Idea- Versus Time-Driven Competition

How is your company competing in the marketplace? The trend among technology-oriented companies has been to respond to competitive pressure in the form of time-driven competition. The company that can get to market first succeeds. Why is this?

The history of some of the established successes in technology, such as Tektronix, H-P, and GE, was not based on being first to market. Tektronix founder Howard Vollum began building laboratory-quality oscilloscopes based on his wartime involvement in radar. He recognized the need for such an instrument, though his competitor, Allen B. DuMont wondered who would ever pay $600 for an oscilloscope. Tek succeeded because Vollum had a bigger perspective on electronic test and measurement, not because he beat DuMont to the market with a marginally better product. Vollum and Tek co-founder Jack Murdock succeeded because they were visionaries; Tek was idea-driven instead of time-driven. The founders were competing along the dimension of ideas, not time-to-market.

Hewlett-Packard has historically been idea-driven too. H-P is willing to take the time to develop radically new technology that gives them a competitive edge for years to come. Only now is significant ink-jet competition appearing. And General Electric? GE had to buy the company that Charles Steinmetz worked for to get Steinmetz. This outstanding creative genius, who made major advances in motor theory, was well worth the price. Somebody at GE recognized that what is truly important in business competition are superior sources of technical ideas.

Time-driven competitors are in the commodity business. Just as wheat is wheat and steel is steel, much of today's competing electronic gadgetry is not differentiated on the basis of novel concepts. Often the difference is one of style, modest performance improvement, or a different combination of user-interface features.

Where is the creative contribution of inventors - people with new and better ideas - in today's products? In the components. Integrated circuits are often idea-driven, though increasingly, IC companies will design and produce an IC only after a major customer comes along. By tracing the development stream to its source, we find the inventors, thinking up the enabling technology for time-driven competitors to build into their products. Unlike the past era of Edison, Steinmetz, Westinghouse – and even Bill Lear or Bob Widler – an era when inventors were honored for their seminal contribution in turning the wheels of technology, an "inventor" now is somebody who sends away for an invention-development kit and is suspected by the public of being a crank if not merely a nurd or geek. We now refer to inventors as "technology developers" or "design engineers." Whatever the name or the public reputation, these people still contribute at the headwaters of the technology stream. And inventors themselves often develop in developing environments.

I was building test equipment and a radio station in my early teens out of components stripped from TVs that I got from the local radio-TV repair shops. Nowadays, you can't find such shops in the neighborhood. In fact, the neighborhood is in suburban America, a technologically sterile environment where most children can find nothing more to tinker with than the family computer. Zoning keeps local industry far from young creative minds. No wonder analog engineers are in continuing demand. Motor-drive designer Dr. Allan B. Plunkett of AC Drives Technology (http://home1.gte.net/bmwalker/acd.htm) remarked years ago in casual conversation that most engineers come from upwardly-mobile families, with parents struggling to "get ahead." These families are often rural or in small towns, where industrial and commercial material or equipment can be found, with which to tinker and dream of building things. With welding equipment available on the farm, former Tektronix design engineer Cal Diller would build "dune buggys." The parental example of valuing things because they cost scarce family resources motivated the upcoming inventor to learn how to optimize, value property, and apply ingenuity. Suburban children satiated with material possessions, purchased with a virtually-infinite money supply and with no challenge to better their lot in life, are not inclined to develop these character qualities.

Perhaps this social trend contributes to the emerging dominance of time-driven competition. The desire to maximize short-term income competes with the seemingly time-wasting desire to tinker, to spend time in that creative frame of mind which is the engine of industry. Perhaps that is why there is a lack of new, idea-driven companies based on novel technologies. Although advances in telecom have taken center-stage, Internet-based variations of IPO get-rich-quick schemes abound.

While instrumentation is a well-established market, shared mainly by Agilent (formerly H-P), Tektronix, Fluke, and a few other companies (and usually requiring high-speed IC development to get into), power electronics is much younger and less settled. Its market-sector pie chart is fragmented among a large number of relatively small markets and companies. It is still on the frontier, inhabited by inventors and idea-driven companies. While power supplies have become a commodity, new ideas in motor drives and electromechanics are not exhausted. And with the recent commercial advent of fuel cells, improved photovoltaic solar panels, efficient wind generators, and high energy-density electrochemical devices, the creative possibilities in this field are continuing to be revealed. The emergence of hydrogen as an energy storage and supply medium in this decade is signaling the waning of the hydrocarbon era, and opening immense opportunity for the use of power electronics in hydrogen-based energy control and conversion to electricity.

It is not necessary to be mired in the rat-race of time-driven competition for creative companies and their inventors. The open-endedness of innovation and its possible economic consequences is accessible to anyone willing to get out a blank engineering notepad (or click "File, New"), lean back and (as H-P ads say) ask, "What if ...?" One must be willing to accede concrete and short-term gains to reach for intangible, long-term rewards. Such a course is driven only by the rare human quality of vision, of faith in the unseen, existing at first only in the mind. The risk-return ratio is not all that bad – especially when one of the benefits is simply to revel in the possibilities of a new idea.

Ó Dennis L. Feucht, 2000