Monday, November 01, 2021

Exploding the explosion of innovation myths

 I found an article today on the web that was published by the Wall Street Journal in September 2021, that claims to explode the myths about innovation.  I was excited to read it, because 1) I like things that explode 2) I like myth-busting and 3) I am always curious to see what people who aren't in the actual corporate innovation space believe about innovation.  Perhaps you can tell from the way I framed this set up that I didn't think all that much of the discovery.

We should separate the insights and hard work that went into the research - the authors of an upcoming paper are serious scientists and have great credentials.  Basically, what they found, at least from what I read, is that innovation is deterministic, based on the advance of underlying physics.  So, some breakthroughs are only going to happen when the physics are correct.  

I am simplifying, of course, and will link to the Wall Street Journal article here.  

Is this really news?

Having worked in the semiconductor industry, and knowing something of Moore's Law, this finding is not a surprise to me.  Almost all technical innovation is driven by the advance of underlying science, whether it is the number of transistors on a chip, or the amount of data we can send in a packet.  For any science or technology advancement that is based on the constant evolution of a technology, or an advance in physics, this is good news - the future is somewhat predictable, and all of us who do innovation work should be constantly monitoring - and forecasting - how these technologies will advance.

The first signal that all was not right from a big "I" innovation point of view was the counting of patents in the algorithm.  Counting patents is a favorite of many companies - the more patents, they claim, the more innovation.  If you stop to look at a lot of patents, and what happens to those patents, you'd recognize that we are counting what is countable, but that they don't always count.  Many patents are put in place to block competitors from creating new products, not to create new technologies or products, and thousands of patents are filed and never acted on.  So, while counting patents seems logical, we need to ask what is the purpose of the patent, and will the patent be converted into new products or technologies.

Not all innovation is technology based

Further, while a lot of tangible products are reliant on advances in physics and other technologies, that portion of the overall "innovation" marketplace is small and getting smaller.  Product innovation is just one of at least ten types of innovation Doblin defined decades ago, and most of the rest of the types aren't overly reliant on advances in physics.  Service innovation, experience innovation, business model innovation and other types of innovation either don't rely on technology at all, or aren't as dependent on advances at the nuclear or physical level as innovations in, say, high definition televisions.

Uber, for example, or Airbnb, did not need advances at the physical layer in order to create new innovations, and the model the scientists created, while valuable, would not say anything about the opportunity they addressed or the need for technology to provide the solution.  In these cases, the opportunity was there for the taking for incumbents, who could have addressed the markets with existing technology.  They simply did not see, or did not look, at the market opportunity.

Market and customer shifts

Then, of course, there are the shifts outside of the technology that also matter.  While the article points out that nuclear power will lose out to solar power because the cost per watt is rapidly decreasing for solar, there are literally dozens of reasons why really great and valuable technologies do not achieve market dominance.  Our regulatory, oversight, and legislative processes will determine winners or losers many times, far more than a good technology by itself will.  We are getting very close to the potential of autonomous vehicles.  What will limit the use of these vehicles is not the technology, but the overlapping legislative areas, the complexity of regulation, the concerns about insurance and risk - in other words, what will limit autonomous cars is not the technology, but the regulatory, insurance and administrative oversight and buy in.

And, if technology alone was the main driver, then we'd all have standardized on Betamax tapes rather than VHS, since Betamax had better sound quality and a better picture.  What made VHS more popular was consumer demand, because most Betamax tapes did not last for two hours, while many movies and other popular shows did.  So the consumer was faced with a dilemma:  switch the tapes half way through the show to ensure everything was captured, or accept a less onerous, but slightly less high quality recording.

 Hero Worship - the other myth

I really love this sentence about corporate innovation in the article - "Looking at innovation this way, as an almost mechanistic, deterministic process, might not be as romantic as our countless hero-worshipping stories of daring inventors and entrepreneurs taking huge risks to bring us the next breakthrough".  It's just that any experienced innovator will tell you that while the stories are great, they are stories we tell to engage ourselves, but most innovators know that innovation happens when any of us work to understand trends, understand customer needs and blend in emerging technologies (when necessary) to create solutions that meet or exceed customer needs.  There is no hero-worshipping, but more getting down to work in your overalls, to paraphrase one of the individuals the article would seem to suggest that we deify.  (Edison's quote about opportunity)

Most innovation happens every day, through hard work, by people in all kinds of companies, who are combining insights, needs, technologies and market openings to create new products, new services and new business models.  We celebrate the pioneers of innovation (like Edison or Jobs) but don't expect to innovate the way they did, or necessarily need to work they way they did.  To suggest otherwise is to signal that you don't know or understand corporate innovation, or entrepreneurs.

No explosions, no myths

So, in a nutshell, the research the scientists did is excellent and should be an input to trend spotting, scenario planning and technology forecasting.  The technologies that are reviewed will drive a small portion of the overall portfolio of innovation outcomes.  We innovators respect the early pioneers and we stand on the shoulders of those giants, but we are as capable and do innovation every day.

Let's get rid of these myths and recognize that innovation is happening in many places, simultaneously, driven by many different people in large and small companies, in research labs and universities, without mystery or hero worship.

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posted by Jeffrey Phillips at 1:14 PM


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