ETEC 522 – September 2012

teacherben 7:25 pm on September 26, 2012

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  David Vogt 7:47 am on September 30, 2012 Permalink | Log in to Reply

  Thanks for sharing this, Ben –

  In every sector, not just digital, companies are finding it more and more difficult to innovate internally. The number of processes, events, incentives, etc, that companies are inventing to try to ramp up internally-generated innovative ideas is quite amazing. Google in particular has given its employees enormous creative freedoms to pursue new ideas on company time. However, it doesn’t seem to be enough to allow companies to be competitive. The demise of Google Labs is one indicator of this for me.

  What’s the problem? The way I see it is that with global competitiveness the proverbial “low hanging fruit” in every sector is long gone. That means companies need to reach higher (for example, do lots of advanced R&D in pre-competitive technologies) and reach wider (for example, bring on experts and projects intersecting many different fields) in order to stay ahead. Both of these activities are typically expensive and really difficult for companies to manage, especially on their spreadsheets.

  So most companies in the world don’t actually “do” much innovation anymore, they “buy” it. They allow the depth and breadth of the open marketplace (ie: gazillions of small start-up companies) to take on the expense and risk of pioneering. Then they try to buy those few companies that seem to be succeeding while they’re still young and affordable. Its a risky and inefficient process, but less so than doing it yourself.

  Another thing large companies are doing is getting involved in “open innovation”. This is where they will put money, with few strings attached, into research labs, incubators, etc, that aim to do work in sectors the company cares about.. Their hope is that this will allow them to spot emerging innovations more quickly than anyone else, and then scoop them up.

  The analogy I’ll use is that traditionally companies planted their seeds in walled gardens, but now they’re finding that this soil isn’t fertile enough anymore. So now they’re more often sewing seeds strategically in many public places, waiting to see what comes up.

  This is how I characterize “Google for Entrepreneurs”. It is a “strategic” public service, essentially like all of Google’s products, that give something away in order to reap value from the activity it generates. Very smart….

  The reason for this long comment is that this global innovation trend should be eye-opening for our current entrepreneur bootcamp. Companies can hire the best people in the world, but they can’t seem to successfully hire entrepreneurs, or cultivate them internally.

  Thoughts?

  David