Author: Franky F
So it’s an equal playing field after all. Companies in mature industries can be just as creative as startups, according to a new study conducted by professors from Boston University and Harvard Business School.
In “How Does Innovative Activity Change as Industries Mature,” Boston’s Anita M. McGahan and Harvard’s Brian Silverman analyzed the patent applications of publicly traded U.S. companies from the early 1980s to the mid-1990s.
They found innovation doesn’t decline with age. Using algorithms, the study identified an average of 75,000 to 100,000 patents per year per industry, which includes manufacturing, agriculture, transportation, retail, financial services, entertainment, and business services. This doesn’t change when you throw in “emerging industries.”
“The results surprised us a great deal at first because conventional wisdom has us believing that new companies are more creative while older companies don’t have the incentive to be as innovative,” McGahan says. The study also found that industry leaders can be “displaced” no matter how many patents they hold.
The two professors reason that while young companies often rely on a great new product automatically attracting market attention, they don’t understand how tough it is to attract customers to that product, no matter how great. But established firms are often much better at marketing. “And they have the advantage of established brand names, distribution channels, and marketing programs,” says McGahan. Startups may only be left with the patent.
Working for yourself, from employee to entrepreneur is the end goal of a new career. But the transition from employee to entrepreneur is like climbing over a wall.
Got the Guts To Be an Entrepreneur?
Remember the Berlin Wall? During the Cold War when East and West were separated by that infamous wall, many freedom-seekers risked being shot by border guards while attempting to climb over that wall.
If you choose the parallel career way to be an entrepreneur, you are as brave as those freedom-seekers. You are willing to take risks (calculated ones though), make changes and set goals for your future.