TIMnovate

Yves Saint Laurent, one of the world’s greatest fashion designers, died in Paris. He was 71. Here is what the New York Times wrote about him:

During a career that ran from 1957 to 2002 he was largely responsible for changing the way modern women dress, putting them into pants both day and night, into peacoats and safari jackets, into “le smoking” (as the French call a man’s tuxedo jacket), and into leopard prints, trench coats and, for a time in the 1970s, peasant-inspired clothing in rich fabrics.

Mr. Saint Laurent often sought inspiration on the streets, bringing the Parisian beatnik style to couture runways and adapting the sailors’ peacoats he found in Army-Navy stores in New York into jackets that found their way into fashionable women’s wardrobes around the world. His glamorous evening clothes were often adorned with appliqués and beadwork inspired by artists like Picasso, Miró and Matisse. Above all, he was a master colorist, able to mix green, blue, rose and yellow in one outfit to achieve an effect that was artistic and never garish.

What can innovators learn from Saint Laurent? 

There are three simple lessons. First, he found inspiration, not inside his studio, but “on the streets.” Second, he was fearless, able and willing to break the rules of an industry that has very rigid rules. Third, he built his innovative designs on life style.

I heard a fashion expert explain Saint Laurent’s success brilliantly. “His success was due to the baby boomers”, explained Gil Michaely, Israeli  Paris-based journalist. “He designed clothes for baby-boomer mothers who wanted to look like their daughters. He designed clothes, as well, for the daughters, who wanted to look like their mothers. And, he designed clothes for the mothers, who wanted to look like their [wealthy, successful] husbands.” Saint Laurent invented the pants suit, which now has become a high fashion item women wear not only to work but also to parties and evening social events. 

“My small job as a couturier,” the New York Times quotes him as saying, “is to make clothes that reflect our times. I’m convinced women want to wear pants.”

“The clothes incorporated all my dreams,” he said after a show, “all my heroines in the novels, the operas, the paintings. It was my heart — everything I love that I gave to this collection.”

Live your dream, we tell innovators. Yves Saint Laurent not only lived his – he let other people wear them. In doing so, he made them beautiful. 

NASA’s Phoenix explorer spacecraft, about to begin digging into the surface of Mars, has a major lesson for innovators. Sometimes you find the best ideas in the junk pile of discarded failed ones. Here is how the New York Times describes the process that led to the Phoenix’s rise, literally, from the junkpile ashes:

In NASA’s “faster, better, cheaper” era, two landers of almost the same design were built: Mars Polar Lander and Mars Surveyor 2001. The Mars Polar Lander disappeared as it tried to land on the planet in December 1999, NASA’s second Mars failure that year. After an investigation showed shortcomings in the spacecraft design, the Mars Surveyor 2001 mission was canceled, and the spacecraft was put in storage. 

In 2002, Peter H. Smith of the University of Arizona proposed taking the mostly built Mars Surveyor 2001 spacecraft, which was to have landed near the equator, and using it to land in the northern arctic plains of Mars. NASA gave the mission, named Phoenix Mars, a green light in 2003.

Let us salute the innovative Peter H. Smith. We all recycle plastic bottles and newspapers. Why not recycle old ideas – especially those that have already been built and paid for? There must be a great many of them just lying around, waiting for the right “Peter H. Smith” to come along and discover them.
 

The remarkable story of Arnie Goldman, who had a fantastic idea, implemented it, ran out of money a few months before the legislation to validate it passed California’s legislature… and is trying again. This time, the story will have a happy end.

Arnold Goldman – or Arnie, as everyone calls him – is an extraordinary Jewish visionary, entrepreneur, electrical engineer, and author, in that order. Entrepreneurs can learn much from him. His earlier failure was colossal. Today, he is 63 years old, and has embarked on a new entrepreneurial venture. This time, he may succeed big-time. His latest book is Moving Jewish Thought to the Center of Modern Science. And, he believes he is the only person in the world who is convinced that 1+1 does not equal 2.
  
In California, where he was born and raised, Arnie was co-founder of Lexitron, the first company to sell word processing software, sold to Raytheon in 1977. He then came to Israel with his wife and three children to build a solar energy firm. In the early ‘80s, he founded Luz International, a pioneering solar-energy company based in Israel. The name Luz came from the Biblical city where Jacob dreamed of a ladder rising to heaven.  Jacob renamed the city Beit El (House of G-d). 

Arnie dreamed of building a new ladder to celestial energy. Between 1984 and 1990 Luz built nine SEGS (Solar Energy Generating Systems) in southern California, generating 2% of the area’s energy needs and aspiring to produce up to 10%. The solar energy fields built then used solar reflectors that covered 2 million square meters. Arnie used talented Israeli engineers for Luz’s R&D, done in Jerusalem.

At one point Luz produced 90% of all the solar-generated electricity in the world! But it ran into a snag. To compete with conventional energy suppliers, in the era of cheap oil, Luz needed its vast solar-mirror-covered fields to be exempt from property tax. Such exemptions had been legislated in California, but the legislation expired in 1990. Luz assumed the renewal and extension would pass easily. And it did, with over 90% of California’s legislature voting “aye.” Luz went ahead with construction of its 10th solar plant. At one point Luz had $300 m. in annual revenues. 

But in 1991, the Republican Governor of California, Pete Wilson, vetoed the bill, under pressure from powerful electricity companies. Later in 1991, the U.S. Congress passed national legislation exempting solar fields from property tax – but it was too late. Luz had burned $20 m. a month to keep the construction going, and had run out of money. It was broke. Business Week says Luz went bust because rival natural gas systems were superior. But I think the reason was the delayed tax exemption.

Goldman says “the failure was shattering – financially and personally,” according to the Jerusalem Post. It took him 15 years to recover. 

But Arnie is back – big time!

He has founded Luz II, wholly owned by BrightSource Energy, which he founded and chairs, a U.S. company that designs and builds large solar electricity plants. Investors in BrightSource include Google.org, the ‘social responsibility’ arm of Google, which together with other investors has put $115 m. into Luz II. According to Business Week (May 14), BrightSource signed a huge deal with utility giant PG&E (Pacific Gas and Electricity) to supply PG&E with up to 900 megawatts of solar electricity. 

Luz II’s technology is unique. Unlike photovoltaic cells, Luz II’s thermal system uses concentrated heat from the sun to drive turbines, which in turn generate electricity. This technology is based on the system developed by the original Luz, in the 1980’s. 

According to Business Week, “Israel is quickly becoming a hotbed of alternative energy research and startups.” Among them: Solel Systems, Zenith Solar, and the Trans-Mediterranean Renewable Energy Cooperation project, sponsoring Desertec, a scheme to install thousands of parabolic trough collectors in North Africa and the Middle East, to generate electricity for the often-cloudy Northern and Western Europe.

And Arnie? Well, about that 1+1… combine two hydrogen molecules with one oxygen molecule, 2+1, and you get not 3 but one water molecule. Combine one amoeba with another, and you get not 2 but millions.  

He believes he can quickly build Luz II’s revenues to $3 b., 10 times those of the original Luz. “We can produce energy less expensively and more cleanly than anyone else in the world,” he told Jerusalem Post columnist David Horovitz in 2006. 

“The Luz Brothers are back,” Arnie says. With oil at $130/bbl., we should all rejoice.

Presentation Slides
Results-driven innovation is thinking INSIDE the box. SLIDE #2. The “box” is the set of challenges, issues, problems industry faces. These challenges are communicated to universities. Universities then apply creative thinking and cutting-edge science to meeting the challenges, working hand in hand with industry. The trick, of course, is to know which boxes are essential and which can be discarded. Innovation without any boxes is of no value to anyone.

This, I believe, captures the essence of successful results-driven university-industry cooperation. We have heard many case studies showing how this is done here in India. 

I have come 4,000 miles from India to deliver a very short message. Israel and India are strawberries and cream. Together our two countries can do great things. But how?

Here is my message.

Israel has a problem. As a nation we are a powerful innovation machine. But we sell our brains too early and too cheaply. We have 3,000-4,000 startups, in a country of only 7 million. But our great entrepreneurs and innovators ‘exit’ prematurely, selling their startups mainly to U.S. companies who leave a huge check with one or two entrepreneurs, but the people of Israel do not benefit, because a potentially great global firm, another Nokia or Infosys, has been stillborn. (SLIDE #3)

The solution is: (SLIDE #4) BUILD AN INDIAN INDIGENOUS INNOVATION MACHINE. Israel can help. We will gladly share the so-called secrets of our innovation machine. They are not really secrets. And it is not rocket science. India is already highly innovative –(SLIDE #5) I know this, because I work with Indian companies and have taught many brilliant and creative Indian engineers over the years, in America and in Europe. However (SLIDE #6) some of this creativity is deeply buried. Yesterday Vinay Deshpande noted that Indian students want to work for a ‘brand name’ company, even though 80 % of innovation comes from SME’s. My question is: How do you get Indian mothers to tell their sons and daughters to start risky businesses, rather than seek safe paychecks? The mothers of India hold the key. In Singapore Lee Kwan Yew told the mothers of Singapore, in 1965, to tell their kids to study math. A generation later, Singapore had many first-rate engineers.   

NEXT: TAKE THE FRUITS OF ISRAELI AND INDIAN INNOVATIVE IDEAS, MANY EMERGING FROM UNIVERSITIES.

SCALE THEM INTO GLOBAL BUSINESSES RAPIDLY.

SHARE THE FRUITS OF SUCCESS BETWEEN OUR TWO COUNTRIES.

This is a session on case studies. So far, we have mainly heard about success stories. But we learn most from failures. One of the secrets of the Israeli innovation machine is that it is OK to fail. You get another chance. And another. Here is a story of a brilliant innovator, who bridged university and industry, made a huge fortune – and said he had failed. And indeed, he did fail. Here is the story.  

SLIDE #7

CASE STUDY: Moshe Yanai, The Case of the Reluctant Multi-Millionaire

Moshe Yanai is a living legend in Israel, with a Midas touch in data storage technology.  

He himself, however, appears rather disappointed with the outcomes.

Why?

Yanai graduated from Technion-Israel Institute of Technology in 1975, with a B.Sc. degree in electrical engineering. He went to work for Elbit (see above), where he helped design and build data storage equipment for mainframe computers. In 1984, after eight years at Elbit, he was sent to the United States to support a project sold by Elbit to the German computer company Nixdorf. He worked at Nixdorf for three years, until he met EMC2 co-founder Dick Egan. [Contrary to what people believe, EMC did not get its name from Einstein’s equation, but from the names of its co-founders Egan and Roger Marino.]  

Yanai joined Boston-based EMC in 1987, when EMC employed some 1,000 people.  He led development of what became the flagship division of EMC, Symmetrix, ultimately becoming its VP. Little EMC took on the giant IBM – and with its innovations, led by Yanai, defeated it utterly. Yanai’s team included many Israeli engineers Yanai ‘imported’ to EMC’s Hopkinton, MA. Headquarters. When Yanai left EMC, 14 years later, in 2001, it had a market value of some $200 b., and employed 25,000. During the decade of the 1990’s, EMC’s share price rose by more than any other listed company – some 85,000%!

After leaving EMC, Yanai returned home to Israel, reportedly a multi-millionaire from his EMC options and salary. He helped found EMC’s startup in Israel, known as Diligent. He also invested some of his personal wealth in another startup, XIV, and became its chairman. Both Diligent and XIV innovated data storage technologies.  

Yanai found innovation skills among creative young people drawn from graduates of an Israel Defense Forces program known as Talpiot.

Talpiot’s participants are chosen from a pool of highly-motivated youth who specialize in hard sciences such as physics and mathematics. The soldiers, who all become officers, undergo more than three years of training – during which time they receive a degree in both physics and mathematics – and then join the Defense Ministry’s Research and Development Directorate or highly-classified units in the air force. Following the training, Talpiot participants are obligated to sign on for an additional six years of military service, for five of which they earn high salaries. (Jerusalem Post,  August 6, 2007).

On Jan. 2, 2008,  IBM announced it was acquiring Yanai’s XIV for a reported $250 m. “We are pleased to become a significant part of the IBM family,” Yanai said, probably smiling at the irony that after defeating IBM while at EMC, he had helped create technology at XIV that would now allow IBM to return in style to the storage business, to compete with EMC. 

On April 18, IBM announced it was acquiring Diligent for $165 m. Diligent pioneered ‘de-dup’ technology, which, in case of two duplicate files, allows backup only of the difference between the two, thus saving storage space. 

Israel’s daily business newspaper The Marker said that Yanai will pocket about $200 m. of the $415 m. IBM paid for Diligent and XIV.

It is hard to imagine feeling the emotion of ‘disappointment’ at such an outcome.  Yet according to The Marker, Yanai was deeply disappointed. His dream was to build the next Israeli Nokia. As The Marker noted:

“Yanai had not intended to make such quick exits. His original plan was much more Zionistic. He wanted to build the two firms into a global company based in Israel. But in both cases, his partners insisted on selling when faced with such a good opportunity – and profit – and Yanai had little choice but to go along.” * 
“My model is Nokia,” Yanai had told The Marker just two weeks earlier, on April 1. Instead, he had to settle for a different model: King Midas, of golden-touch fame. Will IBM build a new Nokia in Israel with Diligent and XIV? It is improbable.

AND IN CONCLUSION: SLIDE #8
_______________________________________________________________________________________
 *The Marker, Friday April 18, 2008, p. A12. “IBM purchasing storage startup Diligent for $165 m”.

One of my heroes is Leonardo da Vinci, without doubt history’s most creative individual. But alas, out of honesty, I am forced to say in my talks about him that most of his great inventions – helicopters, submarines, parachutes – were never implemented, even in prototypes.

Well, an intrepid Swiss man (Swiss??? Intrepid??) named Olivier Vietta-Teppa built a version of da Vinci’s parachute (see the original sketch below), leaped out of a helicopter with it and… landed safely. This was after a Brit tried the same thing, in 2000, but had to use his reserve parachute (OK, I admit it – Olivier had one too… but he did not use it).  

I doubt there are many examples of innovations that wait for 523 years before being implemented. Now – what about da Vinci’s helicopter? Submarine? Aircraft?  
___________________________________________________________________________
Parachute that Da Vinci drew is made to work… after 523 years
By Ian Sparks- 28th April 2008, Daily Mail

Parachutes have come a long way in the last few decades. They’re easier to steer and a great deal less likely to go wrong. So it takes a certain amount of nerve to plunge 2,000ft relying on a “chute designed more than 500 years ago. However a Swiss daredevil has done just that, trusting to the genius of Leonardo da Vinci.  Olivier Vietti-Teppa, 36, jumped at the weekend using a parachute based on sketches made by the Italian Renaissance artist in 1485. He said after the jump in Payerne, near Geneva: “It worked perfectly. I was unable to steer it, but I just glided gracefully to the ground.

Used da Vinci’s parachute: Olivier Vietta-Teppa
“I came down smack in the middle of the tarmac at Payerne military airport. A perfect jump.” He admitted he had been wearing a modern reserve parachute in case da Vinci’s design – made out of four triangles of fabric and with a pointed top – had failed to open. Mr. Vietti-Teppa is the first person to have made it safely to the ground with the da Vinci model. In 2000, Briton Adrian Nicholas tried it but had to use a back-up parachute to complete his descent. Mr Vietti-Teppa’s parachute was made using modern fabric along lines imagined by da Vinci. The specifications were found in a manuscript dating from 1485.

The parachute consists of four equilateral triangles of fabric, seven yards on each side. The base of the pyramid is a square of mosquito net, which enables the parachute to open. A wooden frame originally conceived by da Vinci was not used. It has one drawback – it is impossible to manoeuvre. “You come down at the whim of the wind,” said Mr Vietti-Teppa.

The electronics product of the year is without doubt the FLIP Video camcorder, made by an unknown startup company called Pure Digital Technologies based in San Francisco. This innovation illustrates what Amnon Levav at SIT Systematic Inventive Thinking, in Tel Aviv, calls “subtraction” – innovating by removing features rather than adding them. It is a powerful way to systematically develop innovations, because most innovators are stuck in the rut of ‘addition’ – adding features, creating needless cost, complication and complexity.  

Pure Digital began in 2001 as a maker of throwaway digital cameras. Buyers offered feedback, as they always do. Founder Jonathan Kaplan listened carefully. He produced, as the customers requested, a permanent shoot-and-share video camera that was fun, easy to use and above all, really cheap. It appeared just in time to tap into the craze for homegrown videos posted on blogs and YouTube, and when existing camcorder markers were busy adding unnecessary bells and whistles to their expensive products.

FLIP is the size of a bar of soap. It has no slot for memory cards. Instead it has a flip-out USB key (no cables!) [press a button and it pops out!] and internal storage of from 30 to 60 minutes. 

Its built-in software loads instantly when you plug it in to your computer.

Price? $150 for the 30-minute version, $180 for the 60-minute one. Over a million have been sold this year, out of a total market of 6 million units. 

Pure Digital has, in the words of the ‘blue oceans’ school, changed the rules of the camcorder game. It has proved that in winning innovations, often, less is more.

FLIP: Orange version, with pop-out USB

Steve Jobs offers contradictory advice.

“Do not listen to your customers,” he says. “They do not know what they want.”

Yet in the same interview, in Business Week, he says, “Always listen to your customers.”

Which view is right? 
Both.

In the words of the Quaker prayer, modified for innovators:
• Give us the courage to not listen to our customers and provide them with innovations that fail market tests and that people say they do not want and do not need. E.g. the Walkman.
• Give us the serenity to to listen to our customers, when they tell us what they want and need and when we believe they are telling the truth. E.g., the FLIP camcorder (see next Blog).
• And – give us the wisdom to know the difference.  

A BBC World Service documentary, The Convict Streak, about Australian convicts and their attempts at escape, includes a wonderful segment about Bernie Mathews, an intractable prisoner sentenced to solitary confinement for two years.

Mathews says his cell is pitch black, with no light at all. Once a day he was given a jug of water, a jug of milk and a loaf of bread. Once every four days he was allowed out to exercise for half an hour or an hour. He lived this way for two years.

How does one keep from going insane, in the total black darkness of a cell, with nothing at all to do?

Innovation.

“I found a plastic button in my cell,” Mathews relates. “I invented a game. I flicked the button, then crawled along the floor to find it. Then, after I found it, I flicked it again. I played this game for hours and hours and hours. That is how I survived solitary confinement.”

Management educators motivate companies to innovate, in order to survive. I wonder if they realize how, for some individuals, this is literally true. 

I am an incurable and persistent listener to the BBC’s World Service on radio (AM, 1323), even though the BBC is consistently anti-Israel in its reporting – doubtless, because of its millions of listeners in the Arab world.
    
The programs I find most relevant and helpful in tracking global innovation are Global Business, with Peter Day, and Culture Shock. Day travels the world and interviews innovators (recently, for instance, he visited Philips’ R&D sites in Enthoven and elsewhere). But my favorite is Culture Shock. This program tracks trends in global culture.

For instance, a recent program segment titled “For Better or Worse” interviewed Prof. Clay Shirky from New York University, who related  how mobile phones and the internet are fundamentally changing the way people organize themselves in single-interest groups – and why this might be bad. In the segment “Preserved in Rice”, Richard Kimber described a trend from Japan where new technology and traditional gift-giving culture have produced unique mementoes for parents and grandparents: customized bags of rice each of which is exactly the same weight as the new born was on his or her Day 1.

If you believe, as I do, that innovation is NOT about technology, but rather about lifestyle, in turn deeply embedded in culture – then listening to Culture Shock is a must. It opens a window on cultural trends that we might miss otherwise.

The table below shows Business Week’s latest top 50 corporate performers for 2007. The rankings are based on profitability, sales growth, and market value.

What we learn from it is this: Every one of the top 10 performers has found a way to innovate, especially in its business model and business design.  

Here is what Business Week said about Coach, the #1, performer: 

The handbag maker moved quickly when it understood that its aspirational customers might suddenly hesitate at spending $900 for one of its Legacy handbags. Coach quickly rolled out more affordable lines of bags for as little as $160. 

And about #2, Gilead Sciences:

The Northern California biotech firm sensed an opportunity for any company that could develop drugs that were simpler and cheaper than standard HIV treatments, which required patients to take dozens of different pills throughout the day. Gilead’s researchers simplify those cumbersome treatments by combining myriad compounds into a single pill, Atripla, that costs just $1,300 a month and is taken at bedtime.

Going on down the list, we learn what strategy guru Gary Hamel has been saying for years: Truly powerful innovation changes the rules of the game in an industry, by redefining the way companies do business. When they succeed, profitability and sales growth soar.