The Changing Nature of Innovation: Part II — National Policy
Michael Porter makes two interesting observations about innovation in the US in his BusinessWeek interview entitled Why America Needs an Economic Strategy:
… U.S. entrepreneurship has been fed by a science, technology, and innovation machine that remains by far the best in the world. While other countries increase their spending on research and development, the U.S. remains uniquely good at coaxing innovation out of its research and translating those innovations into commercial products. In 2007, American inventors registered about 80,000 patents in the U.S. patent system, where virtually all important technologies developed in any nation are patented. That’s more than the rest of the world combined
In contrast to the effectiveness of utilizing research and technology for entrepreneurial purposes, Porter notes a worrisome trend:
An inadequate rate of reinvestment in science and technology is hampering America’s feeder system for entrepreneurship. Research and development as a share of GDP has actually declined, while it has risen in many other countries. Federal policymakers recognize this problem but have failed to act.
Viewed in light of Part I of this mini-series on innovation, a natural question posts itself:
Do the new forms of experimentation, which enable the US entrepreneurial system to be so very effective in coaxing innovation out of research that has already been done, mask a fundamental decline for which there will be hell to pay?!
The Agile Executive 
You pose a fantastic question. Yes, it does mask a decline as statistics demonstrate. Yet I’m unsure about hell to pay. I view our increased ability to squeeze innovation from existing technologies as bringing increased focus to the research process. The squeeze creates focus on research that tends to deliver results and brings greater accountability to a potential academic process that is too often unfounded in reality. The increased use of protoytpes in sw development is a great example of the kind of squeeze that increases focus on worthwhile results versus unfounded or altered requirements.
Bill Keyworth
November 28, 2009 at 2:39 pm
I certainly hope you are right, Bill. Yet, I can’t help feeling that the situation is dire enough to warrant adjustments at the national policy level. I will simply quote an excerpt from my recent post Only 10%:
“If you’re curious to know what lies in store for Seattle and Silicon Valley, spend a day walking around Detroit with the Ghost of Christmas Future.”
This quote is from no less an authority than Clayton Christensen…
Israel
israelgat
November 29, 2009 at 8:05 pm
I remain a pessimist re: the ability to get anything productive at the “national policy level” but an optimist at the opportunity of factual oriented solutions coming from the ground-up that have the potential to make an impactful difference. Hence my unbridled support for innovative focus within existing research that delivers worthwhile results.
Bill Keyworth
November 30, 2009 at 1:21 pm
One of the hard lessons we learned in Agile is that local successes will only take you so far. You might be quite successful with one team or another, but these local successes are not likely to be sustainable unless they coalesce at the enterprise level. Furthermore, local successes might regress as successful teams become disillusioned, bitter or cynical.
By the same token, industry level successes in innovation might not suffice. They need to ultimately coalesce at the national policy level.
Israel
israelgat
November 30, 2009 at 10:15 pm