Different types of innovation

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Miscellanous / Thursday

At the end of Rafah’s post last week, I wrote down that it gave me some thoughts for future posts. This is that post.

Rafah’s role as Technical Program Manager at Salesforce showed her a different kind of role – one that largely consists of coordinating various efforts and aligning different people towards a given goal. In her own words:

If a TPM (any project manager, really) is doing a good job, you probably won’t know what they did, because they removed all the roadblocks in your way before you got there, and they secured support for you so naturally that you didn’t notice it was there.

This got me thinking about how we think about progress and innovation. Usually we are one of two things in mind when we think about innovation:

1) Incremental Progress

Incremental progress towards a goal looks like this:

incremental

You have some goal and you towards it for a long time. This is typical of things like building a career, writing a report, etc.

Bread and butter stuff.

2) Moonshots

This is Silicon Valley–unicorn–100 hour work week–Adderall fueled innovation. It’s a idea of putting 20 coders in a room and locking them up until they have solved the problem. Here’s what it looks like:

moonshot

Self-driving cars have seen something like a moonshot in the last few years. Stripe is a moonshot. The Apollo program was a – literal – moonshot.

Again, fairly celebrated in the media and something we’re familiar with as a concept.

There is however a third kind of innovation that is much more like what Rafah was talking about. It’s a kind of innovation that doesn’t involve big breakthroughs or incremental iterations. It’s mechanisms are not covered by the media because they are more opaque in nature. It involves a relentless focus on operations. It’s the innovation of coordination.

3) Coordination

Innovation through coordination looks something like this:

coordination

The biggest contemporary example would be Amazon or Uber. Their success didn’t involve any major technical breakthroughs – sure, there was some new things on the technological layer but it wasn’t the big missing piece from the industry. They consisted of bringing together different parts of the marketplace.

Why are they rare? I suspect it’s because they require last upfront capital investments. It’s much better from an short term ROI standpoint to do make a $500,000 investment in a fancy emoji app than have to make a $5 million investment in building/renting out logistics centers. I could be wrong.

Why are they not talked about? It’s because much of the magic is invisible, as Rafah pointed out. It requires good operational excellence which is hard to define but can be roughly thought off as optimal use of the capital available that digs in the moat required. This can be building network effects by acquiring a large number of users in the case of Uber or investing in logistics in the case of Amazon.

My thoughts on this piece are evolving so I will come back and add/subtract things.

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