That’s what I said.  Government’s cannot promote innovation

Yesterday, I was playing with John Hagel’s list of three features that distinguish fringe/flaky activities from edge, innovative activities and I suddenly realized: governnments cannot promote innovation.

This is why.

3 differences between fringe/flakey and edge/innovative enterprises

John Hagel, famed for his work on the motor cycle industry in China, points out:

#1 Edge activities are scalable

There is a way to bring the critical stakeholders and a  critical mass of people together to make a difference.

#2  Edge activities are ‘life works’

The change brought by edge activities are so compelling that we are willing to back them with everything we have.

#3  Edge activities change the status quo

Edge activities don’t exist as a complement, extension or protest to mainstream activities.  They intend to take over the mainstream.

When we develop a new industry, we curtail, or even displace, other industries.  People are put out of work.  How can a government sponsor that?

QED.  Governments cannot sponsor innovation.

How can governments support innovation?

It seems to me that govenments’ job is to promote social conditions that promote innovation.

#1  Look at employee rights in failing or contracting industries.  I don’t mean employee privileges, I mean rights.  How do their rights stack up with the rights of other stakeholders (who are also losing out).  Bring those into balance in a fair, transparent, agree and comprehensible matrix.

#2  Make it easier for employees to move from one industry to another.  How easy is it to retrain mid-career?  How often does this happen?  How do individuals go about it?  With what success?  What structural changes would make it easier?

#3  What other structural issues make it hard on employees exiting collapsing industries?  How do we treat people who are not in employment?  How does the tax law and the banking law make life difficulty for people who are reinvesting in new industries?

What I learned from Hagel’s points on edge industries

That’s what I learned from thinking through Hagel’s three points about edge industries.  Government has got to make it easier for more edge industries to  succeed.

And that means Governments must make it less painful for old industries to shrink and eventually fade away.

It also follows that a good governments, in this day and age, should be boasting that this is an economy, and society, in which old industries are given and neat, tidy, respectful burial.  And that we are proud of our ability to move on.  Because moving on just got profitable .  .  . for everyone.

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