Innovation question

In the past several days I have run across a number of instances where innovation has been discussed with one central theme. Where has it all gone? I finally ran across the answer this morning.

The first discussion on the topic arose around why a very large IT product company would cut its R&D budget dramatically from one year to the next. My answer? It is cheaper to acquire technology from smaller companies than it is to fund the development in house. Not to say that this is always true but I was speculating on the real answer for this organization. I believe I am right given that the company announced a continuation of its acquisitive nature in the coming fiscal year.

Next up came a discussion around why a fairly large, long standing organization was not an ideal buyout target. The answer? The CEO has turned down a number of approaches from other organizations and is known throughout the tech industry to be difficult to get along with in this regard. It would seem that anyone approaching him about a buyout is rebuffed almost immediately.

Finally, today I saw an article announcing a new book by a former CTO of Cisco, Judy Estrin. In her book she outlines her concern about the lack of innovation in America in general, and specifically within the tech industries. Her conclusion? Short term vision on the part of senior management. The emphasis on short term gains, building companies to be taken over by larger ones after a short time, funding tech start ups to be bought by the likes of Cisco without any consideration for building anything for the long term was cited as a growing concern. It will be interesting to read the book but I agree with the answer. The situation applies in other areas as well, like oil. Using oil profits to pay bonuses and dividends rather than developing alternative energy sources to replace a depleting one.

Cheers to the tech CEO that would rather build his own organization than to sell out.