How Innovation Led HTC to the Dream

The organization that does not think about engineering problems or design problems, but really tries to think outside the box. Think about babies, think about zero learning. It's about making it beyond simple, so that it's almost innate. That's one example of how Magic Labs operate. It's not very engineering-centric, but very conceptually centric in creating innovation.

What percentage of ideas turn into innovation and what percentage are killed?

Almost all of them are killed -- probably more than 99 percent. Magic Labs is an ideation engine. If you are sitting inside in one of the Magic Labs brainstorming rooms, within an hour, probably 200 ideas will be generated all over the wall. The culture is really good at doing that. Every day there are many brainstorming sessions taking place, many prototypes being built and most of them are to demonstrate, prove or disapprove certain concepts. You and I might think this is a great idea, but the moment you touch the prototype and see how it works, you might realize that, hey, it does not feel like the way we envisioned. That's a great achievement, because you just failed very quickly and very cheaply.

What's the lifecycle of these ideas? Days? Weeks?

Among the 200 ideas written on the wall, by the time the meeting is over, most of them are just put away. Their life cycle is extremely short, measured in seconds. When you turn off the lights, they're gone. But a few of them actually will be promising so people will use them as seeds for other brainstorming sessions. There might be some sketches over a couple of days. The team might conclude that this is no good, and it dies. Among them, fewer yet would be worthwhile. You might have some screenshots, graphic representations. The next step is to make a prototype. In Magic Labs, the mechanical magician is just sitting behind you and the software wizard is right across the table, so you can quickly gather a couple of people and decide, "Hey, let's go make a prototype." That could be made within a week or two and you could try out the idea. If the idea is just mediocre, it might get killed at that moment. If a concept proves to be excellent and you get a lot of positive feedback, then we start to develop it further. Eventually some ideas, very few, will become innovations like Touch Flo.

For many years, HTC was content to build phones for other brands but recently the company's own brand has become more prominent. What happened?

The transition was not like flipping on a switch. It actually happened gradually. Even three, four or five years ago, HTC did not put its logo on the phone. If you go online, there are a lot of communities talking about HTC phones. The HTC brand was already there among its users. A few years ago we started to put the HTC logo on the phones. We basically formalized the brand recognition on the physical product.

Let me share with you how we think about brand. There is a very important difference between brand value and brand recognition. Brand value means something to the end user. Brand recognition, all it means is a bunch of advertising to make people recognize the brand name. At HTC we care about brand value, not brand recognition. Building brand value is like earning respect; you have to earn respect, you cannot buy respect. And the way to earn respect is by continuing to deliver innovative products and creating value for the market, and that has to be done time after time again. It is a journey.

How does the release of the Dream phone contribute to that journey of building brand value?

It's another example of HTC innovation. It's the world's first Google phone. We have been investing and innovating side by side with Google for close to three years. That's not the first or last time we're going to do that.

What can your company teach the business world?

AT HTC every day we think about doing the right thing for our customers. We don't spend a lot of time worrying about promoting the HTC brand or trying to get people to know about HTC. HTC is fairly humble and we are very focused on doing what we think is the right thing for our customers.