Leading Corporate Innovation: HP Labs Director Prith Banerjee (Part 6)

SM: How do you tie in your basic research with business unit involvement? Applied research does not typically result in a market-ready product.

PB: Researchers build prototypes, not products. Within HP Labs we have set up a process by which a small number of projects every year receive additional funding, incubation funding, to take it to the next level. Their job is to build a prototype which is almost a product. It is something we can put in the hands of customers.

In the VC world, to take it from seed or angel funding to beta products you need Series A funding. That is what we are doing. HP Labs is providing the Series A funding on a small subset of products. We have actually started that project this year. We are funding about six projects. Those projects I will not talk about. Those are secret-sauce projects.

Once we have funded those efforts, essentially providing the Series A, it becomes much easier for the business units to take those products and run with them. Business units then provide Series B funding. If you look at HP Labs’ work, we are doing seed funding. For a small number of those products we are doing Series A funding. It is all completely funded by HP Labs.

SM: How was the incubation stage funded in the past?

PB: In the past we went to the business units and asked them to fund the incubation. Now we have carved out a small piece of the HP Labs budget. Instead of doing 23 big bets I am doing 21. It is worth it, because that function is very important to HP Labs.

SM: What is the composition of the people who work in HP Labs? Why should a top technical mind work at HP Labs instead of conducting their own technical startup?

PB: It is about the scale. We are big. We have tremendous scale because of the large channel that we have. If you come to HP Labs and you really make something happen that evolves into a product, it will be used by billions of customers. In this past year, even though we had all these challenges in the economy, we hired several people at HP Labs worldwide. We fund universities and graduate students. The expectation is that these guys will come and intern with us. They are not required to, but we make the offers. Each year we typically bring in 100 interns from various universities to work at HP Labs.

When they graduate, we hope that they will consider HP Labs, and they do. We routinely bring in fresh faces. HP Labs is a very mature organization compared to other research labs at younger companies such as Google. HP Labs is a 60-year-old lab. We have a lot of history. A lot of people have worked at HP Labs for a long time.

When you come to HP Labs, it is not a bunch of younger people who have no experience. You are working with people who have been there, done that. They know what works and what does not work. That wealth of experience is something that we sell to our recruits. I think it is important to make sure we have a balance in our talent pool.

SM: The generation that has grown up on the Internet is very different. I think it is good that you are bringing in new faces every year. What about financial incentives?

PB: The reason people do innovative work is not just for finances. If you only wanted money, there are other ways to get it. Researchers have dual objectives. They want to create something fantastic and they really want to see it being used by people. If, in the process of it, if they make some money, then that is fantastic. I do not think that every researcher wants to make a ton of money. The probability of success of being really outstanding is higher in a place like HP Labs. You can join a startup, but 6 out of 1,000 business plans make it.

This segment is part 6 in the series : Leading Corporate Innovation: HP Labs Director Prith Banerjee
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