Speech Transcript – Doug Burgum, Microsoft Business Solutions Convergence 2003

Remarks by Doug Burgum
Senior Vice President, Microsoft Corporation and President, Microsoft Business Solutions
Microsoft Business Solutions Convergence 2003
March 20, 2003
Orlando, Florida

Announcer: Ladies and gentlemen, please welcome Doug Burgum.

Doug Burgum: Good morning. Its great to have all of you here and what a great way to start out the morning with Matt G. I really appreciated the work that Matt did out here this morning. Setting that bar really low for my keynote, improving my chance of success. But as Matt was going on, and on, I was thinking maybe I wouldnt have to give a keynote because he was going to give one. But it was great to have Matt kick things off, and again, as Matt did welcome all of you. Great to have all of you here back for the seventh Convergence.

I stand before you today as, I think, a very lucky person. Why do I feel lucky? Why do I feel grateful? I feel grateful in part because of the time in history of which I had, through the luck or the fate to be born into, because this is a time, a very interesting time. Its a time of great change, its a time of progress, and as we — everyone in the room — are well aware, its also a time of concern. And I think that being a strictly an amateur historian, one of the things that gives me some comfort at times like this is the fact that as I look back over the span of human recorded history that there as been, sadly, this mix of strife and conflict and sort of human against human, small planet with humans kind of in charge. And we havent- weve been able to make progress against that cycle over recorded history but we still arent out of it. But again, as I stand here sort of one day, this is a day and its a day in a week, and its a day in a month and its a day in a year, but its also a day at the beginning part of a new century. And when I think back at the last century and I think about the new century, thats part of the reason why I feel grateful and part of the reason why I feel optimistic. When I look ahead to the whole next century I get optimistic because I believe that some of the foundational work that has been happening across science and technology and communication and human understanding in the last 20 years really lays a foundation for a different future than what we might imagine. In spite of whatever sort of the daily things that are going on may take us back to thinking of more of the kinds of things that were going on in the 1900s, which was in some ways a century of conflict. Im optimistic that the next century wont necessarily repeat the last one. If you take a look at what technology is doing for education, its really driving the prospect of really a literate world. And when literacy increases, I think today theyre saying theres still 700 or 800 million women in the world who lack basic reading skills. But when literacy improves, healthcare improves, life expectancy improves its a- there are so many benefits associated with that.

Theres just a tremendous increased awareness around the environment of late and great progress in terms of our ability to deal with that. And some of the things that we think about in terms of advances in power sources, like wind energy and other things, probably could not only have an impact on the geopolitical scene in 50 years but also could affect again, how we care of the environment that we live in. If you think about healthcare, amazing progress going on in the last 10 years and again, both through the work of organizations and nations and through philanthropy like last year on this stage you got to hear from Bill Gates talk about the work of the Bill and Melinda Gates Foundation and the work that theyre doing on important topics like an AIDS vaccine. A huge breakthrough is possible in terms of changing the way world healthcare is. And if you think — and all of those things contribute to the elimination of poverty — and again, certainly technology contributing to the communication ability. So its an overstatement to say that the worlds getting smaller, were getting more interdependent. Thats all true and with that hopefully will come a growth in human understanding, a growth in the sense of diversity and a growth in the sense of how were all connected together.

But its that sense of optimism about the progress that could enfold for us going forward. In our own industry, I remain really optimistic even about the next decade because theres a rash of technological improvements, everything from faster chips, 64-bit chips, faster graphics cards, cheaper and better displays which will increase the readability and the usability of the information that we can present. Wireless technology, broadband which can bring streaming video and more rich data types to you, right to you and your team members and your families. Right to your home and your desktop. The Tablet PCs, speech, inking technology where it can record not- doesnt translate your writing into handwriting, which is for any machine difficult for me. But just the fact that it can capture that ink image and transfer and send that and also the handwriting recognition. All these new forms of inputs and outputs again, enable new scenarios for us to bring greater value to customers and great LU, and some of those are just on the horizon in the next few years. Some of those youll hear about and see demonstrated later this morning.

And as Matt said at the beginning, Im not out here to — unlike Matt who was pitching products by the way — Im not out here to pitch some products and Im not out here — youre going to have an opportunity to learn over the next three days going to session after session, hopefully as we know, some great sessions, the additional general sessions this morning and tomorrow morning and Saturday morning to really learn a lot about our products and the work that were doing. But I did want to take a moment this morning and sort of set a context of sort of where we are in the century, where we are in the decade and with that sort of optimistic and grateful outlook of where we are, have a dialogue with you as Ive had and not really talk about, as the video said, our passion, because our passion is around that technology. Our passion is around the work that we can do for you. But I want to spend the majority of the time this morning talking about your potential, thats what I want to talk about today.

But to lead into that, I think its important since a year ago when we were here, Microsoft had not formally announced or formalized a mission, which in some ways Microsofts been pursuing for the last 25 years. And certainly those of you that came to this conference through the heritage of Great Plains would recall that every year that you were here up through last year, we talked about improving the lives and business success of our partners and customers as a core mission of Microsoft and Microsoft Great Plains, which slides right into the now corporate mission statement that you see up on the screen which talks about enabling people and businesses around the world to realize their full potential. This is a powerful mission. And this is a mission, which for me gives me a sense of purpose and a sense of grounding when I come to work any day. Its part of the sense of well-being I sense in some ways that I have, is that I realize that the work that Im doing every day has the opportunity, presents the opportunity, to really be transformational in peoples lives. And that is something that I think I feel good about, I know that the team members across Microsoft Business Solutions can feel good about and it is something that you should hold us accountable to. You should literally- if youre in a situation, youre saying, Hey what youre doing is not enabling me to realize my full potential, use those words right back at us. Hold us accountable to this mission. This is the mission that we intend to pursue.

And this mission having been launched with the full support of Steve Ballmer and other executives, later on this morning youll hear from Orlando Ayala, whos joining us this morning, and he along with a number of other senior execs at Microsoft were really the driving force behind this. And what it really represents is a formalization of the desire for Microsoft, as Microsoft matures, as Microsoft goes through its — having finished its first 25 years as one of the most successful companies in the history of the planet by many, many measures, in terms of growth, in terms of profitability, in terms of balance sheets, in terms of new products, in terms of patents, created over 2,000 patents. The success of Microsoft can be measured many different ways. But is the success that weve had today good enough? And the answer is quite frankly, no, its not good enough — not from a financial standpoint, its not good enough in terms of, are we doing our best work yet? Can we do a better job of helping customers realize their potential? Can we make our products better and easier to use? Can we make things that cost less money that provide more value? And the answer to all those questions is, yes.

And so as we enter sort of the second 25 years of our history at Microsoft, theres a deep commitment to try to really drive the value that we can through this mission. And one of the things that, in addition, that we want to take a look at as we evolve Microsoft forward from a leadership position- its in a leadership position today, but as we go from the leadership position were in to a leadership position where we understand the impact of this industry on the world and the impact that we can have on the industry, its not just what we do but how we do it. And so along with the mission that was rolled out last year there was also a codified set of values that was laid out by Microsoft for the first time in its history. And you might say, well, gee, theres plenty of organizations that have missions and value statements, etc. I think again the commitment starting with Steve Ballmer and with the rest of the senior executive team, there is a word that emerged last year which was
“operationalize.”
How do we operationalize and make sure that these values really stick and that customers and partners can feel the difference in terms of how we make progress against these values? And so the values that you see up there on the slide today, and I know that I had a chance to hear James Burke yesterday, who is here for our prospect event, James Burke said, the only audience that you really hope for is an intelligent one when youre speaking. And I know this is a very intelligent audience, and I also know youre able to read, and so Im not going to read these to you because you can read. Or should I have a raise of hands, how many people in the audience can read English? Okay, good. How many of you believe yourself to be intelligent? I assume the other half is just humble.

So Im not going to read these to you but understand, this set of values was — 55,000 going to 57,000, I think — is about right, team members at Microsoft, every single team member last year on their performance appraisal had this set of values. Every team member had an opportunity to rate themselves in terms of how well they think they did against this set of values and their manager had an opportunity to rate them and there is an opportunity to have a dialogue about, hey, where are you strong? Where can you improve? And if youre a partner or customer you can see out there that in this if you go down to those points numbered 5 and 6, accountable to customers, shareholders, partners and employees, right there in the value statement, were accountable to make sure that were delivering on the mission statement. Passion for customers, partners and technology, that passion thats our passion. This is embedded in the values that we have. So again, I wanted to lay this out because I recognize, I believe that its a milestone in the history of Microsoft, the mission and values represent an important milestone along an important journey for the company.

When we go into Microsoft Business Solutions, which again is the newly launched and newly formalized brand for what was the makeup of bCentral, Great Plains, which became Microsoft Great Plains, and Navision, the Microsoft Business Solutions, and that brand is being launched in a very, very strong way globally. For those people that have already purchased, its probably not that meaningful but I would just throw in sort of an odd tidbit of information about automobile advertising is the highest percentage readers of automobile ads are people whove already purchased. Just interesting, people gravitate, hey, thats my thing and, Im part of that brand and so Im going to reread this ad. So youve probably, even though youve made a decision, may find yourself reading one of our ads in the future and then youll think of that little factoid that I just shared with you and maybe you wonder why youre reading it because you already own it. But this is a group with a lot of curiosity so maybe youll be thinking about that.

Anyway, its our promise. If we talk about being a trusted partner, and thats in conjunction with us, Microsoft, with our partners, with our ISV partners that we want to be a trusted partner to you, the customer, where we unite this flexible technology in business insight. And were going to talk about this this morning, but thats what we want to deliver to you is business insight because business insight is one of the key drivers of success in todays fast-paced world. And so we dont- were trying to transition, we dont think of ourselves as necessarily selling products, we want to think of ourselves as selling solutions and those solutions that we deliver the benefit to you, the primary benefit needs to be business insight, which youve told us that thats what you need. And you can again, hold us accountable to make sure that the solutions that were delivering truly deliver business insight. And again, we want to provide lasting success, not short-term success, we want to provide lasting success. And we want again, as we say, smarter, faster business decisions, which all of us are going to be required to make in the interconnected and competitive world that were going to be living in.

So again, thats the promise and right now you might say, well, Microsoft Business Solutions doesnt mean that much to me, its just sort of some new words up there but youre here at the beginning of a birth of a new brand. And a brand is made up of not just the products and not just the company, but a brand is made up of the partners that deliver that solution. Its made up of the customers that use that solution. Its made up of the ISVs who contribute to that solution, and in the end a brand is another name for community. Its a sense of identity that develops around a community and we want to have the Microsoft Business Solutions brand be equivalent with successful companies and successful partners and successful ISVs that are sort of united together in a community, again, a community of trust, a community of openness, a community of success, a community of collaboration that represents that potential that our future can hold. Thats the dream and thats the vision that were trying to get to. So again, when you say, why is the guy talking about brand? Well, Im talking about brand because youre part of it. The collective actions that we take, if you provide us with great feedback to make us better we thank you because youre helping us improve the brand and improve the experience. Your feedback to us improves the experience for future customers down the road that will be purchasing and using our solutions. So this is not- the ecosystem is the right word because the ecosystem around software products and software solutions its alive, its regenerative, it contributes and everybody has a role to play in that and you have a role to play in our evolution as a customer, and a very important role because many of you will use these solutions for five to seven to 10 years or more before you switch to the next thing so you are a lasting member of this community and we value you and we aspire to having it be a great community that you be a part of.

So Matt was curious about what my topic was going to be, because Ive tried to present a little bit of context about the world going forward, the next century. Ive tried to give a little bit of context about where Microsoft is today at this point between its first 25 years and its next 25 years and then now I want to invite all of you to take, to sort of leave present time and come back with me to a previous time. And with that, that sense of going back in time, I want you to bring something with you. I want you to bring a little curiosity with you. And so Matt was curious about what the topic was going to be today and he almost stumbled across it because here it is. This is the topic for today is curiosity and the role that curiosity can play in our lives, the role that curiosity can play in your potential and the role that curiosity has played in history in terms of helping drive us to where we are today.

It turns out that there hasnt — in spite of the name, in spite of curiosity — I think everybody understands in general what curiosity is. There hasnt been that much research about curiosity. I mean formal, formal research. So I was curious about, how come people werent curious about curiosity? And it turns out there has been some work done, were able to find a few doctorial theses, a few things. The beauty of the internet is you can go out and do all this research and you can try to satisfy your curiosity and it leads to more things and more places and you just keep digging, but a lot of it has been done more on children, children and the role of curiosity in children learning. There has been some done on the role of curiosity in animals, and how does that help them in terms of growth and survival etc.

Theres been less done about curiosity in the role in the workplace, although the research that has been done about curiosity in the workplace suggests that there is a link between people who are more curious and higher job performance, because curiosity is one of those elements of self-learning. For example, a learning conference at work these days, part of what we all need to do is we need to have in our packet of skills as an individual, is the ability to learn and learn new things and learn new things quickly. And its not just learn new products and learn new technologies, we have to learn new relationships. Organizations go through change or consolidation or mergers and youve got new people that you need to connect with: new partners, new suppliers, new managers, new team members. It requires an energy around learning new things and establishing new connections. And those people who tend to be more curious, and some people are more curious about people and some people are more curious about things, thats one of the pieces of research. Showed that, and theyre not exactly sure why but people maybe roughly could be divided into those big, broad, rough buckets, but curiosity is certainly an element.

There has been a time in history, and even recent history, where curiosity was something that was viewed negatively. Curiosity was associated with nosiness or meddlesomeness or kids that were asking questions that they shouldnt be asking, or it was maybe sometimes associated with poor behavior. Theres an old adage, curiosity killed the cat, which Im sure all of you have heard over the time, over the years I thought it was — with my own kids, and I again, feel blessed with three children that are almost 10, just 7 and 4 — that one of the things that Ive brought to the table in my interactions with them and the way that weve tried to really focus and bring those kids, is to really foster a level of curiosity. Make sure that curiosity is sort of an ever-present thing because theres so much that can go on today in school systems where effectively the traditional school systems, as James Burke noted yesterday, were designed — most of the school systems today — were designed in the 1400s to educate monks and very little has changed in those 600 years in some ways. And again, theres a great opportunity for change with the technologies and the connections that are available today, but theres a lot of curiosity that sort of gets pounded out of kids. So I was really, at first, a little bit irked, I think it the right word, when I heard somebody else say last year to my youngest son, Tom, when he was digging around and maybe doing some stuff that people thought was maybe out of the age range for a 4-year-old, and so they were sort of trying to do this shaming thing where saying, and curiosity killed the cat to try to get him to stop doing something. And Tom said, whos curiosity? Which I love that answer. I was like, hey. And I put Thomas up here, we never call him Thomas, but I put Thomas because it sounds more like he might be a scientist someday. But anyway, Tommy was right back with this, whos curiosity? And I thought that was an interesting thing.

And even Steven Wright, anybody heard of Steven Wright, the comedian? Some people know him? Steven Wright had a quote and he said, curiosity killed the cat but for awhile I was a suspect. That was a bad Steven Wright impersonation, but anyway so, whos curiosity? So this is this whole thing about curiosity is sort of for kids, but I know that curiosity, my personal experience is that curiosity has been something thats really helped drive vibrancy later on in life. And so I had just arrived here in Orlando a couple days ago, and had just flown in from Europe, because were doing some work over there both with Navision and with ISVs in Europe, and after Id landed I called my mom. My mothers 88 years old, lives back in Fargo, North Dakota. Im sure many you here have met her, or seen her at Stampedes. over the years, usually always sitting here in the front row, eager to learn more about whats going on. And so she said, Doug, whats your topic this year? And so, and unlike Matt G., I told my mom what the topic was and so I told her the topic was curiosity, and without missing a beat this is what she said to me just two days ago on the phone. She said, for some of us curiositys been a daily essential. Shes 88 years old. She still digs in and learns new things and wants to learn stuff and curious about people and curious about new progress and new inventions, and I think thats part of the reason when people meet my mother theyre like, Wow, she doesnt seem that old. Im sure part of it is because of this approach that she brings. So Im offering up some personal insights here, which is again, I start out by saying I feel lucky, I feel grateful. Im surrounded on both ends, Ive got an 84-year spread of curiosity from Tom to Kaye, which I get a chance to interact with, which is I think, again, been fun — certainly fun for me, and I like hanging around curious people because it adds a little bit of vibrancy.

But as I said, I set this up, I said were going to go back in history and theres a — one of the — now Im curious about where the water is, which appears to be over here. I said were going to go back in history and the place I want to go back to is I want to go back to before the Industrial Revolution. To set that up, and I want to again provide some context. The Industrial Revolution which Im speaking of is the one that was really generated out of England in the 1700s and again, historians could argue at different points, whats a revolution, whats not. I think there is some fairly clear consensus around the fact that of the major revolutions that we like to think of, the first being the original agricultural revolution where we moved from very sort of a loose hunter/gatherer state as humans, to one where we were able to define and domesticate agriculture. And with the domestication of agriculture that increased the availability of food which then therefore led to an increase of population which led to the rise of sort of organized and divided labor, a division of labor, which led to the creation of cities, and thats sort of largely what went on through all the feudal states essentially around the world. There was some progress around the developing of iron and other minerals and advances in clocks and other stuff that happened in China centuries before the progress that occurred in England. And so again, not wanting to be too Western in our thought, where we always sort of attribute stuff to Western Europe, in the progress we want to acknowledge that Asia for a time was way ahead, but through some combination of lack of communication due to breadth of distances, and also there was one element that was missing through the evolution that was occurring at that time in Asia, even though they had developed, I say, like the ability to develop iron etc., was sources of power. There was a sort of a power source, an engine if you will, that was missing in that, and so some of that stuff was learned and then died out and wasnt transferred.

With the industrial revolution that started in the late 1700s in England, that was a point in time which really drove change, which is still affecting all of us today in the way we work and the way we think, the way we transport. The way we sort of do everything, commerce and coinage, everything was affected from that point on and it really drove — this is largely a North American audience but the influence of the Industrial Revolution in England, on the development of North America, was just profound in terms of the knowledge transfer that occurred and the progress and the mechanization of manufacture here that allowed — that began sort of the North American growth engine, which has really continued today and led to the situation that we have today, the combinations of productivity and resources. And so again, you trace this back a couple hundred years, and we are all standing on the shoulders of the inventions and the progress that was made during that time. With that of course, again, I dont want to be blind to the issues associated with progress, I think I highlighted some of those earlier but along with the industrial revolution there was also the rise of factories and the rise of some horrible things, in terms of the use of child labor, in terms of health issues that occurred with people working in dense areas and long hours and sort of an industrial hazard. All of that stuff also came along with it but certainly that there was a level of productivity increase there which drove and raised the general standard of living which led to another- other advances across healthcare and science, etc.

So the Industrial Revolution, so youve got a situation in England where there are some elements there. Theres coal, theres plenty of reserves of coal, theres water, theres some work going on on building canals to transfer coal. Theres certainly an understanding of how coal can be used to help make iron. And so theres some of those elements there, but there still is missing this thing, and so what was the key driver of that? And there was a group of men, unfortunately primarily men, that were in all this, but a group of folks that were interested in a broad range of scientific disciplines and they also had a sense that, hey, that there was something happening. The elements were coming together here where they might really be able in some ways, and I want to say even arrogantly, but, Hey that theres a chance here where we might be able to change the world if we got together and openly shared ideas with each other. And so the group of men came together and created an organization, first called the Lunar Circle, later the Lunar Society. But this group of individuals came together with the explicit purpose of being curious. The explicit purpose of, hey, lets get together and talk about what each of us is learning and our own little disciplines and share those ideas with each other, insomuch as that we might share freely, question each other, we might do experiments, we might do things. And so this thing was not a company, it was not incorporated, it was a, let’s get together every time theres a full moon. And part of getting together every time there was a full moon on either the Sunday or the Monday night closest to when there was a full moon, this group of people also- one of the reasons why they picked that was because they would start with a, sort of a dinner in the late afternoon and then they would go on into the evening and usually after imbibing a little bit too much, they felt it was both more able and more safe to walk home under a full moon after these evenings of interchange, and hence the name the Lunar Circle, then Lunar Society. And they even sort of coined the name Lunatics for themselves because of the crazy ideas that sometimes that they kicked around.

And they did have some wild ideas. One of the ideas they had was to tow icebergs from the North Pole to the climates of the earth to try to cool things off a little bit. To try to tow them down because they didnt have global warming at that time, they were actually going through big waves of unprecedented amount of heat, and so they had ideas like that. That one they never pulled off but they dreamed of air travel, they dreamed of cars, they dreamed of a lot of things that were never invented in their lifetime but their curiosity took them a lot of interesting places. And again, I think its really interesting that this- they just decided, yeah, they werent necessarily particularly educated folks and they werent particularly well-off, but they came together and did some remarkable things.

One of the founders of that group was a guy named Erasmus Darwin. And this guy was the grandfather of the Charles Darwin that we know from the
“Evolution of the Species”
book which influenced a lot of scientific thought, and Erasmus was, again, quite a guy and these are some of the drawings and things that he worked on. He also was the first reported, first Englishman to take a balloon ride and that has even more significance. You can tell from this modest photo, but as he moved on later in life, Erasmus enjoyed eating so much that he- and he became such a rotund figure that he actually designed a special table that had a carved out place in the table where he could get closer to the table when he did his work. So he would not have been the first person that you would have suspected to be the first Englishman to take a balloon ride. And the balloon that they show here is interesting, this was a- a balloon was not driven by hot air, but they had discovered- they were discovering scientifically that you could, through some combinations of acids on metal, create a chemical reaction which would give off hydrogen. And so this balloon was filled with hydrogen which is one of the more flammable objects on the planet so he was a — I believe thats a pen, I hope thats not a whatever that is, in that photo, its not a pipe because this was definitely a no-smoking ride. But he did manage to survive this thing, and interesting again they painted this thing to make him look attractive but all the literature says that this guy was not attractive, did not have a good complexion, was way overweight, he stuttered, none of the things that would sort of bring him on in society, but he did manage over his lifetime with a combination of a first wife who died after five children, a second wife and then two in the intermediate period, he did manage to father 14 children across his lifetime. And his second wife was reported to be extremely attractive and so I dont know if this guy was the basis for the first Revenge of the Nerds movie or what exactly it was but he was a great contributor. He was a poet, he was a doctor, and he wasnt even a particularly good doctor. His very first patient died and he could not get another patient. He moved to a new town after med school to start up his practice and a guy came to him after a knife fight and he treated him without realizing that the guys stomach had been punctured and the guy died. And everybody in the town heard that his first patient died. He learned about the stomach injury because he was a curious guy, so he thought he might as well perform an autopsy and find out why his patient died. So he was into the whole dissection thing, and so he learned that, but he also sort of learned that his career — he spent another three, four months there, penniless and couldnt get another thing. He moved to another town and probably just through random fate saved the first guy that came to him as a patient and everybody thought he was a great doctor the rest of his life and he had a lot of patients and did very well.

He was a poet who wrote some incredibly long and tedious volumes around around plants, but that which were not best sellers, but they did provide some of the inspiration for his grandson, Charles, again who went on to become a celebrated scientist.

Another individual that was part of this group was Joshua Wedgewood, and people probably know the Wedgewood name, synonymous with brand — with the brand of a certain type of china, and particularly jasperware. And this individual, again talk about curious, when he was — there was a lot of potters in England at that time. But there was a lot of problems with pottery which was you could build terrific pottery and it could be beautiful and it could be artistic, but it would break. And transportation at that time was over some very rough roads, trains had not been invented and steam engine hadnt been invented yet, and so it was all by carriage across all these potholes. And so he even had an order that was people had heard about how good his stuff was, the king and the queen wanted some. By the time he shipped it — and these guys were all living up around Birmingham, this wasnt even a London circle — these guys were not initially part of the royal society. They were on the outside, sort of ordinary people trying to take advantage- and entrepreneurs taking advantage of the times. And his work again, this beautiful work, it kept breaking. Over half the stuff that we would ship down there would break no matter how they tried to package it. So he worked really hard on trying to find not only beauty but also the durability and he tried to perfect in his labs- and there is an experiment that he ran over 5,000 times over three years, he kept trying to come up with this thing until he finally came up with sort of the secret sauce which involved another chemical that he put into the clay that gave it additional strength. And then he protected that trade secret, that intellectual property if you will, by not even bringing the additional chemicals into his plant, he had them shipped to a place near London, they would ground them into a fine, white powder and they came up and for years and years and years everyone tried to figure out the secret of jasperware and Wedgewood and today this stuff is still built around very to almost the exact similar formula that it was in those days, and still incredible stuff. And Im sure many of you have seen it in museums around or maybe even, lucky somebody might even own some, but this guy again really drove the whole science around that.

With the — Joseph Priestly was an interesting fellow. And Joseph Priestly was a chemist, and he was also in some ways an outspoken critic of the existing church principles at that time. In England there was the Church of England, which was also connected with the state and it was sort of a dangerous thing to be outspoken about religion because you were criticizing the government at that time. But this just was sort of doing a mix of things, he did uncover the fact that oxygen- or that air was made up of components. People had ideas like air is just a thing and he helped figure out that you could break air into its multiple pieces. And so hes presumably one of the first persons to — along with a couple of mice that he had — to have a breath of pure oxygen. And he did a number of experiments and things where he would- under the sealed glass containers hed put plants in there and put a candle in there and the candle — they knew that the candle needed some kind of air to keep burning but why was it still burning? It was burning because the plant was throwing off oxygen. And so he did some basic things like that. Some of the work that was done around this was then stolen and attributed to some scientists in France before they had the opportunity to publish some of this stuff, but he was sort of on the leading edge of this. And then he was also a contemporary, as there were interrelationships going on across to America.

There was another member of this group who was — whose name was Dr. Small, and he ended up actually at one point being a teacher of Thomas Jeffersons, when Thomas Jefferson came to study in Europe for awhile. Priestly maintained a friendship with Benjamin Franklin across the Atlantic, and they shared experiments on electricity, and Priestly ended up spending the remaining parts of his life in the United States. And part of the reason why he left was because that his house was attacked and looted by a mob of people who were threatened by some of the new ideas that he was coming up. So again, its not always popular to be on the leading edge of thought change or information change, it takes courage sometimes to do that and he was one of the individuals in the Lunar Circle who literally was so thought provoking that people were threatened by it. And in almost a riot sort of- an organized riot with the support of some local magistrates they burned his house and stole most of the things out of his house, which shattered him and he and his family they moved to London for a while, then they ended up moving to the United States, in some ways because they felt they would have more freedom of thought here and would not be persecuted for trying to think on the edge of stuff.

The last two folks here then — there were more folks in there, but sort of highlighting some — but the two that I want to spend a little bit of time talking about are James Watt and Matthew Bolton. Some of you might even have heard Watt and say, hey, why does that name sound familiar? Well, you might — if youve ever screwed in a light bulb youve probably heard of this guy because hes the guy that they named a unit of power after. A watt — he actually invented the concept of horsepower and he was the one that sort of — and horsepower as originally defined by him was sort of, how could a horse pull 75 pounds at five miles an hour for the equivalent of a full work day? That was sort of equal to one horsepower so it really literally was tied to a horse. But he was a inventor and he was from Scotland. And he wasnt necessarily an original inventor because the elements of the steam engine earlier in the century had been put together by some previous Englishmen, but they had — so there were elements there but not the stuff that would really cause it to be a breakthrough. And then Watt comes along and has got these great ideas about how to advance what was these elements of a steam engine and some of them were really — were profound in that sort of the double piston action, the addition of a flywheel, the addition of a governor to regulate speed, a separate condensing tank on the side so that you wouldnt have to heat and cool this piston engine when the steam pressure was being created. And all of those things dramatically increased the output of the thing, but as he invented these things he had a hard time coming up with the idea of how do you mass produce it and how do you actually bring the thing to market? Whats the business model? Whats the thing? So he had this great ability to invent and tinker but he couldnt really drive it forward.

Well, then he meets Matthew Bolton, and Matthew Bolton was the son of a toy maker, and he was a very proficient and skilled craftsman. And he had, after having taken over his fathers business, created what was viewed as really the first factory ever. And so part of his invention was a new form of business and so outside of Birmingham he had this factory where he gathered under one roof, at peak employment, over 1,000 craftsmen were working there. And this is not some crowded elbow-to-elbow, dirty factory like I was referring to earlier. This was well-lit, well-paid, innovative, fresh air, well-ventilated, great stuff, everybody had the best tools and the whole idea was were going to build high-quality stuff at low prices and at consistent quality because weve got consistent practices, weve got great machine tools, weve got all these things. And so he spent a lot of time improving the machine tool process, etc. And he had the- and so its also all under one roof, the marketing, the design and the manufacture. It became the biggest tourist attraction in Birmingham was people from all over the world coming to see this factory which was sort of a new way of doing a business.

So Watt and Bolton get hooked up together, and Watt is about ready to lose his patent on the steam engine because hes got these patents for these new inventions but he hasnt been able to get it to manufacture. The first thing Bolton does is say, weve got to get an extension on those patents. So through his apt political skill they got an extension for many, many years on the patents through parliament through the end of the century. Then Watt was so depressed because hed spent six years in his own lab trying to get this stuff to work, he sends a bunch of the parts down to Bolton who hasnt worked with the thing before, shows up three weeks later and Boltons got a working model going. This guy could make it happen. So then they start manufacturing new things and they got all these coal mines, and coal mines in the U.K. tended to always fill with water. And so then had no effective way of getting the water out and so they would get a little bit of coal, it would fill up with water, and then the mine was useless. Well, then the first early steam engines were used to try to pump the water out. Well, then these things come along and theyre dramatically more efficient and they require less coal because of the whole condensing unit and the flywheel, the efficiency, and so they went from using thousands and thousands and thousands of pounds of coal today to much less. So then they come up with a new breakthrough, Bolton says, hey, I got an idea on how were going to price this stuff. Were going to price it based on one third of the coal savings that the purchaser gets for using this piece of equipment because a lot of these coal mines were- did not have the up front capital to pay for it so they were going to get sort of a pay as you go based on savings. These guys were rolling in it, okay? This is a — Bolton had a quote that said — when its asked about his success he said, what is the one element- he said, What I have for sale is what everyone in the world desires, which is power. And he meant — and so if you think about what really was and what became then this area around Birmingham became the Silicon Valley, if you will, of the whole industrial revolution. It was all driven by the fact that the- and the steam engine became the PC of the industrial revolution, this was the invention that led to so many other inventions. And just like the whole formation of Silicon Valley, there was also a formation of capital that was started to occur after that time. But Bolton was also on the leading edge because a lot of individuals that got their start in companies, including myself, you end up dragging relatives in to invest in your thing, Bolton had a little different tact on Angel investing because he grew up son of a toy maker and didnt have very much capital or access to capital at all, but he had all these great ideas.

But he had another really good idea, which he just happened to fall in love with a very wealthy young woman, OK. And so he married her, and helped use that family fortune to launch the aforementioned capital. Sadly, after a couple of children, his wife died at a very young age, but undeterred, he developed a, how should you say, a courtship, a courtship with his wifes sister, who was younger, who had even more money than his sister because now the father had died. So then he married into the family again and got a second wave of capital which also then helped drive this whole thing. So Bolton was an entrepreneur in many ways.

So anyway, but these two guys created a company called Watt and Bolton, and Watt and Bolton, if you think of it was sort of like the Intel of its day and the manufacture of these engines became more efficient. They were able to- they sold them in applications all around the world. It led to the invention, as the efficiency increased of the engine then they were able to start thinking about being able to use the engines in trains and so the whole idea of that, and plus the use of the engines led to the improved manufacture of iron, which led to the manufacture of railroad tracks, which then the whole combination of railroad tracks plus steam engines for trains transformed the whole world in terms of transformation. We did talk about it here at Convergence a couple years ago, the transcontinental railroad changing the timeframe of crossing the United States from six months around the tip of South America. A year and maybe uncertainty in terms of life or death trying to cross in a Conestoga wagon or five days on a train the day after the continental railroad was completed. Dramatic shrinkage of the way the world was coming together.

So these guys were at the heart and core of all this and again, I want to emphasize — part of what I want to say is James Watt and Matthew Bolton, neither of these guys had a significant amount of education. The university systems at the time were teaching things that were not keeping pace with the relevant- with the amount of change that was happening at the world at that time so its interesting that the people that really drove the change were outside the accredited institutions. And these were not the PhDs of the time or the leading authorities, the respected this and the respected that, these were tinkerers and inventors and ordinary people that all got together and said, Hey, we believe and weve got a dream and weve got a passion and we think theres a way where we can really change the way the world occurs. And so I think that as I bring this back together for everybody in this, is I want to say we have- there is certainly an obvious lesson here, which is part of the driving force of the Lunar Society was curiosity. Part of the driving force of the Lunar Society was a belief that individuals, that ordinary individuals, could make a difference in the course of the world. There was also an openness to understanding that, hey, across all these different things theres things happening. Theres a reason to be optimistic because of whats happening in this field of science, or whats happening over here in a new business process. And the combination of bringing together of that stuff created this synergy, this convergence of ideas is what caused the leapfrog ahead in the productivity. And productivity increases for humankind began during the industrial revolution and have continued straight through to today. And theyve just had again, profound, profound impact on this.

And then Bolton, he didnt stop then. So this guy, he had invented the first factory process, he figured out a way to create and sort of monetize the whole steam engine concept and drive that so then later on in life the capital system was not working in the U.K., period. It wasnt working anywhere in the world because coins that were available were not uniform and they had a thing where they had both shavers and forgers. You could take a coin from the royal mint, shave the edges off of it, put that in a little pile and smelt your own little coin later on and so then you gain- you were shaving off of these and forging new ones. And nobody was the wiser. There was an estimation around that — the late part of the 1700s — that two thirds of the coinage in Britain was forged coins or was light because of this capability, and the royal mint wasnt able to figure out what to do. So Bolton decided, hey, Im 59 years old, Im looking for something new, Im curious heres a problem maybe I can try to solve it. Heres the steam engine sitting here. The steam engines got a lot of power, boy, I bet that thing could stamp out coins a lot stronger with a lot more effectiveness. His dad was a toy maker, they knew about doing fine stuff so he goes into the coin-making business. Private entrepreneur, I think Ill go into making coins. Turns out that a lot of people had tried to solve this problem because businesses had to give out tokens which had limited exchange capability, but Bolton then got into this thing and he drove a set of machinery where he was able to produce thousands of coins per hour that were of a higher quality, they had the raised edges that we see around coins now today, because that way if anybody shaved those raised and serrated edges then you knew that someone had been tampering with it. And they were able to get better graphics and etching in there. But right away then, of course, Britain resisted because, hey thats a private guy and were the royal mint so he was building coins for all over the world as far away as Sumatra he was developing coinage. Finally the royal mint said, hey, we think you can do it better and so then the processes that he developed became essentially the coin-printing processes for the next couple of centuries. Unchanged all the way up through the 1900s with the way that things were stamping coins. And so he had a huge impact, again on commerce because of all the interchange of all that work.

Then of course also the other backdrop of whats happening at this time, the French revolution, the American revolution, social institutions were changing. There was an explosion of freedom and entrepreneurship that was going on in the world, in part contributed to by this change. And I think in some ways today were in the midst of the same kind of thing, we maybe dont realize it. Some people call it the information age, some people maybe get deterred a little bit by the fact that we have sort of the .com boom and bust, but the underlying drive thats going on right now with the- with computer chips doubling in power every 18 months and foreseeable through- doubling in power and dropping in price. And I said, graphics chips and broadband and wireless and all these things that are happening that are converging together and ideas. The work thats going on in the human genome project and around DNA and our ability to have breakthroughs in healthcare going forward is just an amazing- were living in this amazing, amazing, amazing time. And when youre going through a time like that, one of the things that I think people need to be armed with is a lot of curiosity because a lot of us grew up in these educational institutions that tended to focus us around a certain silo of education. A lot of us grew up in an educational environment where we did get the curiosity beat out of us. You probably — we can all think back to a loving teacher that we had that said, hey do it this way or you get an F. That really foments that great interdisciplinary thinking that we all need. But Im just saying is, maybe some of you had great teachers, Im not going to get myself all wound up about some guy you dont want to hear about.

But anyway, Im — I think what Im saying is, we have an opportunity to think differently about our childrens education. We have an opportunity to think about how we approach business and how does this come back to business? I did make the point that the research that has been done on adult curiosity says that there is a link between curiosity and effectiveness in the workplace. Not surprising, not surprising that people that are interested in other people, that are interested in new things, that are interested in new processes, that are interested in doing things differently are going to be the change leaders in those organizations. And for your company to survive and grow, you need more than just great solutions from us. You need more than that, you need leaders, you need individuals. And as Ive said at every one of these conferences, regardless of the position that you hold in your organization, you can be an agent for change. You have an opportunity to be empowered during this age in this time. You have an opportunity to every day bring your curiosity to work with you, to bring your curiosity back to your family, to bring your curiosity to your friends in a way that raises the experience and raises the tide and increases the connections for everybody. You have an opportunity to do that. Thats a choice that we can all make. Its just an easy, easy choice to make.

And so I guess the — I want to close out with a quote. And its easy to find Einstein quotes on curiosity. Theres a list at least at least half a dozen quotes on curiosity that are attributed to Einstein. And a lot of them are similar to this, and again, knowing youre an intelligent audience but for impact I will read to you what you are already reading, which Einstein says, I am neither especially clever nor especially gifted but Im passionately curious. Another quote he says, Im very, very curious. I have no special talents, but Im very, very curious. Curiosity is always- when anybody was attributing to him his success, that was what he came back to. That was his special talent. Thats what he had a passion for. And when I think about it, Ive talked before about passion. I think that we all have choices to make and we can choose, we can choose a lot of things. We can choose to live life blandly or we can choose to live life passionately. And I think that one of the things thats hard for me to separate curiosity from passion. Those things are- when you see this quote where they were together I thought, Well, in some ways, no wonder this guys brilliant because what he brought to his life was a passionate curiosity, not sort of a once-in-a-while curiosity, or a, hey, maybe today Ill be curious kind of thing but the rest of the time Im going to close my mind. Its about being- because curiosity is about having an open mind. Curiosity is about bringing new stuff in. Curiosity is about — leads to innovation, it leads to risk taking. Curiosity even can help fuel your own courage for change because, what would life be like if I did things a little differently? What would life be like if I tried something new? It is about that interesting and stepping out. And again, I think we all have such great capacity for change and we all have such great capacity, and we all have such great capacity to go do great things, and like the Lunar Society, we all have the capacity today at this time to have an impact on our families, on our friends, on our companies and Im not even saying, in a room this size, there could be somebody in this room- one individual in this room thats going to do something thatll change the world. Thats a real possibility that that could happen.

And so I guess in closing, I just want to offer you a challenge, which is — and its a real simple challenge, and yet its really hard and it turns out that like say, when we talked about the values at the beginning of the thing, values, those are soft, how do you measure them? Well, it turns out soft is really hard. And so Im going to give you a challenge thats soft, but its really hard. And that challenge Im going to give you is right from this quote. Im going to challenge all of you to each day, to try to find a little bit to be more curious. Just a little bit. Its an easy challenge. Today, be more curious today than you were yesterday. Tomorrow, be a little more curious than you were today. Ask yourself, what opportunities am I missing because Im not curious enough because I havent risked asking a question? Because curiosity is about looking stuff up, its about, hey, I wonder about the- you wonder about something, write it down, go look it up on the Internet. Its so easy today to get your curiosity satisfied because youve got so much access to so much stuff. If youre curious about stuff here, ask one of us. Ask questions when youre in the sessions this week. You can start right now. Get more out of the conference because youre more curious than you might have been. And little by little, thats going to build. Some day you may wake up and you may find yourself that youre passionately curious. And you may find your life changed because of that curiosity and you may find your kids lives changed and you may find yourself to be 88 years old and loving life because youve maintained that curiosity.

So thats my challenge. You guys have been an intelligent audience, youve been a great audience. Its going to be a great Convergence. Thank you so much and I look forward to spending time with you here at Convergence. Thank you.

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