Last month, IBM announced that it lead the list of companies receiving US patents for the 23rd consecutive year. IBM’s patent leadership is extreme. It not only consistently tops the list, but outpaces the number two company, Samsung, by 50%. That’s pretty impressive.
IBM’s commitment to research goes back a long way, dating to when its legendary CEO, Thomas Watson established the Research division in the depths of the Great Depression. And, while other great labs, such as Xerox PARC and Bell Labs have long since fallen into obscurity, IBM has redoubled its efforts.
Yet there is a notoriously poor connection between patents and corporate performance. Samsung, Canon and Sony, who also consistently perform well on the patent ranking, have fallen on hard times. Apple, on the other hand, which never makes the list, has dominated tech over the past decade. So is IBM a model for others to follow or a cautionary tale?
Marketing used to be pretty simple. To promote your brand, you used mass media to reach large audiences and create widespread awareness about your product or service. If you crafted a powerful message, the approach could work wonders. Most of the great brands of the 20th century were built that way.
Yet marketing in a digital economy is different. Not only have audiences fragmented, necessitating a more targeted approach, but digital activity is tracked. So even if you are successful in building awareness and creating action, your rivals can retarget those consumers with competing offers.
That’s why many have turned to content. Rather than paying to be sandwiched within ad breaks and between editorial pages, brands can communicate directly with consumers. Unfortunately, the result is often a longer form version of the same old ads. Marketers need to change their approach. Here are four questions that will help you create a viable strategy.
Yet look a little closer and it becomes clear that that the real problem wasn’t callousness, but mismanagement. The defect in the ignition system was, in fact, relatively minor. The real problem was that it caused airbags not to deploy. Each subsystem was performing to standard, but the interaction between them that resulted in disaster.
Sadly, most organizations today are run much like GM. All too often, we optimize isolated metrics, but fail to see the whole system. Today, we have to deal with a level of complexity unimaginable a generation ago and we need to think in terms of ecosystems rather than linear value chains. We need to focus less on metrics and more on a shared sense of mission.
Look at any marvel of our technological age, whether it be an iPhone, a self driving car or a miracle cure and you’ll find three things: An academic theory, a government program and an entrepreneurial instinct. When it all works it is a wonder to behold, not only creating prosperity, but solving our most difficult problems in the process
It is the unlikely partnership between academia, the public sector and private enterprise that allow us to navigate the path from discovery, to innovation, to transformation. The process, however, is often unwieldy, taking decades to go from from primary discovery to a measurable impact on society.
Unfortunately, most efforts to accelerate innovation focus on just one facet, such as giving tax breaks for innovation, increasing investment for research and helping start-up companies find funding. Nevertheless, these approaches ignore the fact that innovation is a complex process, requiring us to integrate a variety of efforts. That’s where we need to focus now.
In 1914, Thomas J. Watson was hired to run the Computing-Tabulating-Recording Company, a far flung holding company strewn across several industries. Watson, sensing an opportunity, decided to focus the firm on something he called “information processing” and changed the name to International Business Machines.
More than thirty years later, after IBM had come to dominate the market for punch card machines, it faced an existential threat from UNIVAC, an “electronic brain” that far outperformed IBM’s products. Yet the company that owned UNIVAC, Remington Rand, failed to focus on the technology and IBM soon dominated once again.
Today, 100 years later, IBM Is a $136 billion company while Remington Rand is long gone, acquired by the Sperry corporation in 1955 (which is also long gone). IBM’s focus had a lot to do with the outcome. It’s easy for corporate strategists to point to greener fields and fabulous yonders, but truly great companies are the ones that are able to do one thing extremely well.
Modern marketing really began in the 1960’s with Philip Kotler and his ideas about uncovering the “needs, wants and interests of target markets.” Ever since, generations of marketers have learned to focus on the consumer and communicating features and benefits to them effectively.
Yet perhaps an even more important source of wisdom for marketers today is Ronald Coase’s famous 1937 paper about The Nature of the Firm, which argued that the purpose of a firm is to minimize transaction costs, especially search and information costs. Surely, that is also an important function of brands.
Today, digital technology has brought search and information costs crashing down. So the challenge is no longer getting a message in front of consumers, but that they are so deluged with information that they are often completely overwhelmed. That’s why marketers need to worry less about collecting “eyeballs” and learn to design rich and seamless interfaces.
When J. Paul Getty was asked about his formula for success he said, “rise early, work hard, strike oil.” The quote is funny because it’s meant to be. Every story of great success involves some luck, yet few admit it as readily as Getty did and that kind of honesty is refreshing.
Yet take a deeper look at any story of great success and you will find one thing that they all have in common: overcoming failure and adversity. There is no straight shoot to the top. There will be challenges along the way and some will get the better of you. What makes top performers different is that they take adversity and use to help them shape a better future.
In an unusually contentious political season, there seems to be one thing that unites leaders from both parties: the need to thwart terrorists using encrypted messages. Everybody from President Obama and Hillary Clinton to Donald Trump and Jeb Bush are calling on the private sector to facilitate backdoors for security officials.
The tech industry, for its part, has balked. A letter to President Obama, signed by dozens of top firms as well as civil liberties organizations and security experts, urged him to “reject any proposal that U.S. companies deliberately weaken the security of their products,” saying that it would “undermine our economic security.”
The truth is that such a policy would provide little benefit at great cost. While it would impair the marketability of American products, perhaps permanently, criminals and terrorists could simply use encryption protocols beyond the reach of the US government. At the same time, the general public would face increased vulnerability to hackers looking to steal our data.
Yet the truth is that the road to any significant innovation is a long and twisted path. First, scientific research uncovers important insights. Then, those discoveries must be engineered into useful solutions and finally, new products and processes must be implemented at scale in order to transform a particular field or industry.
Unfortunately, most efforts focus on only one part of the chain. Researchers toil away quietly in their labs, engineers tinker with improvements and evangelists work to accelerate adoption. Yet at MD Anderson they’re working on a new, more integrated model they hope will revolutionize the pharmaceutical industry. Early signs suggest that it’s working.
Content, in theory, should be a boon to marketers. The Content Marketing Institute says that “consumers have shut off the traditional world of marketing“ and touts content as a “strategic marketing approach that can attract and retain audiences” and “drive profitable customer action.”
Sounds great. The only problem, as I’ve noted before, is that content is crap. Nobody calls anything good, like an Oscar winning film or a hit song, content. The concept mostly exists as a fantasy in the minds of strategic planners who want to replace paid media with long-form ads on media assets they own and control.
In other words, content marketing fails largely because it is pursued by marketers who bring a traditional mindset to a completely new field. Rather than discovering and telling stories, they try to wrap marketing messages inside canned narratives. The truth is that marketers need to shift their mental models to think less like carnival barkers and more like publishers.