If you’re a tech geek like I am you probably enjoy following the latest innovations in gadgets and tech gear. If you follow for any length of time, you’ll notice a phenomenon which exists throughout business but is amplified and readily apparent in the tech industry. Underdogs and smaller companies take risks and innovate. Larger established companies play it safe and stagnate. Because technology by it’s very nature is about the ‘next greatest thing’ and the life cycles of innovations are getting increasingly shorter, innovators can become stagnators almost overnight. Look at this commentary on HP (full article link here):
Formed in 1935 in a Palo Alto garage, the company was pivoting before Steve Jobs was born. It started as a maker of audio oscillators and then dabbled in thermometers and calculators, among other businesses, before embracing the semiconductor revolution in the 1960s. Like Xerox, HP’s name evokes Argo-era connotations for many. Perhaps that’s fitting. The 70s and 80s were probably HP’s peak of innovation. Consider that HP had a touchscreen PC in 1983 and secured the hp.com in 1986. At the time it seemed like if anyone could see into the future, it had to be Hewlett-Packard.
But the innovation dried up. By the 2000s, the company was chasing the market, at one point licensing Apple’s iPod instead of coming up with its own MP3 player. When the mobile revolution came along, HP’s big idea was to buy Palm, which, like Autonomy, turned out to be a bad move.
Even my beloved Apple has slowed in their innovation in the past 2-3 years. The same company that practically invented digital music players, made smartphones mainstream, and defined the tablet industry now has 2-3 years of product iterations that are evolutionary rather than revolutionary. And they received a bunch of heat for the iPad mini being just a shrunken iPad rather than anything new. Is it a coincidence that this innovation slow down has come as the company has increasingly gained marketshare for computers and became the highest valued company in US history on the strength of its mobile products?
Oddly, companies struggle to reach the top by taking risks and not fearing failure but when they get to the top they stop doing the things that got them there in the first place.
As Steve Jobs said…”Stay hungry, stay foolish”