Article at a glance:

Innovation’s uncertain terrain

It's natural for companies to focus their R&D efforts on what seem to be the most promising projects. But inventors and executives, no matter how insightful, have a poor record for predicting the use and importance of even the most important innovations. Railroads, for example, were originally developed as feeders for canal systems, and IBM's iconic president, Thomas Watson Sr., is famous for predicting that computers would have only a few customers in the whole world. A look at some successful commercial innovations explores the dimensions of uncertainty and the way complementary innovations work together to create new opportunities.

The take-away

Because it’s difficult to predict winners, government research projects shouldn’t overemphasize any single technology. A privately funded research group must make a bet on the most likely candidate for commercialization, but competition among companies pursuing different technologies can make it possible for several paths to be explored simultaneously.