Far too many people expect profitability, for the product and the business, right out of the gate. When I was at Philips I watched most new product categories and businesses on their slate get cancelled—even for products that were almost ready to ship. Built. Tested. Done. They would die on the vine because the top brass were protecting themselves. Any execs

joining the team always wanted a near guarantee that new products would make money. [See also: Chapter 2.2: Data Versus Opinion: Most people don’t even want to acknowledge that there are opinion-driven decisions.]

They demanded to be shown ahead of time that the unit and business economics of the product were sound. But that was impossible.

They were asking us to predict the future with near 100 percent confidence. They were asking for proof that a baby could run a marathon before it had even learned to walk.

These guys didn’t know much about babies. They knew even less about how to create a new business.

Perversely, the desire to avoid risk often magnifies it. Dumping money into big me-too projects with modest upside is a lot more perilous than seeding lots of early-stage ideas that are further out on the fringe. In the age of upheaval, incrementalism is the riskiest bet of all. What’s needed is a radical shift in how we think about experimentation. The goal isn’t simply to reduce the uncertainty around new products or get them to market faster, but to build an organization where everyone is working to extend the boundaries of what’s possible. That’s how an organization buys insurance against irrelevance.

The implications of this kind of leap to a company’s economic model can be devastating. In IBM’s case it meant the collapse of gross profit margins and the attendant changes we had to engineer to lower our cost structure without compromising our effectiveness.

Yet the hardest part of these decisions was neither the technological nor economic transformations required. It was changing the culture—the mindset and instincts of hundreds of thousands of people who had grown up in an undeniably successful company, but one that had for decades been immune to normal competitive and economic forces.

The oppression of false peace: we are taught that our truths are disruptive, and that disruption is a negative act. This one is particularly insidious, and ties back into capitalism—only those moving towards profit can and should create disruption, everyone else should be complacent consumers.

Disruptive technologies, Christensen had observed, often grew out of hobbyist communities. They were developed using “bootlegged resources” in which “off-the-shelf components” were redeployed for something other than their intended purpose. They started out wonky but rapidly improved along attributes of performance that established players ignored.

But even once you had absorbed this lesson, it wasn’t easy to implement. Pursuing niche markets cost profits, making investors question your sanity. This, too, Christensen had foretold: “One of the reasons managers at established firms find it difficult to serve emerging markets is that their investors and customers tell them not to.”

That was the real secret of The Innovator’s Dilemma, which readers often missed. It was not a book about how to succeed; it was a book about how not to fail. Christensen’s book wasn’t a how-to for start-ups but a counterinsurgency manual for senior managers at stagnating firms. Thirteen years in, Huang felt that Nvidia was at risk of becoming such a firm, and it was as much paranoia as optimism that led him to pursue the mad-science market.