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Companies have much in common with biological organisms. They’re born, they grow, they evolve, they die. The trick in forestalling the latter is to keep the evolution going strong.

Unfortunately, most companies perish after a disappointingly short life because they fail to engage in adequate innovation, the very fuel of evolution, said internationally recognized businessman Alok Aggarwal in remarks delivered April 6 at HMC.


Aggarwal came to HMC to share his ideas about innovation and creativity as part of the continuing Annenberg Leadership and Management Speaker Series.

“Companies that innovate become different. If they don’t innovate, they simply die,” said Aggarwal, co-founder and chairman of Evalueserve, a global delivery center that grew from five employees to 2,200 in less than a decade.


In the course of his talk, he suggested that today’s most successful companies—Google, Apple and Amazon, for instance—are winners because their founders have been and remain brilliant innovators.


Six characteristics of innovation

The former emerging business opportunities director for IBM’s worldwide research division devoted much of his time at the podium to a discussion of six main characteristics he said are prevalent among innovation-minded companies and people.

First, was the characteristic of associating. This, he explained, is where two seemingly unrelated activities, skills or materials are paired to form the basis of something new and useful. He pointed to the example of a young Steve Jobs, co-founder of Apple Inc. In college, Jobs took a class in calligraphy. Expertise he acquired from that course led to development of font formats that eventually became integral to both Mac and Microsoft Windows-based computers: an interesting association, that of art and computer science, Aggarwal marveled.

Later, Aggarwal talked about the characteristic of experimenting, insisting that research is at its core a fun proposition. “...[Y]ou don’t know whether you will succeed,” he said. “You just keep trying.” That’s what nature does. Aggarwal said there is in fact a striking similarity between abundant business trial-and-error and the natural world’s epsilon-type mutations—countless experiments to arrive at the next interesting, hopefully higher evolutionary species.

Another of innovation’s signature elements: networking. People engaging with one another is vital to creativity, he alluded. But he also warned that it is counterproductive for, say, electrical engineers to have business friendships only with other electrical engineers. Although homogeneity is a normative inclination, he said that networking with people of diverse professions and experience is better for the reason that it injects more spark into one’s thinking.

Risk-taking as virtue


The characteristic of observing was also discussed. “Carefully looking at customers’ behavior and learning [from it] is another aspect [of innovation],” he said. “A very good example is mountain bikes. [They] were actually minted not by the bike companies but by users in California....”

Questioning was another innovation characteristic on Aggarwal’s list. Of it he said, “We need to make sure that our students, we ourselves, question why is it this and not that. As the generation which is going to be old and passed soon, we need to make sure that the next generation knows to ask, and learns to ask why and how.”

Perhaps most provocative was his detailing of the characteristic of handling ambiguity, a trait he deemed crucial for risk-takers. “...[P]eople who are in companies [and unequipped to handle ambiguity] do not want to take risk because there is no reward they get for taking risk.” More so, they fear scorn if, by taking a risk, things don’t pan out. “And then everyone says, but you failed. [Well, no,] it’s not that you failed. It’s that you did not succeed.”

To underscore the point, Aggarwal referenced Thomas Edison’s famous retort to a critic who mocked the inventor’s 1,200 failed attempts at devising a viable electric light bulb. Edison answered, said Aggarwal, by saying it wasn’t that he failed 1,200 times; rather, it was that he discovered 1,200 ways a light bulb could not be made.