Evolution and Invention


How can we make sense of all the changes taking place around us?  More importantly, how can we create the change necessary to attack our most pressing societal problems?

 

Short answer:  building blocks.  I will return to this theme again and again in other posts.  But for now: a preview.

 

Eric Beinhocker's Origin of Wealth leans on the theory of complex systems to show how, little by little, a small thing like a wheel gets incorporated into increasingly complex components and systems.  First we see carts, then bikes, then the Audobon.  More building blocks mean more complex combinations built from them.  And these combinations give rise to greater variety, greater sophistication, and greater wealth.

 

Brian Arthur's The Nature of Technology provides a related account, up to a point, but emphasizes how change is not always gradual and continuous.  For instance, piston-powered propeller airplanes began as rather simple machines and performed well for short flights.  But when these planes began to fly at higher speeds at higher altitudes, their limitations became evident.  To address them, engineers began making a series of increasingly complicated modifications until, finally, an entirely new means of powering a plane appeared:  the first jet-engine.  This invention was not further evolution of the piston-propeller arrangement but, instead, was based on entirely different principles.  It was much simpler too, the original prototype of the jet engine having just one moving part!

 

In my book, Design Your Life, Change the World: Your Path as a Social Entrepreneur, I have examined how similar ideas apply to social enterprises.  Often, social enterprises evolve gradually, becoming increasingly effective as they become ever more complex.   As an illustration:  Once, local banks were as much fixtures of communities as mom and pop grocery stores (been to one of those recently?).  Over time, they began to add remote branches and, as regulation allowed, expanded their reach to increasingly distant locales.  These changes were intended to create more efficiency, more competition, and more choice.

 

Overseas, a similar evolution began to include poorer and poorer customers as first, nonprofit organizations and later, for-profit banks began to offer microcredit and other microfinance offerings.  Still, microfinance excludes ten times as many customers as it serves.  Poor clients are expensive to serve, even more so when they are at a distance.  Branches are too expensive in many parts of the world.

 

Yet in Kenya, an invention has dramatically changed the situation.  Much like the jet-engine, which overcame the deficiencies of propeller planes by incorporating a completely new principle, M-Pesa overcame financial exclusion, especially created by distance, by creating an alternative form of money.  Kenyans buy this currency, which is installed on their cell phones.   This e-currency can then be safely, conveniently, and affordably transferred to someone else by sending a financially secure text message.  Urban workers can remit money to relatives in the countryside.  Micro-entrepreneurs can buy trinkets or agricultural products to resell without the insecurity of relying on bus drivers to transport their payments or the inconvenience of taking the bus to make payments themselves.


 

 

 

How successful is M-Pesa?  Over half of all Kenyans use it, nearly three times as many as have bank accounts.  M-Pesa has created similar services in Tanzania, Afghanistan, and South Africa.  It recently created a partnership with Western Union that allows funds transfers to Kenyan M-Pesa customers from 45 countries. 

 

Is this a "one-off," relevant only to citizens without ready access to banking services?  Not at all.  Mobile wallets (as they are known) are moving "up market" to the United States and the rest of the developed world.  Tech stalwarts (Apple, Google, and others), mobile carriers (including Deutsche Telecom, China Unicom, Verizon), and financial institutions and credit card companies (among them Chase and Visa) are all exploring how they can capture this huge, potential market.

 

What was created by the invention of alternative currency has begun to evolve.

 

Let's consider this illustration from an evolutionary perspective.

 

The banking system changed in ways that resemble biological evolution.  New variations (say, bank branches) are tested for their performance (would people use them?) and, when successful, they proliferate. 

 

Producing societal-level change isn't under the control of any single organization.  Consider the environment.  No company or government, of course, "controls" efforts to address climate change.  Yet there are many ways organizations play roles in striving to stem our environmental problems. 

 

How can we stack the odds so that they are successful?

 

By encouraging variation, creating fair and effective tests, and ensuring that winning ideas truly proliferate.  These are not abstract ideas without application.  For instance, the tests performed in the marketplace (profit, sales) give distorted results that fail to account for environmental (mis-)behavior.  As the adage goes, you get what you measure, and we are measuring the wrong things.  Similarly, proliferation can come from replication, but exposing winning ideas to others provides another means to increase their scale.

 

But we must be cognizant, too, that invention is sometimes necessary to spark progress when we are at an impasse.  Methods like recycling, just like propeller-powered planes, can't evolve far enough to achieve our environmental ambitions.  Recycling is better than tossing, but as a practice it still fails to promote better, inherently green methods of creating products in the first place.  That is where invention becomes critical, to create "jumps" in evolution rather smooth, gradual refinements.  Markets in carbon avoidance, for instance, are built on the premise that you can buy the benefits of others' good behavior.  From this new premise various ways to create and operate these markets emerge, themselves subject to variation, testing, and proliferation.  Invention begets evolution.

 

These two forms of change - gradual, continuous; and radical; discontinuous - operate by creating and re-organizing building blocks.  We can think of building blocks as fundamental elements that underlie the process of creating change.  To be architects of change, we must learn to recognize and harness them.  I intend this blog entry itself to be a conceptual building block which we return to, and build on, as we understand how to improve society.

 

 

 

 

 

 

 





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This page contains a single entry by Michael Gordon published on June 15, 2011 8:30 PM.

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