Why companies lose their best innovators (2019)
forbes.com
forbes.com
It seems to be that simple: If you WANT innovation, you'll get innovation.
What most people (at least those willing to climb the corporate ladder) want however is a career. And within a corporate incentive structure, career and failure don't go well together. Creating value out of nothing is way harder than simply not screwing up existing value. So it's obvious what you're gonna get.
Eventually, there is no such thing as 'corporate innovation'. There could be a thing called 'corporate sponsored innovation garage', or something similar. At least for new business development from the ground up.
The promising way to pull that off it seems is a blend of YC startup school tutoring, venture capital, [Google] X, the innovation culture of Tesla/SpaceX and access to cutting edge technology/people - baked into the right incentive structure.
IF innovation was repeatable, I'd bet on such a vehicle and allocate resources there.
proceeds to promote people who only make safe bets, suck up to management and tow the party line
I've seen a few big companies attempt to avoid the pitfalls you're describing. They set up some moonshot division consisting of "startups" and they do allow them to fail, but that's not enough. The problems are that they don't face the same financial pressures as startups, and they draw from the same talent pool as the general engineering pool of the company.
This is a problem because I don't think the article's premise goes far enough, big companies don't just drive out innovators, they convert them. They create a context where adding more bloat is seen as innovation, and then suck up enormous amounts of talent into this environment.
These "startups" I've seen look on paper like they have every chance to succeed. Financial institutions starting companies in the finance space for example, they have all the domain knowledge, it's right in their wheelhouse etc etc. But they don't seem to realise that they don't have the right kind of engineering talent. It's not that their devs are bad, they're just playing a completely different game. I think this is partly to blame for the whole "ageism" thing in SV as well. Somewhere along the track a big group of people realised (probably subconsciously) that there's a whole bunch of very talented senior engineers out there that are complete garbage at building something from scratch in an environment where you live and die by the quality of your software, because the majority of people work in places where their success and failure is just indistinguishable noise in quarterly profits. And for interviewers that aren't particularly good at surfacing that or don't even know what they're looking for, ageism is the easiest (and shittiest) way to filter most of that out and improve your odds
All these "startup within a big company" projects seem to follow the same rules as a modern trendy enterprise project. Big fuck off kubernetes clusters on the back end, a monorepo clusterfuck for the front end with more packages than pages in the app. Everything "scales", everything is perfectly set up to handle every possible use case, there's 8 kinds of tests, and a huge CI/CD setup, and all the tooling you could ever need. And then once that's all set up, in true waterfall fashion, the dev finally starts... at the same pace all the company's other projects run at.
And because all the other company's projects run at that pace, nobody notices anything is wrong. But if you do this, and you have any even remotely competent competition, you're going to get absolutely fucking poleaxed in features. Slow and steady might win the race but nobody has ever won the race after being shot in the foot with the starting pistol.
Most attempts I've seen about fixing that by creating a "startup culture" inside a company have not really added more value compared to simply investing that money in a start up.
In my experience, end of the day, “innovation” or “creating value” or “getting shit done” boils down to solving problems. It could be big problems like fundamental research or little problems like moving a desk in an office.
Either way, big organizations, private or public sector, create their own problems that are difficult to solve. Inefficient or dumb process sticks around until times are tough because the process gives someone power.
Now, the iPhone 1 didn’t do very much, and often there is far more value in the innovation than there was in the original invention. But you don’t get the innovation without first inventing something that didn’t previously exist.
Sadly, using words incorrectly swaps into thoughts, and affects reasoning. Because these words have been conflated, organizations are typically no longer able to reason about invention and innovation correctly, and are uninterested in inventing as a result. I would argue we see this in the lack of new underlying technological inventions after the 90s. It is like we have eaten our own seed corn. Very sad.
Doesn't it just.
I approached someone in charge of innovation for a part of the UK's National Health Service. I offered some software (at no cost to them until they were content it met a need) based on a project I'd worked on in a different part of the public sector where the same idea had been successful. I was turned away, not because it wasn't actually innovative, but because to the NHS innovation meant funding deployment of commercially successful, mature software with existing customers and I didn't own the software from the previous project so I'd written a new (and improved) version.
It still puzzles me. I occasionally wonder how much time he must spend turning away people who have innovation ideas wondering why companies with mature products aren't calling his innovation department.
The word innovation is awesome at dedicating when someone is speaking bullshit.
When someone says the word innovation I assume they are a politician, marketer, salesperson, or in public relations. This causes me to listen to what they are saying more critically because I assume they as a professional attempt to persuade or influence people.
I disagree. Not screwing up existing value is way harder than simply creating value out of nothing.
I’m not sure I 100% agree with the statement, but it’s an interesting perspective to try from time to time.
For instance, do you mean to say that, given the average company making $X net profit per month, it is harder to steer that company to grow to make $(X + Y) per month, than it is to start another company that makes $Y per month, from nothing?
Like sibling comment said, from a data-driven perspective that seems incorrect, but I wonder if your definitions of "value" or "difficulty" have some other nuance.
Given that most corporations fail eventually no matter what, you might have a point there.
Maybe what I meant was the micro-level, not the macro-level evaluation. It might be easier for a given individual within a large corporation to play the game of 'keep the system running' and do well as compared to playing an active role in a small group of pirates that is building value from scratch which eventually can scale to a significant size.
Fair point though!
Best of breed corporations are often characterised by a focus on key ideas and their variations - look at Apple, pretty much all their products are variants of an iPad at different sizes and different target audiences. Picking some other global Fortune 500s: Walmart and Amazon, profound dedication to logistics. DuPont knows chemistry, Boeing mastered turbulence and propulsion. A couple of big extractors that know how to claim resources from the natural world. These companies are all very innovative, but also profoundly focused. They will really struggle to cope with innovations that aren't in the area of their strategic edge.
It isn't a loss to anyone if the next trillion-dollar idea spins out as a new company instead of growing within an existing major. If someone has great ideas, we should invest in the person not in their employer. And they should stand to profit from their own success.
I think you're selling some of these companies short -- the thing they might seem focused on now was not the thing they initially got popular for doing. In other words, they innovated outside their expertise to stay relevant.
I don't see who the loser is in this story. It isn't Cisco shareholders; they can be Zoom shareholders too if they want to be.
Sure Cisco shareholders would have been better off if Zoom was an in-house project, but investors are really the ones who are supposed to be making the value calls on teleconference-or-routers market exposure style decisions. If I'm a Cisco shareholder I don't think management made a mistake. I think I made a mistake not becoming a Zoom shareholder.
I want them to fire the management chain that was involved in the zoom debacle, and also fire the people that hired / promoted that management chain.
Large companies can identify innovators, or at least learn to do so. In some cases, it will be as obvious as the founders of companies they've acquired. In other cases, it may be simply polling the engineering and product management ranks and tracking down those who are considered innovative by their peers. Or, you may even make it egalitarian and offer developers a 'year of invention' after some number of years at the company.
One point I think is key is to create an environment that is conducive to innovation. Relaxed administrative obligations, flat organization structure and a budget. Nominal oversight and justification requirements. Then, a simple guideline: What is developed needs to be on a path to becoming a product or service the company could offer.
Innovators could be supported with HR for finding contractors or consultants to work with, purchasing for buying components or equipment, marketing and business development persons could be assigned to the program to help innovators with business plans, cost and pricing analysis, market research. The innovation organization could be placed in a work space with dedicated space for their project, and a common space to meet and collaborate with other innovators.
Rewards for successful products could simply be additional stock grants and recognition, or perhaps simply another tour of innovation.
The risks would be if the program were abused and budget misspent, or the innovator simply didn't do any real work, or went off the rails with their projects. Also, development projects could have many budget sizes from virtually nothing to multiple millions. Perhaps the business development partner could help with proposals to request additional budget, once prototypes were far enough along to be compelling.
A multi-billion corporation could easily allocate a few million to this type of environment and keep a dozen or so innovators busy. You'd only need one success every so often to make it worthwhile.
From "Ask HN: Insider history of the demise of Kodak?" https://news.ycombinator.com/item?id=12111597
Bingo. Innovator’s Dilemma. You have to be willing to eat your own lunch because otherwise a competitor will eat your lunch.
If you are in an organization filled with vindictive employees, I recommend terminating them all if you have the power, or finding a new place to work. Not everyone can be part of the A-team. Trying to constantly appease those who feel entitled to the highest levels of the software engineering ivory tower will never end in a good outcome for the organization and will dis-incentivize those who actually bust their ass every day.
Finding and terminating toxic employees is the single best thing every company should do to improve its health, but few do. Probably because some of the most toxic people are very skilled at looking good to their superiors while causing huge amounts of damage.
I think that's not how it'd work. Instead, those vindictive people would be managers, and they'd be the ones that provided you with information, and based on what they said, maybe statistics they show, it'd seem like obviously good ideas to scrap those projects
Opposite - they are designed to be incumbent.
Once a product sticks, companies become 'operational' and not 'dynamic' which is to say they excel at customer, product, regulatory, lobbying, scale, RFPs, branding, little features that satisfy a range of customers. Everything done 'just well enough' but otherwise the entity has not reason to innovate.
Innovation is just a pile of risk to the system, when in fact, the 'incumbent corporation' is a 'cog' in that system so there's no reason to change it.
Not only is there little incentive to change, there is 'anti incentive' in many cases.
Also - innovators are really hard to identify, and that thing may not be part of the job anyhow. There are all kinds of creative innovators, with many kinds of specialisation, the Zoom case I'm not sure is very exemplary anyhow.
I think it's in the nature of big companies to view everything as a process optimization problem and losing out on "innovators" is viewed as a gap in optimality that needs to be filled. An environment tuned to value extraction is inherently going to be hostile to exploration. Can't have your cake and eat it too, buddy.
Corporations, in practice, aren't that. They are not disposable in practice. Large companies dominate their markets, expect to live forever, etc.
Innovations that don't happen within Google, microsoft, etc... those innovations don't happen.
This isn't an absolute statement. Innovations can happen outside and new companies can be founded. We went through a period in internet-based innovations where a lot of innovation happened outside of existing large corporations and became their own giant corporations. That's not a long term norm though. That reality was largely driven by really low capital costs. These days, new internet companies raise a lot more money... mostly to pay for advertising that goes to google and facebook, who control access to users.
More likely than innovation outside of existing companies gets bought into bigger ones.
Consider Tesla. Obviously Musk's abilities played a big part. So did his bank account, his ability to raise capital, etc. It takes that much force to innovate in that market from outside. Very difficult.
I think it's reasonable to ask why existing car companies couldn't pull off anything like it. There are incentive/incumbent reasons, but I don't think these are the whole story.
I agree that innovation should and could come from outside big corporations. But, the reality is that resources, market power and such are highly concentrated within large corporations. There isn't much space to operate outside of it. We can't expect a sub-1% section of an industry to do all the innovation... outside of rare examples like the internet circa 1995-2015.
Also, consider that tech giants are a lot more innovative than incumbents in other industries, largely because of the pressure from small companies and their relative youth. Trains, Planes, Cars, Roads, Banking, smelting, etc... these industries are not like that. Nothing at all happens outside of large corporations, innovative or otherwise.
Usually I leave comments alone unless I agree or disagree, but this is a really easy one to answer - the entire Tesla experiment has been grossly unprofitable so far and there isn't any concrete evidence that any business should follow in Tesla's footsteps. They just posted their first measly profit after a decade with not much to show for it.
It may yet come good and it has been a good ride for shareholders, but if you want to know why nobody is rushing to innovate like Tesla it is because they have been leaking money like a drunken sailor.
The MEB platform is part of a Volkswagen strategy to start production of new battery electric vehicles between 2019 and 2025.[3] In 2017, the VW Group announced a gradual transition from combustion engine to battery electric vehicles with all 300 models across 12 brands having an electric version by 2030.[4]
As of May 2018, the VW Group had committed US$48 billion in electric-vehicle batteries supplies[5] and announced plans to outfit 16 factories to build electric cars by the end of 2022.[6]
They’re also doing more to help the environment than any other corporation (and probably government) on earth.
But, yeah, their quarterly profits kind of suck.
What’s wrong with that? An “innovation” is not always a product. Sometimes it’s just a feature of a larger product.
Apple for instance acquires a company every couple of weeks according to Cook. Those companies’ innovations get integrated into an already successful product.
“The Innovator’s Solution” is for larger companies to start a small independent team not beholden to the corporate structure. That’s basically what an M&A strategy is.
Either way, you now have a more concentrated industry, with a larger share of resources in non innovative hands.
Also, don't rely too much on internet companies for your example. This is (was?) a sector with high, fast returns on innovation, low barriers to entry and low capital requirements. That's not the norm.
Also many of its most strategic acquisitions have been used to design and manufacture hardware from processors, biometric sensors, etc.
Yes I realize Apple doesn’t “manufacturer” anything. But its just a legal construct. More of a difference in degree than kind. It pours billions in its manufacturing partners.
Apple sells 300 million+ physical goods every year.
Boeing I would say has a lot to learn from SpaceX.
>If someone has great ideas, we should invest in the person not in their employer.
But what if the employer is investing? This talks about how corporations dismiss good ideas, but large ones like Bell fostered it. Not sure if Apple had some innovators leave, but if they did, I haven't heard of them.
Bell Labs was a classic blue sky internal research outfit. Modern corporate culture can't quite handle the concept, so modern R&D is more constrained and "results driven."
There's a critical difference between implementing existing ideas and inventing completely new classes of ideas and devices - like the transistor, or information theory as a discipline.
Modern corps do a lot of the former, but not so much of the latter. Far less than Bell Labs used to.
Highly creative people generally rank low on conscientiousness. Organisations as they grow need ALL their employees to be conscientious: organised, punctual, goal-oriented, accountable - to not just to control outcomes but maintain cohesiveness.
Organisation culture stifles those type of people.
For an organisation to keep their innovators they need to be siloed away in an autonomous 'Skunk Works' where they can be free from the bureaucracy required to run a company.
The one thing that corporations are extremely good at is destroying all the initiative and add so much bureaucracy to the development that you loose interest to improve / inovate as you are paifully aware that this will bring in more documents, jira tickets, endless "bicycle shed" discussions, endless covincing of managers that only care about their schedule (which you will corupt by "unknowns"), endless politics as there is always some architect/team lead that "must be the smartest" (and typically those comming to those positions are excelent in navigating buereaucracy and politics and are rarly inovators as those endanger manager schedules, adding risks, ...) and so on.
Too many cooks spoil the broth.
At the end you just figure out it is not worth it , do what you are paid for and you inovate at home.
If those inovations become a startup you just leave.
I worry about the optics of it, but at least have confidence that other developers can see the end result is solid for the total amount of time invested. Smooth workflow for everyone is the other major concern, but again we're lucky to be working on our own system and not beholden to external deadlines.. and I guess lucky to have enough want-to-dos in the backlog that no one is ever without something useful to work on.
We do create a bit of expectation of every developer having at least some tasks each week that are picked up and some that are completed, and it's tempting to just game that a bit to put up some numbers on the weeks where I'm figuring out how to do what I'm about to do.
For JIRA in particular, also avoid creating sub-tasks if you're burn-down is tracking at the task level - as you have to complete all subs for the main task to be complete.
Are you sure about that? I would rather assume that highly creative people often rank low on "tolerating bullshit" instead of having a low conscientiousness.
Probably safe to say dealing with other people's bullshit gets in the way of industriousness and achievement and leads to low agreeableness. ;)
In any case, I just wanted to point out here on HN we value those who back up their claims with good data.
You did this. So, thanks.
https://en.wikipedia.org/wiki/Big_Five_personality_traits#Cr...
Saying refusing to play along is not “conscientious” is classic corporate double speak.
I’ve definitely similar elsewhere. In fact, the article points out that people that “can’t cut it” at corporate culture often go on to create the best companies.
How many of those ideas got out of the page/prototype stage? 0.
Because it seems like the important thing for many is to seem innovative. After that part has been done, interest disappears.
Everyone would rather you excite them with a new idea. So much of this "innovation" stuff is about media and being trendy.
What's the easiest way of keeping you at the company rather than going to innovate somewhere else? Make it as easy as possible for you to get your next "hit" of innovation dopamine.
(I'm being cynical - this isn't necessarily what your employer was doing, but it could have been.)
Realizing that about him made it feel worse somehow.
Or you can use hydrophobic nano coating
There is so much to improve and none of it seemed to ever happen.
So why not turn them into a couple hundred bucks for a page or two of writing?
I have some ideas I quietly research and do not reveal that I may want to turn into a startup one day, but those are just a few of all of them.
For example, my winning capstone project idea during my banking internship was in the mental health space. I have won other prizes in the professional mental health space as well. My interest in ever being in that space beyond ideation is 0 so I am not giving away anything that has other value to me.
Yeah me too. It’s a curse... wish I could focus on just one more often. Things I’ve “invented” in my mind only include mesh networking in 1997 (people thought I was crazy... why would someone share their bandwidth?). Actually submitted that one internally to a company that had the wherewithal and positioning to do it, a multi billion dollar idea, and they said “nope.” That company is now barely a wisp of a shadow of the behemoth it once was.
I’m of the school of thought that it’s the doing that counts, and I respect it when someone brings things past a finish line.
Anyway nice that you’ve found a fun and rewarding outlet for some of yours.
It was so obviously the only way to handle datasets larger than RAM that I assumed it was common knowledge.
I reinvented database query execution engines and an informal relational algebra on top of SQL a few years later. That thing was basically a JSON service API, except it used a home grown XML RPC layer (it was closer to modern approaches than the XML RPC standards being pushed at the time).
Since then, I’ve developed an appreciation for good marketing people.
What kills most of it is the execution, and I'm not talking about the tech side, I'm talking about working within the hidebound structure of a massive organization and all the rules created for the current business.
Need to tweak a policy slightly so you can actually execute? Get ready for a 6 month slog arguing for the change with legal, compliance, finance, etc. I remember working on an innovative idea were were partnering with an external firm on. Took 8 months just to get the ok to proceed.
Almost invariably I find the product idea to be more expensive then I consider a reasonable price.
The next stage of death is the marketing. I've gone through about 25 marketing books, careful notes, annotations, etc, and honestly it's still the most common place of death. Money helps a lot here. So if you want that then go back to stage 1 and see if the price still works.
Then the things that pass that have logistics hurdles in the facilitation of the demand. There's delays, quality slippage, customer relations, it's not easy. You may get caught with a large stock and demand slips and you have to figure out storage, that's an additional cost on things that haven't even sold yet. Ackk.. The details are where the death is.
Innovation exists outside of all of this. Every now and then I hear about someone that went from innovation to product, experienced zero of these issues and just sailed in on easy street.
Those people are just lottery winners by another name. Screw them, that's not common reality. The world has randomness, it can be favorable, luck is something very real.
The hard knock strategies to modest success where you're not worrying yourself to sleep every night don't make sexy stories but it's the 99%. Expect nothing less.
I like being in a big corporation because of the low risk lifestyle it entails, lots of time with the family!
It has nothing to do with managers, HR, or what not.
Say you have 100 innovators in your company. Everyone comes to you with an idea, as an SVP or a Director, can you agree to all of them? You obviously pick and choose. And how can anyone say a new product / service by a company is not the result of an internal innovator?
Alternatively, in the safe environment of a company, as in the innovator is getting capital and resources from the company finances, I think it is more likely that people are more free to give out ideas, even crappy ones. It's easy for a good idea to get lost in the noise.
Ultimately, what is the solution to this? I guess you have to fundamentally change the structure of companies itself.
In the given example, if Cisco were to transfer the innovator to another division, give him some money, on the same terms and conditions as a VC, perhaps it would have borne fruit.
Essentially, it's easy to see companies, once a certain size, are effectively hard wired to move at a slow, glacial pace and focus on sustainability, rather than fast and fail innovation.
Yes, actually you can, as long as you control the parameters around how the idea is tested. We used to do a full 2-week sprint once out of every 16 weeks just to prototype people's ideas. In order to pitch the idea the only constraint was that it needed agreement from someone knowledgeable in that area that a prototype could be accomplished in <= 2 weeks.
Is this actually happening? Are ideas being pitched at a high rate? As at every company I know of that has held an internal innovation competition, interest is quite low.
As in, an opportunity to give away good ideas for no cash and no equity?
Seems to be true even cases like Google and Microsoft.
Cisco actually has a program like this. They maintain right of first refusal to acquire the resulting company, and call them spin-ins.
I think the problem is that they won’t fund things that directly compete with one of their own products, even when their existing offering is terrible.
To do that, they’d have to admit the product is terrible, and that upper management isn’t competent enough to fix it.
For a while IRC was cool, then it was CUSeeMe, then there was Paltalk, and ICQ, and AIM, and Microsoft Messenger and Skype and Lync and Skype for Business and Google Talk and Facebook Messenger, and...
If you look at them closely you can find some improvement (e.g. Zoom has a server that makes the "Hollywood Squares" view of all the participants) but if you look at them broadly they don't seem to have gotten better over time, they've just locked people in, stagnated, then something new comes along. It's hard to see how Facebook Messenger is different from AIM except for what it is locked in to.
If the EU really wanted to show some leadership it would put an outright ban on proprietary chat programs and force them all to use open protocols. Think of it as a part of a "computer user's bill of rights". Every time somebody wants me to download some new chat app I want to throw a hammer through a screen like that Apple 1984 ad.
I'm not sure how to fix that, since lack of freedom wasn't the problem! It probably is just making sure that the right people are leading.
I also don't know how to reduce other engineering groups more focused on practical projects resenting the innovation group working on more fun, low stress projects. That is a hard political problem.
But any innovations put forward were rejected through political games played by non remote employees. On some meta level I was fine with that because while they saw those as petty wins I was living a life of freedom working less than half the day.
Since then I realized the same level of freedom could be had with people who care to leverage innovation instead of striving to fight it. Life was very good, now it's great.
It jumped right out at me and I had to login and reply right away - because my experience is the same as yours, verbatim, for the first part!
I'm presently as you mentioned: fully remote, fixing the hard problems so they keep me well rewarded, doing it part time and enjoying the freedom, the org is political and non remote with culture issues stifling true innovation .. its striking in its similarity I feel like we could be work twins!
I would love to talk to you about the next level, what it is for you and also how you got there. If I can, how can I get in touch with you?
The funny thing is, whenever we have hackathons, hardware teams always end up winning because someone has been sitting on a cool idea that they would never have the time to investigate during their normal job duties.
We have definitely lost a couple of our good people because of this attitude.
As such, they want to build a “fortress” to protect the current business model. Innovation- even internal innovation - can upset the apple cart.
Making things worse, executives running a mature company are often very operations oriented. They’re not the same mentality of a founder (who are conversely often terrible at streamling operations!).
The advantage of starting your own path is that you get 100% autonomy over every decision and every client that you take on. This can give you an incredible uplift because nothing is ever in your way from an organization/people/politics angle.
The disadvantage is that you have to rebuild all that corporate boilerplate in order to establish name/brand/reputation/process/etc. You also don't have many constraints acting upon you when starting from zero, and you can wind up making piles of decisions that roll-up into disaster.
I think the best course of action would be to present your ideas to executive leadership. If you can secure some equity share in the organization or products you propose, this is easily the fastest and least stressful way to get them to market. Being able to reuse your same HR, marketing & sales teams can save you potentially years of headache.
If your current organization is gigantic or otherwise inflexible, you are probably best suited building out your project on your own time, incorporating LLC over the weekend, etc. One day you just put in your notice and move on with your dream.
- “Golden handcuffs” - $BIGCO / $RECENT_IPO accidentally pays way above market because the stock appreciated since the person was hired.
- “Benching” - $BIGCO hires an army of senior people at significantly above market rate to do work that should go to a recent grad. They can’t attract competent recent grads, and can’t retain senior engineers at market rate.
- “Resting and vesting” You did a bunch of quality innovative work, but corporate culture changed and the opportunities to pursue new projects dried up before your stock vested.
Since quality engineers get bored quickly, and most good ideas have a short shelf life, why not pitch them to management while you’re twiddling your thumbs?
LOL, You are lucky if your managers did not take credits of everything you achieved.
For one thing you can't "just" create a replacement; you need employees, capital etc.
So it was much more likely a game of politics rather than one of innovation.
A more useful example would be one involving engineers, not a senior tech exec.
(*) we find out through success or failure, which is at best a proxy.
Any organization (not just a corporation) has to have a lodestar; a “shared vision.”
In some cases, this is a “boat anchor,” preventing the organization from moving forward, but in many cases, it is the thing that holds it together, and allows it to continue its existence; albeit, at a humble scale.
Sometimes, a “boat anchor” is necessary.
Not all organizations are about continuous growth, or even innovation. They may be a “do one thing, and do it well” type of shop, where growth and innovation can actually be harmful.
I know, because I worked in a company like that. They found a product line that was crazy profitable, and it changed the company culture quite drastically. For many years, the company grew like a wildfire. The focus became “blurred.” Lots of money poured in, but I feel like the company may have “lost its soul,” so to speak. The original “lodestar” was never sufficiently replaced with a new focus.
Then, the bottom fell out of the market, and the company suffered an implosion. They contracted back to their “roots,” where a conservative mindset took over.
Will they survive? I’m not sure, but over a century, they did weather numerous disasters and roadblocks (like having a lot of their assets turned to kindling in war). I sincerely wish them well. Despite my frustrations there, I have nothing but respect for them. I learned many important values that I never would have learned at other organizations.
But they are like a cactus; ideal for the harsh conditions of a desert. They are not well-suited for temperate rainforest, where so many other plants thrive.
Innovation and risk-taking was difficult (not impossible) at that company, and many of my efforts to introduce change never bore fruit. It was my decision to remain with them, despite that.
Basically, some organizations are just not places where innovative staff can thrive. They are stony, dry soil; ideal for cactus, but not for redwood trees. That is not always a bad thing.
In those cases, the innovators either have to accept that they will have to live within great constraints, or they will need to move on.
Probably the only reasonable way for a company to be able to take profit from these innovators is to make it easy to spin out with a favorable equity position.
Isn't this the most obvious reason? If you have an idea and the capabilities to develop it for your own gain, why would you do it so the shareholders of your old company can buy a new yacht, while you struggle to buy an apartment?
Unless innovators are rewared with equity in the innovation (not the broader company - the reward needs to be tightly coupled with the power of the innovation), there's no incentive to produce extremely successful innovations. You won't be rewarded for outliers. That's all there is to it.
I was so enthusiastic after graduating .. i adopted the product, made it upgradable (8 year old repo, 1 programmer before me who was a sysadmin) - made it into a modern 12 factor app, before i even knew what that was.
One thing i learned is that innovators dont belong in certain environments .. those innovators didnt belong where they were .. and that was their wake up call, at least, it was mine.
Now i found a work place that appreciates me energy, and took me in as a fullstack dev and im so thankful, and careful. Im sure some devs there cant hear what i have to say. I learned, to speak less. Do more. Hobby? Ill make my own. A work place needs me to make it better - not to have me judge it .. its not easy thing to balance or properly execute if you Want to keep your soul.
For my next job, I was careful, it took me 4 months of interviews that tried to pitch a junior/mid and secretly wanted a senior .. but eventually, i found a home.
But sometimes its really necessary to wake up, and see that your efforts are being wasted, and move on. Left them better than i found them, and but i neglected myself and it was a valuable lesson in self care and the significance of my own time.
Another important lesson is growing beyond having milk teeth .. we should look around, and see where we are, and what kind of people are there ... are we making enemies, or injecting spirit?
Its no easy, those devs didnt belong in those companies to begin with. It was a life lesson to all involved.
Cisco is pretty explicit about the model: its not uncommon that someone quits to develop a promising technology (and even someone else quits to develop an alternative approach). If one or both fail, or come in second, you VP an get your job back. While if one succeeds Cisco can buy the company.
This allows them to provide bonuses for developing something new without screwing up their comp system and allows smart people to develop new stuff even if there are institutional biases.
For many years they were an acquisition machine for this reason. Really the opposite of today’s “Acquihire” model.
So not a failure at all.
Customers want "this product but better", that the innovation will be limited around that product's initial characteristics.
Of course another line of product can be independently developed, but it's riskier as customers may or may not want that kind of product.
Having that said, I think the new product innovation has ground to a halt after Steve Jobs, mainly because of the overall mindset of the company changing from a services centric one from a product centric one. Their focus has gone onto News, Music, Storage, Cloud and other service areas. Macs and Phones continue to get refreshed but are too pricey for the quality they offer, which is why they have not been able to make a dent outside EU, US and China (or in other words, emerging markets).
How likely is it, for instance, that Zoom will internally develop the VR chat app that will be to Zoom what Zoom is to Cisco?
From my personal experience, I think the major thing that always stymied creativity for me was office politics. Having to constantly watch your back for someone with a knife can really drain your energy from just, you know, doing a job you otherwise enjoy.
Only thing Cisco could have done better was establish a venture capital division to fund work beyond its internal controls. Yet, they would probably only fund ideas by top performers and this in itself wouldn't ensure greater success because metrics, politics and culture driving employees performance do not imply excellence or deficits.
I not saying big corporate environments don't stifle innovation but maybe there's some sanity in not investing in every "innovative" idea?
Totally we can see 8 options here; Pick the best one that fits in your company;
If I have a good idea, I will benefit for it or nobody.
> Three reasons companies lose their best innovators.
> 1. They fail to recognize and support the innovators
> 2. Innovation becomes a herculean task
> 3. Corporations don’t match rewards with outcomes
While the paragraphs under point 2 do discuss risk and the paragraphs under point 3 do discuss rewards, I'm not sure this article belongs here.
Risk and Reward.
Large corporations are able to pay people by doing things at scale; with sufficient margin at sufficient volume to justify continued investment. Risk is minimized by focusing on ROI.
Startups assume lots of risk and lots of debt and most don't make it. Liquidation preference applies as the startup team adjourns (and maybe open-sources what remains). In a large corporation, that burnt capital is reported to the board (which represents the shareholders) who aren't "gambling" per se. "You win some and you lose some" is across the street; and they don't have foosball and snacks.
How can large organizations (nonprofit, for-profit, governmental) foster intrapreneurial mindsets without just continuing to say "innovation" more times and expecting things to happen? Drink. "Innovators welcome!". Drink water.
"Intrapreneurial." What does that even mean? The employee, within their specialized department, spends resources (time, money, equipment) on something that their superior managers have not allocated funding for because they want: (a) recognition; (b) job security; (c) to save resources such as time and money; (d) to work on something else instead of this wasteful process; (e) more money.
Very few organizations have anything like "20% time". Why was 20% time thrown off the island to a new island where they had room to run? Do they have foosball? Or is the work so fun that they don't even need foosball? Or is it worth long days and nights because the potential return is enough money to retire tomorrow and then work on what?
Step 1. Steal innovators to work on our one thing
Step 2.
Step 3. Profit.
20% Project: https://en.wikipedia.org/wiki/20%25_Project
Intrapreneurship: https://en.wikipedia.org/wiki/Intrapreneurship
Internal entrepreneur: https://en.wikipedia.org/wiki/Internal_entrepreneur
CINO: Chief Innovation Officer / CTIO: Chief Technology Innovation Officer https://en.wikipedia.org/wiki/Chief_innovation_officer
... Is acquiring innovation and bringing it to scale a top-down process? How do we capture creative solutions and then allocate willing and available resources to making that happen?
awesome-ideation-tools: https://github.com/zazaalaza/awesome-ideation-tools
After a recipe to some initial commercial success has been painfully discovered, then the only strategy that make sense is to replicate it to grow the company. The initial recipe will be scientifically and meticulously improved, optimized, refined and scaled in all its components. Possibly by deploying additional capital, because the investment is now much less risky. This is what professional managers do. They perfect the execution of a recipe and balance risks doing so. Because now, as an established company with many shareholders, thousands of employees, suppliers, customers … the company has so much to lose by doing anything risky. Any established company must be risk averse or it will quickly disappear.
Fast forward a decade or more of commercial success optimizing the same recipe with a risk-averse mindset, which still has room for some internal innovation but only of the incremental type, then any company is no longer fluid but solid. If it’s a public company obsessed with short terms returns, then it’s a very dense solid. It is also a large organization by now, with many gatekeepers to company resources. An internal innovator would have to convince all of these gatekeepers for any significant new endeavor. This is clearly impossible unless the internal innovator is the CEO of the company. That's why companies lose their best innovators. That’s why significant innovation cannot be produced inside large companies, but it can nevertheless be brought in via acquisitions ... sometimes from ex-employees who left to start their own company!
What you see as an established company today, you can also see as a “fossil of its past successes”. That’s why an established company cannot be an innovation machine in my opinion. This was not always the case in the past. It’s probably a consequence of contemporary professional management, with too much emphasis on short-term, low risk and immediate returns.