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Are You Playing The Innovation Long Game? An HP Story.

It’s a question that all businesses must ask themselves at some point: are we playing the innovation long game or have we settled for the quarterly short-term metric of innovation success? What does it take to stay engaged in an era when trend shifts happen with dizzying speed, and new technologies

Phil McKinney
Phil McKinney
7 min read
Concept image of the innovation long game
playing the innovation long game – predicting the future

It's a question that all businesses must ask themselves at some point: are we playing the innovation long game or have we settled for the quarterly short-term metric of innovation success?

What does it take to stay engaged in an era when trend shifts happen with dizzying speed, and new technologies can quickly render yesterday's innovative solutions obsolete?

For starters, it takes a commitment to long-term thinking. That means looking beyond the next product launch or market pivot and instead focusing on investing in innovation that will support your business for years to come.

It also requires a willingness to experiment and take risks.

Time Frame For Innovation

Playing The Short Game

The time frame for playing the short game for innovation is typically quarterly, where businesses are focused on making quick decisions that will affect their numbers in the short term.

Playing the short game for innovation often results in disappointing numbers. When businesses focus on one-time goals and quick decisions to benefit their immediate need, they end up hurting their overall growth prospects.

Playing The Long Game

Playing the innovation long game can take anywhere from several years to a decade or more, as businesses focus on laying the groundwork for future success.

The key ingredient to maintaining any long-term innovation initiative is patience, sustained funding, and allowing sufficient time for the original mission to play out. Throughout history, there have been many instances of innovation breakthroughs that were not realized until several years in the future.

Pros and Cons

There are pros and cons to both approaches, of course. The short game can be thrilling, and it can produce results in the near term. But it's also risky, and it can be tough to maintain momentum over the long haul. The long game is more deliberate, but it's also more sustainable – and it can pay off in the form of lasting success.

Massive Shift to The Short Game

In 1970, the SEC put regulations in place that mandated quarterly reporting for all publicly traded U.S. companies. Combining this with the arrival of MBAs on Wall Street and their search for key performance indicators (KPIs) to predict the future performance of public companies, the quarterly results have pushed leaders to focus on short-term goals instead of long-term innovation. This is a massive shift that is seen throughout the business world.

The problem with focusing on short-term goals is that they can often lead to disappointing numbers. History has shown that playing the short game on innovation results in near-zero breakthroughs when it comes to creating new products or services. Instead, the results are incremental.

How do organizations fight against the short game?

Organizations that focus their innovation effort on the short game lack strong innovation leadership. The Board and Executive Team must establish the long-term vision and be willing to make decisions that will have a positive long-term impact, not just a short-term gain. They also need to allocate the resources for the long game, which is often difficult when quarterly goals must be met.

In order to play the innovation long game, it's important to have the right people on your team. This includes employees and partners, such as your innovation agency, with the skill set and mindset to think long-term, as well as a culture that supports risk-taking and experimentation.

It's also important to have a clear vision and mission as part of your innovation strategy. When everyone agrees with where you're going, it's easier to make decisions that may not have an immediate impact, but will support your business for years to come.

The 7 Immutable Laws of Innovation

I've discovered a set of innovation laws through trial and error over the years. Of course, I have the scars from my education at the school of hard knocks to establish that these Seven Immutable Laws of Innovation are essential for innovation success.

The penalties for breaking any of them can be devastating. The laws apply to all sizes of businesses, ranging from well-established multinationals to early-stage start-ups to national governments.

In playing the long game for innovation, there are two laws that leaders need to commit to.

Law of Patience

It takes time to be innovative. More time than expected. The company must have patience with the long-term vision that innovation requires. Leaders must avoid the urge to make quick changes. Annual budget resets (re-justification) force organizations to focus on short-term planning for innovation.

If resources are adjusted to help the organization meet quarterly profit-and-loss challenges, then leadership (e.g. Board of Directors and Executive Team) are not playing the innovation long game.

Law of Resources

Innovation requires a committed level of resources (people, money, time, equipment, manufacturing, supply chain, sales channel, marketing, etc.) over an extended period. The level of resourcing is the validation of the importance and commitment the organization devotes to innovation.

Does your executive team commit the best resources to innovation? Are the resources protected?

Success From Playing The Innovation Long Game

HP Leadership in Computers

HP dabbled in the computer industry for years. David Packard challenged the leadership team to either commit or partner for the computers it needed. In 1985, after much discussion, David Packard and the team committed HP to become “the leading” manufacturer of computers. The timeline? David Packard set the goal to be achieved in 25 years! Now that is playing the long game.

In 2008, HP took over number #1 market share in PCs, workstations, and servers making it the #1 computer company in the world. That was 23 years after David Packard's long game commitment to become the market leader in the computer industry.

Had David Packard lived to see his 25-year long game, he would have been 95 when HP achieved the vision. How willing are you to establish an innovation long game beyond your lifetime?

Failures by Playing The Innovation Short Game

HP Halo

Developed as a co-innovation effort with DreamWorks Animation, Halo was a response to travel concerns after the terrorist attacks of Sept. 11, 2001. Halo allows meeting participants to make eye contact, share files and documents, and shout over each other in an attempt to be heard, just like a real meeting. HP released the commercial version of Halo in 2005.

Since that time, many companies took the ideas of Halo and launched their own offerings, including Cisco Telepresence, Webex, and Zoom.

In June 2011, HP failed the Law of Patience and exited the market, and sold Halo to Polycom. The deal included HP's products, employees, and customers.

Fast forward to 2022 and HP acquires Poly which is the combination of Polycom and Plantronics. So they sold Halo to Poly in 2011 and 11 years later bought it back.

What role could HP have played had it committed to the innovation long game in collaboration technologies?

HP Palm

In April 2010, HP announced the deal to buy Palm Inc for $1.2 billion. The plan was to combine Palm with the work that HP (via Compaq and the iPaq phone) had underway to expand its position in the mobile communication space.

But again, HP failed the Law of Patience. In August 2011, HP chose to shut down Palm after only 16 months. The drive and focus on quarterly results overrode an agreed strategy between the Palm team, the Board, and HP Executive Team.

How Do You Commit To the Innovation Long Game?

Organizations have two options to play the innovation long game. First, use internal resources. Second, use external resources to avoid distracting internal resources from achieving the quarterly metrics.

Internal Resources

In order to successfully commit to the innovation long game with internal resources, it's important to have the right resources and experience in place. This includes things like a supportive corporate culture, ample funding and resources, and a team of talented and innovative employees.

A company's corporate culture is a key factor in supporting long-term innovation. A culture that values risk-taking and creativity will be more likely to embrace new ideas and initiatives, while a risk-averse culture may stifle innovation. It's important for executives to create a corporate culture that supports and encourages employees to take risks and experiment with new ideas.

Funding is also essential for committing to the innovation long game. Companies need to have the financial resources to invest in new products, research and development, and marketing. In order to sustain long-term innovation, companies also need to be willing to make short-term sacrifices in order to achieve long-term goals.

Having a team of talented and innovative employees is another key ingredient for committing to the innovation long game. These employees can help to generate new ideas, test new products, and market new initiatives. It's important for companies to foster a culture of creativity and collaboration in order to encourage employees to share their ideas and work together to achieve common goals.

External Resources

By using external resources, companies can leverage the expertise and resources of outside organizations to achieve their goals. This includes things like partnering with other companies or working with innovation agencies.

Partnering with Other Companies: Partnering (co-innovating) with other companies can be a great way to access new resources and expertise. This can include partnering with other companies in your industry to develop new products or partnering with companies in other industries to tap into new markets.

Working with Innovation Agencies: Innovation agencies can help companies to overcome the challenges of committing to the innovation long game. These agencies have experience in helping companies to innovate and can provide access to resources like ideas, funding, expertise, and networks.

By using external resources, companies can avoid distracting their own employees from achieving the quarterly metrics while also playing the innovation long game. This can be a great way to achieve sustainable growth and stay ahead of the competition.

Are You Committed To The Long Game?

Most companies do not commit to playing the long game in innovation. This opens the door for companies that will commit to both achieving short-term results while also committing to long-term innovation. By being strategic about the resources used (internal, external, or both), companies can commit to the innovation long game and achieve sustainable growth.

So, how do you know if your company is playing the innovation long game? The best way to find out is to ask yourself the following questions:

  1. Do we have a corporate culture that supports risk-taking and creativity?
  2. Are we willing to make short-term sacrifices in order to achieve long-term goals?
  3. Do we have a team of talented and innovative employees?
  4. Are we partnering with other companies or working with innovation agencies?
  5. Are we willing to commit to the long game in innovation?

If you answered “no” to any of these questions, then your company is not playing the innovation long game.

Time To Commit

The old adage that “good things come to those who wait” is not always true. Sometimes, in order to get what you want, you have to make sure it comes soon.

It's a fact of life that some people are more innovative than others. But there are also organizations and companies with a culture of innovation where risk-taking and creativity are rewarded. What's the key to becoming one of those great innovators?

It's not about being first to the market with a new product or service. It's about playing the long game, embracing change, and constantly learning and evolving. It's about taking risks and being willing to fail. It's about having a culture that supports innovation and risk-taking.

So, are you playing the innovation long game? If not, it's time to start. The future of your organization depends on it.

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Phil McKinney Twitter

Phil McKinney is an innovator, podcaster, author, and speaker. He is the retired CTO of HP. Phil's book, Beyond The Obvious, shares his expertise and lessons learned on innovation and creativity.


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