This week we spoke with Vinnie Mirchandani, former Gartner analyst and founder of Deal Architect, about his new book, The New Polymath: Profiles in Compound-Technology Innovations. Mirchandani will be in Paris to speak about the book next Friday, July 23, at Delaville Café.
What is/should be government’s role in innovation?
I give examples of the Chinese, for example. A very, very speed-driven investment economy. They are starting to make investments in clean tech and we kind of consistently underestimate them, and how in fact they’ve become – or will soon become -- one of the biggest players in clean tech. Their image is one of polluters and all that, but in fact they’ve been making a number of [clean tech] investments. I give the example of how Germany, through subsidies and so on, encouraged the development of its own Solar Valley.
In the GE case study I point out how GE is collaborating with various universities and other academic and government bodies. In the BP case I point out how they were a little sensitive about that, but you can imagine a multi-national like BP talks a lot to government agencies on a whole variety of topics. I think government is an important player in all this. I have numerous examples where the government, either at the state, local or federal level is helping along all these innovations. One of the messages from the book actually is that I’m really concerned that Silicon Valley doesn’t realize what is going on both in corporate America and around the world. Silicon Valley has this very internally focused view – Google and Apple and Facebook and Twitter are God’s gift to Earth. As much as we all respect it, it’s just a small part of the overall innovation.
What kind of challenge does this pose to Silicon Valley?
Having made that statement, I’ve got Kleiner Perkins as a case study in the book. They’re a Valley-based firm that is investing heavily in clean tech. I have Plantronics as a case study, which is an audio-device company; I have Salesforce.com, which is a SaaS company, as a case study. So don’t get me wrong: it’s not like Silicon Valley is dead by any means, but I also point out a lot of corporate examples, GE, BMW, Nike.
There’s plenty of corporate examples, and in the government realm I’ve got a whole case study of the National Hurricane Center, how they analyze a bunch of data to be able to track storms and so on. I pulled out smaller examples in Macedonia, Rwanda and Estonia. These are all national examples. To me innovation is not just shipping two million iPads in a month – it’s about moving the ball forward no matter where you are. And so that could happen in Estonia, which was communist 20 years ago and now is probably one of the most digital societies per capita there is. That’s a huge amount of innovation.
What are the barriers to innovation?
I don’t think you can generalize. I give examples of big companies like GE that are innovating quite a bit. On the other hand, I’m very hard on the big telecom companies. I start off by talking about France Telecom, all the suicides there. They probably didn’t want me to, but that is one organization that is struggling with change. You look at AT&T and Verizon here, you look at BT in the UK – these are dinosaurs, for the most part. I’m not really kind to them; I’m not really kind to 2 or 3 of the software vendors like Oracle and SAP. These are 20, 30, 40, 100-billion dollar companies that are really not innovating. They’re just milking what they’ve developed 10, 15, 20 years ago. So I don’t think you can generalize and say ‘big is bad,’ and ‘small is nimble’ or that ‘Asia’s where it’s coming from.’
I started with certain hypotheses [like] “All big companies are too fat, dumb and happy,” and then I went to GE and I said “Wow.” It’s amazing, the amount of innovation that’s going on in its different business units. Much more so than Google or Apple. They would run circles around most of the Valley, based on the 1800 researchers they have; in every discipline there, they have Ph Ds. These guys are into some basic, but certainly a lot of applied, research that very few other companies are. And this is a $200 billion company, so you can’t generalize.
I saw examples at BP which unfortunately, because of the spill, is getting all the negative press, but they have a group of 12 people – just 12. It’s remarkable, the amount of innovation they’ve delivered in the last 10 years. So this is a small group within a big company that – you know, you could say the big company is dodgy or whatever – after the oil spill you can call it whatever you want. But that small group stood out; it’s like a diamond in the rough there.
You talk about left-field thinking in your book, the fringe where the ideas come from. Can organizations develop that, or does it have to grow organically?
I think most big companies, and even small companies can. I think the Valley has it in spades also, where if you’re successful – the justification usually is ‘I’ve survived 10 years and I’ve grown to 3 billion, or 20 or 100 billion. I must be doing something right.” So you tend to feed on what you know, you tend to stick to your values, you tend to stick to what brought you to the dance, if you will. My point is that’s okay: in the end you may go back to what you know best, but for God’s sake, every time you have an opportunity, at least look outside. I point out I think 10 examples.
I think some of them are business models, innovation ideas, a couple of them are talent ideas, where to find the site, using women as technology innovators. I think the industry has done a poor job of leveraging women. So that ‘left-field’ idea, it’s right here. Why don’t we look at them and see what we do better. I have an example of rural sourcing; I gave an example of this guy who is using an Arkansas-based labor force. We’ve tried off-shoring and it’s worked pretty well, but why not try something right here? I give an example of the freemium model. Is it right for a change? I think it is.
I kind of question whether we can keep going the way we’ve defined freemium. My basic point is that we tend to do just what we are comfortable with, and that chapter was meant to challenge that idea and say ‘Look at the exotic.’ The chapter is titled “Exotic,” because the tendency is, if it’s that different, you don’t hustle towards it. That was my left-field example.