Tuesday, March 26, 2019   14:58:49
Why Cities Are Our Most Important Innovation Platform
When we think about innovation, we tend to think about individual gifts of insight—researchers in crisp, white lab coats, slick tech entrepreneurs with fancy gadgets and VC’s doing inspired deals.

When we think about innovation, we tend to think about individual gifts of insight—researchers in crisp, white lab coats, slick tech entrepreneurs with fancy gadgets and VC’s doing inspired deals.

English: Chinatown, Manhattan, New York City 2...

It's is the inherent messiness of cities that creates the collisions that makes innovation happen. (Photo credit: Wikipedia)

Yet, the truth is that innovation is a messy business. It’s full of blind alleys and half-baked ideas, random collisions and abrupt changes in direction.  Ideas mix and recombine, fail, reemerge and, in the end, a precious few become wildly successful.

Innovation, most of all, is driven by collaboration.  So it takes more than just smart people, but diversity as well.  Different people, working on different things, colliding together in unexpected ways is what brings about important new ideas.  That’s why, more than anything else, vibrant cities are crucial to our continued ability to innovate and compete.

The Essential Elements Of Innovative Cities

In The Rise of the Creative Class, author and urbanist Richard Florida argues that culture is a prime driver of innovation.  After all, if the best and the brightest can go anywhere, why wouldn’t they go to a place they will enjoy living in?

Further, he posits that three elements are crucial—talent, technology and tolerance—all of which cities have in spades.   The first two are obvious, but studies also show that diversity trumps even ability when it comes to getting optimal results.  A homogenous culture, even made up of very smart people, isn’t likely to produce much.

As Steve Jobs noted, creativity is about connecting things.  The more random collisions you have with people who have different ideas, the more creative you’ll be.  That’s why he designed Apple’s new headquarters to facilitate interactions, with lots of open spaces and common areas.

It’s also why cities need more than office buildings and research parks.  They need cafes, music festivals, art shows and other places where creative people meet and exchange ideas.

Urban areas, as Jane Jacobs pointed out in her classic, The Economy of Cities, are not particularly efficient.  They’re expensive, hard to navigate places. So it shouldn’t be surprising that most production happens outside of cities—in farms and factory towns where land and labor are cheap.

Cities, however, create new work and that's key to their success.  Jacobs argues that progress begins with import replacement.  For example, in the mid-20th century, Tokyo imported a lot of bicycles, which created a large market for repair shops. Eventually, those shops began making their own parts, which led to manufacturing whole bicycles and then exports.

This can only happen in a city where there are an abundance of repair shops.  A small town is unlikely to generate enough demand for a new component supplier nor will it provide the network of relationships necessary to transform components into a full product.  Only cities can do that.

Bicycles are, of course, a simplistic example.  Yet go to city with a healthy tech sector and you’ll find entrepreneurs following the same model.  Venture capitalists mixing with entrepreneurs, hardware guys running into software guys, buyers working out of the same building with sellers.  That’s how new work and new economies are created.

One of Jacobs’s chief insights was that import replacement was necessary to diversify goods flowing into the city and is therefore a precursor to new types of work and exports.  In effect, learning to do old things in new ways forges the path to doing completely new things we never thought of before.

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