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Jerry Engel

Open Innovation: Google and Niantic Labs

By | Case Study | No Comments

Bonus: see below another visual storytelling of Niantic Labs & Google from, Wei Li ,a Technology Innovation Manager and Presentation Designer @ INNODIARY, a project sponsored by IEEE Singapore Section to share business knowledge using visual designs.

Clusters of Innovation

By | Idea + Insight

“Entrepreneurship and innovation are the drivers of value creation in the twenty-first century.”

The Concept: Clusters of Innovation

‘Hot Spots’ Where Innovation Rules: Around the globe there are geographical ‘hot spots’ where innovation rules. New technologies germinate at an astounding rate. New companies capturing opportunities from these technologies are ‘born global’, targeting global markets from their inception. Pools of capital, expertise and talent foster the development of new industries and new ways of doing business.

What distinguishes these innovation clusters from the industrial business clusters described by Michael Porter and others? From 20 years of observation of Silicon Valley, the archetypal Cluster of Innovation, Jerry Engel distilled the unique components and behaviors that made possible the evolution of Silicon Valley and its continuing expansion and re-invention.

Key Behavior of a Cluster of Innovation (COI)

Alignment of Interests, Incentives and Goals:

Enterprises and individuals within a Cluster of Innovation benefit from a web of shared values, business practice and culture.

Win-Win Challenge as Competition:

While fierce competition certainly exists within a cluster
community, the grander competition is often with incumbent solutions and their providers. Although the innovators compete with each other, they participate together in a win-win challenge to displace existing methods and introduce new solutions. Venture capitalists share deal flow and co-invest as a regular practice in spite of fierce competition among firms. Shared ownership arrangements, such as stock options, break down traditional barriers between owners and employees and align interests of founders, managers, employees, advisors, and investors with the success of the venture.

Poking into a New Reality : Interview with John Hanke Founder and CEO of Niantic

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“John, and dynamic entrepreneurs like him, are the heroes of our innovation culture. But his accomplishments demonstrate something even more profound than entrepreneurial excellence: What’s extraordinary about entrepreneurship in Silicon Valley is the way large companies and young companies collaborate to accelerate innovation. It’s that process of open innovation that makes Silicon Valley unique. It is absolute magic.”

John Hanke is an American entrepreneur and business executive. He is the founder and current CEO of Niantic, Inc., a software development company spun out of Google that designed Ingress, Pokémon Go and Harry Potter: Wizards Unite.

A graduate of University of Berkeley Haas School of Business, John joins Jerry in 5 part interview to discuss:

  1. Business School and the Internet
  2. Intersection of Gaming and Geo-location
  3. Business Model – Ahead of the Curve
  4. Spinning into Google
  5. On Leaving Google

Business School and the Internet (Part 1)
Jerome Engel and John Hanke

Intersection of Gaming and Geo-location (Part 2)

Jerome Engel and John Hanke

Business Model – Ahead of the Curve (Part 3)

Jerome Engel and John Hanke

Spinning into Google (Part 4)

Jerome Engel and John Hanke

On Leaving Google (Part 5)

Jerome Engel and John Hanke

Clusters of Innovation Framework: The Role of the University

By | Idea + Insight

“We have made great progress in creating an entrepreneurship and innovation economy—and the university has been a major contributor—but now it is time to do more.”

In a keynote last week to the 12th Annual European Entrepreneurship Colloquium I focused on three challenges/opportunities for immediate action:

1. Reinvigorating the innovation strategies of major enterprise

2. Extending entrepreneurship and innovation across the university

3. Engaging universities to create healthy innovation communities

CORE ELEMENTS FROM THE TALK:

Five years ago, in a meeting sponsored by this great institution and its own entrepreneurial leader, Helmut Schönenberger, a dozen scholars gathered to raise the question: “What is the role of the University in the creation of an innovation society?” The group anchored on a framework that extended the work of Michael Porter of Harvard, Henry Etzkowitz of Stanford and other great contributors before them. That framework, that the group came to call the cluster of innovation framework, went beyond its predecessors’ focus on the components of a cluster: namely industry concentration, venture capital and such; and placed equal or even greater focus on the soft factors of behaviors and structures.

Since I came to Berkeley in 1991 to establish the Lester Center for Entrepreneurship much has been accomplished by entrepreneurship educators at universities around the world. Some BIG issues have been laid to rest – thanks to educators like yourselves – and conclaves like this one – no one any longer asks:

“Can Entrepreneurship be taught?” OR

“Does Entrepreneurship belong in the University?”

It is understood that entrepreneurship is a life skill with broad applicability. It is important and helpful to many, NOT only those who choose to pursue entrepreneurship as a career. Like mathematics, it is broadly relevant – not just to those that chose to become a mathematician

What lies ahead?

With your indulgence I will briefly reflect on my experience as an entrepreneurship educator over the last 25 years and identify the challenges that lay ahead. I will focus on three big challenges:

  1. The importance of entrepreneurship education to corporate innovation strategy
  2. The importance of entrepreneurship education to university education writ large
  3. The importance of entrepreneurship education to the creation of healthy innovation communities / or clusters of innovation

Let me share a historical perspective

In the beginning – entrepreneurship education was the domain of the business school.

In the 1980s:

When we thought of entrepreneurship education, if we thought of it at all, we thought of “Small Business” –  SME’s. It was often a stand-alone cross-disciplinary capstone course where students built business plans and integrated the skills they had learned in their marketing, finance and management courses. Case studies were the new pedagogical innovation and experiential learning was limited to internships or student projects for smaller firms.

In the 1990s:

We discovered the startup. Especially with the arrival of the Internet, the opportunity for any student to start their own business became evident. Business Plan Competitions grew like mushrooms. However, we still taught entrepreneurship the same old way, with case studies and business plans.

In fact, the common philosophy was that technology startups were just SMALLER VERSIONS of big businesses. With their potential for explosive growth they were exciting opportunities – but we did not build special management tools or pedagogical techniques.

The turn of the century brought a new reality.

In November 1999 the NASDEC peaked at 3,940 Euros. By May 2002 it had collapsed to 1,328, not to start a sustained recovery until November 2008, a full nine years after the bust. With the busting of the internet bubble, some questioned the value and durability of the entrepreneurial revolution. A leading Silicon Valley venture capital firm published a briefing headlined with a tombstone engraved R.I.P. – Rest in Peace!

The hiatus of the excesses of the bubble, and the subsequent rebirth of the technology startup opportunity, not only yielded Google, and many other global success stories, it yielded new approaches to discovering opportunity – using less capital and more experimentation. Out of the necessity of the capital crunch of the post-bubble period came the first instances of the entrepreneurial management practices we now know as ‘LEAN’, the Lean Startup or the Lean LaunchPad.

2010:

In the last decade we have seen these methods become well understood and broadly promulgated. We have built new stools: The triad of the business model canvas, customer discovery and the minimum viable product have become ubiquitous. We have developed a new pedagogy:

We no longer teach that a startup is a smaller version of a big business, rather we now teach that a startup is a temporary organization whose purpose is to discover a viable and scalable business model.  We teach evidence-based entrepreneurship. The business plan – while still a valuable management tool – is an execution tool; to be used once the startup is ready to scale. The capstone case study is no longer about someone else’s business, but the student’s own venture. The professor is no longer the source of all wisdom, but rather a guide who provides an enriched environment for the student’s own research and experimentation.

What are the challenges of the next decade?

Three challenges loom:

First is our role in corporate innovation. Again history is our guide. The modern corporation was the innovation engine of the mid-20th century. With massive corporate R&D labs, doing some of the best basic research, the modern 20th- century corporation was a vertically integrated technology commercialization machine. But that model is long gone. With the focus on execution forced on top management by the public financial markets, research departments have been spun-off or devolved to product development. True research has been relegated to the University, and innovative new market creation and disruptive innovation outsourced to the startup.

For some, open innovation has simply meant scouting for and acquiring promising startups.  The challenge of the next decade, for the leaders of entrepreneurship education, will be to help the more progressive major corporations go beyond such “Open Innovation” to become true ambidextrous organizations.

Organizations that simultaneously execute and experiment. This evolution has already started. Many major corporations are trying in different ways to adopt entrepreneurial business model experimentation. It will be our job to aid them, and study the results, and synthesize the best practices so we can bring them back to the classroom. That classroom may not initially be the traditional college venue. Initially it may well be more suitable for Executive Education – but those are the experiments that are in our future.

Our second challenge involves entrepreneurship education’s role in the entire university.

Entrepreneurship education has long left the exclusive purview of the business school. It’s relevance to engineering and the sciences has never been more clear.  For example, look where we are today! Here at UnternehmerTUM we see the perfect confluence of engineering and entrepreneurship education. In the United States , the Federal Government is embarked on an ambitious program, The National Science Foundation’s Innovation Corps [or I-Corps], of which I have the privilege to be the National Faculty Director. It is embedding the Lean LaunchPad, an intense 10 week entrepreneurship experiential emersion, into the very core of technology commercialization funding. In just four years since its inception, this program has already trained over 1,500 NSF funded scientists and is now expanding across technology commercialization efforts of the National Institute of Health, the Department of Energy and other Federal agencies. Beyond these direct efforts, it is having a fundamental ripple effect, impacting entrepreneurship education at universities across the country.

Going beyond its bedrock constituents in engineering and the sciences, entrepreneurship education is penetrating and adding value to the pursuit of the arts and the professions, such as journalism, medicine and law. Over 10 years ago, when Wake Forrest, a top quality liberal arts college in North Carolina, established the first entrepreneurship curriculum focused on the arts it was considered extraordinary. Now entrepreneurship education has not only spread into new fields, but the corollary is also true – more and more diverse fields are influencing the advancement of entrepreneurial studies. I need only cite the impact of design thinking to make my case.

Now let’s turn to our third, and perhaps most impactful challenge: the role of the university in creating clusters of innovation.

Just as entrepreneurship has established itself on campus, the critical contribution of the University in fostering healthy innovation communities has received broader recognition. The university has long been recognized as a provider of the seed corn of knowledge and technology. What is new is the awakening of new pathways for social contribution, through commercialization, driven by entrepreneurial ventures. As this effect has become more profound in scale and scope – so too has the role of the University in fostering and enabling this process. The University’s contribution is important not just for academic relevancy, but for effective public policy as well.

Five years ago, in a meeting sponsored by this great institution and its own entrepreneurial leader, Helmut Schönenberger, a dozen scholars gathered to raise the question: “What is the role of the University in the creation of an innovation society?” The group anchored on a framework that extended the work of Michael Porter of Harvard, Henry Etzkowitz of Stanford and other great contributors before them. That framework, that the group came to call the cluster of innovation framework, went beyond its predecessors’ focus on the components of a cluster: namely industry concentration, venture capital and such; and placed equal or even greater focus on the soft factors of behaviors and structures.

Behaviors, such as the mobility of people, money and technology, the propensity for risk taking, acceptance of failure as a learning process.

Structures that create alignment of interests, engender teamwork and win-win scenarios, such as broad based equity compensation.  Elaborating the Cluster of Innovation Framework lead to an important insight – that clusters of innovation did not have to be restricted by physical boundaries. Communities that shared these propensities, these behaviors, these structures, could extend beyond physical borders and align with other like communities around the world, forming a new “silk road,” forming global networks of clusters of innovation. The active constituents of these communities are better prepared to succeed in today’s innovation economy, an economy that is characterized by the rapid emergence, dominance and sunset of technologies, business models and the businesses that give them life. The role of the University is central in this new world and has undergone a major make-over; going beyond the technical contribution of modern science and engineering, and the training of a qualified workforce. The modern university contributes a new resource – the entrepreneurial team – which is at the center of the innovation process. The work of that group of scholars five years ago spawned research and publications, some of which will be discussed at this conference. More import is the role of this group, the educators gathered here today, for the 12th time, to celebrate and enrich their capabilities to contribute to this important process.

In conclusion …we stand on the cusp of a new day and new challenges:

  1. Taking what we have learned about innovation from the entrepreneurial model into the corporate context. Enabling the creation of new management practices that support the ambidextrous organization, one that can both execute and innovate.
  2. Embracing our role as partners in innovation education with the entire university. Informing and being informed by the contributions of others.
  3.  Undertaking our mission as cornerstones in the creation of clusters of innovation in our communities, and as academics using our special access to foster collaboration with other partners around the world so our communities can benefit from the synergies of the global network of clusters of innovation.

These goals may seem audacious – too grand and ambitious – but if I may borrow liberally from a biblical scholar – if not us, then who?  Who else is better situated, or better prepared? These opportunities are at our doorstep. I look forward to undertaking these challenges with you.