Google's Project Loon ©Jon Shenk
Google's Project Loon ©Jon Shenk

How procurement can enable innovation

19 January 2018

Some say there is an inherent conflict between procurement and innovation, but it made Google’s lifesaving Project Loon a reality. The function has the potential to enable transformative ideas – if it learns how to operate in a shifting innovation ecosystem

When David Natoff was leading strategic sourcing at Google, an unusual request landed on his desk: to buy a $50,000 balloon. With an average project spend of $3m, it would have been easy to reject the request and say: “I’m not working on this, it’s too small,” he recalls. But he threw himself into sourcing the perfect balloon.

That one balloon became 2,000 balloons. It was the prototype of Google’s Project Loon, a research and development project with the mission to provide internet access to remote areas. “It became a much bigger prospect – and we managed to reduce the costs,” says Natoff. Several years later, when storms battered Puerto Rico in October 2017, Google was able to use the balloons Natoff and his team had procured (above) to provide 4G internet access to areas that had been cut-off. In the wake of the storms, the balloons delivered basic connectivity to 100,000 people, helping them connect with emergency services and loved ones.

For Natoff, who now runs his own consulting firm Blue Sphere Consulting, the Project Loon anecdote neatly encapsulates how procurement can be a player in innovation. “Procurement can be innovative when it’s an enabler rather than a cost-savings blocker,” he says.

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