Climateer Investing: A Master Course on the "Thinking About Innovation Biz"

Wednesday, July 9, 2014

A Master Course on the "Thinking About Innovation Biz"

Irving sounds annoyed.

And you have to agree that in many cases the folks decrying the current path in innovation (including me) make facile and sometimes superficial observations without, you know, actually doing anything about the problem, innovatively speaking.

On the other hand he doesn't really address one of the real problems, that a lot of what is being passed off as innovation is just marketing, or marketing related, rent-seeking.

On the third hand W-B has been present at the creation more times than Secretary of State Dean Acheson.
(who called his memoir: Present at the Creation).
So...
Blame, in part, the finance guys:

"Fundamentally VCs are risk adverse – they want no risk in the deal,
if we could handle risk we'd be entrepreneurs."
– Victor Westerlind, General Partner at Cleantech VC firm Rockport Capital

And in part the inventors/entrepreneurs and in part thepolicymakers and...

From Irving Wladawsky-Berger:
Disruptive Innovation Revisited

The recent New Yorker article, - The Disruption Machine: What the gospel of innovation gets wrong, - by Harvard history professor Jill Lepore, has led to a flurry of opinions on disruptive innovation. The New Yorker described the article as “Rethinking the innovation craze.” Others called it an “absolutely devastating takedown of disruptive innovation,” a concept that Lepore said is a “competitive strategy for an age seized by terror.” It’s also a takedown of her fellow Harvard professor Clayton Christensen, - considered the father of disruptive innovation based on his 1997 bestseller The Innovator's Dilemma, and a number of subsequent books and article, - whom she accused of poor scholarship, misreading history, and myopia.
As I wrote last week, disruptive innovation has been often misused, as happens with popular concepts which become trendy buzzword. Many are truly tired of all the talk of disruption, even if they could not do without their smartphones and the Web. Lepore’s article may well be part of a growing backlash against the relentless advances in technology. It’s important to examine the impact of technologies on society, especially by those who can best write about the societal changes in their wake through the lens of history and human nature. I was hoping that Lepore had written such an article, but in the end, her aggressive attacks on Christensen turned me off.

John Hagel, - co-chair of Deloitte’s Center for the Edge, - had a similar reaction in his blog post The Disruption Debate - What’s Missing? “I admit that I’m mystified by Jill Lepore’s article in the New Yorker attacking Clayton Christensen and his theory of disruptive innovation,” he wrote. “Not only does it have a meanness that isn’t warranted, but it leaves the reader with an unanswered question: if Clay's theories are not helpful (and I still believe they are), how do we explain the cascading disruptions that are playing out in markets and industries around the world?”

Hagel then proceeds to examine the growing forces of disruption, which he views “simply as the sudden demise of leaders or incumbents in particular markets or arenas. . . Disruptions turn the assets of incumbents into potentially life-threatening liabilities. . . “[D]isruption is occurring with increasing frequency in the business world. Whether it is good or bad, it is happening and becoming increasingly widespread.”

We’ve generally studied disruption by looking at case studies of individual companies, including companies like DEC, Wang, Polaroid and Borders that are no longer around. But, a company doesn’t have to disappear to have been severely disrupted. Some go through a painful near-death experience but are able to survive and reinvent themselves, like IBM and Xerox. Others survive, but are now shadows of their former selves, like Kodak, Blackberry and US Steel.

Lepore actually cites US Steel as one of the cases that she believes Christensen mishandled. “U.S. Steel’s struggles have been and remain grave, but its failure is by no means a matter of historical record. Today, the largest U.S. producer of steel is - U.S. Steel.” Yet, a few days after her article appeared, we saw this headline: US Steel Gets Booted from S&P 500. “The struggling Pittsburgh-based steelmaker . . . was the world’s first billion-dollar company and was once so huge it was known simply as The Corporation. It was one of the most valuable companies in the index for much of the early half of the 20th century.”

According to Hagel, you can discern a more fundamental and systemic trend beyond the individual case studies. Something profound is happening. He cites the evidence collected in the Shift Index project, an initiative he co-leads at the Center for the Edge to measure and quantify the long term impact of the digital revolution through 25 different metrics. One of these metrics is the topple rate, a measure of how rapidly companies lose their leadership position. The topple rate has increased by almost 40% since 1965....MUCH MORE