Innovation Needs Constraints
Some years ago, I wrote an article in Harvard Business Review about stock buybacks, which were being pilloried at the time. Many people thought that companies were spending too much money to gin up their stock price when they could be investing those funds into innovation, making better products and creating new markets.
Yet I pointed out that things weren’t as they seemed. As Clayton Christensen had showed around the same time, there was a superabundance of capital (in response to the financial crisis, central banks had been flooding markets with money) and corporations had more money than they could profitably invest.
I also suspected, although the evidence was scant at the time, that the extra money was going to Silicon Valley startups, which seemed to me to be less potentially problematic, especially when the public sector was being woefully underfunded at the same time. Today, we can see the results and they aren’t pretty. Without constructive constraints, even good ideas go bad.
The Chimera Of Mass Adoption
Shai Agassi had a good idea. His key insight was that electric cars couldn’t survive without an ecosystem of charging stations. Therefore, he reasoned, to spur mass adoption you needed to develop the cars and the charging stations in tandem. Once you relieved the problem of “range anxiety,”…
