Entrepreneurial Innovation at Microsoft

How ironic is it that a title like that—Entrepreneurial Innovation at Microsoft—itself seems contradictory, or ironic? This is the company that perhaps more than any other, made computers work for ordinary consumers back in the 1980s and 1990s.

And yet, here we are, in 2010, and there’s nothing at all surprising about reading an op-ed in the New York Times by a former Microsoft vice president, asking why it is that Microsoft has managed to become almost irrelevant to the quest for innovative new technologies.

Microsoft’s huge profits — $6.7 billion for the past quarter — come almost entirely from Windows and Office programs first developed decades ago. Like G.M. with its trucks and S.U.V.’s, Microsoft can’t count on these venerable products to sustain it forever. Perhaps worst of all, Microsoft is no longer considered the cool or cutting-edge place to work. There has been a steady exit of its best and brightest.

The headline on Dick Brass’s article is “Microsoft’s Creative Destruction.” I love that phrase, and in fact I originally considered entitling my upcoming book about entrepreneurship, “Creative Destruction for Fun & Profit.” But I think there’s something inspiring about the seemingly immutable law that says eventually almost every entrepreneurial, innovative new venture will become the stodgy status quo.

Now if I could just figure out why I’m hearing The Circle of Life playing over and over again in my head…

At rock bottom, she found the foundation for her success…

From council flat and near poverty to gazillionaire known the world over.

If you haven’t see JK Rowling’s 2008 Harvard commencement speech, it’s well worth 20 minutes of your time.

J.K. Rowling Speaks at Harvard Commencement from Harvard Magazine on Vimeo.

Is the iPad a solution to anything?

From the man who brought you the Newton…

We’re just over an hour into iPadapalooza.  Already, there are looming questions about Apple’s new product—or more accurately, its new product category, squeezed between handhelds like the iPhone and laptop computers.  Steve Jobs even asked one of these questions himself, although I don’t think he had a real answer:

“Is there room for a third device?”

Isn’t that, like, the very first thing Apple should have asked itself?  You know, before like, designing, building, and launching the product?  So, teachable moment:  To all the aspiring innovators and entrepreneurs out there, before you rush something to market, ask yourself:

“What problem is my product designed to solve?”

If you can’t answer this question right off, your business plan is based on luck.  Maybe it will turn out that your innovation is well-received.  Maybe you’ll be the equivalent of the company that built tamper-proof packaging just before the 1983 1982 Tylenol scare.  But hope is not a plan.

See, the notebook/laptop computer was a hit because it solved the problem of portability.  The iPod brought pesky mp3 players to the masses because it solved the problem of how to organize and easily play music.  Amazon’s Kindle went a long way toward solving a similar problem of organizing and reading books.  The iPad looks like a pretty neat tool (albeit with a HORRIBLE name).  And there are a number of problems that it could solve…

…but so far it hasn’t been presented as the solution to anything.

As a writer, I find this really ironic.  The entire publishing business, from newspapers to novels, has been waiting on iWhatever as the possible savior of the industry.  See, there’s a problem it could solve!  Maybe it even will, eventually.  But tackling this head-on would have required positioning iPad as a sort of Kindle-on-speed.

So, Apple has two saving graces here.

First, there’s the App store.  As Steve Jobs acknowledged, who knows what kinds of killer apps third-party developers will create for this thing?

And second, Apple could probably launch a product called iDung, and at least in the short-term, a lot of us would buy one.  (And I say this as a guy typing his blog on a MacBook, waiting for his wife to call on his iPhone.)

But remember kids, hope is not a plan.  And the last time I insisted that powerful people probably understood their plan better than they were articulating to the little folks like me—we wound up invading Iraq.

Ciao for now.

Risk-free space travel?

I’ve been thinking a bit about commercial space travel over the past couple of days. And I’ve concluded that while space travel itself is still quite risky, starting a well-thought-out company that specializes in space travel might actually be much less of a gamble.

It’s going to take a few best-sellers and maybe a winning lottery ticket or two before I can afford to join the more than 300 people who have shelled out $200,000 for a ride on Richard Branson’s SpaceShipTwo. But between thinking about that, and reading Malcolm Gladwell’s recent piece in The New Yorker about entrepreneurial risk-taking (basically he says the most successful entrepreneurs are actually incredibly risk-averse) … and most importantly, after spending more than a year writing a book about Harvard Business School and intelligent entrepreneurship—I started to ask the question:

Just how risky is space travel anyway?

First, how much of a gamble is it to fly into space? And second, how uncertain is it to start a commercial venture like Virgin Galactic, Branson’s space-travel company?

First, the risk of actually traveling into space.

The most-tested, most-modern space ship the world has devised is the soon-to-be-obsolete Space Shuttle, scheduled to fly its 134th and final mission in September 2010. Over the shuttle’s 30-year history, two flights haven ended in disaster: the 1986 Challenger explosion, and the 2003 disintegration of Columbia. Presuming (and praying) that the remainder of the shuttle flights launch and land safely, the shuttle will retire with a 98.5 percent safety record. NASA itself claims that its astronauts have a 1:100 chance of dying each time they go up; presumably NASA thinks it’s caught and resolved safety issues, so that shuttle flights now are safer than they were.

Now let’s look specifically at Virgin Galactic. Before SpaceShipTwo has even been completed, three engineers working on a prototype were killed when one of the spacecraft’s engines exploded in a test. And Branson’s chief designer says that he thinks early 21st century space tourism will be about as safe as 1920s aircraft travel was. To put that in context, Charles Lindbergh flew from New York to Paris alone in 1927. On the one hand, he made it; on the other hand, doing so was so novel and exciting that it made him into an international hero.

Next, the risk of starting a space tourism company.

Virgin Galactica has two major, major capital costs that I can think of offhand. First, the company has to had to design and build the spaceships that its passengers will ride. Second, it needs needed a facility from which the ships could depart and return. (I’m tempted to include insurance as one of the monster up-front costs, but as that’s probably more of an ongoing operating cost than a startup cost, we’ll just note it and move on for now.)

The space ship.

“SpaceShipTwo,” to be precise. SpaceShipTwo will be piggy-backed aboard a larger craft known as “WhiteKnightTwo” as far as 50,000 feet. Then, SpaceShipTwo will detach, and rocket up to 360,000 feet above the Earth. It will stay there for only about five minutes during which passengers will achieve full weightlessness. Then it will glide unpowered back to Earth. (Knock on wood.)

In order to build five SpaceShipTwos and two WhiteKnightTwos, Branson reportedly expects to spend a total of $400 million.

Each ride costs $200,000. As of December 2009, Branson reported that “more than 300 people” had already ponied up the money, even before the space ship is finished. Planning on a first launch next year, Branson said he estimates that a thousand people will fly during calendar year 2011. (That’s pretty amazing, considering that as of right now only about 450 people in the history of the world have ventured into space.)

So, let’s do the math. Before the first flight takes off, he’s supposedly recouped about $60 million of the $400 million development and ship construction cost (and keep in mind, that’s for five ships.) And, presuming he hits the target of 1,000 passengers during 2011, that’s a total of $100 million. In other words, one-fourth of the total design and construction cost before the first flight.

Now, the second component, the spaceport.

This one’s easy. Branson got the state of New Mexico, with a little help from the federal and local governments, to pony up the entire construction cost of a facility in the Mohave Desert. We’re talking $200 million or more.

It will have a 3,000m (10,000ft) runway and a suitably space-age terminal and hangar building designed by Foster and Partners.

(I have to say this is a great deal for Branson, but it’s could be a great bet for New Mexico, too. Right now, the state’s economy is based primarily on natural resources, tourism, and federal spending—things like the three air force bases and the nuclear laboratory contained within its borders. Gaining an early foothold in the commercial space industry might—might—prove turn out to be a great boon for the state.)

But back to Richard Branson. When you analyze everything, I think his startup risk isn’t all that severe. The state pays for his facility, and his passengers pay for his space ships—even before he’s finished building them. Clearly there are going to be huge operating costs. I can only imagine what insurance, fuel, and personnel are going to cost. (Frankly, I wonder whether he’s actually underpriced rides on this thing. I mean, once you’re at the $200,000-a-ticket level, what’s the point? Why not a nice, round $250,000—thus adding another $50 million in projected revenue during 2011?)

Regardless, we’re left with the odd situation in which I think if Branson’s estimated costs are accurate, his risk in starting Virgin Galactic is significantly less severe than the risks each of his passengers will be taking when they strap themselves in. Very impressive.

An out-of-work architect “thinks new”

Starting a business because you’ve lost your job is often a recipe for failure.  (I think it’s a lot better to become an entrepreneur because you actually want to be one.)  But that said, a struggling architect’s reaction to being out of work is pretty cool.

Here’s the scene at a Seattle farmer’s market…

Mr. Morefield, 29, is no politician, but an architectural designer looking for work. He was seated at a homemade wooden stand under a sign reading “Architecture 5¢,” with a tin can nearby awaiting spare change. For a nickel, he would answer any architectural question.

It turns out that channeling Lucy van Pelt like this isn’t a bad way to drum up business.

I’ll give him a lot of credit for going to where the yuppies are, as opposed to waiting for them to come to him.  With his unusual marketing technique, John Morefield brought in clients and earned $50,000 last year—more than he’d ever made in his life.  And he got a lot of earned media as well, including coverage in The New York Times and on NPR.

But, architecture looks like a really tough industry.  In the second half of 2009, the NYT article says, 40,000 architects lost their jobs.  Ouch.  And let’s be honest, $50,000 isn’t a horrible income, but it’s not great.

I don’t know what kind of architect Mr. Morefield is.  You can check out his website here.

But as an entrepreneur he gets the following grades:  A “B” for the quality of his business idea, a “C” for market research—but an “A” for creativity and drive.

If anyone can make it in this business, I think he can.  But if things don’t work out, that kind of smart thinking and willingness to work his tail off suggest he’ll probably do great things in another field.

Here’s an official Bill Murphy Jr. life lesson via a true-life metaphor…

 

…just shy of its ten year anniversary. 

In 1999, my brother and my girlfriend at the time and I decided we’d go to Europe.  We didn’t have a lot of money, so it was one of those frugal, giant backpack, stay in crappy hotels and look for cheap flights kind of trip.  

At the time, Icelandair had these ridiculously inexpensive fares to Europe—something like $290 roundtrip from Baltimore to Frankfurt.  The only drawback is that you have to change planes in Iceland.  

On the way over, we decided we’d work it out so we actually spent a few days traveling in Iceland.

So the plane landed, and we were groggy.  We’d boarded at about 10 p.m., and now it felt like about 3:30 in the morning to us, even though it’s 7:30 a.m. local time.  We picked up our bags, and I  had that tired, dirty, cranky, been-traveling-and-I-just-want-to-find-the-flippin’-hotel feeling.

I made my way through Keflavik Int’l Airport with my 50-pound pack on my back and another smaller pack hanging  on my chest.  Not that I was ever ”airborne” in the army, but I felt like I was wearing a parachute with a reserve in front. 

It was awkward and heavy, and when we got through baggage claim, I managed to get separated from my brother and girlfriend. 

Then I spotted them through a big glass window, just outside the terminal on the sidewalk, where we could pick up a shuttle to Rejkjavik.

There were a series of big revolving doors, the giant kind that are meant for three or four people to walk through at the same time.  I wearily made my way to the door and begin to push.

It wouldn’t budge.

I leaned a little harder, and looked around, wondering if there’s some sort of button you’re supposed to push.  Behind me, a woman said something in German.  I don’t speak a word of German.

I pushed harder.  I started leaning into the door.  I clocked in at about 160 pounds then, so add maybe 70 pounds of clothing and gear and that was 230 pounds of highly motivated traveler, trying with all his might to get this door open.

Outside, a couple of tall Scandinavian men started yelling at me.  They seemed to be laughing.  Of course my Swedish and Finnish are no better than my German, so I had no idea what they’re saying.  But it made me mad, and more determined.  So I leaned even harder into the door.

Then I noticed my brother and my girlfriend, laughing at me as well.  I kept pushing, thinking, “Why don’t these people stop laughing and help me?!!”

I probably let loose with a “Golly!” or a “Doggone it!” or even a “Drat!”  Finally, I gave up, and stand up straight.  The door slowly started moving towards me.  

Yes, it was an automatic door.  

Yes, it turned clockwise.  

Yes, I was trying to push it the wrong way.

I made it outside.  Brother and girlfriend were laughing hysterically.  Finally, Brother says:  “I wanted to tell you, but I was laughing so hard I couldn’t get the words out.  And then I figured, he’s a pretty smart guy.  He’ll figure it out.”

See what I mean?  Important life lesson.  When you’ve pushed as hard as you can, and you’re not getting the result you need, stop pushing.  There’s probably a better way.

Why they talked, and what they want

A great gulf exists between American military and civilian societies. But paradoxically, it’s can be hard to tell young veterans of our wars in Iraq and Afghanistan from their peers who haven’t served. As I wrote a book about West Point recently, I would visit with vets who had left the Army and were attending some of America’s most prestigious universities. I was struck that the veterans were often the ones walking around campus with the longest hair, and the most stylish clothes. Spot a guy with a high-and-tight haircut and a wardrobe looking straight out of the AAFES at Fort Bragg—odds are he’s a wannabe who reads too many Tom Clancy novels and never served a day in the military.

But soldiers and veterans want to be noticed. That’s not to say they want to be singled out, but I found over and over as I wrote my book that they want civilians to pay attention to their collective service. Soldiers talked with me for thousands of hours, and even gave me access to their diaries, their letters, the “sent mail” folders of their yahoo and gmail accounts. They know their stories are worth telling. And what’s more, they recognize that the rest of us need to know. We need to understand.

I did more than six hundred interviews for In a Time of War. I recorded most of them, and paid people to write transcripts. Here’s a sample of what I heard:

***

Joe DaSilva was assigned to lead a platoon of soldiers in Kuwait just days before the March 2003 invasion of Iraq.

“I pulled everyone in that night, and I told them, look … I’m not going to lie. I don’t what awaits us on the other side of that berm. I have no idea but I’ll tell you this … [I]f I have to give my life for any of you I would do that in a heartbeat …

“And I had soldiers after that come up to me and telling me that they don’t know why but just hearing that from their lieutenant made them feel better. I knew they weren’t B.S.-ing me because months down the road we would talk about how they felt when I took over … They were brutal.  They were talking about tying [me] up in the back of a humvee … Some of the other platoons were joking with them, saying, You guys are going to die!  You guys are going to die!”

*** 

Drew Sloan was nearly killed when his humvee was hit with a rocket-propelled grenade in Afghanistan. He turned down a medical discharge, endured a year of surgeries, and recovered to go to Iraq. When an IED went off right in front of his humvee, he was surprised by his own reaction. He smiled broadly and reached out to bump fists with a sergeant in the front seat.

“Having a bomb go off close by to you can’t help but remind you about your own mortality,” he explained later. “And being reminded of that makes you feel really alive.”

***

Eric Huss served an intense Iraq tour, taking over for a lieutenant who had been killed in action. I interviewed Eric and his wife, Julie, in a brew pub in Denver, just after he got off active duty.

“I didn’t let him drive for a while when I was in the car,” Julie explained. “And his short term memory was non-existent.”

“I talked to a lot of different guys,” Eric said. “It’s about a year before your short term memory comes back.”

“I haven’t heard that,” I replied.

“I’ve been trying to, like, psychoanalyze it, and here’s what some friends and I have come up with. You’re doing a job.  It’s kind of a crappy job.  You go through a lot of stress on many different levels.  Regardless of the stress you face you still have to get up the next day and do the same missions over and over again, whether it be a different patrol, a different IED, a different guard shift—whatever the case may be. Regardless of who shot at you the day before, whether you got mortared the day before, you know, etc., etc. And as a defense mechanism in order to help you cope, we figure that over time you start to basically, automatically, kind of forget a lot of what just recently happened to you, so you can kind of cope and live in the present … [W]hatever happened to you that day or the day before, you still have to continue on that mission regardless. As a result, you act, react, and then dismiss it and try not to dwell on it. Because otherwise it’d be so hard to get out of bed the next day and do the same damn thing.”

***

War is a horrible thing, and not all of the real-life characters in my book survived Iraq. I interviewed Jen Bryant, the widow of Lieutenant Todd Bryant, about the day she learned his fate.

“I was in my classroom waiting for all my students to come back up from lunch, and the assistant principal came in and said to me there’s somebody in the office. We need you in the office. My whole chest caught… And so I walk in the office and for a split second I was relieved because I didn’t see any officers. And I thought it’s okay. And I just looked around for someone to tell me what was going on. And one of my students was in there, and she’s like, ‘Oh, they’re in there,’ pointing to the principal’s office in back.. I saw my principal standing there, and I just looked to my right, and there’s four or five officers standing, wearing their class As. And one of them was one of the generals at Fort Riley.

“I just hit my knees and I started saying, No, no, no. Don’t tell me. Don’t tell me. And I remember General Kearney, like, kneeling down beside me. And he took my hand. He just kept holding my hand. And I screamed. I kept saying, No! No! No!”

***

About one and a half million Americans have served in Iraq or Afghanistan.  They want us to notice them. It’s disturbing, to say the least, to come home from a war only to find that nobody notices anymore. The opposite of love isn’t hate; it’s apathy.

We owe these veterans quite a bit.  But before all else, we owe them the duty to pay attention. And to listen.

Bill Murphy Jr. is the author of In a Time of War: the Proud & Perilous Journey of West Point’s Class of 2002.  A lawyer and former Army Reserve officer, he lives in Washington, DC.

What I’m looking for next

I’m trying to get my hands on a copy of a 1999 Harvard Business School case, entitled something like “The Harvard Business School Classes of 1949 and 1999:  Comparisons and Contrasts.”  Unfortunately, nobody seems to have a copy of it.  Not the authors, not the Harvard Business School or its publishing arm—nobody.  

So, if you ever happen to be google searching or something and come across this post, and you know where I could get a copy, please:  Email me at billmurphyjr@gmail.com.

The guy from yesterday?

I interviewed him today.  Very cool stuff.

I want to interview this guy…

So I finished the book, turned it in to the publisher, watched it come out, got some great reviews, did a book tour—-and now I’m back in Washington, DC.

And I’m working on another book.  Actually I’ve been working on it for a few months now.

More about the details as we go along.  For now, just check out this video.  Words to live by.  I want to interview him.