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The Innovation Trap (and How to Avoid It)
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Transcript of The Innovation Trap (and How to Avoid It)
The Innovation TrapAnd How To Avoid It
New Economic SchoolGuest Lecturer on Innovation: Steven GeigerJanuary 23, 2013 Moscow
Topics
• Why countries are chasing innovation
• Common traps they fall into
• Specific challenges to innovation in Russia
• How to avoid innovation traps and succeed
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Why Countries are Chasing Innovation
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Why countries are chasing innovation
• Prosperity through economic growth
• National security
• Fear of “falling behind”
• It’s trendy
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Prosperity is no accident
It is the result of planning, investment,
risk-taking and innovation
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US R&D spending
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McKinsey innovation map
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So most countries chase innovation
HsinchuTainan
Leading global innovation centers8
If only it were this easy . . .
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Typical Innovation Traps They Fall Into
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“We must be like Silicon Valley”
• Tendency to blindly copy California model
• But SV is a culture, not a place. . . easy to copy culture?
• Timing issues; is SV model even still relevant?
• You’ll never lead through imitation; find your own style
2% to make it
50% for innovative IP
Who do you want to be?
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“We must have a shiny new city”
• “Field of Dreams” approach
• Try to avoid the “Edifice Complex”
• Remember, these were all built in a student dorm or garage:
Masdar City Skolkovo Songdo
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“The parts will make a whole”
• The abiogenesis approach: abstract, sterile assembly of “innovation components” that magically come to life
• Create an “innovation ecosystem” …and hope the “magic” happens.
• Magic doesn’t happen, you make it happen.
Alexander OparinCoacervates
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Think of innovation as a Rubik’s Cube
Entrepreneurs
Govt. Policy
Infrastructure
Large Corp.
VCs
•6 different elements, communities
•Different needs
•Any change affects all
Research &
academic
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Think of innovation as a Rubik’s Cube
A few changes to any side and pretty soon you have this:
Looks simple, eh?
Or worse, this
Only a holistic approach succeeds. And experience helps.
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Specific Challenges to Innovation in Russia
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General ranking not great: 51st
Source: The Global Innovation Index 2012 (Insead, WIPO) 17
But innovation “efficiency” not bad
Russia• Just slightly
below trend line
• Reasonable chances to improve
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The C-Word
• Karamzin said it best: «Воруют»(“They steal”)
• Innovation will struggle in Russia with current levels of corruption
• “Brain drain” will accelerate
• State innovation projects must be the vanguard of honesty
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Russia needs to “close the gap”
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Russia needs to “close the gap”
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Russia needs to “close the gap”
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Weaknesses in projects like Skolkovo
http://www.rbcdaily.ru/politics/opinion/562949985372676
• Scope is too broad (laser or flashlight?)
• Misalignment of shareholder-management interests
• Overly focused on building “shiny new city”
• Lack of internationalization
The good news: not difficult to solve these23
Recommendations for Successful Innovation
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1. Don’t force the glass slipper
• Innovation can’t be forced (though it can be encouraged)
• Accept that Silicon Valley was a rare convergence of factors
• Leverage your culture and strengths, don’t blindly imitate25
2. Be careful what you wish for…
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3. Can you handle the truth?
Innovation often requires:
• Great individual freedom
• Tolerating unconventional ideas and lifestyles
• Open exchange of information and ideas
• High tolerance for failure
• High risk-taking
In short, innovation is freedom: can you handle that?27
4. Set “stretch” yet achievable goals
• world's largest offshore windfarm• world's largest single operating CSP plant• world's first CSP plant using molten salt as a transfer fluid• world's first graduate-level research university dedicated to renewable energy • world's largest renewable energy conference & expo (25,000 annual visitors) • permanent UN headquarters for International Renewable Energy Agency
UAE example: can a tiny oil sheikhdom become a world leader in cleantech and sustainability? You bet!
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5. Don’t blindly follow “the experts”
They’re often wrong
(Nice shoes, Albert)
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Discussion
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