By: Itai Green
About ten years ago, four out of ten people in the world had a Nokia cell phone. We can only imagine how the CEO of Nokia ten years ago would have reacted if someone told him that in 2018 not one of us would have a Nokia.
Nokia is just one example. Blockbuster, Blackberry, Agfa and others like them vanished despite their belief that that which was is that which will be. It’s just not so. These extinct mega-corporations missed out on some innovative technology which was adopted by another player on the market.
The rate of change increases every year. Technology now allows for particularly speedy change, implementation and time-to-market. When one player incorporates a technology slowly, he should assume that his competitor is incorporating it quickly. Whoever’s faster often takes the whole pot. Quickly.
In the last quarter of 2018, as corporations debate feverishly in preparation for their agenda for 2019, a professional CEO and a high-quality board of directors committed to their shareholders, employees and customers, must define their agenda since every manager and employee must assume that “that which was is not what will be.” That which has worked so far won’t work in the future, and every manager and employee must open his or her mind to innovation.
It’s essential that managers be judged not only according to quarterly results which indicate short-term achievements, but by strategic parameters including the extent of the incorporation of innovation in the organization. The more the managers are encouraged to incorporate innovation in the short term, the less the chance that their competitor will take them by surprise. The quarterly financial statement must not be the be-all and end-all when it comes to measuring managerial performance since the quarterly statement doesn’t encourage investment in innovation.
For many years organizations thought that innovation would come from within, from their own R&D and other departments.
In recent years organizations have come to realize that the real, groundbreaking innovation which will save them from ending up like Nokia comes from outside of the organization. Where does it come from? From startups, academia and partnerships with other corporations. The professional term is “corporate open innovation” – as opposed to innovation from within.
More and more corporations are realizing that the rate of technological change is so fast that in-house entities can’t keep up. The understanding is that even if company employees are gifted in their fields, there are more, faster, and more creative brains out there and if the corporation wants to survive it has to work with them.
Israel has been blessed with uncommonly fine entrepreneurs. Warren Buffet said:
“If you’re going to the Middle East to look for oil, you can skip Israel. If you’re looking for brains, look no further. Israel has shown that it has a disproportionate amount of brains and energy.”
Over 350 international corporations spend millions of Euros and even more trying to get their hands on “the next big thing.” They realize that “from Israel will come the gospel” and want to make sure they hear it before their competitors do.
Israeli corporations now have a golden opportunity, thanks to the fact that they’re no more than an hour’s drive from a world-class pool of Israeli entrepreneurs with a common language – an opportunity to incorporate innovation, to be a testing ground for technology for entrepreneurs and to guarantee that they’ll be the first to apply the technology before their competitors the world over.
Incorporating innovation is a challenge for corporations. In recent years many methods for doing so have been developed and all that remains is to learn from them and apply them successfully so the corporation doesn’t end up, God forbid, like Nokia.
About the author
Itai Green is the founder and CEO of Innovate Israel. He is one of the dominant leaders of Israel’s corporate open innovation. Itai is recognised as a leading player in Israel’s startup ecosystem and is at the forefront of launching its growth at a rapid pace. Itai leads innovation processes by connecting global corporations with the Israeli startup community to create advanced technological solutions; focusing on IT, consumer products, pharma, finance, travel, e-commerce, retail, banking, insurance, energy, construction tech and IoT. Itai is a member in several startup advisory boards. In the past, Itai was head of business development and Innovation at Amadeus IT Group in Israel, amongst other prominent positions at Elbit, CEO at Maxtech Technologies, VP Business Development at Techtium and the co-founder of JerusalemOnline. Itai is the founder of the ITTS community (Israel Travel Tech Startups). ITTS houses 350 Israeli traveltech entrepreneurs and strengthens the internal collaboration between startups, as well as increases the level of engagement between startups, multinationals and investors. Itai has also created the IITS community (Israel Insurance Tech Startups) for the Insurance start-up sector.
Email: [email protected]
Featured image via Pexels.