How technology aids innovation

Experimentation Matters: Unlocking the Potential of New Technologies for Innovation, Stefan Thomke, 2003.

Some time ago HBS Working Knowledge carried an interview with Stefan Thomke about his book, 'Experimentation Matters: Unlocking the Potential of New Technologies for Innovation.'

Thomke emphasizes that experimentation is vital to innovation and survival in today's business world. Computer modeling and simulation, rapid prototyping, and combinatorial technologies drive down the marginal cost of experimentation and allow companies to create more learning more rapidly.

He also proposes that it may make sense to shift experimentation from producers to customers: some companies have abandoned their efforts to understand exactly what products their customers want and have instead equipped them with tools to design and develop their own new products, ranging from minor modifications to major new innovations. The user-friendly tools, often integrated into a “toolkit” package, deploy new technologies (e.g., computer simulation and rapid prototyping) to make innovation faster, less expensive and, most importantly, better, as customers run “what-if” experiments themselves.

This suggests that since experimentation can be moved up and down the supply chain (relatively) easily, the technology matters more than the location. More on this when I've read the book...