Monday, November 16, 2009

Thomas Edison’s method of innovation

What was the most significant innovation of Thomas Edison? Some may say it was the distribution of electricity and incandescent lamp. Others may say it was the phonograph. I belong to Henry Ford club who believed that his method of innovation was as significant a contribution as his direct contributions such as lamp, phonograph etc. Let’s look at Edison’s method of innovation briefly through an example of electric distribution system.

1. Establish the need: In the summer of 1878, Thomas Edison was watching a gang of miners drilling for ore with heavy tools when he was seized by a vision – the idea of energy moving as electricity over a long distance.

2. Find anchors to hang your imagination: In the same year (1878), Prof. Barker of University of Pennsylvania suggested to Edison that he should subdivide the electric light so it could be got like small units like gas. Coal gas industry was an established industry by then supplying gas to homes and streets through underground pipes (e.g. see Austin’s coal gas plant which arrived in the city in 1873). Prof. Barker’s analogy provided a useful anchor for Edison. Around the same time, Edison visited the workshop of William Wallace and saw a generator system they had built to power their arc lamps – eight of them, in a row, all at once. Edison reported to New York Sun after a month, “I saw for the first time everything in practical operation. It saw that the thing had gone so far but that I had a chance. The intense light had not been subdivided so that it could be brought into private house”.

3. Know the known: Henry Ford writes Edison saying, “I started my usual course of collecting every kind of data. This time it was about gas: I bought all the transactions of the gas-engineering societies, et cetera, all the back volumes of gas journals, et cetera. Having obtained all the data, and investigated gas jet distribution in New York by actual observations, I made up my mind that the problem of the subdivision of the electric current could be solved and made commercial.” When Edison decided to focus on electricity project, he suspended the phonograph project.

4. Establish goals & use-cases: Edison established top two requirements as follows: "I realized that an electric lamp to be commercially practical must of necessity bear a general comparison with a gas jet in at least two points: first, that it must give a moderate illumination, and, second, that such a lamp must be so devised that each one could be lighted and extinguished separately and independently of any others. With this basic idea in mind we resumed our experiments at once”. Subsequently he wrote an 8-point memo that articulated requirements and use-cases of the entire electricity distribution system (see page 20, Henry Ford).

5. Iterate over experiments: Edison says, “When I am after a result that I have in mind, I may make hundreds or thousands of experiments out of which there may be one that promises results in the right direction. This I follow to its legitimate conclusion, discarding the others, and usually get what I am after.” In this case, he assigned the lamp experiments to his assistants Upton and Batchelor. Every experiment used to have a number. For storage batteries, Edison ran 5 series each with 10,000 experiments.

6. Demonstrate prototypes to stakeholders: Between October and December 1879 hundreds of carbon lamps were made and put into use not only in his lab but also on the streets and several residences at Menlo Park. On December 31, 1879, Edison and his gang made a public demonstration of his incandescent light bulb at Menlo Park. Special trains were run to Menlo Park by the Pennsylvania Railroad, and over three thousand people attended the demo (including public officials, financers, journalists etc).

7. Commercialize: This is how Edison established the commercial viability of electric lamp. Edison says, “The first year the lamps cost us about a dollar and ten cents each. We sold them for forty cents; but there were only about twenty or thirty thousand of them. The next year they cost us about seventy cents, and we sold them for forty. There were a good many, and we lost more money the second year than the first. The fourth year I got it down to thirty-seven cents, and I made up all the money in one year that I had lost previously. I finally got it down to twenty-two cents, and sold them for forty cents; and they were made by the million. Whereupon the Wall Street people thought it was a very lucrative business, so they concluded they would like to have it, and bought us out.”

8. Manage a portfolio: Edison always managed a portfolio of projects. For example, during 1880 to 1885, the peak of his lamp and distribution system project, he also filed patents related to magnetic ore separation, secondary batteries, telegraph and telephones and electric railway. His secretary estimated that in 1890 he was engaged in 72 different projects.

Source: Edison as I know him by Henry Ford.

Related articles:

  1. Thomas Edison, the father of systematic innovation: my favorite quotes
  2. Appreciating the promise of an underdog technology: Story of Henry Ford’s first meeting with Edison

1 comment:

  1. Found you at website. this article is a real insight burster. thanks for sharing.