Competing for the Future: How Digital Innovations Are Changing the World

Dr. Henry Kressel's "Competing for the Future" is a must-read for anyone responsible on any level for technological innovation. Here, captured in one book, is the innovation roadmap as only Dr. Kressel with his wealth of experience and obvious keen intellect could construct. The book transcends industries as it exposes the illusive innovative process critical to creating not only the next generation, but new generations, of products based on technology leaps. The innovation process is complex, and in a technology driven organiztion, it must be endemic, shared across all functions. "Competing for the Future" helps us understand that dynamic through powerful examples over the years. As such, it's an inspiring and exhilerating read for cross funtional teams and technology leaders across the entire spectrum of industry. Dr. Kressel started out in electronics and my backround has been in pharmaceutical research, but the principles are the same and that's what makes Dr. Kressel's book such a valuable read.

In Competing for the Future, Dr. Henry Kressel takes us through a fascinating journey, from the invention of a few basic digital technologies to the birth and growth of the digital age. As a starting point, Dr. kressel introduces us to semiconductor technologies and devices. It takes an exceptional mastery of the field to summarize the physical basis of digital electronics in a few key concepts, and Dr. Kressel, a physicist by training, manages that feat. He goes beyond the technologies themselves and expands on the history of their development; how and why they came about. With this foundation in place, Dr. Kressel takes us to the next leg of the journey, namely how these new electronics enabled the development of new computing, networking and communications systems. How did these revolutionary technologies turn into new industries? This is the subject of the second half of the book, in which the author discusses the industrialization and globalization of R & D, the development of new manufacturing processes and finally, venture capital financing of product launches and company build-ups. Competing for the Future exposes the complexity of the overall innovation process. Dr. Kressel writes with the wisdom, insight and experience of someone who not only took part in, but was very successful at, all the steps of that process. His experiences as a physicist, manufacturing manager, leader of an R & D organization and venture capitalist, give him a very clear overall picture and a unique ability to show how all the pieces of the puzzle fit together. Competing for the Future provides a timely and comprehensive analysis of the innovation process, and of the various forces shaping the digital age.

"Competing for the Future" is a thought provoking journey through digital electronics starting with the transistor and laser, proceeding through computers, fiber optics and the internet, and ending with a prescription for the future prosperity of the United States that includes technology innovation, risk capital and advanced manufacturing. It is fascinating as Dr. Kressel examines the interactions between the technological innovations themselves, the source of the R & D as it moved from US industrial labs to world-wide start-ups, the funding of the R & D as it evolved in parallel, the tight coupling between R & D and advanced manufacturing, and the role of governments. Dr. Kressel provides a unique perspective because he is walking this road. He helped create the digital electronics age while he was at RCA Labs with his pioneering work in lasers. After a successful career there, he moved to Warburg Pincus where he funded many of today's successful digital electronics startups. His hands-on experience and lively anecdotes bring the book to life. This book is "required reading" for anyone who wants to understand the future of hi-tech innovation and what that future might hold for the United States and for the world.

In the interest of full disclosure, I have had the opportunity to work with Dr Henry Kressel on a variety of Warburg Pincus engagements since 1990. I attended MIT from 1964-1972, and learned first hand how many companies were started by MIT alums, such as Bose (by Amar Bose), Analog Devices (by Ray Stata), and DEC (by Ken Olsen), as well as seeing my classmate Bob Metcalfe create the most widely used network technology today, Ethernet (akin to the electrical power outlet), and then 3Com. While at Bell Laboratories, I saw the advent of UNIX, the rise of DARPANet leading to the network of networks or Internet, the advent of local area networks (I represented ATT on Project 802 Local Area Network Standards) which permitted networks of computers to share printers, storage, and network access as if they were a single computer. I was involved with the original funding of Ciena, the first commercially successful optical transmission equipment vendor, with moving Uniphase into telecomms to create JDSUniphase as a vendor of optical components and modules, and Covad, one of the first data only Competitive Local Exchange Carriers. With that as backdrop, I found the book to be full of insights, driven by excellent data analysis: good analysis leads to surprising insights, and I found many of them throughout. The discussion of financial innovation and the mechanisms to commercialize the technical innovations is in my view without equal and is worth the entire book (and the other sections are outstanding!): the issues are precisely delimited, the creation of lega structures to facilitate commercialization, to align the interests of customers, investors, and companies, indeed the term venture capital was created because no bank would lend money to a business with no customers or revenues yet there was a clear need for such funding and the financial payoffs could be huge. This chapter merits particularly detailed rereading to understand the terse lessons dispensed here. The sections on manufacturing restructuring, globalization, governmental oversight, and industry structure take us back to one fundamental truth: there are two major businesses, transportation and communication, and the communication business is still undergoing an incredible revolution today and for the next twenty odd years (at which point biotech and materials science advances will be in full flower).

Dr Kressel has captured the disruptions in society caused by fundamental shifts in the technology base dating from 1948 with the invention of the transistor and culminating in the recent emergence of IP networks as the dominant technological force behind our data and communications network. The early chapters deal with the history and impact of these important technologies and for those readers with a need to understand these technologies in greater detail, appendices are provided that take those interested into a journey of discovery into the important fundamental technology discontinuities such as Integrated Circuits, their scalability and limits, logic gates, semiconductor memories, semiconductor lasers and LEDs, photodetectors, fiber optics, and LCD displays which are used throughout the networks of today. These early parts of the book also point out the importance of the protocols that are used to transport data as well as the underpinning software methods that are used to build the networks without which engineers would not have been able to build today's Internet. Again, appendices are provided on these topics for the enquiring reader. The book takes the reader through the early technology shifts that have enabled the knowledge economy and the author has mapped these changes to very basic but nonetheless revolutionary shifts in software, semiconductors, wireless and fiber optics. These dislocations taken together with the emergence of the venture capital industry and the entrepreneurial spirit fostered in the technology centers in Silicon valley and elsewhere, provided the mix for the revolutionary data networks to emerge which would have far reaching societal changes in later years. The book describes this journey and along the way the author draws our attention to the demise of the industrial central laboratories that nurtured the early inventions that gave birth to these technology dislocations and whose gradual disappearance in the 1960s and 1970s released large numbers of very bright scientists and engineers into both government laboratories and most importantly, small business start-ups. These in turn provided the incubators that gave birth to such technology behemoths as DEC, Intel and others. Dr Kressel then shows us that the improvements in the secondary education system in the United States fuelled these new companies and together with significant venture capital, nurtured a large number of new companies. These companies had the heft to eventually produce the high performance optical systems, computers and servers necessary to populate early distributed data networks. These were born out of US government-sponsored activities to devise resilient data networks that could survive potential threats emerging from the Cold War of the 1970s and 1980s. These networks eventually were to become the Internet, a pervasive network that now has affected us all and which provides us with the infrastructure today to instantly communicate on a