Innovation By Design

Tom Friedman Looks At Better Place, Electric Car Innovator

Tom Friedman of The New York Times isn't finished beating up the Detroit auto companies.

In his Dec. 9 column, "While Detroit Slept," he likens the idea of a Detroit bailout to pouring billions of dollars into saving the CD music business at the advent of the iPod and iTunes.

His argument centers around the need to innovate instead of insulate.

To illustrate his point, Friedman writes about Better Place, an electric car company start-up based in Palo Alto, Calif.

Better Place's idea is to offer an electric car infrastructure that includes charging spots, battery switching stations and software that automates it.

"Founded in October 2007 with $200 million in venture funding, Better Place builds electric vehicle networks powered by renewable energy," according to a Better Place press release. "The company is currently working with partners to build electric vehicle infrastructure in Israel, Denmark, Australia and the United States."

If fortune favors the bold, then Better Place may well be a recipient. Their vision is nothing less than audacious.

"Better Place is committed to delivering transportation as a sustainable service by eradicating the need for oil as a fuel source and migrating toward renewable energy," according to the Better Place web site. "By leveraging energy from resources such as wind, solar and other carbon free sources, transportation becomes part of a self-reliant infrastructure that not only reduces the financial impact of our oil addiction, but also improves and protects our environment and our health."

When did you ever hear a CEO of the Big Three auto companies seize the high ground and inspire us with a vision like that?

Instead, the current thinking from G.M. has been more like staying in the same old place rather than taking us to a better one.

"Bob Lutz, G.M.’s vice chairman ... has been quoted as saying that hybrids like the Toyota Prius “make no economic sense.”", Friedman writes. "And, in February, D Magazine of Dallas quoted him as saying that global warming “is a total crock of [expletive]," according to Friedman in his Nov. 11 column.

Why not be audacious? Bold action can spur success from unexpected sources.

In the early 1970's, Intel reluctantly entered the microprocessor business. The company was already manufacturing memory chips and struggling to meet demand.

But Robert Noyce, Intel's founder, instinctively understood the vast potential of the multi-function microprocessor and he urged his managers to develop it.

The entrepreneur faces a dilemma. He never knows if his vision today will be relevant tomorrow.

The very fact that entrepreneurs keep on going in spite of the unknown suggests that the unknown itself is part of the adventure.

The life-threatening dilemma facing Detroit automakers today suggests that bold visions, risky bets - the DNA of entrepreneurial life - were bleached out of the culture.

Friedman uses Better Place to suggest that anyone with entrepreneurial spunk can seize the moment and embark on a whole new way of doing things. And Better Place founder, Shai Agassi, has done just that.

His "company is focused on one of this century's biggest challenges - building a scalable and sustainable personal transportation system that ends oil dependence," according to the Better Place web site.

Agassi's vision, if it succeeds, not only holds great promise. Much like the iPod and iTunes did to the CD music business, his vision could completely up-end the automobile industry. No wonder Friedman entitled his article, "While Detroit Slept."

"Do not expect this innovation to come out of Detroit," Friedman said. "Remember, in 1908, the Ford Model-T got better mileage — 25 miles per gallon — than many Ford, G.M. and Chrysler models made in 2008. But don’t be surprised when it comes out of somewhere else. It can be done. It will be done."

Knowledge and innovation are like quicksilver.

These days, innovation can happen anywhere, not just in places like Detroit where the once invincible General Motors set the pace of car innovation for consumers.

"If you have an idea in Detroit or Tennessee," Friedman writes, "Promise me that you’ll pursue it, because someone in Denmark or Tel Aviv will do so a second later."

No one has a lock on new ideas. And, because of globalization and the success of the Internet, it's easier than ever to put new ideas into motion. We don't have to wait for once-great companies like G.M. to issue edicts.

Instead of innovating, they insulated; and now they're dying.

"Under the Better Place model," Friedman writes, "Consumers can either buy or lease an electric car from the French automaker Renault or Japanese companies like Nissan (General Motors snubbed Agassi) and then buy miles on their electric car batteries from Better Place the way you now buy an Apple cellphone and the minutes from AT&T. That way Better Place, or any car company that partners with it, benefits from each mile you drive. G.M. sells cars. Better Place is selling mobility miles," Friedman said.

Tom Friedman Writes About Detroit's Lack of Innovation

You innovate or you die.

This long-held axiom is a way of life for Silicon Valley companies. Without innovation, there would be no microprocessor, no Google, no iPods.

But when you look at the precarious position the Big Three automakers find themselves in today, you can't help but wonder what they were doing all these years. Were they innovating or insulating?

Detroit's predicament is an object lesson in how big companies fritter away opportunities, ignore market realities and embrace hubris. And, while innovation alone doesn't guarantee success, there are clues that suggest that the automakers ignored opportunities to embrace innovation when they had the chance.

In his Nov. 11 column, "How to Fix a Flat," Thomas Friedman of the New York Times, says that the Detroit automakers' problems stem from a variety of missteps including a "very un-innovative business culture."

 

He also points out that, "visionless management and overly generous labor contracts explain a lot of it (the threat of bankruptcy)."

 

Instead of innovating, "around fuel efficiency, productivity and design," Friedman writes, the automakers focused on lobbying to protect its gas guzzlers.

The net result, writes Friedman, "was an industry that became brain dead."

 

In other words, you innovate or you die.

Do you think the Detroit automakers should be bailed out without preconditions? 

What are the consequences for the American economy if the Detroit automakers file for bankruptcy?

 

Guy Kawasaki Interviews Scott Berkun About The Myth Of Innovation

Inventing something new can occur in a revelatory moment filled with dramatic intensity. And, more often than not, the idea is the easy part. The trickiest part of the game is building it and then convincing skeptics that your invention is not just good, but great.

In his June 28 blog interview, Guy Kawasaki asks Scott Berkun about the process of innovation, the temperament of inventors and the challenges they face. Berkun, a former Microsoft employee and author of "The Myths of Innovation" provides fascinating insights into the process. And it's worth a read.

Kawasaki is no stranger to innovation and new product development. He is a former Apple employee and Mac evangelist for the original Mac in 1984. He later founded a couple of software companies of his own. Kawasaki is also a Silicon Valley venture capitalist, public speaker, author and noted blogger - How To Change The World.

In the interview, Kawasaki poses 10 questions for Berkun on topics like the inventor's "toughest challenge" and whether an inventor is "born or made."

Do you think age plays a role in innovation? Read the interview to find out.