The Material Competitive Advantage through Speed of Innovation beyond Negotiation
The challenge is communication as much as science. Who to talk with, when, how, where and why? How to find partners, how to de-formalize partnership to keep the benefits while increasing the speed. 3-month negotiations of investment, intellectual property disputes, joint development agreements, milestone agreements — these are ripe targets for disruptive innovation. Those who find new ways to preserve the value of such steps on the path to innovation via time-saving means, will reap a material competitive advantage.
That’s not to say that talkshops are dead, or delay is dead, or agreements are dead, or debate over the Division of the Labor and the Division of the Spoils is dead, that lawyers are going away, or disputes will not happen in some rosy future. It is an observation that faster timescale drives margins, margin drives competitive advantage, advantage drives profits, investors are restless, and value that is not unlocked by existing combinations will be unlocked in new ones. Just ask the gang at Dow and DuPont about their two-year ride through a world of happy.
Of course, here’s the challenge for the new DuPont, the new Dow and the new Corteva. Having found corporate combinations that make more sense to Wall Street, they now have to prove that it delvers value-creation at a faster-clip than before — not even the same pace as before, and Lord hopes not on a slower basis. Which is to say, they have to deliver on innovation. Will all players continue to become bigger as we have seen with Bayer-Monsanto and Syngenta-ChemChina. Or is there strength in smallness?
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