I think I first became intrigued by the potential of innovation as a Peace Corps volunteer in one of the most resource-deprived countries in the world. I saw, surprisingly, an incredibly inventive people: the kids, for example, managed to create sophisticated toys out of discarded materials that put our highly-educated children to shame. Perhaps this is a necessity in an impoverished country where debilitating disease was endemic and life expectancy at birth was 30. Yet there were very few innovative solutions to the overwhelming challenges these people faced.

Over the years, I’ve asked myself, simply, why innovation didn’t thrive there, when it does in innovation hotbeds like Silicon Valley, Route 128 or Israel? Lots, of course, has been written over the decades on the necessary conditions (educated workforce, access to VC capital, support infrastructures, etc.), yet trying to create organizational ‘innovation incubators’ is often a fool’s game. Peter Drucker wrote, in 1973,

Because the purpose of business is to create a customer, the business enterprise has two – and only two – basic functions: marketing and innovation. Marketing and innovation produce results; all the rest are costs.

Fast forward through my MBA, my early product marketing years, an overseas posting and a consulting gig to a stint in corporate marketing at IBM, where my colleague on several corporate branding, marketing and innovation initiatives, Chris Gammill, coined the formula: Invention + Commercialization = Innovation. It was such a stunning epiphany that when we took it to the EVP of Technology, this grizzled 35-year veteran immediately expunged the word invention from his vocabulary and started the entire technical community there down a new path. So, it took me about a nanosecond to click on this article in today’s NYTimes: How Google decides to pull the plug, which leads:

GOOGLE recently set the blogosphere abuzz by announcing that it was pulling the plug on several products.

The only thing I disagreed with is what appears to be a throwaway line: “But in this difficult economy, even Google is paying more attention to costs.” I think this misses the point. Organizations that hope to drive innovation should ALWAYS pay attention to costs. This, of course, doesn’t mean you let the accountants loose on innovation initiatives too early! But getting the right metrics in place is critical; here is how the writer describes Google’s:

All of the shuttered projects failed several of Google’s key tests for continued incubation: They were not especially popular with customers; they had difficulty attracting Google employees to develop them; they didn’t solve a big enough problem; or they failed to achieve internal performance targets known as “objectives and key results.”

The challenge is that if unproductive initiatives are allowed to continue for too long, they distract and suck up resources that could be better deployed on more productive programs.

In other words, find a way to create an organization (= structure, rewards, processes, management systems, culture) that encourages the innovators to fail early, and fail often. Not, of course, to be confused with Strategies that fail.

BTW, Tom Friedman also wrote on innovation in his column today, about two young American women ‘driving’ environmental change in India: Yes, they could. So they did. Inspirational enough that I sent it to my daughters.