In 1961, the first minicomputer, called the PDP-1, arrived at the MIT Electrical Engineering Department. It was a revolutionary machine but, as with all things that are truly new and different, no one really knew what to do with it. Lacking any better ideas, a few of the proto-hackers in residence decided to build a game. That’s how Spacewar! was born.
Today, the creation of the Spacewar is considered a seminal event in computer history. Because it was a game, it encouraged experimentation. Hackers tried to figure out how to, say, simulate gravity or add accurate constellations of stars and by doing so would push the capabilities of the machine and themselves.
Tech investor Chris Dixon has said that the next big thing always starts out being dismissed as a toy. Yet it’s because so many technologies start out as toys that we are able to experiment with and improve them. As virtual reality becomes increasingly viable, this human-machine co-evolution will only accelerate because, to create a new future, we first have to imagine it.
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Expensive technology used to be a significant advantage for big companies. Large enterprises had the resources to hire consultants, invest in sophisticated systems and collect masses of data to analyze. That gave them better visibility into market trends, helped them automate processes and make better decisions.
The cloud disrupted all that because it meant that world-class technology no longer needed a significant capital investment upfront. Today, anyone with an idea can sit at their kitchen table and access the world’s best technology with little more than a broadband connection. That’s been a real game changer.
It has also meant larger organizations have had to adapt. Cloud computing is not only much cheaper than legacy systems, it is also more flexible, adaptable and much easier to integrate with new capabilities like artificial intelligence. Yet moving your business to the cloud can also be a major challenge. Here’s what you need to know to get it right.
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I’ve never really liked the phrase “innovate or die.” Why not, “finance or die” or “sell or die” or even “manage or die?” Clearly every business function is essential and no organization can survive without building some competency in all of them. In an ultra-competitive business environment, you have to do more than just show up.
What makes great innovators different is that they succeed where most others fail. They not only come up with new ideas, they find ways to make them work and create value for the rest of us. Even more importantly, they are able to do it consistently, year after year, decade after decade.
Over the years, I’ve gotten to know many of these extraordinary people and they are all impressive in their own way, but what has struck me is not their differences, but what they have in common. It seems that there are some things that all great innovators share and, importantly, they are all things that we can do as well. So there is hope for the rest of us.
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In 2011, IBM’s Watson system squared off on the game show Jeopardy! against two human champions, Brad Rutter and Ken Jennings. It beat them both so handily that for his last response Jennings simply wrote, “I, for one, welcome our new computer overlords.” It was an awesome display, unlike anything anyone had seen before.
The implications went far beyond the company or the game show. Watson’s triumph kicked off an arms race in artificial intelligence. Later that same year, Apple launched Siri, its personal assistant. In 2015, Google’s AlphaGo computer beat a human champion at the famous Asian board game and Amazon launched its Echo smart speaker.
This summer, IBM raised the stakes again with its Project Debater, a system that can compete with skilled humans arguing about controversial topics. Much like Watson, Debater’s objective is not to launch a new product, but to expand horizons. While the full implications aren’t yet clear, we are surely we are embarking on a new era of possibility.
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Every enterprise needs to innovate. It doesn’t matter whether you are a profit-seeking business, a nonprofit organization or a government entity, the simple truth is that every business model fails eventually, because things change over time. We have to manage not for stability, but for disruption or face irrelevance.
There is no shortage of advice for how to go about it. In fact, there is far too much advice. Design thinkers will tell you to focus on the end user, but Harvard’s Clayton Christensen says that listening too much to customers is how good business fail. Then there’s open innovation, lean startups and on and on it goes.
The truth is that there is no one path to innovation. Everybody has to find their own way. Just because someone had success with one strategy, doesn’t mean that it’s right for the problem you need to solve. So the best advice is to gather as many tools for your toolbox as you can. Here are four things about innovation you rarely hear, but are crucially important.
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All too often, innovation is confused with agility. We’re told to “adapt or die” and encouraged to “move fast and break things.” But the most important innovations take time. Einstein spent ten years on special relativity and then another ten on general relativity. To solve tough, fundamental problems, we have to be able to commit for the long haul.
As John F. Kennedy put it in his moonshot speech, “We choose to go to the moon in this decade and do the other things, not because they are easy, but because they are hard, because that goal will serve to organize and measure the best of our energies and skills.” Every organization should pursue grand challenges for the same reason.
Make no mistake. Innovation needs exploration. If you don’t explore, you won’t discover. If you don’t discover you won’t invent and if you don’t invent you will be disrupted. It’s just a matter of time. Unfortunately, exploration can’t be optimized or iterated. That’s why grand challenges don’t favor the quick and agile, but the patient and the determined.
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In the 1960s and 70s, Route 128 outside of Boston was the center of technology, but by the 1990s Silicon Valley had taken over and never looked back. As AnnaLee Saxenian explained in Regional Advantage, the key difference was that while Route 128 was a collection of value chains, Silicon Valley built an ecosystem.
Clearly, ecosystems are even more important today than they were back then. In fact, a recent study by Accenture Strategy found that ecosystems are a “cornerstone” of future growth and that 60% of executives surveyed viewed ecosystems as a way to disrupt their industry. A similar number saw them as key to increasing revenue.
The problem is that competing in an ecosystem environment is vastly different than a traditional value chain strategy. While a value chain is driven by efficiencies, an ecosystem is driven by connections in a network. So we need to do more than adapt our strategy and tactics, we need to learn how to play a whole new game. The first step is to learn the rules.
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In 1970, a scientist at IBM Research named Edgar F. Codd make a remarkable discovery that would truly change the world. Though few realized it at the time, including IBM, which neglected to commercialize it. It was called the relational model for the database and it would spawn an entire industry.
Yet while today few have heard of relational databases, everybody seems to be talking about blockchain. Much like Codd’s idea nearly a half century ago, blockchain represents the opportunity to create a new data infrastructure, which in turn, is likely to help power business for another half century.
Still — and very contrary to the current hype — few of us will ever work with a blockchain or even know it is there. The real revolution will come not from the technology itself, but from its secondary effects in the form of new business models. To leverage these though, you will first need to understand how Edgar Codd created the data economy in the first place.
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This time last year I had just published my first book, Mapping Innovation. Having never published one before, I really didn’t know how it was going to go, so I was excited, but also a little bit nervous. Would people like it, or would I be exposed as a fraud and a hack? I hoped for the best, but prepared for the worst.
What a difference a year makes! Mapping Innovation has been a runaway success. Sales are great and it was even nominated for the prestigious Business Book of the Year Award. Even better, this past week I signed a new contract with McGraw-Hill to publish my next book, Cascades, about how to create transformational change.
I had no idea that all this was ahead when I started Digital Tonto in my apartment in Kyiv, nine years ago this week. It’s been a wild ride! I can’t tell you how much I’ve appreciated your support, especially those of you who have stuck with me since those early years. So Happy Birthday Digital Tonto! Here are some of my favorite posts from the last year.
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In 1997 Clayton Christensen published The Innovator’s Dilemma and it sparked a revolution. It seemed that all anyone could talk about was disruptive innovation. That was until Henry Chesbrough published Open Innovation in 2003 and that got hot. Then Stanford launched its d.school and design thinking was where it was at.
Yet go to an innovation conference these days and chances are that most people will be talking about “the Lean Startup.” That’s a sure sign that a good idea is about to go bad. When any process or practice descends into mindless conformity, especially an innovation practice, we should begin to be skeptical.
As I explain in my book, Mapping Innovation, there is no one “true” path to innovation. So a process that works great for some types of problems is bound to fail when applied to others. No tool or method is a panacea. That’s why although the Lean Startup model continues to offer tremendous value, we should be increasingly skeptical about it and keep our eyes open.
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