Innovation has become a key factor for economic growth, but how does the process take place at the level of individual firms? The book Innovation in Firms: A Microeconomic Perspective presents the main results of the OECD Innovation Microdata Project, which was the first large-scale effort to exploit firm-level data from innovation surveys across 20 countries in an internationally harmonized way, with a view to addressing common analytical questions.

Open-source software pioneer Brian Behlendorf, who sports a ponytail and organized an online music site called SFRaves, is the unlikely architect of a new technology being embraced by the U.S. Defense Dept.

The DOD has started using technology from CollabNet, a Brisbane, Calif., company that Behlendorf co-founded with Bill Portelli, another open-source veteran, to provide an online meeting place in the Internet "cloud" for U.S. military agencies to build software through "crowdsourcing".

I have had the good fortune to be close to many successful entrepreneurs. And so I have a perspective as to what separates those who make it big from those who don't. Yes, the quality of the idea is critical, of course, as is the access to capital. And certainly being at the right place at the right time is the ultimate good fortune.

But, if I had to put my finger on the one dominant factor of entrepreneurial success stories, it is the absolute total unwillingness of the entrepreneur to say "uncle."

Taking the plunge and becoming an entrepreneur is akin to making a giant leap into the abyss. You might be the most orderly, anal-retentive organizer or logistician and may have a clear picture in your head about how you are going to achieve independence and satisfaction. Do you know how to make God laugh? Tell him you have a plan and in this case tell him that you are going to be a successful entrepreneur! The unfortunate truth, as those who have been down the road before you will testify if you ask them seriously, is that you are in for some adventure. Your plan is nothing more than a constant work in progress and you will certainly end up putting more time, effort, emotional and physical work into your own business than you would working for anyone else.

In the glorious Past Before Television, adventurous men and women gained fame and fortune by testing their skills in competitions designed to expand the limits of human knowledge and innovation. Several organizations are bringing back this kind of “innovation prize” in a big way, with competitions designed to solve some of humanity’s greatest challenges, and expand its horizons beyond terrestrial limits.

One of the greatest scientific breakthroughs in history was the result of a prize offered by the British government in the 18th century. At that time, many ships were being lost due to the inaccuracies involved in calculating their longitude at sea. The previous method, dead reckoning, introduced greater errors the farther the ship got from a known point, usually ending in loss of life and heated discussions about the velocity of various types of swallows. The British Parliament offered the modern equivalent of $4.56 million for a solution to the Longitude Problem.

You read blogs about running a business. Amazing that I could deduce that, right? A regular Sherlock Holmes over here, writing that on … a blog about business.

Why read blogs? I’m guessing it’s because you’re constantly out of your comfort zone: Making decisions about things you’ve never had to think about, weren’t trained for, didn’t learn in school, and might very well decide the fate of the entire company. Or maybe this decision doesn’t matter at all, but who could know?

Award provides dedicated mHealth funding as part of Vodafone Americas Foundation’s Wireless Innovation Project

Walnut Creek, CA & Washington, DC (December 7, 2009) -- To spur innovation in the development of wireless solutions to global health challenges, the Vodafone Americas Foundation and the mHealth Alliance announced today a partnership that will expand the Vodafone Americas Foundation’s Wireless Innovation Project to include the new mHealth Alliance Award. The award will be granted to the developer of an innovative wireless technology with the most potential to address critical health challenges, especially in developing regions.

“In places where roads remain unpaved, and where basic infrastructure such as clean water and electricity are scant, mobile phones already have become an empowering force for millions,” said David Aylward, Executive Director of the mHealth Alliance. “The mHealth Alliance Award challenges innovators and social entrepreneurs to use mobile technology to advance health delivery in even the most remote environments, such as through improved diagnosis, treatment or access to information.”

It looks like the innovation issue may really be gaining some attention in Washington. David Brooks, the in-house conservative political columnist for the New York Times devoted today's column to the subject. He even mentioned in passing the Obama white paper (see earlier posting). While supposedly looking at the recommendations from the paper, interestingly enough he ignored that paper's central conclusion: that we need an activist innovation policy - complete with ways of addressing grand challenges. Brooks instead took the tack of advocating a set of high level government interventions. The included reforming education, increasing R&D spending, a National Infrastructure Bank, support for regional innovation clusters and rebalancing exchange rates. He also through in a few of the standard conservative positions: cut the deficit, lower the corporate tax rate and "Don't make labor markets rigid. Don't pick trade fights with China." (Although I'm not sure that "rebalancing the exchange rate isn't picking a huge trade fight with China.)

Venture capital firms that traditionally invest in niche-technology-backed start-ups have turned their attention to robotics.

Pune-based Precision Automation and Robotics India Ltd (PARI) received Rs41.4 crore recently from investment management firm Axis Holding Pvt. Ltd’s India Strategic Opportunities Fund. PARI, one of India’s biggest robotics firms, provides automation solutions for both manufacturing and non-manufacturing processes.

IDG Ventures India Advisors Pvt. Ltd, which manages a $150 million (Rs696 crore) fund and makes early-stage investments in technology-enabled companies, is also eyeing the robotics business.

South Dakota was rated the friendliest place for entrepreneurship by The Small Business & Entrepreneurship Council’s Small Business Survival Index 2009.

The report ranks the 50 states and District of Columbia according to some of the major government-related costs affecting investment, entrepreneurship, and business. The fourteenth annual survey looked at a number costs that impact small businesses such as individual capital gains tax, personal income tax and corporate income tax.

Eight million may finally be enough. That's the approximate number of jobs lost since the recession began at the end of 2007. The latest government data show that after 23 straight months of job losses, the unemployment rate has finally stopped rising and started falling. That's the most hopeful sign to date that the tsunami of layoffs is abating. If the trend continues, it will confirm an end to the devastating recession.

But an end to job losses won't solve the unemployment problem. The U.S. economy needs to add more than 100,000 jobs per month just for the unemployment rate to stay even and more than that to get back to an economy that feels healthy. And there's little sign of new jobs popping up in significant numbers anywhere. To understand why, I spoke recently with Carl Schramm, president and CEO of the Kauffman Foundation, a nonprofit group that promotes entrepreneurship. Schramm participated in President Obama's recent "jobs summit" and advocates government incentives to help create and nurture small businesses. Excerpts from our conversation:

New Montgomery County council president Nancy Floreen is pushing the idea of creating an economic development authority to try to spur job growth in the county.

She said Monday she wants officials to look at the experiences in Fairfax and Prince William counties and elsewhere, but didn't have specifics on what a Montgomery authority might look like.

"Montgomery County needs to get in the game," Floreen said. "There are best practices in the region--well, at least there are practices across the region. Are they the best?"

WASHINGTON, D.C.—President Barack Obama and Commerce Secretary Gary Locke today announced that five organizations are the recipients of the 2009 Malcolm Baldrige National Quality Award, the nation’s highest Presidential honor for innovation and performance excellence.

The 2009 Baldrige Award recipients—listed with their category—are:

• Honeywell Federal Manufacturing & Technologies, Kansas City, Mo. (manufacturing)
• MidwayUSA, Columbia, Mo. (small business)
• AtlantiCare, Egg Harbor Township, N.J. (health care)
• Heartland Health, St. Joseph, Mo. (health care)
• VA Cooperative Studies Program Clinical Research Pharmacy Coordinating Center, Albuquerque, N.M. (nonprofit)

“The road to greatness in America has been, and always will be, traveled by those who embrace change and work hard every day to be the best; the organizations we honor today with the Baldrige National Quality Award exemplify that spirit,” President Obama said. “This year's recipients have shown how quality, innovation, and an unending quest for excellence help strengthen our nation and brighten the future of all Americans.”

Federal, State and Territory Innovation Ministers said they adopted a set of national innovation principles to guide policy development and increase the consistency of government innovation programs across Australia.

The adoption of the "Framework of Principles for Innovation Initiatives" by all governments, said Australian Innovation Minister, Senator Kim Carr in a statement, will increase the coordination of innovation program design to ensure that the programs are complementary and respond to the changing needs and priorities of Australian businesses.

When Jose Manuel Barroso, the President of the European Comission presented the Manifesto for Creativity he strongly defended the concept of a “New Platform of Innovation and Creativity” for the future of Europe. That´s a new collaborative order between the different actors, with the strategic challenge of reinforcing the central competitive ences of society and qualifying them as the unique ways of creation of value and modernity. Europe is facing a unique opportunity within this new concept. The message is clear - the new time that all of us want for Europe in the future demands a strong commitment with Innovation and Creativity as the effective enablers of change.

The launching and implementation of this “New Platform for Innovation and Creativity” will require a strong Partnership Contract between all the actors (States, Universities, Companies, Civil Society), in order to build a real Strategy of Confidence in the execution of the different actions that are associated with this Agenda of Change. The focus on Innovation and Creativity as the drivers of creating added value with international dissemination is a unique challenge that may be the answer to a new way of interaction between those who have the responsibility of thinking and those that have the responsibility of producing goods and services. This is the main reason for the opportunity of the Platform.

The crossfire from friends and colleagues debating net neutrality has caught my attention in recent weeks and got me thinking about how it affects my industry, venture capital. We make our money by investing in startups, of course, which would not, by definition, exist without capitalism. Many of the technology startups we invest in similarly wouldn’t exist without the Internet, as they use it as a platform on which to provide their services.

The capitalistic system on and off the Internet encourages economic growth by the use of free and open markets to distribute goods. While some could argue that a free and open Internet means less regulation and oversight, my experience leads me to believe that an Internet that encourages innovation and startups is one that supports net neutrality — and unless such neutrality is enforced, capitalism on the Internet is in serious jeopardy.

When it comes to research on entrepreneurship, few organizations do more of it than the Kauffman Foundation. For a just-released study called Making a Successful Entrepreneur, Kauffman surveyed 549 company founders of successful businesses in high-growth industries to determine the factors that influence the success or failure of startups. The key success factors, it turns out, are "prior work experience, learning from previous successes and failures, a strong management team and good fortune." Let's look at the highlights one at a time.

A team led by the Massachusetts Institute of Technology spread the wealth far and wide to locate 10 red balloons in undisclosed locations across the country on Saturday and win a $40,000 cash prize from the Pentagon's think tank.

The DARPA Network Challenge was designed to celebrate the 40th anniversary of the creation of ARPANet, the precursor to today's Internet, and to study how social networking could help solve big problems in a small amount of time.

Dr Sam Pitroda, a leading innovator, entrepreneur and thought leader was recently appointed as India's first Innovation Czar, a post curiously titled as the “Infrastructure, Innovation and Information” adviser to the Prime Minister. Perhaps this the first step towards having a full fledged Ministry of Innovation, something that Dr Mashelkar has been advocating for a while now.

As one can appreciate, this is a critical milestone in the history of Indian innovation policy. The Mint published an editorial of mine reflecting on this milestone, as below:

In the first part of this interview with John Hagel, co-chairman of Deloitte's Center for the Edge, he told Ann All that on an economy-wide level, U.S. companies’ return-on-assets (ROA) has plummeted 75 percent since 1965, despite major improvement in labor productivity over the last four decades. Here, he offers suggestions on how companies can turn this trend around by focusing on institutional innovation, rather than product and technology innovation.

All: So with it becoming so much harder to benefit from simple cost reduction, it would seem companies need to focus more on innovation. But Deloitte found that innovation doesn’t seem to improve ROA either. Is this because innovation that occurs spontaneously is outpacing what we see within most companies?

Hagel: My sense is a lot of it has to do with how we define innovation. Most executives, when you talk about innovation, immediately default to product innovation or technology innovation. Maybe they’ll talk about process innovation. The problem with all of that is, the average lifetime of a product is compressing dramatically. If we come up with an innovative new product, it has a shorter and shorter shelf life. We think the real opportunity is to shift the focus of innovation to what we’d call institutional innovation.