Innovation is one of the most critical contributors to both national and global economic growth. Achievement of sustained success in an area such as Northern California’s Silicon Valley can be attributed to many factors that lead to a culture of innovation.
Initially, in the 1960s and 1970s, Silicon Valley grew through government investment (in defense), universities (Stanford University and University of California, Berkeley), and bright technical and scientific people who identified opportunities to make a difference in the market. To leverage this foundation for national and global growth, entrepreneurs, investors, and corporate leaders can build an innovation culture by developing these key characteristics found in the business pioneers of Silicon Valley:
- Risk taking. Innovation is dependent on challenging the status quo, doing something different, and making gains, and then addressing feedback from the market. Success is not guaranteed, so innovators embrace failure as a step on the path toward success.
- Diversity. Working in teams with people from different cultures, backgrounds, and ways of living requires outside-the-box thinking, which fuels innovative ideas and products.
- Mentorship of entrepreneurs and intrapreneurs. Surrounded by good ideas and thriving businesses, people within Silicon Valley often “pay it forward,” helping someone else without the expectation of a direct return. These mentors know that by helping someone else succeed we are all building a better future.
- Focus on meeting a defined customer need. While initial funding may be available for researching a concept or product, sustainable innovative success is built on revenue generated from customer purchases of a solution that matches their needs and wants. This means rapid, iterative testing of concepts and products with customers along with a sustainable business model.
- Timing. Because competition and economic cycles change frequently, by Silicon Valley standards, the average time to market for a “minimal viable product” is 18 to 24 months, with committed customers and a strong revenue and profitability plan.
- Teamwork. By recognizing that no one can effectively fill all of the roles required to build a successful business from an innovation, Silicon Valley icons from Steve Jobs to Marc Zuckerberg focused on building and leading a great team.
- Engagement with ecosystem partners that complement the internal team. Many successful businesses are the result of early alliances and ecosystem engagements between entrepreneurs and corporations, alliance partners, and service providers.
- Building value through revenues and profitsfrom customers. By perfecting the match between market needs and solutions, your company will create value and profit, which can be used to fund the next great idea. This continual cycle of innovation is the core of what has made Silicon Valley successful for more than 50 years.
Innovation is built on great technical and scientific competence, supported by research and educational institutions along with public funding. However, sustainable success is achieved through development of an innovation culture within a company, accelerator, city, region, or nation.
JENNIFER VESSELS is the CEO of Redwood City, Calif.-based Next Step, which comprises a team of 40 professionals who provide marketing, sales, and employee development consulting services and training programs.