After Gutenberg

Subtitle: So hard, to get through to you

“Any short list of the world’s most admired business people would include Andy Grove, the chairman and CEO of Intel in its years of explosive growth. During his career, Intel became the model for Silicon Valley. Silicon Valley became the model for the world. And Grove became Time’s Man of the Year—an icon of the promise of American life.” Richard S. Tedlow

Felix Kramer passes along an article appearing in Portfolio, the new Conde Nast business monthly. “In my position as a lecturer at Stanford Graduate School of Business,” writes Andy Grove, “I’ve been working with my colleague Professor Robert Burgelman to examine how large companies can defeat the law of big numbers.”

In looking at various companies that have been hindered by their own success, we found that under certain conditions a firm can create a new growth spurt for itself by entering an entirely different industry. The target industry must be stagnant and populated with companies that cling to doing business the way they always have. The corporation that enters this environment with an innovative product or service can shake up the status quo and reap big profits. Burgelman and I call this phenomenon cross-boundary disruption, or XBD for short.

Grove was Intel’s CEO from 1987-1998. He is considered to be “one of the pioneers of the modern computing industry. Known for his strategic business thinking, Grove opines that General Electric can find a new market in building electric cars.

James Fraser previously relayed a story in Fortune about General Electric in the Clean Energy Business.

“The hunt for clean, sustainable energy will be the defining story of the 21st century,” says Michael Idelchick, VP of advanced technology at the Global Research Center in Niskayuna, New York. While this means leading products for passive solar and wind power in the United States and Europe, it also unfortunately means G.E. involvement in coal gasification.

“GE is an investor in battery maker A123Systems, and has been working on hybrid locomotives for some time, so it has a toe in the water.” Well, maybe, or maybe your snapshot is the last part of an exit rather than testing the water. As commented to Kramer, I seem to recall that General Electric was posed at one time in the past to build electric cars.

Nonetheless, Grove sees potential. Cross-boundary disruption is when an established giant seeks to transform a market other than its own. “A successful disruptor of the huge and complex energy industry has to be big, patient, and daring. I think G.E. has these qualities.” He wrote to Jeff Immelt, C.E.O. of General Electric, with his observations, to include that judging from the comments of the business press and analysts, G.E. is too big.

The company’s market capitalization is $414 billion, and last year’s revenue was $152 billion. Profits that inch up or down don’t seem to move the stock much. Something extraordinary is required.

Could manufacture of electric vehicles become a way of transforming growth for G.E. and a way for our country to shed its dependence on foreign sources of energy. After all, what’s good for General Electric, is…

“Good for the Globe? Can G.E. outdo Mitsubishi? Can it outsell Byd?”

Perhaps, looking at some related news might give us some indication. Pink Tentacle (Oh, No, There Goes XBD) reports that Japan’s Ministry of Economy, Trade and Industry (METI) “has announced its shortlist of finalists for…

“The Squidball Tourney?”

No, the 2007 Robot Award.

The nominees include 9 robots in three categories (service robots, industrial robots, and public sector robots), as well as 4 robot-related items in the components / software category.

What’s mechatronics, got to do, go to do, with it? I dunno, let’s ask NEDO (New Energy and Industrial Technology Development Organization).

“Pardon me, boys, is this the Peabody Death Train?”

“No, Declining Emperor, this is the Bali Express.”

Software developed by Denso Wave, Inc. is recognized for contributing to the creation of an open network interface that simplifies access to automation devices.

Anyway, in the future world of ubiquitous controller area networks, systems will be much more prevalent that are modular. Why? As any mechatronics engineer will tell you (If you get cornered at the annual holiday get together and are unable to escape), by-wire subsystems tend to be easier than traditional mechanical and / or hydraulic systems to produce, assemble, and install / replace.

“Simpler assembly and installation means lower cost to the manufacturer, not to mention providing for advanced passenger safety technologies. Want to come over to my condo and see my CAD?”

No.

“They’re XBD-rated, heh-heh.”

No, thank-you. Excuse… You just spilled punch on my sleeve.

“Whoops! Heh-heh. Let’s get you out of those wet things.”

(The raised eyebrow look) That didn’t even work back in the seventies.

“I know, I know, but retro is back in. Wanna do the Nasty?”

The what? (Sigh.) Oh, O.K., let me just get my Vinegar Robot and…

“Excuse me, would ya? I just saw Newton Braga over there and I’ve been meaning to talk to him about an idea for a new book in his Evil Genius series. Newton! I say, Newton…”

Andy Grove: The Life and Times of an American ASIN: 1591841399

Making Things Talk ASIN: 0596510519