The Risk of Not Using Innovation – Can You Afford It?

By Dmitry Gorbatov for Beyond The Blocks - Tuesday, August 09, 2016


With innovation comes change and with that, risk.

Given the speed at which technology is advancing today, many find it difficult to keep up, and some even perceive it risky to do so. People and organizations would rather stay with the safe and comfortable; there’s less risk there.

Or is there, really?

Have you stopped to consider the unprecedented opportunities that innovative solutions may create? And more importantly, have you thought about the cost of continuing to ignore innovation?

Changes Everywhere You Look

We tend to take a lot of things for granted. When people are exposed to a certain culture, attitude and/or behavior every day, it’s easy to lose appreciation for beauty, uniqueness, and true innovation.

Up until 10 years ago, I used to visit Israel few times a year for work. But then I started working for NetApp and there was no need for me to travel back.

Last November, I went back to this beautiful and crazy country to visit my parents. Looking at my surroundings on that visit, I was amazed at the way Israel has changed over the last few years. While driving from the airport, I couldn't help but notice numerous new buildings, businesses, and even more new construction in progress. The landscape and skyline have changed drastically.

What hasn't changed, though, is its people – driven, smart, aware, and intense.

Challenge the Status Quo

While shopping for gifts with my mom, we stopped at a bookstore and one paperback caught my attention. It was called “Start-up Nation: The Story of Israel's Economic Miracle” by Dan Senor and Saul Singer. On a side note, I think everyone needs to add it to their reading list.

I distinctly remember one quote that describes Israeli people the best: it’s not just about talent, but about “tenacity, insatiable questioning of authority, of determined informality, combined with a unique attitude toward failure, teamwork, mission, risk, and cross-disciplinary creativity.” That quote resonates with me and reminds me of my early days at Comverse Technology in Israel.

The first SMS was sent in 1992. While there were other technology companies that sold SMS systems, by 1996, we were delivering our first SMS and voicemail systems for cellular phone companies in Japan. We knew that the ability to send text messages between mobile phones would be a huge value-add, but we did not know what customers really wanted.

In our first meeting, we told the decision makers in Yokohama that we "almost" had what they needed but some of it may have been lost in translation. They agreed to pay, and provided us with the rough list of the expected features they thought we had. Our product managers from Israel ended up spending the entire 20-hour trip back to Tel Aviv writing product specifications.

It took developers 6 months to write the code and do some testing. My peers and I went back to deploy the system in production. Yes, we had bugs and, yes, we had to work around the clock to resolve them. But what we were able to deliver then became something that every cell phone owner takes for granted today.

Innovate or Make Money?

The core business of any technology company demands a very pragmatic approach. It is no longer enough for technology to meet the requirements of the time and solve a very specific problem; it also needs to make a profit. So the result is twofold – on one hand, this approach requires innovation; on the other hand, it creates limitations because of anticipated and often expected profitability level.

Even at startups that are not publicly traded, the executives have the responsibility to the board of directors to show healthy business behavior. In other words, it is necessary to bring new technologies to market, for which customers are willing to pay a "premium," appreciating their benefits and features.  

Big Names, Same Technology

But what if customers are risk-averse? What if their mantra is “you cannot get fired for buying IBM, EMC, HP, SUN” (pick your own favorite 2-, 3- or 4- letter acronym)?

You can pick all the big names you want but going the low-risk route doesn’t guarantee a better way to do things.

Fast forward to 2008. By that time, I was working for NetApp. Using flash for permanent storage of enterprise applications was akin to Russian roulette. Remember how just at a mention of SSD caused people to immediately talk about unreliability? This was a very significant moment. Most of our customers did not worry about performance. Main concerns and objections to the use of SSD in enterprise storage were just in terms of reliability and maturity of the technology.

So vendors like NetApp and EMC chose the most risk-free way to enter the flash market. Using their enormous marketing resources, they convinced the most conservative customers to use the unfamiliar technology. They put flash in most familiar "disk" form, they used the most proven and reliable algorithms for working with data (RAID, firmware arrays, etc.), standard disk shelves, and traditional disk arrays.

What they did, essentially, was mask the "risky" technology with the look and feel of a proven one. As time went by, these vendors started gradually promoting hybrid storage and the ability to cache on flash with a gradual increase in the proportion of all-flash arrays.  

Old and Reliable is not Always Better

Risk-averse decision makers will never go for the most innovative cutting-edge product from a young startup. Because in their mind, it means risk – a risk that their business cannot afford. They would want others to try it out first and discover all the “undocumented features.”

As the book says, “Fear of loss often proves more powerful than the hope of gain.”

So I think that the key is to be able to show these people that some innovative products actually reduce the risk to the business.

Take Reduxio’s BackDating™ for example. It’s not your usual, run-of the-mill big-name solution. But consider these questions: Can you afford to pay hackers for Ransomware? Can you afford to lose time and money recovering from virus attacks? If your answer is no, then it could be the right time to let go of the “safe.”

Does your current technology allow you to recover your data to one (1) second before your main production database got corrupted? Probably not. Well, BackDating™ can do that and more.

Innovation Reduces Risk

I came to Reduxio because of the people who work here. They have something that one very good sales guy at NetApp used to tell me every day – “accountability, responsibility and sense of urgency”. Incredible engineering talent combined with chutzpah (A Yiddish word chutzpah that means "gall, brazen nerve, effrontery, incredible guts, presumption plus arrogance, such as no other word and no other language can do justice to.") Not to mention that the product idea and implementation have challenged the existing paradigms of the storage industry.

So I dare you.

Venture out, get outside of your comfort zone. Do not become wedded to any idea or solution just because it worked in the past. Take a chance, and reduce the risk to your business by innovating.


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Dmitry Gorbatov

Written by Dmitry Gorbatov

Having worked abroad deploying and supporting various voicemail, SMS text, and multimedia messaging value-add systems, and directing support and field engineering teams in Southeast Asia for Comverse; then more recently, a 10-year period with NetApp in New England as their Senior Solution Principal and Enterprise Systems Engineer, Dmitry brings end-user and vendor perspectives together. Now the regional lead of Systems Engineering for Reduxio Systems, Dmitry offers his experience, professional expertise, as well as his personal passions for golf, distance running, and anything to do with his son’s youth basketball successes.

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