Israel's Innovation DNA

Every nation has it's idiosyncrasies but Israelis may have the most.

By SHLOMO MAITAL
Israeli innovation ML 311 (photo credit: Arieh O’Sullivan / The Media Line)
Israeli innovation ML 311
(photo credit: Arieh O’Sullivan / The Media Line)
Americans are individualists.
The French love food, vacations and love − in that order.
The British are polite. The Germans are methodical. The Italians are chaotic.
And the Israelis are… well, complicated.
Hebrew University Prof. Gad Yair, a sociologist, has written a short, readable book, “The Code of Israeliness,” to crack the code of what makes Israelis, Israeli. He rejects the almost universal ban among sociologists and political scientists against stereotypes. Every statement in the opening paragraph above is scandalously politically incorrect. Yet most of us believe there is indeed such a thing as collective identity and that Israelis, too, have one. But what is it? Here are a few of Yair’s “10 Commandments” of Israelis’ national DNA , and my own thoughts about how Israelis have mustered a common history, culture and set of values to make a rather good living from innovation and entrepreneurship.
Existential Fear: Yair observes that Israelis do not take for granted the continued existence of their country. The pogroms and Holocaust that afflicted Jewish history make this understandable.
This fear helps generate breakthrough ideas in defense technology, later leveraged for civilian uses. For instance: Given Imaging’s tiny video camera encased in a “pill” that films our gastrointestinal tract and Nice’s security cameras both arose from devices developed by IDF and Rafael (Weapons Development Authority). Given Imaging has about $150 million in annual revenues; Nice Systems sells $689 m. yearly.
Buddy-buddy mentality: Many Israeli start-ups are built on childhood friendships. Checkpoint Software Technologies, for instance, makes firewall protection for networks; it was founded in 1993 by three close friends, Gil Schwed, Shlomo Kramer, and Marius Nacht, who were army buddies. Schwed and Nacht still run the firm. Checkpoint’s third-quarter 2011 sales were $308 m.
Hutzpa: What some perceive as Israeli rudeness, on the highways and in lines, becomes icon-smashing businesses.
Breaking the rules on the highway is often disastrous. Breaking the rules in R&D labs, in contrast, often creates breakthrough innovations. Take for instance Teva Pharmaceutical Co.’s hit drug Copaxone, which has helped millions worldwide who suffer from multiple sclerosis. At its peak, Copaxone brought Teva over $2 b. in annual revenues. Discovered by Weizman Institute scientist Prof. Ruth Arnon, Copaxone began its life as Copolymer-1. Most drugs are a single molecule. Copaxone is a mixture of polymers, very hard to replicate as a standard uniform dose of medicine that can pass clinical trials. It can’t be done, the experts said. Teva VP Irit Pinchasi led a team who cracked that problem, against all odds, and won US FDA approval. It was pure hutzpa.
Loathing of hierarchy: A culture in which sergeants delight in telling generals what to do will be more likely produce scads of creative ideas. In their best-seller “Start-Up Nation,” Dan Senor and Saul Singer recount how Paypal President Scott Thompson once went to Tel Aviv to meet with the FraudSciences start-up team, an Israeli company he had just acquired. “I’d never before heard so many unconventional observations – one after the other,” he said.
“Junior employees had no inhibition about challenging how we had been doing things for years. I’d never seen this kind of completely unvarnished, unintimidated and undistracted attitude. I found myself thinking, ‘Who works for whom here? Did we just buy FraudSciences, or did they buy us?’”
This insubordination “gene” drives Israelis to start their own companies, but perhaps also prevents them from scaling them into global companies. After all, in big companies someone has to tell others what to do, and have them obey. This gene can and does generate chaos. In the words of Dave Kelly, founder of the leading American industrial design firm Ideo, for effective innovation you need an oxymoron, “organized chaos.” Often, Israel seems to have more “chaos” than “organized” because of this particular “gene.”
Being opinionated: Over two decades ago, a junior Israeli engineer named David Perlmutter, along with his friend Uri Weiser, flew to Intel headquarters in Santa Clara, California, and improbably persuaded Intel CE O Andy Grove to cancel a key decision and focus instead on what would become the highly profitable Pentium microprocessor. Perlmutter is now Intel executive VP and head of its Mobile Group. He and other opinionated Israeli engineers have helped lead Intel to invest heavily in Israel. Intel Israel employs 7,000 workers and in 2010 exported some $3.5 b. worth of products.
Forty years ago, author Amos Elon’s book, “The Israelis: Founders and Sons,” sought to define the Israeli consciousness in terms of Israel’s Zionist history. This classic, when read together with Yair’s new work, helps Israelis understand who they are, where they have come from, and how their collective personality shapes what they think, say and do.
I am writing these words at the end of a week that saw an amazing countrywide outburst of joy, gratitude and emotion, as Gilad Schalit returned home to Israel after 64 months in a Hamas dungeon. The daily “Haaretz” editorialized that the collective identity of the Israeli people established a kind of “direct democracy,” demanded a deal for Schalit’s return, and compelled Prime Minister Benjamin Netanyahu to contravene his worldview that opposes freeing murderous terrorists.
The powerful narrative of a son returning to parents, grandfather and siblings was best captured by President Shimon Peres.
“You [Gilad] have returned to us,” he said, “and we have returned to ourselves.” There is indeed an Israeli identity. It expressed itself powerfully following Schalit’s return to his home.
The writer is senior research fellow, S. Neaman Institute, Technion.