Saturday, August 23, 2014

Accidental Innovation... Any takers?

Of course, there are takers! After all who cares? An innovation that happens by accident is just as good as an innovation that was carefully, deliberately, meticulously, and painfully thought out and executed. The reality is, as I had discussed in my book, Living in the Innovation Age (TekNirvana, 2011), that errors are the lifeblood of innovation. History is full of examples of innovations that were the result of accidents and errors. Alexander Fleming discovered the virtues of penicillin when mold accidentally contaminated a culture of Staphylococcus (i.e. Staph) he had left by an open window in his lab. Think of how many lives have been saved because of that one accident. Modern electronics owe their existence to a few errors as well, a few of which ultimately led to the creation of the vacuum tube. In fact, it is said that when Lee De Forest first invented the vacuum tube even he did not completely understand why it worked!

So, you might be wondering why all of a sudden I am writing a blog on this topic. The blame squarely lies on a recent article I read in Businessweek that discussed a Nanogenerator that can recharge a device with a jostle, swipe, or tap. The one millimeter thick, transparent nanogenerator converts mechanical energy (or movement) into electricity. An obvious (and very lucrative) application would be to incorporate such a nanogenerator into a cell phone case/cover, which would continuously charge your cell phone as you were using it and even as it bounced around in your pocket. The kicker is that the innovator, Professor Wang at the Georgia Institute of Technology, had been working on a new charging technology for several years. The big breakthrough, though, came as the result of a sloppily pasted model by one of his students. The "erroneous gap" in the model, due to the sloppy work, actually boosted the current output! Hmm, I wonder what grade the student got...

The Bottom Line
Yes, many innovations have been the result of well-thought out and deliberate actions. However, history (and as the example above illustrates, even the present day) is chock full of stories of amazing innovations starting out as a side-effect or even an accident. Of course, by no means am I suggesting that anyone throw all caution to the wind, but at the same time don’t be afraid of making mistakes… embrace them for you never know which one of those errors might sow the seeds to the next groundbreaking, game changing innovation!

Thursday, August 8, 2013

To Do or Not To Do - Now that's a Decision

A while back I had blogged about how impressed I was with the insights from Management Guru Peter Drucker as I read his classic book (aren't they all classics?) “Innovation and Entrepreneurship”. In Chapter 12, Peter discusses a process he calls “Selective Abandonment,” in which every three years or so, the enterprise must put product, process, technology, market, channel, and staff activity on trial for its life. The organization must ask, “Would we now go into this market, product, channel, technology, etc. today? If not, the next question becomes, “How do we stop wasting resources on it?” Selective abandonment not only helps free valuable resources for the “new” but helps an enterprise relieve itself of the burden of “near misses” and “half successes.”

How about just calling this "making a decision"?

The fact is making a decision is not as easy as it might appear. I just came across an interesting blog on HBR on this titled "To Move Ahead You Have to Know What to Leave Behind" by Nick Tasler. Did you know that when an executive announces that her business will change to become a luxury service provider, technically it is not a decision until she also states that they will not provide low cost services to price-sensitive customers anymore?

So, a necessary element of a decision is not just what will be done but also what will not be done. In fact, this element is actually part of the word [decide] itself. As Nick explains, the Latin root of the word "decide" is caidere which means "to kill or to cut." (think homicide, suicide, genocide.) Technically, deciding to do something new without killing something old is not a decision at all. It is merely an addition. But as he also explains, making trade-offs is mentally exhausting and uncomfortable, which is why most decisions never actually become decisions; they are just "pile ons" to existing initiatives.

The Bottom Line
Making real decisions is crucial in business and life. Michael Porter's theory on strategy is based on this concept - deciding what not to do is just as important as what to do. Innovation relies on this as both Peter Drucker and more recently Vijay Govindrajan have demonstrated with their respective theories on "Selective Abandonment" and "The Three-Box Model". Making decisions is a cognitively and emotionally taxing activity that the average person will go to great lengths to avoid but a key element of what makes great leaders great. Great leaders and change agents have come in all shapes, sizes, colors, genders, and personality types. But the one thing they all seem to have in common — the one thing that distinguishes them from ordinary people — is their willingness to decide when others could not.

Tuesday, July 23, 2013

Google's Culture Wars - Will Innovation Still Thrive?

Google's "20% time" has been legendary in terms of how many successful innovations it has helped Google bring to the market. Basically, Google allows its employees to use up to 20 percent of their work week at Google to pursue special projects. That means for every standard work week, employees can take a full day to work on a project unrelated to their normal workload. Google claims that many of their products in Google Labs started out as pet projects in the 20 percent time program.

That might be a thing of the past in the not so distant future...

At least that's what many in the industry are thinking out loud based on the recent demise of Google Reader, a popular tool for reading RSS feeds. Adding salt to injury, the original Google Reader, Chris Wetherell, says that he wouldn't have founded Google Reader within Google as the company exists today. Instead, he would have just gone elsewhere or started his own company. As Alex Kantrowitz explains in his blog on, "Wetherell’s comments highlight a problem Google might face now that Reader is shutting down. The company has long benefited from a culture of innovation which has helped it turn employee side projects like Gmail, Google News and Ad Sense into core offerings. But, with the understanding that even successful products can be killed in the future, the company’s employees might now have less of an incentive to launch their ideas within Google, and innovation at the company may suffer as a result."

The Bottom Line
Personally, here's what I think:
  1. Google is devoting significant resources to it's social networking endeavors and has decided to redirect resources utilized on Google Reader to Google Plus. As a publicly traded company with a shareholder price to worry about, this type of cost/benefit analysis is to be expected. 
  2. There could be a bit of "sour grapes" on part of the Google Reader's founder who of course would be personally attached to his invention.
  3. It is a stretch to extrapolate that Google might either discontinue to 20% time or that employees would not use this time to explore their ideas in fear that their ideas would be squashed at some later time. One data point is just not enough to arrive at that conclusion. In statistical terms, this one observation could be deemed as an "outlier" - an observation that is numerically distant from the rest of the data and is often excluded from analysis.
I really don't think Google is going to be any less innovative than it was before. Let's not proclaim that the sky is falling just yet...

Wednesday, July 3, 2013

Tesla - An Evolving Ecosystem and A Tale of Business Model Innovation

Tesla's Model S is designed to allow a fast battery swap, exchanging a depleted battery for a fully charged battery in less than half the time it takes to refill a gas tank. To facilitate this, Tesla has introduced an innovative switching station based infrastructure based on a model pioneered by the now bankrupt electric vehicle company, Better Place. These switching stations serve a similar purpose to what gas stations serve for fossil fuel vehicles - if and when a motorist runs out of charge, they can replace their depleted battery with a fully charged battery. Realizing efficiencies and gains from economies of scale, these switching stations can be a win-win for both motorists and Tesla. Motorists are relieved of their anxiety of being stranded with a drained battery and the car company can get many more motorists to buy their vehicles and sign up for use of the stations. Tesla's latest battery swapping switching stations builds upon its evolving strategy of building a complete and robust electric vehicle (EV) ecosystem that started with aspirational cars (0 to 60 miles in 4.2 seconds), batteries with up to a 300 mile range, and supercharging stations. 

Innovations come in many forms forms the essence of Principle #5 of my recent book, Living in the Innovation Age (TekNirvana, 2011). I compare these forms of innovations to the concept of avatars of Lord Vishnu in Hinduism - each form unique and specifically designed for a purpose but none any better than the other. While most associate innovation with technology, a crucial and often necessary form of innovation occurs in business models, such as the Tesla switching stations described above. As Karan Girotra and Serguei Netessine discuss in their HBR blog, At Last, a New Business Model for Tesla, groundbreaking technology rarely achieves mass adoption without a corresponding innovation in the business model around the sale/use of the technology. I concur with the authors' assessment that these patterns extend far beyond Tesla — there are numerous innovative technologies that are waiting for an innovative business model that could facilitate their use and adoption.

The Bottom Line
Innovation has many forms. One such form is Business Model Innovation, which is often the catalyst that enables groundbreaking technology to achieve mass adoption. It is a well-known fact that much of Apple's iPod's success can be attributed to its business model innovation of the iTunes Platform. Such is the story with Tesla as well. Tesla realizes that it is not enough just to build a great electric car. In order to make their product truly useful, they are creating an entire ecosystem around it - long range batteries, supercharging stations, and now high speed battery swapping switching stations. So, will Tesla's switching station concept finally be the tipping point that will position its flagship product as the first all-electric, no-compromises, luxury sedan? Only time will tell...

Monday, May 27, 2013

Sony and "The First Mover Advantage Fallacy"

Sony's SmartWatch
Although first to market it might
only help competitors come up
with better offerings
One of the topics I discussed in my book, Living in the Innovation Age, is the fallacy of the first mover advantage. While there are cases where first movers have been highly successful, there are plenty of cases of disillusionment and despair as well. I used the meteoric success of TiVo followed by a decade of sagging profit as a case-in-point in my book. 

On October 12, I blogged about GM's failed attempts at capitalizing its first mover advantage with its early introduction of the redesigned "2013 Chevy Malibu" in February 2012. 

The May 6 - May 12 issue of Businessweek discusses yet another example of the so called first mover advantage fallacy. The victim this time? Sony. 

Sony introduced its first smart watch, LiveView, in 2010. As a new product in the growing and lucrative smart device marketplace, it was interesting but lacked in features and was mired with kinks. A more recent version called the SmartWatch is priced at $130, is about the size of an iPod nano, has a 1.3-inch touchscreen, and wirelessly connects to Android smartphones using Bluetooth technology. The gadget alerts users to incoming calls and allows them to reply to e-mails or texts with an array of pre-written messages. It even connects to Facebook and Twitter and controls a wearer’s phone-based music library. 

Sales are struggling though.

Sony’s failure to gain traction with the SmartWatch is the latest in a long line of first-mover advantages the electronics giant has squandered. Well known failures include the CliĆ©, a Palm OS-based personal digital assistant that allowed users to listen to music, play games, and watch videos, which Sony introduced a year before Apple's iPod; a failed music platform similar to iTunes despite owning the distribution rights to thousands of popular songs and films; and an e-reader called the Portable Reader System, which Sony introduced a year ahead and with 600,000 titles, more than twice as many as Amazon’s Kindle.

Sources with inside knowledge of the company have attributed Sony's struggles to research that has been too inward-looking and deliberative and not focusing enough on early customer feedback. Perhaps Sony could learn and benefit from an increasingly popular concept known as the "Minimum Viable Product", which found its origins helping smaller entrepreneurial companies launch new products but seems equally applicable to larger companies such as Sony as well. 

The Bottom Line
Don't be too quick to assume a positive correlation between successful innovation and being first to market. As Mito Securities analyst Keita Wakabayashi puts it, "Sony was ahead of its rivals to release a watch, but it takes more than an idea to create a hit product. It’s about bringing a product that has functionalities that people would want and marketing the product in the right way.” So remember this the next time you have an innovative idea and instinctively want to rush to be first to market. You might just be helping out your competitors in the process...