Today’s (short) post is about two articles in the September 2012 issue of Harvard Business Review. The first one, “The New Corporate Garage”, discusses the places “where today’s most innovative – and world-changing – thinking is taking place”. The main argument of that article is that we have entered innovation’s fourth era, after the eras of (1) the lone inventor, (2) corporate labs and (3) venture-capital-backed startups. In this new era, the author states, “the scale of a big company can unleash innovation” thanks to “passionate, entrepreneurial catalysts who use corporations’ global infrastructure, brand reputation, partner relationships, process excellence and other capabilities to develop solutions to global challenges in ways that few others can.”
The article provides the following examples:
- Medtronic’s Healthy Heart for All
- Unilever’s Water Purification
- Syngenta’s Productive Farming
- IBM’s Smarter Cities.
These companies “mixed the entrepreneurial approach of a third-era VC-backed start-up with the unique capabilities once housed in second-era corporate labs” and leveraged their advantages to achieve results start-ups would be hard-pressed to replicate. The author is careful to emphasize these successes would not have been possible without corporate catalysts, “those mission-driven leaders who corral corporate resources that are outside their traditional span of control to address sprawling challenges.”
Another interesting article in the same HBR issue was “Are you solving the right problem?” with the subtitle “Most firms aren’t, and that undermines their innovation efforts.” I particularly liked that article because it is based on a framework developed by InnoCentive, the online innovation marketplace, and uses concrete examples of how well-defined problems have led to once-elusive solutions, for instance:
- cleaning the 1989 Exxon Valdez spill in spite of the low temperatures (which hindered traditional pumping) by framing the problem as one of “materials viscosity”,
- identifying the stage and progression of the disease in any patient by using a noninvasive biomarker, instead of trying flat-out to cure ALS (Lou Gehrig’s disease),
- predicting solar flares with better accuracy by recasting the problem as a data-driven and forecasting challenge, which led to a solution by a semi-retired engineer whose model provided 85% accuracy with an 8-hour lead time (instead of 50% and 4 hours in the previous NASA model).
I don't think so. From corporate labs, we had Bell Labs, that brought us who knows how many untold innovations. Venture-capital backed startups turned into the Googles and the Yahoos of the world.
This whole "global corporation funding innovation" thing has yet to really pay enormous dividends on the scale of Bell Labs, aside from, actually, Google itself, which has Google Glass and the Self-Driving car (oh, and Google fiber, which I think will revolutionize internet).
How often do the large corps come up with innovation anyway these days?
Posted by: Ilya Kipnis | December 04, 2012 at 12:16 PM