NEW Report 103

Your newsletter on applied creativity, imagination, ideas and innovation in business.

Wednesday, 3 March 2010
Issue 164

Hello and welcome to another issue of Report 103, your monthly newsletter on creativity, imagination, ideas and innovation in business.

As always, if you have news about creativity, imagination, ideas, or innovation please feel free to forward it to me for potential inclusion in Report103. Your comments and feedback are also always welcome.

Information on unsubscribing, archives, reprinting articles, etc can be found at the end of this newsletter.


REPORT 103 STRIKES BACK: SOMETIMES CHANGE IS NOT FOR THE BEST

This January, I announced that we would take a break from writing and editing Report 103 in order to work on other projects. Moreover, I wrote that Report 103 would most likely reappear as a collaborative blog in the near future. That was the plan. But it has changed.

I received a lot of feedback from readers of this publication, my colleagues, business partners and even my brother. In the end, it was felt that Report 103 functions better as a newsletter than it would as a blog. Primarily, that is because Report 103 goes directly to your e-mail box, so you do not need to visit the www.jpb.com web site in order to read it. It's easy to print out and to forward to colleagues which, apparently, many readers like to do. It has also been suggested that there are simply too many blogs out there!

However, a few people pointed out that while they love the content, some felt that it was simply too much. Fewer, quality reports would be better than more frequent reports. And at least one person said our messages were getting repetitive. So, for the time being, Report 103 will be a monthly newsletter, which makes things easier for me as well. However, if there is special news or timely information which I believe would be of value to you, we will publish a special issue of Report 103.

In conclusion, my thanks to you and every other reader of Report 103 for your support. And many thanks to those who took the time to provide feedback.

Feedback on content, style, theory or anything else is always welcome. Over the years of publishing Report 103, I have met some fantastic people like you. I've made new friends and business partners. A few readers have even become clients of our products. And that's nice too, of course.

Now, let's get on with the innovation news!


WHAT ARE YOUR INNOVATION GOALS?

If innovation is important to your firm, then what are your innovation goals? If you have not got any goals beyond innovating for innovation's sake, or if those goals are not clear, then your firm has serious problems with its innovation process. Innovating for the sake of innovating is a pointless and expensive exercise doomed to failure. This is absolutely critical to bear in mind.

Successful innovators have clear innovation goals that are firmly based on strategy. Apple, for instance, has the innovation goal of taking existing gadgets, rethinking them conceptually and building trendy, highly functional variations, of those gadgets, which capture substantial market-share and establish the firm as a technology leader.

Until recently, Toyota's strategy was very much based on quality production combined with reducing manufacturing costs through improving the efficiency of the process. With this aim in mind, Toyota built an innovation process based on continuous improvement in production efficiency, delivery of parts on a “just-in-time” basis and quality improvement. This was phenomenally successful. Toyota pioneered just-in-time deliver and briefly became the world's biggest car manufacturer. It is only recently that the company has veered into prioritising market share – and straying from their innovation goals, that the company has run into trouble.

Indeed, every successful innovative business has clear innovation goals which are communicated to employees, suppliers and stakeholders. You should be doing the same in your firm.

Innovation Goals Are Derived from Strategy

If you are not clear about your firm's innovation goals, you need to start with strategy. If your strategy involves providing customers with the most cutting edge technology, then your innovation process needs to focus on improving the technology of your products. If your strategic focus is to have the lowest prices, innovation needs to focus on efficiency improvements that reduce your operational costs. Indeed, it is not difficult to extract one or more broad innovation goals from your strategy. What is more difficult to understand is why so few organisations have actually done this!

Applying Some Good Old CPS

Assuming you use creative problem solving (CPS: see the 7 August 2007 issue of Report 103: http://www.creativejeffrey.com/report103/archive.php?issue_no=20070807) or a similar problem solving approach such as TRIZ), the next step is to formulate innovation challenges that can become the basis of your innovation efforts.

This involves reviewing how you are and are not achieving your strategic objectives through questioning. Arthur B. VanGundy, in his book Getting to Innovation (in fact, this book is an excellent introduction to applying creative problem solving to the innovation process and, I am proud to say he and I corresponded on a number of these issues while he was writing the book) advocated creating Q-banks of questions regarding strategy. These questions can be reviewed by internal teams, stakeholders and others in order to identify weaknesses in achieving strategic goals. And the discoveries made during this process can be turned into innovation challenges.

Likewise, innovation goals tend to be very broad and need to be broken down into smaller challenges that can be tackled individually. For instance, if one of your innovation goals is to increase the efficiency of operational processes in order to bring down costs, you will need to look at several things. You should address all of the processes individually in order to see how they can be made more efficient. You should look at how processes might be combined to reduce wastage. You should probably ask what can be outsourced and what processes are unnecessary. The result should be a great many innovation challenges.

In the archives of Report 103 (http://www.creativejeffrey.com/report103/archives.php) there are several articles on formulating challenges, including an excellent one by VanGundy, which became a part of the above mentioned book.

From Challenges to Ideas

Once the innovation challenges have been formulated, you need to look at innovation methods and tools that can help you generate ideas and solve those problems. These can include brainstorming (but be careful here, traditional brainstorming is far less effective than most people think: see http://www.creativejeffrey.com/report103/archive.php?issue_no=20070918 and http://www.creativejeffrey.com/report103/archive.php?issue_no=20091103). More effective approaches include ideas campaigns (when you want to include large numbers of people in the idea generation process), focused teams developing solutions, experimentation and similar methods.

However, you have to be careful during the idea generation process as there are a number of pitfalls that can cause it to become at best highly inefficient and at worst counter-productive.

Firstly, bear in mind that generating ideas in response to a challenge is not a terribly efficient process. A lot of ideas need to be generated and they will inspire other ideas. Initially weak ideas may be collaborated upon on in order to turn them in to more effective ideas. In ideas campaigns (where my firm's speciality lies) with well formulated challenges anywhere from 10-50% of ideas will be viable as part of the solution, depending on the nature of the ideas campaign. Campaigns that target incremental improvements tend to result in a very high number of implemented ideas, while those targeting more dramatic breakthrough innovation have much lower numbers of implemented ideas; although the value of the latter ideas is generally higher.

Beware of Suggestion Schemes

Recently, the market has been flooded with cheap suggestion scheme software posing as idea management software. Suggestion scheme software is basically a collaborative suggestion box on the web. Anyone can submit any idea they want. In theory, this seems great. And over the years, I have found a great many companies try this approach during the early stages of their innovation initiatives. However, suggestion schemes tend to fail after 12-18 months owing to lack of focus, inefficient evaluation systems and high idea rejection rates.

Fundamentally, the problem with suggestion scheme software is that it does not permit you to focus idea generation on innovation goals. As a result, a large number of unusable ideas are generated, all of which are very time consuming to review.

Similarly, suggestion boxes, e-mail addresses where suggestions can be submitted and similar non-focused idea generation events are highly inefficient and detract from innovation goals

But There Are Ad Hoc Solutions

If you do not wish to invest in idea management software or your firm is a small one (in our experience, Idea management software tends to make the most sense with 100 or more employees), there are other options. Aside from face to face meetings in which challenges are addressed and ideas submitted, you can also use shared documents or open source tools like Wikis that allow team members to contribute to collaborative solutions. The important thing is to clarify the innovation challenge being addressed in the shared document or wiki.

Good Habits

Once you have established your innovations goals and have begun acting upon them, you will find that your firm naturally falls into the innovation process. There are many other issues to address, of course, such as culture of innovation, budget, evaluation process and more. But, all in all, getting started on a functional innovation strategy is remarkably easy once top management have put their mind to it.


THE FEAR OF INNOVATION

By Fernando Cardoso de Sousa

Innovation mechanisms and priorities differ according to the company which uses them. At minimum, specific variables, both internal and external, mean that theoretical innovation models cannot be used in every company in the same way.

In fact, teams tend to define areas of improvement around internal company efficiency; in areas like management control, communication, motivation, supervision and relationships with the clients. This way, organizational problems, seen from the point of view of the employees, tend to contradict the necessity of innovation or, put in another way, tend to stress the need for the organization to adapt to market, technological and management changes by providing some internal stability. Constant time and management pressures over the employees do not provide suitable conditions for them to see innovation as a benefit in itself. However, their attitude may change if they are given enough credit to balance constraints and initiatives, and to make innovation a collective internal effort. That is why the existence of organizational innovation systems is fundamental.

Even if we try to do our best to raise companies to the standards reflected in our management study books (which are based on the best company examples in the world), the gap between reality and perfection is too deep to be easily reduced. So, an extra effort is necessary to understand the kind of problems raised by the personnel. This is more effective than trying to develop ideal solutions (such as those presented by external consultants) , regardless of the reality of corporate culture, even if this means preventing external and internal changes from disrupting the ability of the company to innovate from within.

About the Author

Fernando Cardoso de Sousa holds a Ph.D. in Organizational Behaviour and is the director of the Marketing and Research Unit - GAIM (www.gaim.pt), the Apgico and of the M.A. in Human Resource Management courses at the INUAF, Loule, Portugal. He is a guest speaker in universities and companies as well as the author of books and articles on subjects like creativity, innovation, leadership, human resources, psychology and military sociology. Fernando is a consultant to companies in human resources and organizational behaviour, he was recently awarded the “Excellence in Innovation Award”, at the 3rd International India Innovation Summit, in Mumbai (http://www.3is.biz/about_new.html).

About APGICO
Created in 2007, the non profit association APGICO (Portuguese Association for Creativity
and Innovation – www.apgico.pt), aims to develop creativity and innovation in organizations, helping to create conditions for their increased competitiveness.


MOB-SOURCING

Recently, there has been a lot of fuss about crowdsourcing. Many innovation pundits claim that harnessing the power of the crowds is a great way to innovate. By allowing many creative minds to freely be creative, they argue, you are sure to get lots of very creative ideas.

On the other hand, social psychology has since the time of Sigmund Freud, explored crowd psychology and its uglier variant, mob psychology. In so doing, they have put forth a number of theories, most of which are somewhat controversial, about the behaviour of people in crowds.

Freud's crowd behaviour theory states that individuals in a crowd adjust their behaviour to meet the norm of the crowd. Thus, individuality is lost and a group behaviour emerges. This does not seem entirely conducive to creative thinking!

Over 100 years ago, Gustave Le Bon argued similarly, that crowds operate anonymously and sometimes generate emotion. This notion has become something of a cliché. Le Bon's theory is often used to explain the notion of a lynch mob, that is a large group of normally moral and ethical people may become violent in a crowd. This is why, Le Bon would ague, peaceful demonstrations turn violent. Emotions generated in a crowd, combined with anonymity, give members of the crowd a feeling of diminished responsibility for their actions. Lynch mobs of the American south, Nazism and religious cults are all said to be examples of Le Bon's theory. Nevertheless, many researchers question Le Bon's theory.

Meanwhile, Emerging Norm theory (developed by Ralph Turner and Lewis Killian) argues that as crowds grow, they develop their own norms of behaviour and decision making processes. As time progresses, members of the crowd take on certain roles. At the same time, behaviour particular to the crowd becomes the norm within the crowd, even if it might be considered unusual in normal society.

Small , Diverse Teams May Be Better

These theories of crowd psychology suggest that large crowds are likely to show less breadth of creativity and variety of ideas than might be expected. Indeed, crowd psychology seems to suggest that large crowds would demonstrate reduced creative thinking as members of the crowd identify more deeply with the crowd and behave accordingly.

On the other hand, substantial research shows that when it comes to solving complex, non-routine problems, the most effective groups are those composed of people who have a variety of skills, knowledge and perspective. Thus, rather than try to draw in huge crowds for their creative idea generation activities, organisations may do better to put together diverse problem solving teams.

Voting In Crowds

On a related note, researchers at Columbia University invited 14,000 young people to rate songs by little known bands and artists. They were divided into two groups, both of which were asked to rate songs and download the ones they liked. The first group acted independently and had no information on what other members were doing. The second group, however, was able to monitor downloads on a rolling popularity chart.

In the first group, downloads and votes were widely distributed across many songs. In the second group, not surprisingly, people tended to vote for and download the most popular songs. What perhaps is more surprising is that this made the second group more unpredictable than the first! That's because, in the second group, the first songs that were downloaded tended to become the most popular songs because group members would see these being downloaded and so decide to download the same songs themselves, thus creating trends for songs based not on quality or even true popularity, but rather early popularity.

Lessons not yet Learned

This has a lot of implications for business delving into crowdsourcing as there is a growing body of evidence suggesting that behaviour in crowds is unpredictable, sometimes emotional and often does not reflect the true feelings of individuals within the crowd. Other research has shown that individuals with strong personality can become leaders of crowds and sway behaviour to meet their needs. Nevertheless, none of this is conducive to creative thinking. But to be fair, it is not clear that such behaviour would be detrimental to creativity – although my sense is that it would be.

Thus, when companies open large on-line suggestion schemes in order to crowdsource ideas, and they do not use ideas campaigns (see article on Innovation Goals above) or other methods to guide creative thinking towards innovation goals, they are unlikely to get much in the way of useful, relevant ideas. Worse, it is also clear that voting for ideas, which is typical of such systems, is unpredictable and unlikely to be in any way representative of the “best ideas” (I have problems with the concept of “best ideas”: see When the Best Is Not the Best in the 2 June 2009 issue of Report 103: http://www.creativejeffrey.com/report103/archive.php?issue_no=20090602).

Moreover, existing research would indicate that rather than investing in broad crowdsourcing initiatives, organisations would do better to bring together diverse teams (from inside and outside the organisation) and have them focus on specific innovation challenges. Better still, in view of the costs associated with administering massive crowdsourcing initiatives, it is worth bearing in mind that smaller diverse groups are less costly to administer and likely to generate more value than crowds!

References:

Wikipedia on Crowd Psychology: http://en.wikipedia.org/wiki/Crowd_psychology

The Psychology Wiki: http://psychology.wikia.com/wiki/Crowd_psychology

Group Genius: The Creative Power of Collaboration; (Book, 2007) by Keith Sawyer, Basic Books

 

JENNI INNOVATION PROCESS MANAGEMENT

The operational costs of producing and archiving Report 103 primarily come from sales of Jenni innovation process management (IPM) software. So, if you have not ordered Jenni for your firm, get on the telephone now and contact your nearest representative (http://www.creativejeffrey.com/jenni/contact.php).

Since 2003, Jenni has been helping all kinds of organisations innovate more effectively. And unlike suggestion schemes, Jenni boasts sophisticated ideas campaign functionality that allows you to align idea generation with strategy. That makes the innovation process more efficient, more effective and relatively inexpensive to adminster.

Jenni also boasts the best evaluation tool set in the industry, enabling you to identify readily the ideas with the greatest value potential. Add a social networking module, team functions and much more and Jenni is simply the best choice in idea management on the market today!

That's why clients on five continents have used Jenni to generate ideas for new products, packaging, services, process improvements and more.

And, by using Jenni you support 103. So what are you waiting for? Give us a call!


JEFFREY'S PERSONAL AND UNGODLY CREATIVE ACTIVITY SPACE

If you have been reading Report 103 for a while and have begun to wonder what sort of chap I am in real life, you can visit my newly created personal web site at http://www.ungodly.com. It contains some artwork I have created recently (I am hoping to digitise older work soon) and a rather unusual blog.


ARCHIVES

You can find this and every issue of Report 103 ever written at our archives on http://www.creativejeffrey.com/report103/archives.php


Happy thinking!

Jeffrey Baumgartner

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Report 103 is a complimentary eJournal from Bwiti bvba of Belgium (a jpb.com company: http://www.creativejeffrey.com). Archives and subscription information can be found at http://www.creativejeffrey.com/report103/

Report 103 is edited by Jeffrey Baumgartner and is published on a monthly basis.

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Jeffrey Baumgartner
Bwiti bvba

Erps-Kwerps (near Leuven & Brussels) Belgium

 

 


 

My other web projects

My other web projects

CreativeJeffrey.com: 100s of articles, videos and cartoons on creativity   Jeffosophy.com - possibly useful things I have learned over the years.   Kwerps.com: reflections on international living and travel.   Ungodly.com - paintings, drawings, photographs and cartoons by Jeffrey