Can Innovation save the US?

During the last couple of weeks, perhaps provoked by the year end, I've seen over a dozen of articles and columns arguing that innovation will save the US economy. While no one can argue against the critical role innovation plays in any economy, proclaiming that innovation will save the U.S. misses the point in so many ways.

First, it seems to ignore the fact that the rest of the world is also riding the innovation wave. Granted, United States enjoys many competitive advantages in the innovation arena but, to use a somewhat abused term, the world is flatter and the competitive landscape is leveling out.

Second, proclaiming innovation as the cure-all is delusional. Competitiveness and economic growth are wicked problems. By wicked, I mean ill-defined, multi-dimensional, non-linear, and complex. As tempting as it may be, proposing a single factor as the absolute solution ignores the multifaceted nature of the beast.

To top it all off, most of the pro-innovation arguments call for "top-down" heavy solutions - create a Federal Innovation Office, establish an Innovation Fund, pass an Innovation tax credit. They seem to ignore the "bottom-up" side of the equation. If innovation will play a protagonist role in ailing our economy, and it will, it won't be through an exclusive "top-down" approach.

I'm an innovation freak. My career has revolved - in many ways - around the innovation theme. To hear innovation proclaimed as the "true" or "only" source of competitive advantage is music to my ears. Unfortunately, the world is a lot more complex than that.

A final comment from a very different angle, our conceptual faculty gives us the capacity to abstract beyond the specifics of multiple instances and integrate perceptual entities into a single cognitive device - i.e., a concept. That's how we form words. The concept chair stands for all types of chairs; past, present, and future. We can repeat this process with the concepts chair, sofa, and table; and arrive at the concept furniture. Further cycles of abstraction will get us to things or stuff.

So, there's nothing wrong with our interest in naming the final cause of competitiveness, wealth, and economic growth. It’s in our nature – as conceptual beings – to do so. It’s just that innovation – as with quality in the 70’s – is too concrete an answer. If you’re really after the final cause of competitiveness, let me volunteer our ability to think. There you have it. What do you think?

We've lost an extraordinary bottom-up innovator

The best tribute we can pay is to heed his advice...

Borders' Demise

It took me some time to write this entry.  I've been carrying the picture on my iPhone for weeks.  It wasn't until today that I mustered the energy to upload it to my blog.

As you all know by now, Borders closed shop.  They went bankrupt.  The brick and mortar business model finally collapsed.  For some time, it seemed they could co-exist with their virtual counterparts.  There is, after all, something about the touch and feel of books that an electronic download can't provide.  Nevertheless, their business model became unsustainable.  You can search the blogsphere for the reasons of their demise.  For sure, a complex combination of factors - not one single cause - are the culprit.

What brings me to write about this unfortunate outcome is an earlier blog entry I wrote on October 1, 2009 (you can hyperlink to it on the Blog Archive at the right).  In it, I made reference to the emergence of Borders impromptu "chess club" as an example of an emerging strategy and an instance of bottom-up innovation.

Although that blog entry described but one specific instance of bottom-up innovation, I couldn't resist reflecting on the fact that, in the end, it didn't matter at all.  Of course, business success is not a one variable equation.  Interestingly, Borders held one of the highest ratings in customer experience.  Does Borders' demise mean that customers need not be treated appropriately?  Of course not.

So, rather than dump the whole bottom-up innovation thesis, Borders' bankruptcy should prompt us to fine tune the concept and, perhaps more importantly, the context in which the concept is valuable.  Toyota's leadership, for example, recently went through a similar reflection regarding their continuous improvement process.  Even an organizational system that generates between 20 and 30 ideas per year per employee with an implementation rate of 80% can not exclusively depend on bottom-up innovation to succeed.

Should we dismiss bottom-up innovation as a "nice-to-have" because of its vulnerability against force majeure or are our expectations misplaced when it comes to understanding the benefits of a bottom-up initiative?

Comments... ?

Democracy in Retreat

The Economist Intelligence Unit recently released their 2010 Democracy Index report. They titled it Democracy in Retreat. Let me quote from page 2 of the report:

“Disappointments abound across many of the world’s regions. Authoritarian trends have become even more entrenched in the Middle East and much of the former Soviet Union. Democratisation in Sub-Saharan Africa is grinding to a halt, and in some cases is being reversed. A political malaise in east-central Europe has led to disappointment and questioning of the strength of the region’s democratic transition. Media freedoms are being eroded across Latin America and populist forces with dubious democratic credentials have come to the fore in a few countries in the region. In the developed West, a precipitous decline in political participation, weaknesses in the functioning of government and security-related curbs on civil liberties are having a corrosive effect on some long-established democracies”.

History is an extraordinary long-standing experiment. Its most important lesson is the fountainhead of wealth and progress. A thorough review of the tides of civilization from the Dark Ages to the present point towards an irrefutable conclusion: freedom and knowledge. A mind that is free to explore, experiment, and learn, and that owns the product of its thinking drives wealth creation and progress. An enslaved mind doesn’t.

How does this relate to innovation, bottom-up or top-down? Be my guest; connect the dots.