What’s your innovation strategy?
The question often stumps executives, who tend to think innovation is something outside the normal work routines, not something that can and should be directed. Yet how much of your company’s strategic plan depends on innovation — on the development of new products, new processes, or (often) both — that will provide tomorrow’s competitive advantage? Continue reading
The valley of death is an hackneyed term used to describe where startups run out of money. This can be solved, early earlier-stage investors and policy-makers contend, by giving them more money. I’ve argued before this is misguided. The reason why is a cautionary tale to anyone leading a new venture.
The catch phrase of the Republican National Convention, “We Built It,” was a staged response to a strategically clipped quote from a speech by President Obama. As part of the government versus business debate, it has hopefully run its course. But as a lesson on innovation, it feels like a missed opportunity.
It seems that the best strategy for a startup is longer a matter of if, or even when, but now how many times you pivot before you make it rich. Pivoting, a term the enterpreneur-turned-entrepreneurial sage Steve Blank recently popularized, now threatens to become the next business buzzword. Forget open innovation, what’s your pivot strategy? That’s dangerous.
We associate innovation with dramatic technological or market breakthroughs that revolutionize industries overnight. So much so that despite continuing evidence to the contrary—that both today’s most succcessful organizations and most revolutionary technologies were not new—organizations, policy makers, and the public show a breakthrough bias when pursuing, funding, or anticipating innovation. This bias becomes even more salient in the pursuit of sustainability, reflected in outrageously ambitious “goals” that, as a result, create significant challenges for those trying to manage the innovation process.
Innovation is risky business. For companies pursuing sustainable innovations, these risks take on the scale of the effort and the context of the problems, the politics, and the markets involved. The most important aspect of this challenge to sustainable innovation is understanding the nature of risk at work. Without this understanding, innovation efforts are paralyzed and innovation policies—especially those intending to promote new investments—stifle them instead.
Is it time to revisit (or visit for the first time) some of the central challenges of developing and launching sustainable innovations? With the demise of Solyndra and Beacon Power still recent memories; with Ener1 entering bankruptcy; and the recent disclosures that EV makers Fisker Automotive and Tesla are troubled, it may be long overdue.
There are several great resources for teaching—and experiencing—entrepreneurship that are converging in wonderful fashion now and worth mentioning.
One of my favorite quotes, attributed to Steve Jobs, was that the hardest but most critical decisions he ever made were the ones to which he said “no.” Continue reading
On the heels of my post on the Valley of Death, Ben Horowitz of venture capital firm Andreessen Horowitz posted on Ron Conway
and his network (Ron Conway
Explained) and the value of social capital (connections) more than financial capital (cash) to help startups get off the ground.
Conway is one of the Silicon Valley's uber angels, and I have often spoken about the key role he has attributed to his own social networks when evaluating the potential of new startups. In essence, anyone can invest cash in a new venture, so if cash isn't scarce, the distinctive advantage will go to those new ventures with the best networks connecting them to other future employers, lawyers, investors, and customers.
In investing, Conway asks: "can my network make this company successful?"
If we're truly interested in understanding and supporting the emergence of new ventures we must recognize the primacy of connections. As the story Ben related shows, connections are key to finding cash. In theory, cash can help you find connections, but not always with the right people or for the right reasons.
As public agencies step up their funding of small technology-based businesses, they would be wise to make sure cash isn't their only contribution. The DOE, SBA and the variety of SBIR/STTR programs that are ramping up funding of university and laboratory research commercialization should match these cash investments with their clout in convening the broad ranging networks in which they sit.
The challenge is in replicating and scaling what Conway does. Individually, he can manage how everyone behaves in his network (including rewarding good networking behaviors and punishing bad ones). As Ben Horowitz suggests (and I abridge here), Conway is good at this because he has:
• A ridonkulous work ethic—If Ron’s awake, he’s working…
• Pure motives—Ron does what he does, because he likes helping people succeed in business…
• Super human courage—Ron fears no man and he definitely fears no phone call…Ron’s network is always on.
• A way of doing business—This is the unspoken key to Ron’s success…he acts with extreme prejudice when it comes to the proper way to conduct oneself in a relationship.
Try to imagine putting this into a job description. As a formal job the ability to own and manage in this way goes out the window. Instead, there need to be more structural approaches to achieving the same objective. This is the challenge for all of us.
Andrew Hargadon 