Yesterday I did a fireside chat at our portfolio company Shippo and someone asked the question how a company can continue to be successful and grow over a long period of time. My answer was: continue to innovate. A company that wonderfully represents that spirit is MongoDB. Eliot Horowitz, the co-founder and CTO of MongoDB, just announced in a blog post that MongoDB 4.0 will support multi-document transactions.
You should go read the post as it is great, including the epic title “MongoDB Drops ACID” (which I will explain later), but here is the quote that really stood out to me (emphases in bold are mine):
One of the most common questions I get asked by senior managers is “How can we find more innovative people?” I know the type they have in mind — someone energetic and dynamic, full of ideas and able to present them powerfully. It seems like everybody these days is looking for an early version of Steve Jobs.
Yet in researching my book, Mapping Innovation, I found that most great innovators were nothing like the mercurial stereotype. In fact, almost all of them were kind, generous, and interested in what I was doing. Many were soft-spoken and modest. You would notice very few of them in a crowded room.
So the simplest answer is that you need to start by empowering the people already in your organization. But to do that, you need to take responsibility for creating an environment in which your people can
When Amazon opened its cashier-less concept grocery store to the public in Seattle on January 22, the company’s stock rose 2.5% – slightly more than the 2.4% increase after Amazon announced that it was buying Whole Foods this past June. Does Amazon Go signal that smartphone apps and virtual carts will replace checkouts in grocery stores?
A low-cost, automated store is certainly an experiment worth watching. But retailers shouldn’t rush to rip out their registers just yet. Retail is littered with promising technologies introduced with great fanfare that didn’t become mainstream because they didn’t sufficiently benefit either the retailer or the customer.
One reason is that new tools often don’t save the retailer enough or generate sufficient new revenue to cover their cost. Another is that too many customers simply don’t like them. To become the new normal, a technology has to make it beyond
It is clear from some of its recent moves that Amazon sees the 18% of U.S. GDP dedicated to health care as fertile ground for expansion. Consider its decision to pursue the market for pharmaceutical distribution, or the recent announcement that it will be teaming up with Berkshire Hathaway and JP Morgan Chase to create joint solutions for reducing the health care spending of more than 1 million employees and their families.
This latest move has engendered robust debate. Proponents liberally term it “disruptive,” seeing a natural diversification opportunity for the company that has aspired to be “earth’s most customer-centric company.” Meanwhile, skeptics highlight Amazon’s lack of expertise in health care, a sector that many deem curiously resistant to the competitive forces that characterize the retail and web services markets in which Amazon has thrived. Given this state of affairs, it is worth thinking about Amazon’s efforts in a conditional
Can we please agree that there is no such thing as a corporate entrepreneur?
The term corporate entrepreneur devalues what real entrepreneurs do, and it creates a haze of hokum around people trying to innovate in large companies that sets them up to fail.
There is an ocean of difference between people innovating or designing new offerings inside a large company, and actual entrepreneurs. On one shore of the ocean is certainty — the steady paycheck, the options vesting, status, the cushiness of a corporate campus — and on the other is the possibility of incredible wealth. Fly-your-own-plane-to-your-own-private-island-level wealth. And in between the two shores are a million ways to fail, to sink without a trace.
I have now interviewed hundreds of actual entrepreneurs — including founders of Amazon, Apple, Biogen, Boston Scientific, iRobot, Netflix, PayPal, and YouTube — as well as new venture and innovation leaders in large companies like Disney,
Just the announcement that Jeff Bezos, Warren Buffett, and Jaime Dimon will be entering the health care space has sent shock waves for industry incumbents such as CVS, Cigna, and UnitedHealth. It also puts a fundamental question back on the agendas of CEOs in other industries: Will software eat the world, as Marc Andreessen famously quipped? Is this a warning shot that signals that other legacy industrial companies, such as Ford, Deere, and Rolls Royce are also at increased risk of being disrupted?
To start to answer that question, let’s tally up the score. There are three types of products today. Digital natives (Amazon, Google, Facebook, Microsoft, IBM) have gained competitive advantage in the first two, and the jury is still out on the third:
Type 1: These are “pure” information goods, where digital natives rule. An example would be Google in search, or Facebook in social networking. Their business models benefit
Diversity is both an issue of fairness and, some say, a driver of innovation and performance. To assess the latter claim, we undertook a large, cross-country study into the relationship between multiple aspects of managerial diversity, the presence of enabling conditions such as leadership support for diversity, and innovation outcomes.
We surveyed more than 1,700 companies across eight countries (the U.S., France, Germany, China, Brazil, India, Switzerland, and Austria) and a variety of industries and company sizes, examining diversity in management positions, measured with respect to gender, age, national origin, career path, industry background, and education. We partnered with the Technical University of Munich for the statistical analysis of the results. We examined the correlation of these variables both individually and collectively, with the percentage of revenues coming from products introduced in the last three years as a proxy for innovation impact. Innovative companies are taken to
The restaurant industry is notorious for being competitive, risky, and low-margin. This is no less true for the world’s most acclaimed high-end restaurants. Despite being able to charge hundreds of dollars for a meal and being fully booked months in advance, top restaurants often still have a hard time turning a profit. And they face an even greater challenge: maintaining flawless consistency, while simultaneously being innovative and cutting-edge.
While cooking is seen as creative, high-end cooking is mainly about constant, rigorous repetition, in a highly controlled and hierarchical environment. To receive three Michelin stars – the highest rating given by the prestigious Michelin Guide – restaurants must deliver a consistently flawless experience over many visits. This means achieving precise standardization and strong quality control.
For example, at The Fat Duck in the UK (which has had three Michelin stars since 2004, except in 2016 when it closed for
GoPro has been a truly amazing one-hit wonder. Unfortunately it remained a one-hit wonder with its wearable box-style action cameras under the Hero brand, and never produced a viable second product. A few years ago it tried to diversify by announcing an ambitious drone project called Karma, but that effort was plagued with problems all along, ultimately leading to the company entirely exiting that business this past week.
GoPro rode high on the back of the rise of social media since 2010, and the excitement around incredible action-images on Facebook/Instagram etc. I remember 2014–2015 when you couldn’t pass through an airport without noticing GoPro cameras and accessories on sale, and Virgin Airlines even featured a GoPro action-cam channel on its in-flight entertainment system.
Since then the company has faced tremendous competition, pricing wars, and commoditization of its hardware business, and has struggled to develop a software platform that would garner engagement.
A decade ago, Microsoft was considered a dinosaur. It had missed the shift to mobile, was out of step with consumer tastes, and seemed too big and slow to adapt to a digital world that was moving at hyperspeed. Yet today the company is thriving again, largely driven by its growing cloud business.
This is not a new effort. In fact, it began in the early 2000s, but was little noticed until recently. In much the same way, IBM’s Watson project, which is helping the venerable company overcome the disruption of its traditional business, began in 2005. Google has created its own moonshot factory, to pursue game-changing technologies that may take years to pay off.
In recent years, we’ve come to associate the practice of innovation with speed and agility, but accomplishments that truly move the needle can’t be achieved quickly or through mere iteration.
So I am still away on family vacation and following a self-imposed online diet, but even then it has been impossible to ignore the monster sized vulnerabilities disclosed today known as Meltdown and Spectre. And just to make sure nobody misreads my post title, these are bad. Downright ugly. They are pervasive, exploitable and a real longterm fix will likely require new hardware (one ore more extra hardware bits in the CPU). So how can I possibly claim they are good? Here are four different ways I think these vulnerabilities can give an important boost to innovation.
1. Faster Adoption of (Real) Cloud Computing
One might think that Meltdown and Spectre are terrible for cloud computing as they break through all memory isolation, so that an attacker can see everything that’s in memory on a physical machine (across all the virtual machines). But I believe the opposite will Continue reading "Meltdown and Spectre are Good … for Innovation"
As Chieko Asakawa walks around IBM’s campus, she explores new ways of getting from point A to point B. She recognizes the faces of colleagues approaching her and greets them. She reads snack labels and decides whether to eat them. Although she is blind, Asakawa doesn’t need a human or canine companion to complete these tasks. She’s helped invent a smartphone app that, as she explained in a recent TED talk, “understands our surrounding world and whispers to me in voice or sends a vibration to my fingers. Eventually, I’ll be able to find a classroom on campus, enjoy window shopping, or find a nice restaurant while walking along a street.”
Asakawa has been able to turn her disability into a professional asset, to the commercial benefit of her employers. But many people with disabilities enter workplaces that don’t enable them to do the same.
Today, many companies see open innovation — a process for sharing knowledge and ideas with other organizations — as a core part of their strategy for developing new offerings. Examples include L’Oréal working with Renault on an electric “spa” concept car and auto-parts makers Delphi and Mobileye joining forces to produce an autonomous driving system. Many companies have found that such partnerships generate cost savings and creative insights.
Oddly, however, although both the depth and breadth of intercompany collaboration continues to increase, the actual adoption of the ideas developed this way does not seem to be rising at the same pace. In a recent poll by Accenture, more than 50% of the surveyed corporations said that these partnerships don’t seem to be yielding as many new products or other benefits as they had hoped. Similar to earlier studies, our research suggests the reasons more
But the tax bill’s effect on innovation won’t depend solely on the provisions dedicated to universities or corporate R&D. As two recent studies remind us, the likelihood that would-be inventors live up to their potential depends on many other factors — not just their abilities but also the environment they grow up in; the incomes of their parents; the quality of the public services they receive, particularly education in science and math; and the health of their communities. And those things depend on public policy, including taxes. The weight of
Humans tend to think in terms of lines. Point A to B to C. Great innovation draws a new line. This occurred to me when I was reading Seth Levine’s post on how startups grow and thought about this. While it’s intuitively obvious that innovation jumps the track and builds a new track, I don’t think it’s exactly clear when it’s happening. Of course, the best innovation is when you look in the rearview mirror and wonder why you didn’t think of it. Post an innovation being successful we wonder why we never had it before.
If you need an appendectomy, call a surgeon. But if you’re seeking a CEO for a surgical device company, an MD may not be your best choice.
To be sure, entrepreneurs in highly specialized and technical industries need the knowledge that only users (doctors, lawyers, engineers, and the like) can provide. Doctors understand what other doctors will value in a new product; lawyers know what other lawyers need. But you can have too much of a good thing — including input from such experts. In fact, my colleagues and I have found that innovation thrives when expert users make up about 40% of an invention team. Any less and the company will lose sight of what its customers need; any more and the group will tend to converge on old ideas.
Although companies use crowdsourcing more and more to fill their innovation pipeline, it is not so easy to get people to submit their ideas to online innovation platforms. Our data from an online panel reveal that 65% of the contributors do not come back more than twice, and that most of the rest quit after a few tries. This kind of user churn is endemic to online social platforms — on Twitter, for example, a majority of users become inactive over time — and crowdsourcing is no exception. In a way, this turnover is even worse than ordinary customer churn: When a customer defects, a firm knows the value of what it’s lost, but there is no telling how valuable the ideas not submitted might have been.
Despite this limitation, companies still get a lot out of crowdsourced ideas. Encouraged by early successes, many now routinely use
In June, even as his company was enjoying unparalleled success with its subscribers, Netflix CEO Reed Hastings worried that his fabulously valuable streaming service had too many hit shows and was canceling too few new shows. “Our hit ratio is too high right now,” he told a technology conference. “We have to take more risk…to try more crazy things…we should have a higher cancel rate overall.”
As a teenager, Mike Pfotenhauer loved to hike, but he hated how uncomfortable he felt carrying the backpacks then on the market. So, at age 16, he created his own, sewing all the pieces together himself. He went on to design and deliver customized outdoor equipment to clients who’d heard of him through the grapevine, and eventually he founded Osprey, a company that designs and manufactures all kinds of specialty bags and packs, with user-friendly features such as body-hugging contours, a top “lid” flap that converts into a spacious day pack, and a magnetic connector to secure the drinking tube from the built-in water reservoir.
This story exemplifies one type of empathic design, namely by a user-designer who combines deep knowledge of product use with the ability to foresee new possibilities for it. Another well-documented way to achieve the same outcome is through ethnographic research — surveying
Jeff Immelt ran GE for 16 years. He radically transformed the company from a classic conglomerate that did everything to one that focused on its core industrial businesses. He sold off slower-growth, low-tech, and nonindustrial businesses — financial services, media, entertainment, plastics, and appliances. He doubled GE’s investment in R&D.
Andreessen’s article helped accelerate the company’s digital transformation. GE made a $4 billion bet on connecting industrial equipment through the internet of things and analytical software with a suite of products called Predix Cloud.
In response to Ries’s book, GE adopted lean methods and built its Fastworks program around them. Beth Comstock, GE vice chair responsible