Innovation never goes out of style. But it can be nearly asphyxiated when management takes a misguided approach in responding to a stagnant economy. The arguments are legion, but most are just some variation on the theme: "We know we need to invest in research and development, but profits are down, the next quarter looks even worse, and the shareholders will revolt if we commit funds to R&D."
Stagnation is nothing new in technological innovation, of course. Remember Philo T. Farnsworth? He filed the first of 10 patents on television in 1927, during a stock market boom. Then the nation plunged into the Great Depression, says Gary McWilliams in The Wall Street Journal, and the first public appearance of a TV set based on his patents wasn't until the 1939 World's Fair. Then WWII intervened, and TV sets and broadcasts didn't become widely available until 1946, almost 20 years after the first patents. Fast forward to the 1970s. The first personal computers were patched together as one-off units, then Steve & Steve introduced the Apple, also in an atmosphere of stifled business spending. The PC era didn't truly begin until capital spending thawed in the 1980s, and IBM stepped into the market.