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October 29, 2007

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AAPL, HP, MSFT, and IBM did it and/or all doing it in different ways (as you may have noted above, though I didn't read it all).

If you're in the area, perhaps you might want to attend, the following:

TITLE
Copyleft Capitalism: GPLv3 & the Future of Software Innovation

SPEAKER:
Eben Moglen, Professor of Law & Legal History at Columbia, and Chairman, Software Freedom Law Center

When: 29 October, 2007 01:30PM - 03:00PM
Where: Hawthorne GN-F15

Christine Flanagan

Hi Irving - I'm not sure if you're aware, but you really hit a nerve at BIF-3 when you questioned whether any company can reinvent itself without having a near death experience.

I believe there's a fairly simple reason why business model innovation is an entrepreneur's game: more than process, innovation is a state of mind.

In our last session of BIF-3, Mark Cuban was asked by Walt Mossberg whether he agreed with your conclusion that companies must walk the death march before they can truly change. Cuban's response: "Absolutely, which is why I usually sell the company before it gets to that point."

The audience naturally laughed and Cuban followed up by saying: “Every day I wake up knowing that there is a 12 year-old out there somewhere that’s trying to kick my ass. If you don’t pay attention to your business your ass will be kicked.”

Established companies are actually rather good at embracing change if it sustains their current business model and delivers an improved product for their customers. I think Clay Christensen summed it up best during his interview with Walt likening business model innovation to biological evolution: Populations evolve, even though individuals can't. The same thing happens in the corporate world, Clay said. "The population of business units within corporations evolves, even though individual business units can’t. That’s because the capabilities of business units reside in their processes and their values, and by their very nature, processes and values are inflexible and meant not to change."

The key, according to Christensen, is that companies must invest to create the new growth business while the core business is still growing, because new business units don’t need to get big fast. But when the core business stops growing, investing to create new growth businesses becomes impossible. "Once a company’s growth has stopped, the game as we have known it is over," he said.

Thank you so much for sharing your story Irving - it was one of my favorite from our 2-day summit. And for your readers, we've posted Irving's video on our website at: http://www.businessinnovationfactory.com/innovationstorystudio/bif3_iwberger.php

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