> Trying to restart an innovation engine in a large old company like this seems to be nearly impossible.
It's super hard and I've thought about it for years (even though I can't imagine working for a big company -- even with my own companies I leave when the headcount gets to about 200). But I've wondered if there's a kind of "hayflick limit" for corporations too.
Consider Intel. One way to get the old spark back would be to simply start a new company. Takes a lot of capital and involves a lot of risk. The only tech company I know that does this well is Cisco; it's also emerged less intensively in pharma. Other than that, no.
Second: Aggressively prune the product line, milk what cash cows you have, use the savings to invest heavily (including increasing compensation for those who remain, so they feel it's worth staying to be part of something growing). The advantage of this is that you ignore the deadweight problem you describe: it's too hard to root it out when you have a crisis, so just do it at a macro level. I've never seen this really be pulled off; the closet is late 90s Apple when everybody knew they were in an existential crisis and they had enough emotional commitment to keep enough people on board (since they couldn't afford to do the "raise compensation" path right away).
Actually a not bad example is a company called Intel when Grove cut away the cash cow, memory, replacing it with the unproven CPU business because he could see memory rapidly becoming a commodity boat anchor. But that Intel was a much smaller company, with the founders still around, in a immature market. And it was a bet the company manoevre.
The prune-and-milk (mixed metaphor) requires a compelling vision that includes an extreme sense of urgency. Elop's "burning platform" memo at Nokia tried to give the sense of urgency but had no compelling vision beyond "the company needs to make money in order to survive". Gelsinger did a good job of setting out a coherent vision, but is it compelling enough to get good people to join & stay? I doubt it.
(The reason for the "milk" part of the approach is because while you're in the shit, even if you are digging your way out, most of the public articles will be like the submission we are discussing, which makes execution harder).
But in general, apart from a big pool of money and a legacy customer base, why would you try this with a big, cumbersome company when you could just do a startup? That's what Cisco honed in the 90s and still does: I think the company needs to invest in new tech X using approach Y, but that would threaten the revenues of some existing product line. You think tech X is great but approach Z is better. We both quit and start companies (sometimes Cisco even invests in later rounds). Eventually it turns out that one of us was right. That company gets bought (big bonus for the founders, who rejoin Cisco) and the founders of the one that didn't win also can get their jobs back (maybe through a small acquisition so they get a small bonus for their risk taking).
This allows them to compensate innovators outside the normal process (which doesn't piss off the MBA VPs), allow some competing technological developments, and keeps them big. I don't know if that process is as big and institutionalized as it was in the Chambers/Volpe days, but it was super smart.