Iteration vs. Innovation

Despite iterative models feel more static than bursts of innovation, they can potentially unlock greater opportunities in the long run. Hence, to achieve something truly remarkable, is it better to go with a portfolio approach or just focus on a handful of bets?

You can do anything, but not everything.

—— David Allen

The quote that inspires this post, not only has had a huge impact on many of my daily decisions, but it also depicts a lot of truth about today’s tech scene.

Right after Apple WWDC and Google I/O it’s becoming even clearer who’s dominating and leading in the world of tech. Apple and Google are directly competing with each other in a very aggressive market, but curiously they are approaching their endeavors from opposing viewpoints.

On one hand, Apple makes money by selling devices at a premium. They provide services too — and recently showed a lot of interest in them — but its revenue comes mainly from their hardware business. While Google, on the other, monetizes user data through advertising within their ecosystem of free services.

Here’s where things start getting interesting. They are stepping into others’ toes by competing in similar products, yet they do it in a completely different way — a very uncommon setup in technology that usually tends to converge in the long run.

For instance, Apple doubles down and derives as much value as possible from their devices — they use the cloud just as an add-on, and only when strictly necessary. Google, again, relies on their cloud engine and treats devices like thin clients, mere displays to deliver the content rendered by their powerful servers — which perform the heavy lifting.

Both try to crystalize their vision of how the building blocks of technology should be architected, but this is not the main difference when it comes to business strategy and vision. What caught my attention is the stark contrast of the long-term story both try to convey.

Nobody knows what these companies have in mind for the future. But it’s curious how Apple remains focused and private about its strategy. They sit on the biggest pile of cash any corporation has ever hold, yet you can put their entire product line on a desk. One doesn’t think of Apple as the company that will come up with a cure for cancer or sponsors a mission to Mars. The next thing you expect from them is an iPhone with a “bigger screen”. Probably the best smartphone you could buy, but far from the utterly grand tale Google sells to the world.

The search engine corporation started less than twenty years ago as an input text field where you could search on the Internet. Today a lot of people think of Google as simply the Internet. But setting apart this cliche and taking some perspective, Google wants to be perceived as something more profound. A Weyland Industries of sorts that is pushing the boundaries of humanity through technology.

Barely scratching the surface of what you’re “allowed” to see, Google is exploring so many daring problems at once, that few companies would have the courage to embark on a single one: ubiquitous Internet access, robots, healthcare and human aging, self-driving cars… and only God knows what’s currently happening at Google X. Yet getting back to the aforementioned quote: you can do anything, but not everything — not even if you are Google.

What I’ve been pondering lately is whether to achieve something truly remarkable, is it better to go with a portfolio approach, as Google does; or just focus on a handful of bets, dive deeper into those, to later capitalize on larger ventures.

The latter reminded me, for example, of the health market, arguably one of the largest in the world. Google has gone all-in with the daring challenge of curing death with Calico. That is a risky, binary bet, that will require to take over the entire market from the bottom up — it might work, it might not. On the other hand, Apple stands on the chance to gradually capitalize the opportunity by building an integrated ecosystem on top of their, already deployed, devices.

The iPhone is probably the most successful product we’ve seen in our lifetime. It seems that also some kind of wearable is in the works and it’ll be unveiled soon. Technology is getting closer and given the restless iteration Apple approaches its platforms and hardware, we can’t even imagine the services that will potentially flourish from such endeavor.

Given some recent critics over Apple stalling innovation — in stark contrast with Google’s shiny bursts on different markets — I’d argue that despite it looks like iterative models feel more static, they can potentially unlock greater opportunities in the long run.

First published on June 28, 2014