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Big Is Beautiful, Especially R & D

Although a lot of people have read my blog, Big is Beautiful, I’ve
been surprised at the total lack of rejection. Now comes still more
input about big corporations and their research and development,
supporting my suspicions and ideas.

It’s true that Steve Jobs built the first Apple computer in his
garage. And also true that Mark Zuckerberg typed the original lines of
code for Facebook in his dorm room. But their real genius was not the
invention by itself. It was translation. 

When we talk creativity and innovation, we seem to omit the
differentiating issue: translation. The ability to translate theory into
practice. Robert Sternberg, the cognitive scientist, talks about
creativity and innovation in three stages. First is that of creative
intelligence, the ability to go beyond the given and create novel and
interesting ideas. These are typically people who see connnections that
other people don’t see. Gates saw his basic software as connecting to
IBM and Apple’s computers, with the potential for making them
free-standing.

Analytical intelligence, that ability to evaluate ideas, solve
problems and make decisions is extremely important for creatives to
analyze their own ideas and evaluate their merit. I worked for a number
of years with a partner who could toss about more ideas than I could
digest. But he seemed to lack the ability to evaluate the usefulness of
those ideas and put them to work.

The third aspect of creativity, practical intelligence, is all about
translation. It’s the ability to “translate” theory into practice and
abstract ideas into practical accomplishments. Translation, ultimately,
is about selling. Indeed, the ability to sell your creative ideas
determines whether it ends up on the scrap heap or becomes a product or
service. 

3M is famous the world over for its R & D. Having consulted there
for years, I’ve learned that the best ideas can easily go into the
circular file. Thus, inventors spend a lot of time with colleagues
figuring out how to use the idea and how to sell it to the leaders of
the company. And if the senior execs don’t buy that idea, it goes
nowhere.

The Foreign Affairs writers had this to say about big companies and their contributions to research and development: 

Today, we celebrate small places with
big ideas. It is true that Steve Jobs built the first Apple computer in
his garage and that Mark Zuckerberg typed the original lines of code for
Facebook in his dorm room. But the genius of Jobs, Zuckerberg, and many
others was in turning their ideas into highly competitive global
enterprises. Apple now employs 46,000 full-time employees — and it is
the combined energy of those employees that delivered the iPod, the
iPhone, and the iPad.

At the turn of the twenty-first
century, the National Academy of Engineers ranked the greatest
achievements of the previous century based on how each innovation
improved people’s quality of life. Major U.S. corporations — the Edison
companies, General Electric, AT&T, and General Motors — played
significant roles in the development, production, and distribution of
the majority of these achievements.

It is safe to say that without its
major corporations the U.S. economy would not be, and would not remain,
the largest and richest in the world. Big businesses invest
significantly more in research and development than smaller firms. And
they are far better placed to capture economies of scale and scope,
which is crucial to making U.S. goods and services competitive abroad.
Large companies account for more than 70 percent of U.S. exports. The
same economies benefit U.S. consumers, too. Despite the vilification of
Walmart, for example, the arrival of a Walmart Supercenter to a
neighborhood leads to a 25 percent decrease in the average grocery bill
for local residents.

Beyond R&D performance, sales
abroad, and bargains, big business offers what the United States needs
most: jobs, and many of the best in the country, at that. The largest
firms pay about 50 percent more and provide 10 percent more working
hours per week than small companies. These firms provide jobs to almost a
third of the American work force.

In our glorification of small business,
let’s not throw out the baby with the bathwater. We really, really need
big corporate America. Big really is beautiful.

You cannot possibly realize how deeply
writing this goes against my biases and my historical mindset. But
reality is reality. And I believe it’s important to sing the truth, even
when it is very, very difficult. Otherwise, our country will be in a
long, very hard slog.

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