The Idea Factory: Bell Labs and the Great Age of American Innovation

THE PURPOSE OF INNOVATION is sometimes defined as new technology. But the point of innovation isn’t really technology itself. The point of innovation is what new technology can do. “Better, or cheaper, or both”—Kelly’s rule—is one way to think about this goal.

“You may find a lot of controversy over how Bell Labs managed people,” John Mayo, the former Bell Labs president, says. “But keep in mind, I don’t think those managers saw it that way. They saw it as: How do you manage ideas? And that’s very different from managing people. So if you hear something negative about how John Pierce managed people, I’d

Pierce later remarked that one thing about Kelly impressed him above all else: It had to do with how his former boss would advise members of Bell Labs’ technical staff when they were asked to work on something new. Whether it was a radar technology for the military or solid-state research for the phone company, Kelly did not want to begin a project

Pierce, to put it simply, was asking himself: What about Bell Labs’ formula was timeless? In his 1997 list, he thought it boiled down to four things: A technically competent management all the way to the top. Researchers didn’t have to raise funds. Research on a topic or system could be and was supported for years. Research could be terminated with

Eugene Kleiner, moreover, a founding partner at the premier venture capital firm Kleiner Perkins, was originally hired by Bill Shockley at his ill-fated semiconductor company. But the Silicon Valley process that Kleiner helped develop was a different innovation model from Bell Labs. It was not a factory of ideas; it was a geography of ideas. It was

To think long-term toward the revolutionary, and to simultaneously think near-term toward manufacturing, comprises the most vital of combinations.

At the time of the breakup, in fact, it was widely assumed in the business press that IBM and AT&T would now struggle for supremacy. What undermined such an assumption was the historical record: Everything Bell Labs had ever made for AT&T had been channeled into a monopoly business. “One immediate problem for which no amount of corporate bu

“It is just plain silly,” he wrote, “to identify the new AT&T Bell Laboratories with the old Bell Telephone Laboratories just because the new Laboratories has inherited buildings, equipment and personnel from the old. The mission was absolutely essential to the research done at the old Laboratories, and that mission is gone and has not been rep

A large group of physicists, certainly, created a healthy flow of ideas. But Kelly believed the most valuable ideas arose when the large group of physicists bumped against other departments and disciplines, too. “It’s the interaction between fundamental science and applied science, and the interface between many disciplines, that creates new ideas,