Innovation Deficit in Germany

Recently I visited the SAP Labs facility in Palo Alto, California, the heart of Silicon Valley. It was buzzing with activity: engineers, designers, and product marketing folks were working together in teams, visibily excited with their work. To the outsider, it appeared a bit chaotic, but it is the same atmosphere that one finds in tech start-ups throughout Silicon Valley. What a contrast to the atmosphere I found at the SAP headquarters in Walldorf.  Compared to Palo Alto, Walldorf was a mausoleum with individuals isolated in their cubicles, their bosses in offices along the perimeter.  In Palo Alto, it was difficult to discern any hierarchy.

Why did SAP find it necessary to build its innovation center in Palo Alto? The answer, sadly, is that tech innovation appears difficult to achieve in Germany.  SAP desperately needs to tap into the talent pool in Silicon Valley if it hopes to compete against Microsoft and Oracle. A recent study put out by the Institut für angewandte Innovationsforschung (Institute for Applied Innovation Research) at the Ruhr University in Bochum surveyed 1200 German companies and identifed some of the barriers to German innovation:

Als Ursachen identifizierten die Innovationsforscher fehlende Marktorientierung der Projekte, Over-Engineering und fehlende Prioritäten. Die würden die Entwicklungszeiten unnötig verlängern und so die Kosten in die Höhe treiben. Auf der anderen Seite würden Ideen, die sich später als bahnbrechend herausstellen, häufig in der Frühphase aussortiert oder gar nicht erst erkannt, wie die Hälfte der befragten Unternehmen einräumte. (The innovation researchers identified the following causes: the projects lacked a market orientation, were over-engineered and lacked priorities. Development cycles were unnecessarily pushed out, driving up the costs.  On the other hand ideas which later proved to be genuine breakthroughs were rejected or not even recognized in the early phases, as half of those surveyed admitted.)

Reinald Biberat, writing in the NachDenkSeiten, is more scathing in his assessment of innovation in Germany: 

Innovative Querdenker, die oft aber auch die Eigenschaft haben, unbequem zu sein, waren in Deutschland noch nie erwünscht.
Es regiert der Mainstream. Auf diese Weise können selbst Papageien Karriere machen, sofern sie nur 100 Fremdwörter akzentfrei aussprechen können (ohne freilich zu wissen, was diese eigentlich bedeuten). (Innovative rebels, who are more often than not, disagreeable people, were never wanted in Germany. Don’t rock the boat. This way even a parrot can have a brilliant career, as long as they can pronounce 100 foreign words without an accent (one need not know what the words actually mean)}.

Just ask the young Querdenker from eastern Germany, Jawed Karim, who fled to Palo Alto and hooked up with a couple of other young guys to work on a crazy idea.  That idea turned out to be the wildly successful site YouTube.