Tag: innovation

  • Waiting for an innovation miracle

    Waiting for an innovation miracle

    Many companies are waiting for an innovation miracle said Autodesk CEO Carl Bass at the company’s final press and analyst conference at the Autodesk University conference in Las Vegas late last year.

    “Change happens when new people enter the market or companies find new ways to do things or they are scared by competitors doing something they can’t do,” Bass said in an answer to a question from a Korean journalist about dealing with changing markets.

    “The two things I hear over and over again from customers – you stand back and scream because they are all the same – most of our customers want to innovate,” Bass continued.

    Building for sustainable change

    “Generally they mean they want to build sustainable, competitive changes. They want to create products that have the ‘Apple Premium’ that someone wants to pay more for because it’s the best product in the category and they want to sustain that for as long as possible.

    “The second thing that’s almost universal with our customers is when they have a good idea, they want to get that to market as quick as possible. To the extent we supply the tools to help them fulfil those two big needs of ‘how can I innovate and do something I wasn’t capable of doing?’ or ‘how can I shorten the time between when I think about this to when I can sell this?’ Those are things that will motive people.”

    At this stage Autodesk CTO Brian Kowalski chimed in, “there is slightly depressing moment in the innovation conversation where the customer says ‘I really want to transform into an innovative company. Can you help me do that using exactly the same tools, people and mindset I currently have. They are hopeful our answer will be ‘yes, we can help you.”

    For those organisations Kowalski had bad news pointing out that creating a corporate environment that embraces change requires all three of the ‘people, processes and technology’ triangle. Just adding a new product over the top of the existing culture won’t change the business.

    Sympathy for the corporation

    Bass though has a sympathetic view towards those large organisations seeking to change.

    “Companies do believe there’s some miracle that happens and one of the things I’ve seen most clearly is this idea among startups and VC backed firms is that big companies are just dumb and unaware,” Bass stated. “There almost no large company anywhere in the world that doesn’t know what is going on the world, some of these companies have whole armies of people whose only job is to figure out what’s new and exciting and interesting.”

    “People on the other side don’t understand this, they (big company managers) know what’s going on and what’s different, they may not have the wherewithal to change but the idea that car companies didn’t see changes coming – that they couldn’t see a Tesla – they knew but there were a bunch of reasons why they couldn’t make it to the other side.”

    Skilling the next generation

    Another aspect that troubles Bass are the skills of the next generation of managers, engineers and software developers.

    “The second thing I wanted to say about tools is that I go to a lot of universities and I talk to academics about what’s coming next,” he says. “What depresses me a little bit is the faculties have all sorts of new ideas and methodologies but they are teaching using old software tools. No student I know would want a twenty year old cellphone but they sit dutifully and learn twenty year old software. I think that’s one area they have to change first.”

     

    Bass and Kowalski make some important points about the challenges facing organisations seeking to adapt to changes markets, workforces and a rapidly evolving society – it’s not easy and the issues facing all businesses are complex.

    Paul attended Autodesk University in Las Vegas as a guest of Autodesk.

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  • High hopes for the innovation dreamtime

    High hopes for the innovation dreamtime

    The Turnbull government and its ministers face a big test in the upcoming innovation statement this week and will need to follow through with tangible results.

    In 1976 Clive James visited Sydney fifteen years absence from his hometown. In his book Flying Visits he described the changes that had happened during his time away including some observations on the nation’s thriving movie industry with the comment “premature canonization is the biggest threat facing the young Australian film director today.

    James’ words came back to me at an Australian Israel Chamber of Commerce in Sydney last week where the hosts were gushing over 25 year old Wyatt Roy, the Federal Assistant Minister for Innovation, last week.

    There’s a lot to like about Wyatt Roy, he’s an intelligent and articulate minister with a self depreciating sense of humour and a touch of humility – qualities generally not associated with Australian politicians – though the old guard gushing over his youth and the achievements of his two months in office can be embarrassing.

    In many ways the fawning over Wyatt Roy is emblematic of the general sense of relief in Australian business now the Turnbull government has left behind the nightmare of the vindictive and petty middle aged adolescents who made up the Abbot administration while also being a world away from the backward looking grey Liberal Party stalwarts of the Howard era and the self interested suburban Labor apparatchiks of the Rudd and Gillard years.

    The question though is whether the hopes pinned on Turnbull and Roy can be realised which is why there are so many hopes being pinned on this week’s expected release of the government’s Innovation Statement laying out a policy framework for the nation’s economic pivot.

    For Australia the stakes are high, the resource sector is collapsing and the property market – the real key to the nation’s suburban prosperity – is looking brittle. Policies that encourage new businesses and industries are now essential to maintain the country’s living standards.

    To date Canberra’s policy makers have not managed the economic changes well; the Intergenerational Report earlier this year blithely ignored the effects of technology on the future workforce and its implications to incomes, jobs and government budgets, while three years after the Gillard government’s Australia in the Asian Century report it’s remarkable how dated the document with its underlying assumption of never ending resources demand now looks.

    So the Innovation Statement matters in laying out a strong view for the future of Australia however even if it does prove to be a strong, forward looking document, the Turnbull government will need to follow up with substantial actions.

    The real risk with all the talk of innovation is that it will be siloed, along with IT, as “something the geeks and young kids” do. For the this week’s announcement to be anything more than more fine words from the Innovation Bureaucracy then it has to be backed by strong reform to taxation, social security, immigration and corporate governance regulations.

    While the canonisation of Wyatt Roy and Malcolm Turnbull may well be premature many Australians, including this one, are hoping those hopes are well founded. This week’s Innovation Statement will be the first test.

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  • Ending the banking era

    Ending the banking era

    The industry that benefited most from the economic reforms of the last twenty years of the 20th Century was the banking industry.

    With the elections of Margaret Thatcher and Ronald Reagan three decades of good times began for the banking sector.

    Now the good times are drawing to a close warns former Barclays boss Antony Jenkins who told a London audience how the banking industry faces an ‘Uber moment’.

    While Jenkins focused on the fortunes of branches and frontline staff, the technological change facing almost all aspects of banking from tellers to risk analysts and upper management are all facing massive changes as artificial intelligence moves into fields that a few years ago most believed couldn’t be automated.

    For the incumbent banks shareholders this is mixed news, on one hand it makes their existing operations vastly more profitable – the One Percent become the .001%.

    On the other hand for the incumbents, the market is opening up new competitors and as Jenkins points out some of these disruptors will be the banks of the future. At the moment though established banks will do all they can to interfere with new entrants.

    While interference will only go so far, the real challenge is to get ahead of the changes which is why financial technologies (fintech) has become such a hot topic in the last three years with major banks sponsoring or opening their own incubators, accelerators and hackathons.

    Another important aspect in a changing environment is that of regulation and with the banks winning from the deregulations of the 1980s and 90s it may well be that we’re going to see a tightening on their powers as technology changes the playing field.

    One thing is for sure, bankers are about to find times as exciting and challenging as many of the industries they displaced late in the Twentieth Century.

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  • Google goes alphabetical

    Google goes alphabetical

    As announced two months ago, Google quietly morphed into Alphabet after stock trading closed on Friday. The Wall Street Journal describes the new structure and the rationale behind it.

    It’s hoped putting the smaller, more speculative operations into a separate business units from the company’s core search and advertising businesses will allow managers to be more focused on the business while giving more flexibility to the newer divisions.

    One of the major reasons for Google’s reorganisation is the company had become too unwieldy with the WSJ story quoting one former employee who illustrates the problem.

    Many entrepreneurs believe “it’s easier to do their business outside Google rather than inside,” said Max Ventilla, who left Google in 2013 to found an education startup. “There’s a lot of red tape for head count and money to get through at Google.”

    At the moment it’s not clear that headcount is going to fall under the new structure and certainly some more revisions to the core business are going to be needed to get focus back for products like Google Docs and the local business search operations which have been drifting for some time.

    Over the next two years we’ll see how successful the new structure is. If it works, then Alphabet could be showing the new model for corporate conglomerations.

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  • Does broadband really create an innovative economy?

    Does broadband really create an innovative economy?

    How much does broadband really matter in developing a competitive and innovative modern economy? A corporate lunch with US software company NetApp last week illustrated that there’s more to creating a successful digital society than just rolling out fibre connections.

    Rich Scurfield, NetApp’s Senior Vice President responsible for the Asia-Pacific was outlining the firm’s plans for the Australian market and how it fits into the broader jigsaw puzzle of economies across the region.

    Like many companies in the China market NetApp is finding it hard with Scurfield describing the market as “chaotic”. This isn’t unusual for western technology companies and Apple is one of the few to have had substantial success.

    Across the rest of East Asia, Scurfield sees them ranging as being mature, stable and settled in the cases of Japan, Singapore, Australia and New Zealand through to India where the opportunities and the challenges of connecting a billion people are immense.

    Digital outliers

    The interesting outlier is South Korea, one of the most connected nations in the world, where the promise of ubiquitous broadband isn’t delivering the expected economic benefits to the entire community.

    In theory, South Korea should be seeing a boom in connected small businesses. As Scurfield says, “from a technology providers’ view this connectivity means you could do more things very differently because of the infrastructure that’s available.”

    Global Innovation Rankings

    Korea’s underperformance is illustrated by last year’s Global Innovation Index that saw South Korea coming in at 16th, just ahead of both Australia and New Zealand whose broadband rollouts are nowhere near as advanced as the ROK’s.

    Making a close comparison of Australia and the Republic of Korea’s strengths in the WIPO innovation index, it’s clear the technology and engineering aspects are just part of a far more complex set of factors such as confidence in institutions, the ease of doing business and even freedom of the press.

    Putting those factors together makes a country far more likely to encourage its population to start new innovative businesses that can compete globally. When you have a small group of chaebol dominating the private sector then it’s much harder for new entrants to enter the market – interestingly a private sector dominated by big conglomerates is a problem Australia shares.

    Small business laggards

    NetApp’s Scurfield flagged exactly this problem, “Korea is an interesting market in there’s about six companies that matter and from a competitive view those companies are extremely advanced, they have great technology and great people.”

    “However what’s not happening across the rest of the country is this adoption isn’t bleeding into the broader community,” said Scurfield “Because of that I don’t see broadband connectivity as having a wide impact.”

    That Korean small and medium businesses aren’t using broadband technologies to develop innovative new products and service in one of the most connected economies on earth raises a question about just how effective investment in infrastructure is when it’s faced with cultural barriers.

    Certainly we should be keeping in mind that economic development, global competitiveness and the creation of industry hubs is as much a matter of people, national institutions and culture as it is of technology.

    We shouldn’t lose sight of the importance of our people and institutions when evaluating the strengths and weaknesses of a nation in today’s connected world.

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