‘Necessity….The Mother of Invention’ expresses clearly a key driver of innovation. Compared with several decades ago it seems that ‘necessity’ and big ideas are not as predominant today. Cold war and the space race, rebuilding post second world war, the energy crisis, faster and higher supersonic air travel, and more recently the genome project were all drivers of significant innovation.
Is there a shortage of ‘necessity’ in our modern world? Do we need anything today or do we have everything? Are we missing ‘necessity’ in the noise of a complex world? Is ‘necessity’ just different or more subtle today? Have we moved from ‘necessity’ to ‘nice to have’? Are we becoming complacent? ‘Invention as the mother of necessity’ has taken root in consumption economies but these inventions have not solved big problems like curing cancer or feeding the world’s hungry.
The Economist recently questioned if the idea machine was broken. The article takes an interesting long term view of major innovation events in world history suggesting a general sense of innovation pessimism has emerged in developed countries. One underlying root cause may be a period of technological stasis resulting in an innovation plateau because we may have run out of big ideas that can change the world. Evidence of the technological stasis was identified threefold as: diminished need to use labour and resources in better ways; reduced level of invention activity; and the observed rate of progress seems to have slowed particularly in our households, transportation speed, and medicine.
The Economist goes on to note that although the information age and the web has taken center stage in technology development economists such as Robert Solow have noted that information technology has not made a significant impact in economic productivity. The Economist also suggests reason for optimism because the 2008 Financial Crisis may have masked the productivity improvements from the burst of information technology in the 1990s. Further reason for optimism along these same lines is the tendency for a lag in results from the introduction of new technology can take up to 15 years and full exploitation can take longer so the impact of the information technology should become more predominant in productivity statistics in the near future. Using electrification as a example The Economist also noted that innovation implementation can be lumpy but in the long term history proves that it will continue to drive productivity improvements.
New drivers of ‘necessity’ may emerge from the resulting dynamics of labour and resource costs as the global economy recovers from the structural break following the financial crisis. Refocus on climate change, water and food shortages with population growth, and repatriation of manufacturing with cheaper energy prices are leading candidates. Another driver may be the re-emergence of ideological competition in the global economy. The competitive political pressures of the cold war have subsided as the world moved from a bipolar world to a unipolar world resulting in a weaker US innovation machine. The absence of government investment like the Apollo program driving innovation is a good example. The debt crisis has certainly diverted developed governments attention away from longer term innovation. As the new multipolar world emerges perhaps new competitive races like seen in the cold war may also foster more ‘necessity with urgency’ to drive fresh waves of innovation.
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