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RE: The Innovation Problem


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RE: The Innovation Problem
Topic: Technology 11:48 pm EST, Dec 28, 2008

Acidus wrote:
Let me explain. I work for a Fortune 15 technology corporation. They pay me very, very, very well. However in return I'm subjected to (with a fair bit of good things) unbelievably stupid bullshit. They don't seem to realize that I couldn't give 2 shits about their money otherwise I'd have alot less bullshit in my life.

Jay Chaudhry met with me twice in the spring of 2008 and asked me to join his new start up Zscalar. I turned him down for a couple reasons, the biggest being he kept appealing to the wrong side of me. He kept talking dollars, he never talked projects. How are you doing "in the cloud" security. Are you buying or building? Which parts are you buying and which parts are you building. I'm not leaving a role where I get to shape research and product features to babysit a farm of 1U Barracuda boxen. I even flat told him I don't care about money and he looked at me like I was an idiot. And still could not to my satisfaction tell me what I would do.

I go for the project. Yet at both ends of the extreme, from large to small, companies kept appealing to the money side of the "pay/project" coin. From my limited experience the "performance mertic pay" side is taken care of at both extremes of company size and type. Perhaps I'm just really lucky.

However that's not true for the project side of the coin. Smart people go where the innovative products are. And while rewarding performance may be taking hold in large corporations (and I'm certainly proof that it does) innovation is still very much tied to seniority.

So, in my view, the "performance metric problem" is one side of the problem coin. However I believe it is second in importance to the other, far larger and undiscussed side: "The Innovation Problem". The Innovation Problem is this: It is easier for smart people to develop new products or technology in a start up and have a higher degree of success than doing so of inside a large technology corporation.

This is odd considering that the costs of starting a start up are approaching zero. It should cost a corporation hardly anything to incubate new ideas. And indeed I see "incubators" at tech firms all the time. And like startups, most fail. However they fail for far different reasons than traditional startups fail. In-company incubators fail because they starve.

You don't see it unless you have lived in both worlds. At large corporations "innovation" comes from a certain group of people. Phd. Senior Fellow. Technologist. Vint Cerf style. These groups have support structures because they are somehow viewed by the corporation as the "real researchers" even though what they are doing is often identical to incubator groups.


A commonly quoted figure is 9 out of 10 new businesses fail. In a nutshell "The Innovation Problem" says you have less than a 10% chance of navigating the bureaucracy of a large corporation to create something new. Its better to do it external of a large corporation.

All true, and all valid. So, the real question is, when are large corporations going to wake up to the talent pool that is NOT the Phd., Senior Fellow? It's not. The reason that it isn't going to go that route, is that the large corporations can wait to see which of the start-up companies incubate those good ideas, bring them to the forefront and prove a good revenue model. Once they've done that, the large corporation simply purchases them.

Just like the HP acquisition of SPI Dynamics, and a myriad of other technology acquisitions over the past 15 years. There simply isn't a reason for Large Corporations to keep "breeding" new ideas... that's so, ... 1950's.

I hate to say it, but if you want to work for Large Corp, you get the stable job, with the stable pay, and the stable benefits, or you take the risks at the start-up, and get the freedoms, challenges, and get to drive the product/solutions. Rarely, if ever, do you get both... If you ever do, for the love of God, don't blow it.

That's my 2ยข, YMMV.

RE: The Innovation Problem

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