I really love it when some big news breaks and I can say ‘I was just thinking about that!’ It happened earlier this week, when President Biden issued Executive Orders that are aimed at spurring innovation, much of it by making it harder for the largest of our private sector companies to have such commanding control of their competitive eco-systems and an overall tax system that has been groomed to enable powerful financial protection of the status quo.
I have not made a careful study of the specifics of POTUS’s orders, so I do not intend to defend or applaud them here. But it is hard to argue against the basic rationale of his economic team: the pace and impact of innovation has been slowing in our economy for more than twenty years.
Of course, we have seen introductions of amazing products and services – but the economic value of those innovations as a percentage of our economy has been falling. In part that has happened because it is easier for companies to ‘buy’ their growth via acquisitions and marginally-innovative extensions of existing products (i.e. how many varieties of instant oatmeal or Cheerios are in your cupboard?). Investing in real innovation requires research and development; market analysis; audience segmentation; manufacturing ramp-ups; distribution, marketing and sales channels. There is real risk in dramatic innovation – but there is also real impact potential.
Think not just of Amazon – but of the innovations that are happening in the eco-system created by Amazon. The genius of Bezos and his team was not just the construct of their online destination; it was how quickly they also took control of the value propositions in the ecosystem around their destination. They accomplished in twenty-five years what it took more traditional manufacturing sectors a generation or more to create: an ecosystem of vendors and suppliers that can be manipulated by sheer scale. I doubt what Biden’s team is looking for is more Amazons; but the phenomenon of that company is a powerful illustration of the potential of innovation.
Saying it that way sounds bad – it is not inherently bad to be big. There is a lot of good about scale. But the insight from Biden’s economic team is important to reflect on: how do we incentivize innovation that creates real growth within our economy and our opportunities? Not just for some, but for all of us collectively? Economists talk about it this way: how do we make the pie bigger, not just fight over who gets the biggest pieces of the existing pie? So far, Amazon has not so much grown the pie as they have overseen the redistribution of the pieces. The idea now is to find ways to unlock the potential for growing the pie that is an inclusive economy.
What does a communications consultancy have to do with all this? We believe in the power of communications to inspire people about possibilities; to illustrate the need for dramatic change and innovation; to illuminate the path of innovation and its consequences.
Let us know if we can help you imagine the possibilities, or make the case for change, or navigate the process of change. Be brave…here we go!!