ABSTRACT
As we discussed in the previous chapter, the driving principle behind the Early Growth phase is “more is better.” When it is not supported by massive investments in Distribution, this principle eventually turns a recipe for success into a recipe for disaster. That is, the more Tools, Sources, and Packaged Payloads are added to the system, the more congested the Distribution routes become. Initially, the problem can be solved by trafc optimization, but sooner or later a major overhaul is required. As we discussed earlier, Edison’s DC-based electricity system satised Early Growth in lighting and small-scale industrial applications. It was “grafted” onto an existing railroad network for delivering coal to steam engines, but with increased demand for power, a new AC-based infrastructure had to be built. George Westinghouse saw this change coming and took advantage of the opportunity. He invested his inventive and entrepreneurial energy into the emerging power architecture and set the stage for a new phase of industrial and residential growth in America.*
Soon, the General Electric Company of Schenectady, New York, became the biggest beneciary of this system development, because it had sufcient nancial capital and technological prowess to harness the growth. Following the example of George Westinghouse, the company bought patents and hired the best inventors, such as Charles P. Steinmetz and William Stanley, who helped GE create strong technological advantage in the emerging electric power industry. Working on GE’s assignment, Swedish engineer Ernst Danielsen and American electrical engineer-scientist Luis Bell successfully designed an electric AC motor that circumvented Tesla’s patents owned by George Westinghouse. In the early 1900s, GE set up an R&D lab “for commercial applications of new principles, and even discovery of those principles” [22].
