In a recent interview with the McKinsey Quarterly, author and Silicon Valley technology executive Judy Estrin discusses her views on innovation (or the lack of innovation) in the 21st century.

Estrin’s proposition is that while we are currently enjoying the fruits of innovation planted 30 years ago, we are failing to seed innovation at equal rates today. That is, while there appears to be an abundance of "incremental innovation", there is a lack of "sustainable innovation".

An example is the telephone. Since its invention in the 1800s by Alexander Bell, it has evolved to the cordless, mobile and VoIP solutions of today which are technologically and functionally different from their original and comparatively humble iteration. Estrin’s argument is that such developments do not represent fresh innovation in themselves, but evolutionary and incremental developments on previous innovations.

Estrin suggests that this kind of incremental innovation is the natural result of a short-term focus; that a very rapid rate of change created by technology and globalisation encourages a mindset of keeping up with changes, as opposed to considering how to stay ahead of the next change.

It is an interesting observation and (depending on whether one subscribes to the argument) one which might have an illustration in relatively recent experience.

Intel is the world’s largest supplier of microprocessors, with the second largest being Advanced Micro Devices (AMD). From the 1990s, both companies became focused on increasing the performance of their processors by increasing their clock speed. In 2005, AMD redesigned its processors and released a new processor that contained 2 cores instead of 1 (a core is the brain of the processor). It was a radical change. While the new AMD processors operated at a lower clock speed compared to Intel processors, they performed better. Suddenly, consumers wanted processors with 2 cores. Intel’s response was to shoe-horn 2 of its existing processors into one package without any major redesign - however, the result was an overheated processor that performed worse than its AMD counterpart. One could argue that in focusing on keeping pace with AMD’s improvements, Intel’s solution was compromised (until it invented a new design).

So how can we be innovative? Estrin suggests that people need to think outside their mainstream business towards future growth. She emphasises that this is something that cannot necessarily be learnt from customers, because customers often don’t know their own future needs. Listening to customers, while important, will only drive incremental innovation.

Practically, Estrin suggests that business should have small groups of people that are only loosely connected to the business and isolated from its corporate mission. This will allow those groups to nurture and think of ideas, come up with surprises and - intriguingly - do so independently of prescriptive goals.

This is something not everybody can easily accept. Conventional logic dictates that innovators must understand their business, their customers and have a set goal (and time limit) to create products that are suitable for their selected market. However, the flip side is to ensure that creative and innovative people are not subjected to unnecessary constrains. That is, let them do what they want, at their own pace. And you shouldn’t teach them how to "innovate". If you do, it’s not innovation.

Watch the interview here.