Out of the list of the following companies, how would you rank them in innovation?:
- Microsoft
- IBM
- Cisco
- HP
- Apple
- Dell
Now, rank those same companies on how much money they spend a year on R&D. Here is a hint for the 2nd list, it should look exactly like the list just presented. In fact, Microsoft spent 8 times more in 2009 in research and development than Apple based on numbers from the Business Insider. Here are the numbers:
- Microsoft – 8.6 Billion
- IBM – 5.8 Billion
- Cisco – 5.0 Billion
- Google – 2.8 Billion
- HP – 2.77 Billion
- Apple – 1.1 Billion
- Dell – 0.62 Billion
I think it would be difficult to argue that Apple and Google are not on top of the mix in innovation. Where as Microsoft and IBM are on the bottom. Why? Granted I don’t know the inner workings of either company, so this is just a guess. What I’m thinking is that much of the Innovation from Apple is coming from Steve Jobs. And Steve Jobs, love him or hate him, knows how to innovate and has little concern about saving other egos and feelings along the way. When it comes to companies like Microsoft and IBM, much of the “Innovation” is done by committee comprised of people that have survived politically long enough to grow into a corporate role that allows them to sit and lead committees tasked with being innovative. This is clearly not the formula for success. In fact one may argue that politically savvy and innovation are inversely proportional. On the other hand, being an incredibly gifted innovator and having what it takes to run a company successfully are also often inversely proportional. Suffice it to say, may things need to line up just right. As for the others, IBM and Microsoft, they will continue to ride with their inertia for years to come. And they will spend billions on R&D. And with their billions, they will do more to keep the senior level innovators happy than producing anything innovative.