Home Blog 2018 Innovation in the USA
Jan 5, 2018

Blame it on the Moon

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The U.S. is number four in the list of innovative countries worldwide, according to a June 2017 Business Insider article. On the surface, it's a puzzling rank. This is, after all, the country that put a man on the moon (and maybe will again soon), built the initial Internet, and is home to many of the major tech companies, such as Google, Facebook, Microsoft, and Apple. And yet, Switzerland, Sweden, and the Netherlands all rank higher for innovation. Ouch. In fact, the top 10 list includes eight European countries (we’ll include the U.K. as “Europe” until Brexit happens).

I suspect that part of the reason Europe leads the U.S. is the social support structure. Universal health care, for example, takes some of the risk out of entrepreneurship, the educational system is, in general, far more focused on technology at a younger age, and the government investments heavily to support small businesses and startups. Conversely, in the U.S., we appear to be focused on the moon, or rather the so-called moonshots that the U.S. venture capitalist funds are so interested in. Every investment needs to be a “think big... no bigger,” concept that can cover the entire fund’s gambles, rather than focusing on more modest innovations to gain the attention of the VC community. As a result, it’s often more popular to talk of terms such as disruption than it is to focus on evolutionary, incremental improvements to current products or solutions. This contrasts with the mentality in Europe where there is a greater incentive to consider the broader swathe of innovation, as well as the occasional moonshot.

I was reminded of this last week as I spent nearly an entire day waiting for an important package to arrive. The online retailer had provided the less than useful information that the package was on a truck for delivery and would arrive by 8:00 pm. “Today” is quite a broad window for a package that I did not want left out in the rain. So the day was spent working from the couch, never too far from the front door, which really unveiled to me just how antiquated the delivery system must be if delivery schedules are still so poorly defined. In an era when online retail appears to be king, the delivery system is a significant weak spot, and there is no reason whatsoever for this to be the case.

Consider this: delivery trucks all have GPS and a predetermined delivery route. That alone should mean that the delivery company could provide increasingly accurate updates during the day, starting from a window of a few hours, down to “it will be there in the next 15 minutes,” as the truck gets closer to the final destination. That would be a useful innovation of the staid delivery solution that would be clearly beneficial to online retailers. Online retailers could also play their part, adding RFID tags to each package so they know exactly where the products are. That would help to stop “false deliveries” such as the one I had the following day, when the delivery company told me the package arrived… but it had not. Was I to assume that it was swiped from my front porch, or simply that the delivery company made a mistake? The chances are usually the latter, but I was left wondering for another 24 hours until it did turn up.

To be fair, part of the challenge is that innovating existing categories is less sexy, more complicated (due to legacy issues), and far less likely to be profitable. Further, when the legacy solution involves physical infrastructure, there is a far higher barrier to entry than building a new product. And so the near-term solution to tracking a stray package is to buy a front door video cam, so we can see if the package arrived, and if someone else came along to swipe it. But it doesn’t have to be that way. In the Netherlands (just one place ahead of the U.S. for innovation) there’s a food delivery service, Picnic, that leverages GPS for exactly this application, allowing the customer to know precisely where their food delivery is and how soon it will arrive.

And so back to moonshots... while the existing U.S. delivery system doesn’t look like it will improve significantly in the near-term, companies such as Amazon are building workarounds to make the consumer’s life a little simpler. Amazon Key, for example, means that deliveries can be dropped off inside the house, so consumers don’t need to wait by the front door (unless, of course, I want to scare the heck out of the delivery person). And let’s not forget the potentially huge disruptor for the delivery market with drone-based drops. If that’s not a moonshot, I’m not sure what is.

So as we all brace ourselves for the impending Consumer Electronics Show, it’s worth remembering that the best ideas are not always those that try to disrupt; sometimes, the cleverest ones are those that improve an existing idea, dragging it into the present, or future, times. And it may also be worth spending some time in the Holland Tech Square and other European areas.

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