Startups vs Government on innovation

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Comparing tech startups and the government is strange, I know. Nevertheless, having just finished a short course on economic development, I’m quite sure there are some parallels in the thinking of professors and civil servants in charge of the economy, and the thinking of the likes of Eric Ries of Lean Startup fame.

The first thing that resonated is some advice I’ve gleaned from successful entrepreneurs. Pick a goal, i.e. the mountain in the distance. Then, ignore every single step between you and the mountain, except for the next step. Once that step has been taken, look up, make sure you’re still headed for the mountain, then look down and again, ignore everything except the next step.

It applies to economic policy too. Pick a big mission, for example, a balanced budget. Then, ignore all the steps between the country and that goal (there are too many to contemplate), except for the next step. For example, locate tax evaders and collect outstanding taxes. Once completed, look for the next step.

Macro-economic policy is important, but only in its utility as a mountain to aim at. Don’t start the journey until you know which mountain you’re headed for.

Once that is out the way, micro-economic action is what you should be spending most of your time on, finishing each project completely before looking up and double-checking where the macro-economic goal is, and then looking down and completing the next step.

The second similarity is the trend towards validated learning as described by Eric Ries’ Lean Start-Up philosophy.

Experiment. Monitor. Evaluate. Iterate. Repeat.

If you’re interested, as I am, in how South Africa’s economy will reach into new industries and create new jobs, then we should focus less on milestones and absolute statistics, and more on the process of experimentation in new areas of the global economy.


This article by Alan Knott-Craig Jnr originally appeared on AlanKnottCraig.co.za and is published with permission.

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