INNOVATION REVIEW
and SpaceX, a rocket company. There are many more such examples but the repeating patterns are: they are pirates form the tech industry, and they had “I wish I had X” moments, which they conver ted into businesses by jumping into the engineering express.
Lean Innovation It might seem hopeless to take on these swashbuckling, risk-taking, devil-may-care pirates. But wait, there is more. While the Camps, the Kalanicks, the Dorseys, the Hastings and the Randolphs of the world are certainly not risk averse, it would be foolish to dismiss them as suicidal. In fact these individuals have mastered risk mitigation. They (unwittingly, instinctively) practice principles from lean manufacturing, pioneered by Toyota. They do what has come to be called “lean innovation”, and their startups are what Eric Reis calls “lean startups”.
The Japanese automakers brought Western automakers to their knees by doing a few things differently: one was increased quality, and the other was rapid innovation by reduced cycle times. Instead of introducing one new model every two years, loaded with hit or miss features, they introduced lots of small changes quickly, learning, honing and adapting from each experience. Their factories were also lean, enabling them to modify designs and implement changes with agility. The pirates are careful about understanding the industry, about identifying weaknesses and opportunities, about starting with small experiments, about learning and adapting, and about scaling in an informed way. After Garrett Camp and Travis Kalanick had the idea behind Uber, Camp launched an engineering express to put a prototype together, and Kalanick plunged into the cabbie world in San Francisco, ensuring that he understood all the nuances and opportunities. The roll out was city by city. Every time I use Uber, it forces me to enter feedback about the driver and the service, no doubt helping them further fine-tune personnel and procedures. When I went to Milan earlier this year, the system chose me, a previous user rather than a local, to try the system out on a limited basis. The innovation cycle is driven by cautious aggression rather than aggressive caution. The pirates are also ready to
change ideas or direction if the evidence suggests so. No forms, no committees, not egos, and no budget cycles. Agility with deliberation. Here is the thing: because of the engineering express, it is easy to launch, test and cycle.
The Empire Strikes Back No listing of trends in innovation would be complete without mention of the world. It used to be (in the last 300 years) that innovation was largely the province of the major powers: US, Europe and Japan. The empire watched and followed. This has changed in the last decade. Creativity, star tups, engineering and design and scaling are all world businesses now. The first industrial revolution reached its peak with the introduction of interchangeable par ts. The second industrial revolution, largely unheralded and uncelebrated, is in my opinion the lean revolution, which was lead by Japanese companies such as Toyota. The lean revolution made quality portable, and no longer was quality the preserve of exacting cultures such as Germany or Japan. Suddenly, quality became a science and could be achieved in a factory anywhere. This has made manufacturing portable. The third manufacturing revolution, in my mind is the one we are currently in – the one in which people 15