Ever wonder why the same companies that are lagging on the innovation curve are the ones leading the way in cutting costs? Motorola Inc. responds to a crushing loss of cell-phone market share by eliminating jobs, while design and innovation farms like Apple Inc. and Google Inc. seem to spend with abandon.

Aside from the obvious logic that successful design leads to greater sales, which in turn leaves more money to spend on developing new products, there's the theory that the very business processes that are a hallmark of M.B.A. programs — such as defining goals, measuring results and tracking efficiency — may be anathema to the less tangible mysteries of innovation.

A story in the latest BusinessWeek explores how this tension between efficiency and creativity is playing out at 3Com Corp., the company that has a long legacy of product breakthroughs like the Post-it note, but that has more recently come up short on the innovation front, resulting in financial difficulties and even talk of strategic alternatives being explored.

As BusinessWeek notes, efficiency reigned at 3Com between 2001 and 2005, during the tenure of James McNerney, a longtime General Electric Co. employee and Jack Welch disciple, who aggressively cut jobs at 3Com and installed programs to more closely analyze worker productivity. The article says that as current 3Com CEO George Buckley grapples with "whether the relentless emphasis on efficiency had made 3M a less creative company," he is dialing back on many of McNerney's initiatives and hiking spending on R&D, acquisitions and capital expenditures. 3Com's overall R&D budget will grow 20% this year to $1.5 billion.

As a sign of just how much creative space inventors require, BusinessWeek notes the 3Com engineer who invented the now-ubiquitous Post-it note tinkered with the concept for several years before it went into production. But it's been a long time since 3Com introduced anything nearly as transformative as the Post-it. The BusinessWeek story says the company, which traditionally prided itself on drawing at least one-third of its sales from products released in the past five years, today gets only one-quarter of its revenues from such relatively new products. —Andrea Orr

See June 1 PC Magazine story on Motorola job cuts
See BusinessWeek story on 3Com
See May 7 Tech Confidential post on 3Com