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March 16, 2006
Wall Street Doesn't Get Apple or Innovation.
So we have TheStreet.Com's senior writer wringing his hands over Apple because it is "holding the line" on spending on innovation and wondering if this frugality will hurt its amazing product development. Oh, when will they ever learn? It isn't the amount of money spent on R&D, its the innovation efficiency and productivity that counts.
P&G's spending on R&D has declined (some) under AG Lafely and its innovation has jumped sharply thanks to its use of open-source innovation methods. But bone-heads in the financial arena don't get innovation and just count the dollars spent on R&D to measure it and project future revenue and profit growth.
TheStreet.Com should give Doblin's Larry Keeley a call. He can fill them in and maybe help them make a little money too.
And thanks to Signal Vs. Noise for tipping me off on this. It's one of my favorite innovation/design blogs.
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Thanks Bruce. To the writer's credit, he does present both sides of the issue, mentioning that "Apple is a good example of a company that gets a lot of bang for its R&D buck."
Where I think he misses the point is in calling Apple "fundamentally a technology company." While the technology is important, it's through design that Apple really innovates and competes, and the IT analysts haven't realized that yet.
I dissected the financials a bit here:http://noisebetweenstations.com/personal/weblogs/?p=1867
Posted by: Victor at March 17, 2006 05:28 PM