The Innovation Pressure
By: Josh Cruz
Tags: Strategy, Innovation, Corporate Culture, Silicon Valley, Organizational Culture

Big data — whether we like it or not — is enclosed in a fence charged with a million volts to make clear to intending intruders what to expect. The biggest names in tech — Oracle, SAP, Facebook, Google, Microsoft and, of course, Amazon — can be imagined as being more open to toppling governments than giving up their possessive ownership of big data in the entire Planet.

End of story? Well, they can make innovation harder. In fact, they kind of have.

First, harder because the resources required to dent their markets are resources only these mammoth tech companies have, predominantly.

Second, harder because it creates a situational dilemma — in which any successful innovation is at risk of being acquired, if not copied or overruled to the point of obliteration — again by the same mammoth tech lords.

The current pandemic reinforced their nearly total ownership of big data. To a certain rather limited extent, mankind benefits from it. The operative phrase is, “Limited extent.” With gory resources at their disposal, we can at least count on 99.9% service level agreements in terms of availability. Their robust infrastructure assures us that we won’t just wake up one day with the worldwide web gone or our precious data — often that better half of strategy — divorced from us without warning.

It’s pretty much downside from there. I struggle to find an analogy, until I am reminded of the broken clock that says the time correctly twice a day. Must be an analog clock, don’t forget. The tech lords are always on the lookout for something new — something that their in-house herd of nerds and army of outsourced co-nerds may have missed out. They are perpetually sniffing for potential, emerging competition. The option to acquire them early is always the cheaper option because even if they fork out billions of dollars to acquire a company staffed by just 10 people, the prize of permanently removing competition is, by Robert Palmer’s swoon, simply irresistible.

There is also the much-publicized attraction attached to the thought of being acquired. It’s almost like a trophy these days. To be acquired is to be pronounced ready for prime time. Ripe for the big fight. For this, some start-ups actually configure themselves to succeed to the point that the tech lords would want to acquire them, then bang! That’s where they get to earn their billions for all sweat, blood and tears. High fives, we’ve made it!

Free market used to be free. It was not about a market in which the ants and bees innovate for a few master predators ready to gobble them up. Yet this situation should not be viewed as a discouraging wall of titanium spikes and acid-laced barb wire. The direct outcome — when we’re done being intimidated by the tech lords — is proof that in fact, they don’t have it all at all. Smaller companies with smarter people will continue to be more audaciously innovative. That being gigantic almost always equate to being slow. You lose your agility, you lose innate innovative drive. Plain and simple.

Apple was a much more innovative company before they came up with the iPod. Then the iPod Touch. Then the iPhone. Anything else?

That while size matters, being small matters more when we talk about innovation.

I was once a Regional Organization Development Leader, and in a town-hall meeting the COO puts me on the spot and asks me, “What do you like about this M&A and what makes you confident this M&A will succeed?” He asked this question after he sang praises about it, and did not exude a very welcoming facial layout, quite bluntly.

To save his face, I laced my response with the usual clarification BS: My thought process is in the space of, “What will make me say that this M&A has succeeded?”

The dude actually liked it, because he nodded more than twice, like there wasn’t much backbone that connects his head to the rest of his upper torso!

“When I know we’ve grown bigger, yet it feels like we’ve become smaller.”

Bigness notoriously builds bureaucracy. It is famous for creating controls for every type of scenario. Some big organizations ultimately end up having a bigger finance and legal team than organization architects and process consultants. Worse, mammoth organizations deny it! Their leaders wrongly assume that just because there are dashboards with blinking traffic lights in their tablets, smartphones or conference room smart TVs — that they really know what is happening on the ground, on every layer where innovation is supposed to live and breathe freely. That because they’re on Slack or 365, they’re almost always completely in touch.

Leaders as they move up, up and away — refuse to acknowledge that the primary consequence of altitude is that the ground will inevitably look smaller. They install mechanisms and “processes” to magnify the arms and feet of minions they used to have lunch with, as they now can only see them from way up there. That despite their claims of having a flat organization, it is only flat because it is tastelessly designed and structured. For what is the incentive to really remain close to the ground, when I now have a war chest to the tune of One Hundred Billion Dollars, and therefore any significant, life-changing, market share-threatening innovation is eventually at the mercy of my almighty dollars? I can just acquire them, end of story. And then I will unload at my minions later — how could you miss this one out, ants and bees?

This mixture of all-consuming lust for tech lordship and illusion of innovativeness — is what makes this fight far from won. What’s even better — it’s why the fight will always be in favor of the unattached, the unbridled, the un-greedy. The ones who are truly driven by discovering something great, something wonderful, something new.

My view is that right beneath the leaking billions of the tech lords, is a body of water in which we all must swim, not to get closer to the mouth of the ocean in which acquisition means instant wealth, but precisely to build a case against innovation as a preserve of the mighty. Farther down South in this body of water, the tech lords have a host of vendors, usually outsourced, located all over the world. They too all claim that they’re done just being cheaper alternatives to the industrial-world wages. As they claim that, most of them find erotic thrill to mouth a “vision” in which they help their clients innovate when in reality, they too are spread so thin that the most powerful innovation that comes from their ranks usually happens by accident. Yes, you guessed it right — because they happen to have employed a guy so smart that he came up with an idea so cool that even the army of the tech lords didn’t figure out early enough. Hey, don’t count on it. Doesn’t happen a lot, but when it happens — it’s a slap on the face of the tech lords nonetheless.

Bottomline — the tech lords are not the enemies. They are the incentives. They should make us more itchy for innovation and thirstier for something much better than what their oversized batcaves can ever afford to imagine. We should not romanticize the fact that they used to be as agile, as innovative as the ones who now regard them as vultures armed with acquisition dollars. It must cease to be about them, about their dominance.

We need to go back to the strong, blunt facts — that innovation is far from over and the fight for it far from won. Focusing on these, innovation efforts can stop being skewed towards solutions waiting for problems, pretext as being way ahead of its time. Innovation must be viable. That viability must first of all contend with existing difficulties needing to be overcome and problems needing to a simple solve. It may be combining two currently powerful apps into one plus some more. It can be the next most portable solution to every city in the world with dwindling safe drinking water supply. It’s got to be something that no amount of money from the tech lords can buy.

That is, until they’re ready to acquire you and you walk towards the negotiating table with your middle finger saluting them from inside the pocket of your jacket.