Confronting the 'Tech Innovation Deficit' - Page 2

Do you have what it takes?

But she also spread the blame, noting companies small and large as well as venture capitalists have been reluctant to take risks.

"You have to plant a lot of seeds to get one thing successful and you don't know which one it's going to be," she said. "Overall we've lost our courage to take risks and there are no incentives."

Moderator Michael Mandel, chief economist at BusinessWeek, suggested more risk taking might not be the best strategy for many companies and investors. "We saw in biotech people took risks that didn't take off and the same with the dotcoms in the late 1990s," he said. He questioned whether a lot of companies have had "risk taking beaten out of them."

But Estrin said failure is an inherent part of innovation. "There is a difference between risk and intelligent risk," she said. "If you look at the dotcom companies and the recent financial moves, that was gambling, not intelligent risk taking."

The answers are out there

Rashid said even with budget cutbacks, it's not necessarily a bad time to be in research. "Hard times are when people need you the most," he said. "Now might be a good time to sell those ideas you've already done most of the work on and get them out the door."

Cheng said information technology has been evolving at such a rapid clip, it's probably a good thing the economy is forcing a slow down. "The Chinese character for crisis also includes opportunity."

She also suggested companies would be well-advised to follow IBM's strategy of having well-balanced investments in both short- and long-term research.

Rashid mentioned "huge opportunities to renovate the nation's health care system" and embellished his point with a personal anecdote about being rushed to an emergency room after falling from a horse. "If you didn't have a heart attack before you get there, you probably would after you arrive. I was there five hours before someone finally gave me a CAT scan to make sure I was okay. I think they just lost me," he said.

Sue Siegel, a partner with investment firm Mohr Davidow Ventures, said the health care industry is being held back by too many regulatory hurdles to bringing innovative products to market. "And we don't incent for sickness and sick care; we do not incent for prevention. There needs to be a fundamental shift to incent for health span and life span," she said.

On the larger tech front, Rashid said recent investments in computing infrastructure are priming the way to new innovative services.

"Companies like Amazon, Google and Microsoft have the most massive datacenters with the most computation you can imagine," he said. "And businesses, whether it's medical, environmental or whatever the problem is, now have the ability to put sensors out in the environment and create new data driven businesses.

"I think a lot of the new businesses from this will be successful and that's where the climb out will be," Rashid added.

Cheng said she thinks companies are essentially being forced to innovate. "Things couldn't be any worse than they are today; that forces people to focus," she said. "I'm very optimistic."