The Economist Idea of Innovation
Monday, March 12, 2007
The Economist is probably one of the most read weekly magazines around business schools in North America. It is known for its sharp current affairs analysis and a wide coverage of issues that have a relevance to everything (political, economical, technological, etc.).
I'm certain that being a paper magazine, it has seen its share of readership decreased because of the advent of the internet (at least the hard copy version). In truth, the medium is at a cross roads, I think, and it either evolves or closes down shop.
So what's a magazine to do? The Economist decided to try something different and it is being called innovative.
They created a group called Project Red Stripe
to come up and bring to market one idea in six month with 100 thousand UK pounds. Their "about us" page says the following:
Project Red Stripe is a six-member team comprised of The Economist Group?s employees that has been brought together with the task of creating an innovative and web-based product, service or business model by July 2007. In addition to the research which the team is conducting in-house, we are soliticing ideas from the outside world in an effort to attract submissions from a diverse group of people. If you want to know more, please go to the FAQs.
The idea of creating the group is interesting, and the premise of the group "asking" the public for "ideas" is in concert with the new crowd-sourcing models we hear about (read Wikinomics, for more details). But I don't know if the project has the right basis, nor the right incentives to succeed.
From what I read, the group is not under the gun to produce or be gone. In other words, as soon as the 6 months are up these people go back to work to their cubicleland somewhere. There is no hunger to succeed, and there is no sufficient monetary incentive if the project succeeds. A salary is incentive enough, however, when there is no salary people seem to work harder, i.e., entrepreneurs just seem to want it more because there is no security blanket. Of course, there is the bragging rights, but I take that as icing on the $60-120K salary.
Moreover, asking the "public" for ideas will not likely generate enough that are worth while. This type of exercise degenerates into the lower common denominator thinking that make MySpace interesting but not extraordinary. In addition, why would I give my best idea to a group of paid employees with no direct reward to me?
There is a disconnect between a truly community driven effort to create content and the need to change or die for this company.
It is definitively an interesting idea and a different way of doing things in an "old schooled" news business, however, innovation is more of a process rather than a mandate. It's a change from within that requires a way to developing profitable ideas that are aligned with the long term vision of any corporation.
The desire of "creating a high tech, internet related business model" is well and all, but don't we all want to create that next great web-based business?
I'll keep an eye on this project, as I've become interested in the exploration of innovations in any setting, but I don't expect anything beyond a combination of RSS feeds from the current content. The time is too short to really create a disruptive product and the incentives are not aligned with the corporate strategy.
The magazine has most of the data it needs to move into the new territory it needs to: it has a captive audience, it has the a great deal of demographics, it has advertisers. I would just ask a simple question to all stake holders: "what do you want?" And go from there. Maybe a cutting edge web-based business is not what users want, and will not likely come out of this experiment.
has more to say about this very item. As usual, some of the comments are better (read nicer) than others. For example:
figment says: this is the most stupid idea I have ever heard out of them. They actually will compensate you, with a rocking 6-mo web-subscrption to economist.com (street value: roughly $50).
Perhaps the Economist should actually talk to their economists, and ask them what 'Incentive Compatability' means. $50 for a new revolutionary business idea surely isn't incentive compatible. If I were the Economist, I'd be terribly embarassed about this.