy return on (energy) invested). Biophysical economics has a long history, starting in the 1920s with Frederick Soddy (building on 19th-century insights, especially the laws of thermodynamics), with major contributions by Nicholas Georgescu-Roegen in the 1970s, and more recently by Charles A. S. Hall, Cutler Cleveland, and Robert Costanza. The Encyclopedia of Earth provides an excellent overview.

So far, this work has remained outside of mainstream economics. There are many reasons, including a much higher complexity of looking at underlying material and energy flows instead of money, and the fact that most leading practitioners, including all listed above, are not economists. It requires a fundamentally cross-discipline approach. At the same time, this is a big opportunity for teachers of other disciplines beyond economics to help expand learners’ perspective. I sincerely hope this gives rise to many fundamental reflections.

Biophysical economics is closely related to ecological economics, but differs in its focus on energy and entropy, compared to the latter’s focus on ecosystem services. Both are forms of strong sustainability, as opposed to environmental economics and similar approaches, which complement neoclassical economics with pricing externalities, but regard all forms of capital as interchangeable (for example, human misery or polluted water is OK, as long as sufficient economic value is created). Biophysical economics not at all related to econophysics, which applies methods (originally developed in physics) around stochastic processes and nonlinear dynamics to classical economics – to simplify market economics worldview, physics tools.

Notwithstanding its sophisticated mathematical toolbox, neoclassical economics considers itself (and is) a social science, focusing on markets and human behavior, mainly of consumers and managers. In the classical view, scarcity leads to higher prices, spurring technological innovation and substitution, allowing the economy to continue growing (forever).

Let me illustrate this disconnect with a few examples:

  • Absurd energy-related decisions: producing bioethanol (a biofuel) requires oil, and for every 100 joules (J) of oil, around 80 J of bioethanol are produced – a net energy loss of 20%, in addition to pollution, biodiversity loss, human labor, etc. In real terms, this makes absolutely no sense; with subsidies, in our distorted financial system, it might be profitable.
  • New energy sources: our growth society requires constant discovery of new energy with an EROI (energy return on invested) >11 (Fizaine and Court, 2016, “Energy expenditure, economic growth, and the minimum EROI of society”). Historically, oil had an EROI over 100, current oil sources are around 17 and falling; solar panels typically have an EROI of 4-8. There are currently no known new energy sources, broadly scalable in the coming decades, with the required EROI to maintain our growth economy.

revisiting the limits to growthSource: Hall and Day, 2009, “Revisiting the Limits to Growth After Peak Oil”

  • Decoupling economic growth from energy use is unfortunately not happening. In fact, due to the rebound effect, energy efficiency often leads to an absolute increase in energy demand. For example, our consumption of energy for lighting has increased about 100’000 times over 300 years, or about 10’000 times per capita, in spite of an extraordinary increase in efficiency. The consumption of light itself increased a billion times.

All models are oversimplified and wrong; some are however useful. Unfortunately, the neoclassical economics model has outlived its usefulness. Consequently, many economists, managers, and political leaders make dangerous decisions not understanding the physical limits, or at least the practical limits to substitutability, scaling and deployment. The reason I believe the biophysical economics model will be much more useful is that it starts with the most fundamental constraints of all life: energy and entropy.

To answer the question in the title: with the notable exception of limits to material and energy consumption growth, neoclassical economics mostly stays within the laws of physics (without necessarily paying much attention to them), sadly ignoring the biosphere it depends on. Just as bad, it completely ignores human well-being beyond the idealized, rational, by now discredited “homo oeconomicus”. As such, it is no longer serving the society it is part of.

The way forward: while we know what we need to do, we don’t quite know how to get there in the relatively short time available, in a world of soon-to-be severely constrained energy and degrading-but-still-functioning ecosystem services.

As educators, we’ll succeed if we equip our students to experiment as (social) entrepreneurs and find effective solutions to human and environmental issues. Just as importantly, our students should feel empowered to shape the reality they live in, take proactive steps towards changing the rules of the game, vote and engage in politics, and serve as role models in their communities. Some of their projects could become the seeds of future human prosperity. Helping learners move beyond neoclassical economics will be a necessary first step. A deep awareness of the biophysical reality might be a good place to start. This is our challenge for all teachers and learners, in every discipline.

Sascha_NICK Author: Sascha Nick, BSL Professor

Reflecting on 2018: complexity, messiness, progress

December is an excellent time to reflect on the year, and 2018 requires more reflection than most. Wherever one looks, 2018 was messy, from politics (consider, for very different reasons, Brexit endgame, “gilets jaunes”, or Korean denuclearization) to how we deal with major issues: picture 30’000 COP24 delegates in Katowice, surrounded by coal mines and coal dust, struggling to put in practice the good intentions of the 2015 Paris Agreement.

2018 was a year of extraordinary progress of knowledgeTo illustrate:

In February, Steven Pinker set the tone with his well-researched book “Enlightenment Now: The Case for Reason, Science, Humanism, and Progress”, demonstrating the spectacular improvement of human wellbeing on 15 dimensions, including health, safety, and happiness, using data to dispel common myths.

This was followed by one of the most important scientific publications ever, the IPCC 1.5°C report. For the first time, we know exactly what to do to limit warming to avoid the worst consequences (simplified: reduce CO2 emissions by 58% by 2030, replant forests).

 

Report October 2018

Source: IPCC 1.5°C Report, October 2018

Scientists from the University of Leeds scaled these limits to a per capita level in their paper “A good life for all within planetary boundaries” (Phosphorus 890 g, Nitrogen 8.9 kg, material footprint 7.2 t). They introduced a new indicator eHANPP (embodied human appropriation of net primary production), representing biomass harvested or killed for human use, with a suggested limit of 2.62 t per person per year.

Why don’t we act as needed? Knowing exactly what to do is only a first step, but it’s not very useful if we don’t act. So, we need to ask, why are most of what we do “business as usual”? Why do we keep collectively creating outcomes most of us don’t want, like environmental destruction, broken communities, lack of trust, financial crises, millions of refugees, malnutrition, or obesity? This includes individual, company and government action, often pulling in the same (wrong) direction.

Part of the answer lies in the way our socio-economic system has evolved, with its stocks, flows, buffers, positive and negative feedback loops, rules, parameters etc. A simplified example: debt payments require growth, which requires cheap energy, meaning burning fossil fuels, leading to pollution and many other problems.

A bigger part, however, is probably linked to the way we think about the economy: as an independent system, following its own mechanistic rules (remember supply and demand curves from Econ101), separate from the environment and partly detached from society. At its core is money, as a benchmark, behavior driver, store of value, in addition to being a means of exchange.

Without this cultural baggage, an independent observer would see a still beautiful planet with a threatened biosphere; closed material flows but open energy flows powered by the sun; a dominant, individually smart but collectively stupid species obsessed with power and money; a highly complex human society and civilization as a subset of the biosphere; an economy as a subset of society and sub-subset of the biosphere, completely dependent on ecosystem services it is busy undermining.

Outlook: Looking back as far as our data will allow, with Steven Pinker’s help, suggests hope. The progress of knowledge in 2018 reinforces this hope, in spite of the rising complexity of today’s issues. The next blog will examine how we as educators can contribute.

Sascha_NICKAuthor: Sascha Nick, BSL Professor

An exotic Internship between BSL & Sumba Hospitality Foundation

In 2017, Business School Lausanne (BSL) and Sumba Hospitality Foundation (SHF) in Indonesia co-created an Internship program tailor-made for BSL students called Sustainable Development Internship.

You may wonder, what is Sumba? And what do they do? So, let us share a brief presentation of this Foundation. SHF offers a vocational training in hospitality for Sumbanese underprivileged youth. The holistic education program provides students with general courses and enables them to graduate in Culinary, Food & Beverage Service, Housekeeping or Front office. To allow the students to apply and train their skills, SHF has opened ten luxury guest pavilions, a SPA as well as a restaurant & bar to the public. Education, environmental awareness and sustainability are the three most important principles of the foundation. It is in the belief of the foundation that tourism can be a positive force in poverty-stricken regions particularly when its community is involved in the process. The goal of the foundation is to assist in providing viable employment to Sumba’s young inhabitants and break the cycle of poverty while also protecting the environment and their culture.

A large part of the campus is dedicated to the growth and maintenance of a sustainable, organic farm, created with the precepts of the burgeoning field of permaculture in mind. Produce from the land are used in the restaurant and the students are taught current farming methods with guidelines to better cultivate their land. SHF aims to raise the students’ awareness of their environment. The school is powered entirely by solar energy allowing SHF to be completely off the grid and re-uses wastewater for irrigation.

One of our BSL students on Sumba Island, Morgan Manin, is doing his internship as part of his Capstone Project (Master of International Business); I took the opportunity to ask him via email for a preliminary description of his internship, to share with our community.

BSL internship

“Reading about SHF on the website and social media made me choose it to do my internship, as my values match perfectly with the foundation’s values and I believe that I will be learning a lot during my Sustainable Development Internship. After the first week, I have identified areas where I could be helpful and learn, which I can summarize with three main tasks and responsibilities. The first one is to analyze the financials at SHF and therefore create a budget for each department meaning the actual school, the administration, the hotel, sustainability and the F&B, including an indication of Capex by departments. I will also guide the SHF finance team towards greater transparency and define cost improvement initiatives.

The second main responsibility I have is to create a Triple Bottom Line Reporting (TBL). TBL is a progressive mode of reporting and seems suited to the SHF. Sustainability centric practices are deeply entrenched in the DNA of the SHF business model. Environmental and social responsibility sit at the core of daily practices and this alongside the true cost of these operationalized initiatives must be reported. I will then gather information to facilitate understanding around the social, environmental and economic practices of SHF. I will conduct research into TBL, using these understandings and research knowledge, with the aim to create a presentation that highlights sound reasoning and justifies or rejects TBL as a means of reporting at SHF. If TBL is found to be preferred mode of reporting, the presentation will include a step-by-step guide detailing a prescribed pathway toward the implementation of TBL reporting at SHF, and then create the strategy that details how to implement TBL as the reporting mechanism for SHF. In the event that SHF management decides to implement TBL as their primary mode of reporting, I will then begin the process of implementation.

To finish, I will be the IT ‘go-to’ person for the team, helping everyone out on Excel, Word, etc.

I will also consider improved ways of using IT for communication for the SHF team.

Before I arrived here, it was planned that I would have to formulate a business plan to be shared with others wanting to duplicate the model of the SHF. I will, therefore, formulate a business plan, constructed in such a way that it has the capacity to facilitate like-minded operators wanting to duplicate the SHF model.

In addition to my primary tasks and responsibilities, I will have ad-hoc tasks set by the Executive Director, I will take care of the students during their study hours and exams as well as shepherding them at night and being in charge of sport activities for the students; also, I will monitor Community English classes for young Sumbanese children living in the neighborhood.

I strongly believe that I will learn so much through this experience, being in a different environment, living in this community, having multiple tasks matching with what I have learned at BSL, and matching the BSL values”.

Morgan, we are all proud of you, we wish you a great experience and let’s see if we can come visit you at some point on that amazing island!

Dani-Linkedin-300x300Author: Daniele Ticli, BSL Head of Careers and External Affairs

Learning Design for Millennials Measuring learning: are final exams relics of the past?

One of my father’s recurring nightmares is sitting a geometry exam. He has told me about it several times. I also have similar nightmares, very recently I dreamed the final exams period had started and I was not ready. Even when I woke up later, I could still feel the tension in my body! The gap between my father, myself and my students spans across four generations. I believe there are certain aspects of the educational system that have been taken as given for long, we neither question them nor try to change them. Final exams are one of them. “The thought of a final exam still gives me and my father nightmares, and I have not seen many students who are fond of the idea, neither have I seen a teacher who is keen on correcting exam papers, so how come they are still around?” I thought to myself a few years ago. I had always been reflecting on the effectiveness of final exams as a means of evaluation and finally decided not to give final exams anymore in the courses I teach. “But, how do you manage to measure learning and grade the students?” you may wonder.

I will give you a very recent example. This fall, I taught a course on Systems Thinking at Business School Lausanne, where the students did not have to take a final exam. Instead, they collectively created a blog that summarized and synthesized the most important lessons they had learned from taking the course. You can find their blog here https://bit.ly/2K0KRen.

BSL students

40% of the students’ grade came from the work they did on the blog and every single one of them received the maximum grade here. I will now outline here why I was convinced they all deserved it.

They spent much more time on creating the blog than they would have spent on preparing for the final exam. I asked them to create an activity log that captured what everyone did and how much time they spent doing it. As this was a publicly shared document and everyone including myself had access to it, there was no chance of free riding. The moment someone claimed they have completed a task, but was, in fact, incomplete or was done by someone else, others would have reacted to it. Towards the end of their work, we collectively decided it would not be necessary to keep track of activities as everyone thought the contributions were equal.

A friend of mine who was part of a rowing team, once told me that a competition was approaching and her team had to prepare for it. The team met at 5 a.m. every other day for six months. “There was no way to stay in bed and ignore the alarm. My other seven team members would be there waiting for me,” she said. Perhaps, this was something every member of the team was thinking and it was difficult for all of them to get up regularly at that early hour for such a long time, but the team spirit made them get up on those mornings and put in that effort. She later said that they won the championship that year and she regarded this as one of her best experiences. A similar situation happened in the case of my young bloggers. Almost all my 17 students met outside class hours, sometimes on days, they did not have any courses at Business School. They did not want to disappoint their friends. They all managed to put in the effort. At the end of the day, some ended up doing more than others, but those who did less did much more than they would have otherwise done, had they been faced with a final exam.

Teaching is the best way to learn. I made it clear that the blog should be written for those who were completely new to systems thinking, with no technical background. Achieving this meant that learning the course content became a secondary challenge. As a guitar player, once I heard a valuable advice that if I am not able to play a part, I should try playing something that is a bit more complicated, even if I keep on failing at it. After a while when I go back to the original challenge, much to my surprise, it is not a challenge anymore. The same thing happened with my students. There are so many ways that the way they presented the content in their blog can be improved, but here the blog was not an end, it was a means, a transitional object, and a vehicle for learning the course materials.

In their journey to create the blog, they developed various soft skills, such as working in teams, writing, creating short tutorials, project management, etc. Based on my experience, I have realized that the best way of designing for learning soft skills is as a by-product and in an emergent way. Such skills are not best transferred in a direct and intentional fashion. They should emerge as a result of carrying out other tasks. In addition, my course was the first occasion for many of these students to meet. The blog they created provided an opportunity for them to get to know one another and made them closer as classmates. Their collective effort resulted in the creation of cohesion among them as a class. It made the whole class a very well-functioning, self-organizing team.

In retrospect, there was no better way I could have directed them towards learning and internalizing systems thinking concepts than having them create the blog. There were a few technicalities involved in how this happened.
– I gave them the choice between creating the blog and doing the final exam. I could clearly see that anything that exempts them from doing the final exam would be a joy for them. In other words, in their view, nothing can be worse than a final exam and avoiding final exam served as a good incentive for them to create the blog.
– I told them that we can skip the final exam only if they do a great job with the blog. I even told them that their work will be evaluated by how many readers they can attract to the blog.
– I followed their progress on a continuous basis, tracked the changes they made and met with them outside course hours to give them feedback to improve their work. I wanted them to feel that what they are doing is important to me.
– Another acceptance condition I put forth was that everyone should know all the contents of the blogs since it would not make sense if an author is not aware of the contents of what he/she has created.

My final question for all learners and learning designers: are final exams relics of the past? What other components of the current educational system can be replaced, modified or improved?

Stay tuned for the next blogs in this series and Keep on Learning!

Learning Design for Millennials is a blog series capturing Arash’s experience as a learner and an educator.

Profile Pic_ArashAuthor: Dr. Arash Golnam, BSL Professor

 

Keeping the student spirit up!

We meet with BSL professor Erdal Atukeren, who’s telling us about his journey into continuing education.

Can you tell us a little bit about yourself, what is your background?

I am Turkish by birth and Swiss by marriage. I studied Economics & Business Administration (B.A.), and Econometrics (M.A.) in Turkey. Then, I went to Canada and completed a Master’s degree and a Ph.D. in Economics at the University of Ottawa. I came to Switzerland in 1995 and worked at the UBS in emerging markets research and credit risk management areas. Afterwards, I joined the ETH in Zurich and worked there for more than 13 years in economic research, mostly focusing on macroeconomic modeling and forecasting and doing third-party projects. Currently, I teach at BSL and other business schools. I am research-oriented and I have published a good number of articles in academic journals. I serve as an Editorial Board member in International Journal of Sustainable Economy, Journal of International Trade and Economic Development, and Investment Management and Financial Innovations. I am also serving as Guest Editor at the Journal of Risk and Financial Management (Special Issue on Macroeconomic Forecasting) and at the Resources journal (Special Issue on Global Economic Development, Resources and Environment).

What do you teach at BSL, and how long have you been part of our faculty?

I started teaching at BSL in Fall 2010 with the MIB Economics for Business course. Afterwards, I taught BBA courses and later on Master’s courses as well. I currently teach Business Mathematics & Calculus, Business Statistics, and Sustainable Business Strategy at the BBA level. At the Master’s level, I teach the Economics for Business, Risk Management, and the Sustainable Economy courses. In the past, I taught the BBA Operations Management and the MSIF Quantitative Methods I courses as well.

What do you enjoy most about teaching?

I like to see when students start a course with little or no knowledge in some subjects and how it changes overtime. Sometimes, the students think they know a topic; but upon systematic thinking about the concepts, questioning how they are operationalized, and scrutinizing the assumptions they are based on, they see that it is not an easy task. If they are confused about what they think they knew before, I am happy. This is also important for being innovative and developing the thinking-outside-the-box skills. The class environment at BSL is very multicultural. I like to see how students from different cultures and backgrounds tackle an issue and also work together to generate diverse ideas.

How did you get to start up studies again? And what did it bring you?

I live in Zurich. I come to the BSL by train for my classes. Depending on the term, I travel a lot between Zurich and Renens. I read a lot on my trips but I was thinking about using my time more productively and do my readings on a more systematic basis. Four years ago, with these thoughts in mind, I enrolled in a distance education program in Sociology offered by Anadolu University in Turkey. Anadolu University has a Western European Office in Köln – Germany, which coordinates their distance education programs offered in Europe. I’ve now graduated with a B.A in Sociology. Sociology provides a broader perspective into the issues we are facing today. It gives a more holistic perspective – going beyond the narrow lenses of other disciplines.

What is the one piece of advice you would give to a graduating student?

Congratulations! Keep learning, keep the student spirit up. We are always students.

 

 

Innovation at BSL: GAME OVER? – Transforming the lives of the elderly

Edited by Dr. Aileen Ionescu-Somers

Blog Post by GFW Group 3 BSL students: Alexander Svetlitskiy, Amin Riaziat, Andrea Sacco, Deem Almuhaidib, Dmytro Kovtoniuk, Luis Miguel Becerra, Valentina Korobeynikova, Victor Gladskoy

Today, we are neglecting our elderly more and more as a society. Moreover, current retirement homes are not responding to the basic human communication needs of the elderly. There is also a need to incentivize the elderly to remain healthy as long as possible in both mind and body.

As Group 3 of 8 student groups overall during the Spring Gap Frame Week, we selected the “Quality of life” area of focus on Day 1 of the Gap Frame Week so that we could design a useful solution for the future. Our research on Day 2 provided us with significant insights into the “pain” of our stakeholders. By addressing the pain points identified, we felt we could provide an additional choice for the elderly to spend time in retirement, using a mobile application and developing a specialized community center for the elderly. During the rest of the week, we had a challenging time developing an early prototype of our concept, but it was a lot of fun at the same time. Click HERE to view our fun team video so that you can get a sense our positive collaborative spirit!

Our research revealed that many elderly people are suffering from loneliness. In many cases, the elderly have limited communications with other human beings and over time, they may engage in increasingly limited activities. Often, the highlight of an elderly person’s day is simply reading the newspaper. Retirement for many represents a “long wait for the inevitable”. We want to change all that by introducing an easy to use application, supported on all mobile platforms, called “Game Over?”. Our innovation aim is to create a tailor-made application that is extremely user-friendly and easy to navigate. The app would provide several functions – newspaper, TV, a net-working and communication platform, games, activity schedules and plans, with related activity sign-up sheets. Our idea is to provide an easy to use platform where the elderly can engage in a favorite activity such as reading the newspaper but also try other activities. For example, on the Game Over? App, the elderly will be able to play games especially designed to be beneficial to the health of the elderly. Playing video games increases brain stimulation, reduces arthritis, lowers the risk of Alzheimer’s, improves memory and attention, slows down the aging process, improves hand-eye coordination and helps with depression. To appeal to the target group, the design and interface of the App games will appeal specifically to the elderly.

We also discussed including a concept of related Game Over? community centers.  The idea is to provide a room for elderly citizens to enjoy gaming experiences and for those not yet initiated to gaming, provide an introduction class to new technology. Exploring our ideas further, we felt that the “Game Over?” community center could cover other aspects of elderly well-being. It could also have a meditation room and garden to hold meditation and or light yoga sessions with a meditation instructor. This would help elderly citizens learn the art of relaxation and good breathing techniques but also help retain a certain level of physical fitness. We also had the idea of equipping the community center with an emergency treatment room. Another idea was to provide a system whereby the elderly will be able to tutor young students for a profit, depending on their skills, potentially with the profit being used for our platform subscriptions. As we discussed and worked on our prototype, plenty of new ideas came up.

With the target market of elderly (aged 65+), our group felt that the App and linked community/activity center will not only make the lives of the elderly more meaningful but it will change and improve quality of life.

With Game Over?, we are reintroducing a selection of elements that complement and enhance quality of life. In our view, Game Over?, if developed fully,  has the potential to create a new found purpose in life for isolated populations of the elderly in Switzerland and outside. During the next GFW, we will be developing this prototype further, into as feasible a start-up idea as possible in order to attract the attention of potential (albeit hypothetical – for now) investors. Watch this space.

 

Innovation at BSL: Beep Saved – Technology empowering ordinary people to save lives

Edited by Dr. Aileen Ionescu-Somers

Blog post by GFW3 Spring 2018 Group 6 students: Alexandra Sommer, Alexandre Watry, Anastasia Morozava, Aswin Babu, Diego Dimartino, Kamran Hatam-Zada, Konstantin Goldenberg, Theodore Martorell, Volodymyr Kovalchuk

“One right beep – one saved life”

We are proud to invite you to read our blogpost written during the Spring Gap Frame Week 2018, when BSL students focused on coming up with solutions to some of the world’s most challenging social issues.

Many people with chronic illnesses die each year having collapsed in the street or on the way to hospital due to the lack of first aid knowledge amongst people passing by. Our research revealed that 150,000 lives could be saved in Europe yearly if passersby were able to provide effective immediate first aid. We were interested to learn that St John Ambulance research shows that 59% of interviewed people would not feel comfortable providing first aid on the street due to their own lack of knowledge (The Guardian, 2010).

In Russia, many people suffer from diseases such as epilepsy, diabetes and chronic heart disease. The overall number of Russian people with these diseases is actually 32.5 million. Therefore, there is a high risk of people collapsing on the street on a daily basis, and not receiving critical and appropriate first aid from passers-by. After our preliminary research, our Group decided to focus on providing an effective solution to this issue in Russia, a country where victims of heart attacks or other problems have a high risk of not receiving primary first aid on the street. Frequent long delays in ambulance arrivals exacerbate the problem and makes it even more important for passersby to have high awareness and good knowledge about how to act in case of emergency.

Our team came up with an idea of a wearable technology – Beep Saved – that would allow people with health conditions to be attended easily and safely in case of an emergency. Our wearable technology – worn on the wrist much like a watch – provides a panic SOS button, which identifies the emergency, immediately calls for an ambulance using GPS technology, makes a recognizable sound/alarm to attract the attention of people nearby, and provides the passerby with tailor-made first aid tips depending on the person’s health condition. The screen carefully guides the bystander through minimal step-by-step instructions to ensure that the person has as optimal a chance as possible of surviving the episode (CPR, positioning of the body, etc). Click here for a demo to show the operating principle.

To test whether we had a feasible concept, we decided to explore the perceptions of three different groups: customers, doctors, and investors. That meant that we needed to get out into the external environment and meet stakeholders so we carried out interviews in three different locations: the city center of Lausanne, the university hospital (CHUV) and at Business School Lausanne.

We prepared three different questionnaires based on qualitative and quantitative data. Afterwards we divided our group evenly, to carry out the interviews. After carefully reviewing the results, we noted that all stakeholders provided common feedback: acceptance and interest in the concept.

We enhanced our prototype ideas as a result of our research (an interactive screen, GPS for ambulance, SOS button, heart rate checker, and speaker to let passersby know that the person is in need of help). We also added the monitor idea, to show first aid tips to perform in advance of the arrival of an ambulance.

After pitching our idea to the other student groups and faculty, and receiving feedback, we came up with the final technology software prototype. Our group decided to locate this business in Russia and to produce the technology in Latvia due to the costs and legal aspects. We decided not to produce in China as wanted to create a sustainable responsible business and did not feel that outsourcing to China aligned with that vision. We carried out a competitor analysis, looking at the three most well-known similar companies from an international perspective. We focused our analysis on price, strengths and weaknesses. The most well-known comparable concept is Medical Guardian which asks for a subscription price in the market and offers simple technology; followed by Lifefone, which has similar characteristics, but expects a long term contract commitment from customers. Bay Alarm Medical is the most expensive existing solution. It offers wide customization choices and is more than seventy years in the market. Our differentiation from these potential competitors are one-time payment, no contract requirements, free delivery and installation of software, and the fact that it would be the most interactive device on the market. After the competitive analysis and examining the possible target market, we defined our product as a high quality one-time payment product.

We had an opportunity to present a draft version of our concept prototype mid-week, to share what we had learnt from other groups. Our idea received overall positive comments. To illustrate clearly the problem we were trying to solve, we showed a social experiment video filmed in Russia that demonstrated the level of ignorance and even indifference of passersby in case of someone obviously not feeling well or collapsing in the street. This video emotionally connected with many viewers and stakeholders and illustrated well the high social importance of introducing our product to the Russian market. Once other groups had commented, we reviewed the remarks made by our BSL colleagues and implemented their feedback in the development of our prototype.

“Nothing in the world is more dangerous than sincere ignorance and conscientious stupidity” Martin Luther King Jr.

We believe that in today’s world it is crucial to reduce ignorance and encourage the notion of people and communities helping each other on every level. Our device will not only potentially save lives, but it can also have a substantial impact by improving behavior and increasing empathy. Our concept will reduce the level of ignorance and, we feel, raise awareness such that more people will want to help each other in the long run.

BSL Gap Frame Innovation Week, Spring 2018: Is the world all set for MySet?

Blog by Dr. Aileen Ionescu-Somers with video blog by Student Group 2: Anastasiya Markova, Armen Danielyan, James Polit, Julia Bogle, Mathis Chailleux, Napat Suttaponga, Umar Kalanov, Vasily Zhuraviev, Victor Marinescu.

As promised, this is the first of several blogs relating to student output from our Spring Gap Frame Week 2018 prototyping exercise. We want our readers to share in the “buzz” that these weeks create within BSL. And we hope to inspire some of you also. Please refer to this article to understand more in detail what the BSL Gap Frame Week is all about. The short explanation is that the Gap Frame Week is an opportunity for our students to work on prototyping solutions and even start-ups addressing some of the world’s most formidable sustainability dilemmas. In Spring 2018, the students tackled social issues.

Of the eight groups that presented early prototypes of solutions to world social issues, an expert faculty panel on Day 5 felt that Group 2: MySet ticked many boxes in terms of the potential outreach and impact of the idea, if marketed carefully and in the right way.

So what is the concept idea that was prototyped, MySet, all about? In innovation, the best place to start is always with the problem the solution is trying to solve. Group 2 decided to address Education as the social issue worthy of their attention. Their research indicated that students in developing countries often do not have enough seating in their school classrooms. Small children often squeeze into cramped desks, several at a time, or even have to sit on the floor to attend their classes. India is a case in point where 75% of schools in rural areas have this problem. This leads to difficulties concentrating and learning, and even to longer-term physical problems since students are forced to sit in unnatural positions.

What proposed solution did Group 2 come up with? The MySet concept proposes an affordable, light, adjustable chair set made from recycled material. If marketed to the right target audience (obviously, since parents are too poor to afford such a solution, charitable foundations, NGOs and aid agencies would be an interesting target), MySet has the potential to be an interesting proposition. Clever idea. Let’s see how Group 2 does in developing this early prototype into a full blown start-up ready to attract investor interest, with a corresponding exhibition space during our next GFW in May.

The video blog produced by the Group 2 students listed above gives an idea of the journey they took to arrive at their final prototype. Click HERE to view; enjoy!

 

Ionescu-AileenPICTURE-150x150Author: Dr. Aileen Ionescu-Somers

Gap Frame Week designer and orchestrator

BSL and innovation: Does BSL’s Gap Frame Week create value for society?

At Business School Lausanne, we are proud to offer a highly dynamic Gap Frame Week (GFW) experience to our students four times a year. What does this mean, and what happens during these weeks? Well, you might be surprised to learn that our students work in teams to co-create solutions to the world’s most problematic social, environmental, economic and governance issues. Ambitious: yes!  A tough call: yes!  But no one ever said business school should be easy. As the GFW designer, I incorporate a variety of co-creative techniques including World Café and Collaboratories to get our students thinking “out of the box”, but I have also designed the week with a strong red thread of design thinking processes throughout to encourage open innovation and create an inspirational learning context.

Click HERE for a short video of our students in action during the BSL Gap Frame Week.

Design thinking is a process whereby we seek primarily to understand the people for whom we are designing products or services. Design thinking helps us to question “norms” or fixed mindsets, challenge assumptions about “what they want”, change levels of understanding in the innovation teams, and redefine problems in order to find a better fit between “the problem” and “the solution”.  Design thinking is not only a solutions-based approach to solving problems, but also a whole way of thinking and working in itself. It is a good choice for our BSL GFW innovation week because it is so useful in helping to tackle problems that are not very well defined or are even unknown. And since during the GFW, we are tackling problems that the world’s best minds have not yet resolved, we need all the help we can get!

During each Gap Frame week, our BSL students generate new matches between solutions and needs that truly create value for society. And who knows, maybe some will carry a brilliant business idea out of BSL and create value in the real world! We encouraged our students to write blogs recounting their experiences during the last GFW in Spring 2018, so that you too can have a taste of what the students achieve.  Some great examples will be showcased in a series of blogs leading up to our next GFW from 14 to 18 May, 2018. Keep reading our blogs over the next 4 weeks!

 

Ionescu-AileenPICTURE-150x150Author: Dr. Aileen Ionescu-Somers

Gap Frame Week designer and orchestrator

The wonderful world of online education

I am a big fan of online learning and have done many Massive Open Online Courses (MOOC’s) on Coursera (www.coursera.org).

Last year I participated in an online course in « Negotiation & Influence » at Yale University (http://sg.emeritus.org/management-certificate-programs/negotiation-and-influence/) thanks to the faculty development fund of BSL. It was my objective to update myself on these topics, because I teach a class on Business Ethics and Negotiation at BSL.

In addition to learning new fun stuff, this course helped me to put myself in the shoes of my students. I realized that I couldn’t always answer all questions in the weekly quizzes even though I had listened attentively to all the video lectures. This reminded me not to be disappointed when the same thing happens to my students. You just cannot expect students to remember or understand everything that you said just once in class. Of course, everything is crystal clear to you as a teacher, also because you are deep into your topic and have given the class before. Forgetting this is a common “déformation professionelle” of teachers. You always must try harder, repeat, document, and check if students have understood, let them repeat what the task was, be patient and never take it personally.

Besides this more general lesson in self-awareness, this course was extremely useful to get new ideas for my own course.

On the other hand, I was a bit skeptical: Can you really teach a highly interactive skill like negotiating online? Of course, in negotiation you must learn basic concepts like how to prepare for a negotiation, how to haggle, or how to close a deal, but in the end, you always learn the most if you actually negotiate. I was curious to find out how you could run role play negotiations in the virtual space.

It turned out that negotiating online is no problem at all. My fellow students and I met on a special online platform, or we negotiated via WhatsApp or Skype. Every week during this two-month course, we were assigned to classmates that were in our time zone. Of course, it was different from face to face negotiation, but I found it almost as good. Furthermore, in today’s world many negotiations do take place on the phone, on Skype or via email.

What I really liked about the course was its broad focus. As the title “Negotiation & Influence” implies, it went far beyond simply trying to get the biggest piece of the pie. Indeed, negotiation is so much more! It is basically a decision-making process that you need every time you cannot achieve your goals alone (this nice definition comes from the godmother of negotiation, Leigh Thompson, and is the foundation of the course I teach). In today’s business world, it is virtually impossible to achieve our goals alone. This is why negotiation is so important.

If we look at negotiation like this, it is also clear that things like relationships and trust are key. According to research, the “subjective value” of a negotiation (i.e. did I have a good relationship with my partner, did I feel treated with fairness, did I feel good during the negotiation) is even more important than the objective mostly monetary value I achieve in a negotiation.  Even if the objective value one gains from a negotiation is positive, this “victory” is not sustainable if you felt uncomfortable with your negotiation partner, or felt rushed or treated with disrespect.

However, if the partners both enjoyed the interaction, they have a great foundation for the future. One study even shows that job applicants that experienced positive subjective value during their salary negotiations were more likely to like their job and stay in their job one year after the job negotiations (http://web.mit.edu/curhan/www/docs/Publications/Curhan_Getting_Off_on_the_Right_Foot.pdf).

You did not only learn theoretically about this concept of subjective value in negotiations, but even found out how your negotiation partners experienced you with respect to the subjective value you brought to the table. After every round of negotiation, we filled out a questionnaire (http://www.subjectivevalue.com/) about how we felt about ourselves and our partners during the negotiation, and so did our partners. That way, we received a highly individualized feedback on how we were perceived as negotiation partners in comparison to how we experienced it ourselves.

Another highlight of this course was learning how to deal with difficult negotiation tactics like stonewalling, threats or insults. Here the key is not to succumb to the impulsive reaction of either surrendering to these tactics, mimic them or quit the negotiation. Firstly, you need to avoid emotional reactions and try to look at the situation with detachment. This strategy is called “going to the balcony”. It takes some practice, but once you created this kind of emotional distance it is much easier to either simply ignore the mean tactics or deflect them by either asking smart questions (Please explain to me why the price is suddenly so important?) or naming the game (We came here to negotiate with respect. You do not need to insult me. Can we please continue differently now?). We had to apply evil tactics in one of our role plays and this was especially eye-opening as we changed roles: First my partner tested all kinds of difficult tactics with me and I had to try to stay calm, detached and reasonable. Then we switched roles. I must admit that continuing to be evil was pretty hard, because my partner did a great job in staying calm and reasonable!

In conclusion, online courses are a great way to update yourself on the state of the art of your field, you get new ideas for your own teaching and you stay in touch with the students’ experience. I am already looking for my next MOOC.

 

Prof.-Bettina-PalazzoAuthor: Dr. Bettina Palazzo
Professor at BSL