The Limits of Innovation: High Tech’s Diminishing Returns

Intense levels of high tech competition and innovation have been with us for decades. Rapid change — with all the complexities and anxieties it creates — now seems to be the new normal.

As impressive as the fruits of innovation have been, the pace of change seems relentless and, at times, almost mindlessly linear. It suggests a possible disconnect between the products or services being rolled out to the market and whether a specifically identifiable business or consumer need actually exists in sufficient degree to justify the development and investment of resources involved.

In high tech circles, there’s a particular mindset that can become an occupational hazard for those working on technology innovation — a perspective that seems to have only one speed and one direction. It’s a view of the world that doesn’t look back or tend to reflect on the full implications what a particular product or service is “bringing to the table” in the context of any other life domains — in other words, a very siloed way of thinking. Practical considerations such as day to day lifestyle implications or something slightly loftier such as overall benefit to society or the quality of life are generally left to others to wrestle with.

As the tsunami of innovation continues, we are left with an embarrassment of riches that comes at a price — the decoupling of technology innovation from social and cultural contexts. In many cases, we see something akin to “innovation for innovation’s sake”, a grand apotheosis of sometimes questionable additions to the existing panoply of technology products and services that result from the mantra of “continuous improvement” and the sheer market momentum it generates.

Is “Negative Innovation” Possible?

The Institute of Quality Assurance defines continuous improvement as ” a gradual never-ending change…focused on increasing the effectiveness and/or efficiency of an organization to fulfil its policy and objectives…Put simply, it means ‘getting better all the time.” But can the actual practice of continuous improvement run into an existential brick wall as it were, a point of diminishing returns? Or, to take that a step further, given that innovation has become such a runaway freight train, it seems worthwhile to ask: can there be such a thing as too much innovation or the wrong kind of innovation?

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It appears that, indeed, there can be limits to the value of innovation, especially in tech-driven markets such as consumer electronics — inflection points at which companies may have, in effect, innovated themselves out of business or failed to add real value to the marketplace.

An intriguing Wall Street Journal article points out that while innovation certainly is plentiful, many technology investments are simply not leading to positive advances in the standard of living. The author noted that “improvements in everyday life have been incremental, not revolutionary…By all appearances, we’re in a golden age of innovation. Every month sees new advances in artificial intelligence, gene therapy, robotics and software apps. Research and development as a share of gross domestic product is near an all-time high. There are more scientists and engineers in the U.S. than ever before. None of this has translated into meaningful advances in Americans’ standard of living.”

The article speaks to what might be called an innovation gap that exists between new technologies and their ultimately successful and useful adoption. We can speculate that there’s an absorption rate that exists as any new technology works its way into the user base if consumer-oriented, or the workplace if designed for an enterprise application. In other words, for any given technology, regardless of how “innovative” it might be, there may exist limits to how quickly it can be absorbed in the marketplace (which is to say fully or partially utilized).

If It Moves, Automate It

Moving up another level of “magnification” to the macroeconomic big picture, the issue of technology absorption across society at large is both complex and problematic. For example, automation has taken hold in many industries but a known and well publicized unpleasant side effect has been significant levels of social and economic disruption.

Pumping out more technology into organizational structures that have already been destabilized by the first 3 or 4 waves of innovation may seem positive strictly from a business standpoint with the profit motive driving future expectations. But looking at the product or service from a  quality of life perspective often yields a different view. What happens is not too complex to understand: given the torrent of innovation being injected into corporate, community, and/or government organizations, those entities to varying degrees may simply be not prepared to absorb them at any moment in time as governed by the limits to innovation described previously.

What’s the Way Forward?

There’s no escaping the fact that we’re living in a golden age of innovation, filled with technology marvels and an unrecognized potential for allowing advanced technology to be applied to some of our most intractable social and environmental problems. Unfortunately, the trajectory of technology and hyper-technology continues to move much faster than the ability of our social structures – especially  government — to understand and, when necessary, steer, augment, thoughtfully support, or regulate it.

In addition, public entities continue to play catch-up in their understanding of the fundamentals of how technology works and doesn’t work. The Facebook meltdown of 2018 is perhaps the most salient example of how these disconnects can fail to fully serve the interests of either society or even technology providers themselves. The Congressional hearings associated with Facebook’s political blunders exposed deep levels of poorly understood assumptions on the part of politicians about the fundamentals of the media and information-based technologies now in widespread use.

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In the long run, the lose/lose scenarios posed by the unaddressed challenges described serve no one’s best interests. Going forward, such disconnects will need to be addressed not only by the purveyors of technology but by a combination of market correction, viral feedback, changes in social awareness, and NGO-supplied out of the box thinking.

These will need to be combined with an overlay of enlightened governance, something that seems to be in scarce supply given the rapidity of social change and the entropy it generates.

Over the course of time, it is in the best interests of business to create products and services that resonate harmoniously with the need for more sustainable long term growth that supports the overall quality of life and the broader real-life needs of those who ultimately use those products and services.