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Innovation Outposts and The Evolution of Corporate R+D Innovation Outposts and The Evolution of Corporate R&D

- (Huffington) - 1 years, 11 months ago...

I first met Evangelos Simoudis when he ran IBM's Business Intelligence Solutions Division and then as CEO of his first startup Customer Analytics. Evangelos has spent the last 15 years as a Venture Capitalist, first at Apax Partners and later at Trident Capital. During the last three years he's worked with over 100 companies, many of which established Innovation Outposts in Silicon Valley. He's now helping companies get the most out of their relationships with Silicon Valley. Evangelos writes extensively about the future of corporate innovation on his blog. Evangelos and I are working on what we hope will become a book about the new model for corporate entrepreneurship. His insights about how large companies are using the Valley is the core of this series of four co-authored blog posts. --- The last 40 years have seen an explosive adoption of new technologies (social media, telecom, life sciences, etc.) and the emergence of new industries, markets and customers. Not only are the number of new technologies and entrants growing, but also increasing is the rate at which technology is disrupting existing companies. As a result, while companies are facing continuous disruption, current corporate organizational strategies and structures have failed to keep pace with the rapid pace of innovation. This burst of technology innovation and attendant disruption to corporate strategies and organizational structures is nothing new. As Carlota Perez points out, (see Figure 1) technology revolutions happen every half-century or so. According to Perez, there have been five of these technology revolutions in the last 240 years. Figure 1: Five technology revolutions source: Carlota Perez Perez divides technology revolutions into two periods (Figure 2): The Installation Period and the Deployment Period. In the Installation Period, a great surge of technology development (Perez calls this Irruption) is followed by an explosion of investment (called the Frenzy.) This is followed by a financial crash and then the Deployment period when the technology becomes widely adopted. In between the Installation and Deployment periods lies a turning point called Institutional Adjustment when institutions (companies, society, et al) adjust to the new technologies. Figure 2: The two periods characterizing technology revolutions source: Carlota Perez Historically during this Institutional Adjustment period companies have to adjust their corporate strategies to deal with these technology shifts. The change in corporate strategy forces a change in the structure of how a company is organized. In the U.S. we've gone through three of these structural shifts. We're now in the middle of the fourth. Lets quickly review them and see what these past shifts can tell us about the future of corporate R&D. Institutional Adjustments In the first 50 years of commerce in the then-new United States, most businesses were general merchants, buying and selling all ...

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