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Innovation & Small Business

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There are several significant discussions ongoing right now around National Defense including how much to spend, the continued movement toward low intensity conflict and the precision application of military power, and the role of small business innovation to connect the first two. This can perhaps be summarized in the often repeated phrase “we’re out of money so it’s time to think!”. Peter Drucker has been a recognized thought leader in the business world for over 60 years, and reviewing his lessons in innovation seems a worthwhile venture. Following are just some thoughts taken from “The Essential Drucker”, published in 2001 by Harper Collins (ISBN 0-06- 093574-X). The summary bullets are intended to get us thinking about innovation as a practice. An initial review of Drucker’s writing has led me to conclude the following:

- Innovation often fails to emerge in large, well established, and successful companies. This is not a predetermined outcome, but results in the fact that structures, processes, metrics, and reward systems are typically geared towards maintaining success on a large scale.

- Innovation within Small Businesses is not a pre-determined outcome. While the pre-conditions that tend to cause big business to fail at innovation are generally absent in a small business – particularly a relatively new small business – success is not guaranteed. The perception that “flash of genius” (as Drucker stated it) is the primary path to innovation is wrong – it is only rarely the case. Drucker concluded that “…innovation resulting from analysis, system, and hard work…” represents the fundamentals of at least 90% of sustained, successful innovation. There exists, somewhat paradoxically, a discipline within innovative companies.

- Innovation is not about solving problems 5 or 10 or 20 years from now. Successful companies must “…innovate for the present!”. True innovations may have additional long term impacts to the marketplace, but they better have an immediate one as well.

From a business development and marketing perspective, this all has huge implications. We believe Anglicotech is well positioned in a political and economic environment that clearly favors small business. Legislation continues to emerge and become law that emphasizes the use of small business in the National Security marketplace. This support however, is based on shrinking budgets, emerging asymmetrical threats that require new solutions, and a fundamental belief that small business will deliver the necessary innovation at the nexus of these other two challenges. We must “professionalize” the practice of innovation in order to deliver against that expectation.


By: Randy Delarm, COO & EVP
rdelarm@anglicotech.com