Innovation Nation by John Kao

Full disclosure: I didn't get past page 110. The second half of the book might be brilliant. Someone else can find out.

The book's full title says it all: Innovation Nation: How America is Losing Its Innovation Edge, Why It Matters, and What We Can Do to Get It Back. If you already think America's best days are behind it and it's going to get eaten alive by Finland (#1 in global competitiveness according to the World Economic Forum in 2005), then you're going to love this book. If you read that expanded title and say, "OK, prove it to me" then you're going to hate this book. I'm in the latter camp.

What Thomas Friedman did for globalization, John Kao is trying to do for innovation. And I detect much of Mr. Friedman's writing in this book. Subheadings for the chapter "The New Geography of Innovation" include "Silicon Valley is now everywhere," "Talent is now everywhere," "Capital is now everywhere," and the verbose "Government investment in military and aerospace is now everywhere." Kao even calls the current period of innovation "Version 4.0" to distinguish it from earlier ones. And like all of Mr. Friedman's books, this one is heavy on anecdotes and statistics, but light on structure and predictive models (it also cherry picks history).

In addition to graduating from Harvard, teaching at MIT, and starting several companies, John Kao is "a leading expert on innovation" according to the book jacket. The leading expert on innovation defines his own specialization as "the ability of individuals, companies, and entire nations to continuously create their desired future." I guess having terminal cancer isn't very "innovative." He also says that innovation isn't all about science and technology. Grameen Bank, Southwest Airlines, American Apparel, the index fund, and W Hotels are all examples of innovation. Now, here's where I began to have a problem. Kao demands that we be exact when talking about innovation, because innovation is not a vague concept like love, but something that we can measure and actively promote. So, how then? How do we measure innovation? He dangles the idea of measuring innovation in front of the reader, offers some suggestions (the number of PhDs or patents), but then disappears into his next thought. He asks us to take innovation as seriously as accounting, but even a "leading expert" has no real idea of what that means.

So, if America is losing its innovative edge, who does Kao want to get gay with? Singa-bore, Finland, Denmark, Ireland, and a few other places. Why does he want to get gay with those countries? Because Singapore just built a giant mall and it successfully got the Culinary Institute of America to open a school there. The mall I'm referring to is One North. It's an international research and development center created by Singapore to mimic the successes of Silicon Valley. Many of the world's leading tech companies, venture capitalists, and universities are opening branches there to take part in this collaborative, scientific community. Kao says that many parts of the world are engaging in these efforts, and without similar initiatives here, we're going to fall behind the rest of the world in cultivating innovation (and with innovation, economic and scientific success).

I want to shout 'bullshit' from a mountaintop. Singapore is luring venture capitalists, biotech firms, and universities to the same location with the goal of creating Silicon Valley. Why does that sound so familiar... oh yeah, the Arabs just tried that. If I remember correctly, a certain city in the UAE was supposed to rival London and New York as a global financial hub. The Emiraties were awash in oil money and made such brilliant moves as building the world's tallest building in the middle of the desert. For anyone who missed it by the way, Dubai is dead. Don't expect it to bounce back when the world comes out of this recession. Add Dubai to the ranks of Kuala Lumpur, Bangkok and anywhere else that blew all of its capital on poor investment decisions. A fool and his money, as they say. Singapore wants to lure all of the world's finest? If that's possible, I don't think its accomplished with a green campus and access to banks alone. The pharaohs built the pyramids, not the other way around.

Innovation is very important. I'm not saying that it isn't. I'm saying that this book is crap. Government support, a good school system, and all the rest of it are essential, but I think John Kao isn't thinking hard enough about this. As part of his argument, America became mighty by introducing the GI Bill after World War II, allowing a whole generation of Americans to go to college. OK. But we were able to defeat the Germans AND the Japanese without a GI Bill. America's innovation and success didn't begin when John Kao needs it to. It began way before then, when America wasn't doing many of the things that he claims are now essential. I think Mr. Kao needs to go back to the drawing board and come up with a new theory on innovation. But, if in 10 years the best universities are located in Singapore, Finland, and Denmark, I'll take it all back.

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