(upbeat calm music)
Narrator: To compete in a fast-changing
business environment, organizations have to constantly
learn how to do things better.
Like executing key-business processes more efficiently
or crafting smarter strategies for success.
Of course each individual an the organization
is responsible for continually strengthening their skills
and knowledge, but collective learning
is where the real action is.
What is collective learning exactly?
And why does it matter more than ever
for organizations today?
-: Collective learning is the understanding of how teams
cities, organizations, and nations learn
It's the acquisition of knowledge not by individuals
but by groups of people.
Companies stay in business
because they have some knowledge that is in some way unique
that allows them to participate in a market
that few other people can participate, that allows them
to produce a product, that few that people can produce
and therefore they have some sort of temporal monopoly.
Acquiring that knowledge, it's vital for companies.
Narrator: As it turns out, you can measure how much
collective learning is taking place at the levels of teams,
cities, and even entire industries and countries,
but only if you use the right metrics.
-: I've begun to study how knowledge accumulates
at the collective level, how much knowledge that the city
of Berlin has vis-à-vis Paris or Tokyo or New York.
And I developed two measures that can help us understand
how knowledge moves and what is the intensity of knowledge
that exist in a location.
The first one is quite simple and it's an idea
that is now known as relatedness.
This is the distance, you know, in the knowledge that exists
in a city and the knowledge that is required by an industry.
So, it would answer the question, you know, how far is Miami
from the biotech sector? Or how close is Tokyo, you know,
from the musical instrument manufacturing industry?
And what you can do is you can look at all of the industries
that are present in a location.
You can see how related they are to the industries
that are not yet present.
And those measures are very predictive of the industries
that a city or a country are gonna enter or exit
in the future.
And this is true for the products that our country
is gonna export, the technologies in which a city is gonna
patent, the research areas in which our university
is gonna publish and so forth.
(upbeat music)
The second idea is a measure of all of the knowledge
that would be containing a city and how that affects
important macroeconomic outcomes, economic growth,
you know and income inequality.
These tools help you understand a couple of things.
First, you know, you would know which activities
are more likely to be successful at given the capabilities
that you already have.
(pensive orchestration)
Narrator: Every company can benefit by taking the time
to understand how much knowledge is concentrated
in a particular industry or geographic location.
And how it's being built up through collective learning.
Why?
When you understand these things,
you can make some pretty interesting predictions
and you can use those predictions to make crucial
business decisions like which markets your company
should enter and which markets you should avoid.
-: You can predict, you know, which are the markets
that might grow in the future.
You can also predict the success that each one
of those markets might have in the sectors
that you might be interested on entering.
Leadership for a long time, you know,
has been very intuitive and it's intuitive for a reason.
You know, people that have been operating in a sector
or an industry for a long time, they have good hunches
about what works and what doesn't work
because they have a lot of experience.
As data becomes a more prevalent aspect of our lives
and our work, it means that there's gonna be leaders
that are gonna have looked at more data throughout
their lives, and that's gonna give them a richer
intuition and a richer set of experience to draw upon.
Narrator: Clearly collective learning can give companies
some vital advantages, but to capture those advantages,
companies need a new type of leader.
What do these leaders do differently?
How do they enable collective learning in their teams?
And how do they help remove roadblocks to collective
learning that arise as their organizations grow?
In our next video, Cesar Hidalgo offers insights
into these questions.
-: So the most important ability, anybody needs to learn
you know, is the ability to learn.