The latest batch of numbers on productivity growth are awful and this bodes ill for the future if they continue. I know the conventional wisdom is that private spending for R&D is falling and that causes productivity to fall as well.
But invention is not innovation and spending on R&D is no guarantee that you will get the kind of innovation that generates revenue growth, profits, wealth and jobs. Many corporations are trimming their R&D--outsourcing much of it to networks of scientists and engineers--and boosting their innovation hit rates.
But clearly not enough. I joke that innovation is the new black because everyone talks about it these days, but the truth is that very, very few CEOs and managers know how to implement it. The gap between their mouthing the word innovation and their allocating resources to make it happen is wider than the gap between their compensation and the pay of their average employee (sorry but incentives play a serious role in building an innovation culture).
The low productivity growth numbers reflect the slo-mo adaptation of innovation processes and methodologies throughout Corporate America. Take away the handful of companies held up as examples by the business press, and you have hundreds of other companies still struggling to figure out how to take the first steps in creating an innovation culture. Tick tock folks.