07.02.2016

Imitation Game

Nothing enigmatic about this. Successful innovation has been one of the holy grails of getting the Finnish economy off its knees. There have been working groups, symposiums, tax-relief initiatives, politics and a lot of buzz about the value of innovation in creating competitive advantage and sustainable growth. Almost every company claims to be innovative as if it were a form of originality or uniqueness. For a long time I used to agree but for even longer, innovation as a term, especially if wrongly used, has become a turn-off. The subject resurfaced recently and reminded how topical it still is.There has been so much talk about innovation that it was refreshing to be exposed to another perspective – success by imitation. For very obvious reasons (especially if the interpretation is narrow) that imitation is almost a taboo subject in the IT industry. The acidic negotiations about rights for intellectual property often start even before seeing the solution or internalizing the context.Comparing business value driven by either innovation or imitation, the latter wins hands down – so said HBR in 2010 with multiple examples. HBR estimates that 98% of the wallet of innovators eventually goes to imitators. Look at examples like White Castle and McDonalds, Diners Club and Visa, Motorola and Nokia, Dynabook and IBM…

“Parrots mimic their owners. Their owners consider that a sign of intelligence” (Marty Rubin)

Imitation is not copying. It doesn’t mean pretending to be something else. There is a connotation of exploitation, but if done ethically soundly, it is far from stealing. In most cases it is using innovation as a building block or more appropriately as stepping stone to drive business. Sequential or complementary innovation is almost synonymous to imitation and it can be argued in the bigger picture that inventors (and surely society) would be better off with without patent instruments.Software industry as a whole has been probably – at least by reputation – one of the most innovative industries of all times. Sequential innovation is the common norm and complementary innovation is the core business of software ecosystem partners.

“Imitation is not just the sincerest form of flattery – it’s the sincerest form of learning.” (George Bernard Shaw)

From an organizational or HR standpoint, innovation and intrapreneurship may be perceived to be more creative than imitation. This depends of course on culture and e.g. in eastern cultures such as China, this is quite the opposite. Curiosity is drives both innovation and imitation.SAP Business Development Director Ellen Davis recently coined The Five Truths of Innovation in a recent article in Forbes magazine. The first one I found particularly true: “Valuing innovation reminds your employees how awesome they really are”. Whether innovation actually takes place instead of imitation is irrelevant in this case.For me, when we talk about people and about innovation or imitation, I prefer the term Thought Leadership. To be a thought leader, you need to be acclaimed or at least recognized and by definition you are ahead of others. Thought leadership doesn’t necessarily have to have anything to do with a single innovation. It is also hard to copyright a thought so it invites sequential and complementary innovation. It inspires. Inspiration is second nature to curiosity.IT solutions and technology are increasingly enablers of business development and sometimes even innovation. Today nothing would be the same without Internet, advanced business software, wireless networks and telecom networks etc. If the internet were to have been patented as an innovation, none of the current web-enabled megatrends would have emerged nor the hypergrowth of a mindblowing number of web-enabled business applications, innovative business models, disruptive e-business.The SAP ecosystem lives off imitation, very rarely off true innovation. Mass-customized applications offering new advantages are often a set of best practices, lessons-learned, proven methods and usually just incremental improvements to the baseline solution. Imitation in this context is more often targeting for the same end-result as another pre-existing solution, but finding an alternative route which is more efficient, less expensive code or is otherwise more advantageous. Imitation in this context is doing something smarter than before. (Hence why Bilot dubbed their application spin-offs the Bilot SmartSeriesTM product family.) And in these cases more is more.

“Originality is nothing but judicious imitation. The most original writers borrowed one from another” (Voltaire)

Complementary innovation i.e. reaching the ultimate result via separate research line) works well for systems integrators and in our context, SAP ecosystem providers. Our business model is based on SAP’s foundation (innovation or imitation, who really even cares, but it is copyright protected) which we implement to customer specification. Hardly ever do we encounter homogenous SAP landscapes and equally rarely do we encounter SAP software which is flawless. The combination of applications, associated technologies, programming code, releases, customization and business processes makes the end solution always unique.From and organizational stand-point Esko Kilpi picks up on a similar analogy. He explores open collaboration and non-competitive processes of cooperation. Darwinistic competitive selection results in the gradual reduction of players which equals in reduction of diversity. “Interaction creates capability beyond individuals” says Kilpi – in the imitation game context, instead of protecting innovation, openness would similarily promote complementary innovation and provide an organic platform for natural extensions, transposable best-practices and an infinite number of cross-applications.As a conclusion, while we must respect agreed terms on rights protecting intellectual property, I argue that a more open collaboration culture and new liberal innovation norms would accelerate the conception of new in the long term. Even if an idea or innovation is released on an open collaboration platform, its successful exploitation is usually not possible in isolation. The customer situation is specific, the adaptation of the idea to a business process (in all of its usual complextity) is typically quite unique i.e. one cannot just copy-paste ideas successfully. We can see such behavior in the hacking community where there are very few limitations and the outcome is beneficial for all parties and added value is created.

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Mika Tanner

Bilot Alumni