We're talking to Gary Bolles as part of an upcoming report we're producing with Callaghan Innovation on New Zealanders' attitudes towards entrepreneurialism and business failure and we'd love to hear from you. Please fill out our short survey here. It will take five minutes tops, and you'll be in the draw to win one of two Tissot T-Race Touch watches in green and orange (RRP $995)!
Some of the changes you’ve talked about (see Part I here) sound pretty grim. Are you optimistic about where things are heading?
In a broad sense I tend to rely on Charles Dickens' best-of-times-worst-of-times. The good thing is there's tremendous opportunity – there's reduced friction in a variety of different contexts where workers have far greater access to higher value work opportunities than they ever did before. The rise of egalitarian toolsets like video production, graphics production, cross-border collaboration tools and so on provide the opportunity for an incredibly wide range of workers to find meaningful and valuable work, work that might not have been available to them in their geography.
That’s one of the things that’s a hugely beneficial opportunity for citizens of a country like New Zealand which is geographically isolated but has tremendous assets in terms of its language and its culture. So that reduced friction creates competition in various markets also creates substantial opportunity and so as toolsets become cheaper, more widely available and, especially for digital natives, much more accessible, work opportunities are substantially greater.
But this more digitised economy, typically, rewards people who are more proactive, more entrepreneurial, the ones who are pursuing their passion, the ones who know what they love to do.
But this more digitised economy, typically, rewards people who are more proactive, more entrepreneurial, the ones who are pursuing their passion, the ones who know what they love to do. The ones who are more perplexed or haven’t decided what those work opportunities might be or haven't been trained for new opportunities, they're at more of a disadvantage. So I'm more pessimistic for those people, and I think those are the people we especially need to help, which tend to be either older workers or people who have less access to education, that's where you can be more pessimistic and the gap between haves and have-nots is most profound. The people who are are younger, digital natives and are more proactive, they have a world of opportunity, quite literally, in front of them.
Connected to the increase of entrepreneurialism as a part of more people's work life is the concept of entrepreneurial and business failure, something we're looking at right now, particularly in terms of what failure means in different cultures. New Zealand seems to have a more conservative view of failure than the US, or Silicon Valley at least. What are your thoughts on failure in 'disruptive times'?
Let's make a distinction between 'failure' as a noun independent of a person, 'failure' as a noun that refers to a person, and 'failing' or, as I prefer to say, making mistakes. We all make mistakes and there's no emotional coding behind that language. But failure has a lot of cultural anchors, many of them negative, and in some cultures, the fact that someone had a failure, independent of the person, means that the person becomes the failure. This has traditionally been one of the frictions in traditional Western cultures in Europe, for instance, where, until very recently, especially in countries with a historical caste system have been relatively strong stigmas against having a failure – one business failure or one startup that didn't startup or one job that didn't work out could potentially brand somebody for life.
It's okay to have made previous mistakes and hopefully to glean insights that come from those. Just try and make new mistakes next time so you can be continually learning and adapting.
In Silicon Valley, it's very rare for someone to be branded as a failure. Someone could have a failure or two under their belt and there's far less of a stigma associated with it. I prefer, as much as possible, to try and avoid using the word ‘failure’ because of all the emotional coding around it and simply call them ‘mistakes’. Esther Dyson, a longtime investor and entrepreneur whose video I'll be showing in some of the talks, has a marvelous phrase which is "make new mistakes". That both implies that it's okay to have made previous mistakes and hopefully to glean insights that come from those. Just try and make new mistakes next time so you can be continually learning and adapting.
For an individual, for a business, for a culture, we have to become much more adaptive, we have to think of all the different ways and follow the practices that allow us to continually adapt based on new information. Even in tech, there have been a number of practices that were designed not to allow us to adapt very rapidly. If you look at IT systems, and IT departments in many companies, they tend to make a variety of decisions about their technological infrastructure and then they have to live with those decisions for a long long time. So the mantra in Silicon Valley is how do you find out very, very quickly whether or not your thesis about an opportunity or a solution is right and how do you, in a very agile and adaptive manner, continually try to pivot and move in new ways based on new information coming in. And, ignoring the fact that there were mistakes, or whatever label you want to put on it, and just keep driving towards the right solution.
You’re visiting us in New Zealand next week, have you had any thoughts on how a country like New Zealand can best take advantage of the technological changes you’ve been talking about?
Well, I don’t want to give too much away, but there's a recent study by McKinsey Global Institute that talks about digital flows between countries. In the past, we’ve tended to look at the ways trade can have a tremendous impact on GDP for a country and a lot of our macro policies at the government level, and our micro policies where we're teaching people to start businesses and become entrepreneurial, are geared towards hubs where trade occurs.
Digital trade is very, very different from physical trade and it's going to become an increasingly greater factor in the next couple of years. The study talks about how from 2005, the amount of digital trade between countries has multiplied four-to-five times and in just the next five years it's going to multiply another nine times. So McKenzie's takeaway is that digital trade is going to have a greater impact on the average country's GDP going forward than physical trade is, which is inevitable because digital tends to grow exponentially, much faster than moving physical goods around. Bits always move faster than atoms.
The things that can benefit small-to-medium enterprises in terms of thinking about the way they're developing goods and services and the distribution and how they're interacting with other countries, there's a variety of different strategies that you can use to try to reduce as much friction as possible and make yourself more willing and able to meet the needs of other economies, and to be able to provide goods and services in other countries.
We always say it starts with the individual. We need to train our kids and we train our entrepreneurs to build cross-border relationships. In Silicon Valley, there is a wide open culture of interaction where anybody can get anybody's business card or email address and have a discussion about what they're working on. It's an extraordinarily egalitarian, open community from that standpoint and the more we can train our young people and entrepreneurs to be able to develop those relationships, the better. Even if it’s just digitally, that's a jumping off place for the development of business relationships as well. So that's one example of a strategy that can be really helpful.
From a macro standpoint, as a country, if you know that in the next five years, you’re going to basically going to have the opportunity to have nine times the amount of digital interaction that we have today, what are things a country can do to be able to encourage that? Obviously it means investment in digital infrastructure, it means an investment in relationships with other cities and other governments, other businesses where you build the value of those cross-border relationships so an increasing amount of digital commerce can be conducted. None of it’s rocket science but it's pretty predictable that if all these digital flows are going to increase, there's a variety of different things we can do at a personal level, at a business level, and at a government level to increase your ability to be able to leverage those.