Incubating and developing innovation

The mirage of Silicon Valley

 

People used to follow digital product development very often stumble upon comments and reflections about vitality and expertize that some peculiar regional areas have for finding product solution and founding high-tech successful companies.

On the other hand, the black shadow over our economic scenario  and the recurrent postponement of its end certify the tough passage of post-industrial era with its effects of turbulent environment on economy. So, the flexibility and applicability of electronics, software and telecommunication show prized characteristics to more readily face  both changes and prospectives in industry and consumption.

The aim of this brief contribution  will be to problematically tackle vulgates around start-up initiatives starting from two interesting articles. If I  have reached them personally and casually in the last two week, there should be a growing and global demand (perhaps also concerns) to insert itself among nations that can have a such kind of munitions to deal with a less problematic future in terms of jobs and growth – in the wake of simplistic strategy of “me too”…

The passage of time doesn’t seem to scratch the longing of that special place whose name is Silicon Valley, indeed, internet age magnify it!

The longing is an old obsession thinking of tour the French president Charles de Gaulle made at its sprawling research parks and farms south of San Francisco in the 1960; for the eyes of true statists, the value chain of electronic industry is always  a value-added factor for the fortune of a country. To be honest, the successful mix of skills, companies, and public and private institutions of that area marveled the same Americans that tried to (uselessly) replicate the experience in other US regions.

The history of a such kind of attempts has been well documented in a paper by  Stuart W. Leslie and Robert H. Kargon titled significantly  “Selling Silicon Valley” (1966). Years later  there was also a sort of elaboration of a standard methodological “formula” of exportation: “select a hot industry, build a science park next to a research university, provide subsidies and incentives for chosen industries to locate there, and create a pool of venture capital”.

Choosing a brief and partial point of view, I advance along the topic selecting two only aspects – however useful to measure the chances of implementation – that have to do with the consideration of traditional economy about an adequate cover of business initiatives in terms of people and infrastructures.  With its more cultural implications, the first flash regards the centrality assuming the availability of human resources  skilled for new digital economies, as well as of environments able to guarantee a full practicability, that in the language of Richard Florida, sociologist famous for having dedicated many studies  to creative classes, means to offer life contexts that can combine  and manage Technology, Talent and Tolerance.

In a Technology Review article a notorious US citizen immigrant from India that operates as technology entrepreneur and academic in California – Vivek Wadhwa – explains through his direct experience the importance of combination/connection  between cultures and people. “Note that from 1995 to 2005, 52.4 percent of engineering and technology startups in Silicon Valley had one or more people born outside the United States as founders. That was twice the rate seen in the U.S. as a whole. Immigrants like me who came to Silicon Valley found it easy to adapt and assimilate. We were able to learn the rules of engagement, create our own networks, and participate as equals. These days, the campuses of companies such as Google resemble the United Nations. Their cafeterias don’t serve hot dogs; they serve Chinese and Mexican dishes, and curries from both northern and southern India. This is the diversity—a kind of freedom, really—in which innovation thrives. The understanding of global markets that immigrants bring with them, the knowledge they have of different disciplines, and the links that they provide to their home countries have given the Valley an unassailable competitive advantage as it has evolved from making radios and computer chips to producing search engines, social media, medical devices, and clean energy technology“.

It could be noted that when Vivek Wadhwa speaks speedily of “a kind of freedom”, he implicitly remember us that it’s impossible to code all in a “business” project, that competition and cooperation open  up delicate dynamics and tension in a continuous re-modulation  and extension of possible …

If these issues lie in the US ability to feed and manage “the soft power” of which “California dreaming ” is surely expression, another relevant aspect regards State capital injection in strategical projects to generate a “guaranteed” demand. The founder of a big  US capital venture company  Edward Jung notes that  “The economic planners and policymakers who are chasing Silicon Valley’s taillights are learning that they cannot always replicate the entrepreneurial culture and finance mechanisms that flourish there now. But they have forgotten how it all started: guaranteed demand, which stimulates the most ambitious kind of innovation”.

While the demand of innovation in a specific technology area responds to needs of a huge mass of people, “United States’ Apollo program – intended to put a man on the moon – drove demand for more basic technologies (which are simply inventions that no one has asked for yet). Silicon Valley itself was built on demand. The US Department of Defense put up tens of billions of dollars in contracts for microelectronics, a commitment that both paid down innovators’ risk and created an infrastructure that would support the growth of start-ups… state-sponsored demand creates an environment in which multiple solutions to technical problems can proliferate and coexist… Some of these research efforts were never implemented, but many found their way into specialized devices. The diversity of options allowed widespread adoption, paving the way for the digital revolution. If microchip industry had a unique customer in 1962, “but by the end of the decade consumers were buying transistor radios and pocket calculators in droves”.

Finally, let’s talk of “vision”. The smart State envisions some targets but is interested to open up a path in which intermediate efforts and results are prized. As Jung rightly notes “Putting a monkey in space may not have been the most exciting achievement”.

 

References

Florida, R., 2002, The Rise Of The Creative Class: And How It’s Transforming Work, Leisure, Community And Everyday Life, New York, Basic Books.

Selling Silicon Valley: Frederick Terman’s Model for Regional Advantage“, Business History Review, Volume 70, Issue 04, Winter 1996, pp 435-472.

Silicon Valley or Demand Mountain?“, Project Syndicate, 24/7/2013.

Silicon Valley Can’t Be Copied“, Technology Review, 3/7/2013.