[MUSIC] Hey there. In our last video we defined radical innovation. But where do they come from? Is there a conscious effort made by companies to create them? Or do they simply emerge in the mind of brilliant engineers? For a lot of time, radical innovation were seen as a product of luck and genius. Brilliant inventors, ripe technologies, and a little bit of serendipity were used to explain how radical innovations come to be. However, recently researchers offer a different explanation. Organizations of those we have seen, dedicate part of the R&D budget and efforts to develop these products. Some do it in a more structured manner, offer creating a smaller department responsible for the development of this long term on certain projects. When we study the companies, we can see two distinct patterns for the development of radical innovations. Some prefer a more unstructured approach to radical innovations, usually by allowing some engineering scientists to experiment with promising technologies. Three AM in the 80s for example had such an approach. Classic example of radical innovation that we have seen already, is to post it. And we discuss it in our previous classes. But how did it actually become a product? At Three AM, the upper management was known for incentivizing their engineers to work on projects outside the official control of the organization, that did not go through the traditional stage gate model. They even allotted them sometime after day which will do that. A scientist working at Three AM, called Arthur Fry, had an idea to create a product that will enable users to glue and then glue their notes from delicate surfaces, such as books. Specifically he had an issue with keeping those in his religious books that used a very thin and delicate type of paper. Once he had this insight, he went to his colleagues to see if anyone was working on an adhesive that had such properties. He found exactly what he was looking for. A kind of clue that had failed the traditional quality tests at Three AM for being too easy too to unglue. Once he had his idea and the technology to make it work, he created the initial prototypes himself. While Three AM had a structured innovation fun of other products, Mr Fry decided not to run his innovation through this process. It was simply too uncertain a product and would likely fail these stringent screening stages. So he used a different approach. He made some posters himself, prototypes of the product envisioned, and started distributing throughout the organization. Gave some to the director's, some to the president, and to his other colleagues. It was an instant hit. Once he had the attention of the upper management, he was granted the resources to develop this product. And it eventually became a staple in every office. This is a common characteristic of radical innovations. They are often managed outside the traditional processes of the organization. An engineer or scientist, who worked as the champion, putting his efforts into convincing the company that there is merit for his ideas. It is almost a clandestine work. One that escaped the traditional controls of the organization. This type of clandestine innovation was so common that they even had a name for it at Three AM, bootlegging. A word that was used to designate the illegal alcohol producers and sellers in the United States during prohibition. However, since the 1980s a lot has changed. And many organizations began approaching radical innovation differently. By creating departments or teams that are responsible for developing long term uncertain projects. Google, for example, works what they call moonshot projects. They even have a separate company, currently called X, to manage such projects away from the traditional constraints of their R&D department. They have a simple description of what is required for a project to be a part of this organization. A huge problem that affects millions of people. A sci fi sounding solution, this is impossible today. Or a technological breakthrough that will make a solution possible in the next five or 10 years. These are the requirements to participate in the x program. Currently, they are developing several radical innovation projects, such as a type of kite that can float and generate electric power, and a self driving car. What google is doing with their Moonshot projects is similar to what other organizations that excel at innovation are doing. They treat radical innovation as a function in the organization. The same way they have a budget resources and a team for the marketing department, the human resources department and so on. They have one for Radical Innovation department. During the studies about Radical Innovation, Professor Gino Corner, a leading scholar in this field, has seen how this approach bits the clandestine one used in other organizations. Radical Innovation is as important as incremental innovation or marketing, she claims. And should become a function of the organization. By making it official, it becomes harder to dismiss them certain projects and to eliminate them, in case of a budget cut. The same way we don't eliminate the marketing department, when they have a bad fiscal year. In the next class, we'll discuss in detail how companies actually managed radical innovation projects, and the tools we can use to do so. See you there. [MUSIC]
