Shostack + Friends Blog Archive


Distributed Innovation

In the New York Times, Virginia Postrel writes about the work of Eric von Hippel, head of the Innovation and Entrepreneurship Group at the Sloan School of Management at MIT, who has a new (academic) book, “Democratizing Innovation.”

But a lot of significant innovations do not come from people trying to figure out what customers may want. They come from the users themselves, who know exactly what they want but cannot get it in existing products.

One of the themes I’ve meant to explore is how interesting new things appear out of the froth. Emerging from the Chaos. Postrel discusses open source software, along with a variety of sports. She also covers restaurant recipes:

To help chefs create the final recipes themselves, Ernie Gum, director of food product development for the Nestlé FoodServices division of Nestlé USA, developed what Professor von Hippel called a “tool kit” of preprocessed food ingredients identical to those actually used in the factory – for example, a chili purée processed on industrial equipment. In field testing, Professor von Hippel found, the tool kit cut the time to develop new foods from 26 weeks to only 3.

I think recipes are a fascinating example, because they exist in a space that’s being squeezed. That is the area not covered by intellectual property rules. If I have, say, butter-poached lobster, or squash and goat cheese pizza, I can go make it, at home or in my restaurant. Both examples are generally acknowledged to have been created by particular chefs (Thomas Keller, and Alice Waters, respectively.) Some cookbook authors will acknowledge that, others don’t. But neither chef can come after you with a recipe patent, and that lack of threat is critical to innovation.

Great companies learn how to either tap innovation, or do a good job defining ways that they create an ecosystem around their new products. In the computer business, a good deal of the success of Microsoft Windows is attributed to how well Microsoft did at making it easy to program. They took steps to lower the cost of entry. Apple, traditionally, has not. But it offers beautifully designed products, like the ipod, that have a few well defined interfaces, and those interfaces are being used in a host of innovative ways. Companies that neither make their products easy to enhance, nor make them stylishly desirable, end up like General Motors.

Back in the computer business, it took me all of 15 minutes to add the Technorati links to the bottom of my posts. Most of that was because I spent a few minutes trying to figure out how to make Movable Type encode links for Technorati. Then I said, hey, I bet they’ll do the right thing, even if I’m lazy. And they do. I then messed up the Movable Type syntax, and that took longer to fix. Technorati made it easy, MT made it harder. Hmmm.

One final note. I think the name of Professor Hippel’s book, “Democratizing Innovation” is unfortunate. It’s not a matter of democratization. People have always voted (with their wallets) for products that help them solve problems. What the tool-kit approach really does is drive down the costs of bringing a new product to market. Bringing down costs reduces risk. It accelerates the innovation cycle. Democracies are about picking winners that everyone can live with. In stark contrast, most people have no idea about most of the new innovations. They’re emerging too quickly to track.