innovation playground Idris Mootee

Five Critical Questions About Organization Culture That People Avoid Asking.

There is a piece on HBR Blog on the topic of organization culture “Culture Takes Over When the CEO Leaves the Room” by Frances Frei and Anne Morriss (both HBS professors). It is a good piece worth reading and here's an summary of their ideas:

Excellence = design x culture. Your job as a leader is to get both right. You must build a winning structure for your organization and then foster the often unspoken rules and values that will bring that structure to life.

But if we may be blunt for a second, what the hell is culture? And how exactly do you get any better at it? In short, culture guides discretionary behavior and it picks up where the employee handbook leaves off.

Culture tells us how to respond to an unprecedented service request. It tells us whether to risk telling our bosses about our new ideas, and whether to surface or hide problems. Employees make hundreds of decisions on their own every day, and culture is our guide. Culture tells us what to do when the CEO isn't in the room, which is of course most of the time.

My favorite line is “Culture tells us what to do when the CEO isn't in the room.” I have been studying the ‘creation and nurturing” of organization culture for decades looking for practices and patterns among organizations with highly effective and sustainable cultures. Especially those that were not built on incentives such as stock options and those that were transnational.

It is easy to just look at those service intensive companies (Four Seasons, Starbucks, Zappos, Nordstrom and Southwest etc.) where there is close relationships between service and culture, but I am more interested in looking at culture and their relationships with strategy, structure, purpose and their implications on business performance and innovation effectiveness. Some of the questions I have been exploring include:

• The first question is does the CEO or the executive management knows what kind of culture they’re trying to build or what are the conditions required for those culture to flourish and key concepts to build from? Or it is simply unintended consequences of the CEO management style or something inherited from previous management? Do you know what you're building towards?
• The second question is can a company articulate its corporate culture in a way that is both tangible and explicit. A company publishes an annual report about its financies, should they publish a book about the company culture? A company’s prevailing values, mental models, assumptions, attitudes and beliefs all make up the soft, invisible stuff of culture that crate an environment of trust and balance. It determine its outlook—what it finds meaningful and important. Can you capture these stories and communicate them in a tangible way outside a Power Point? And what are the best practices to do this?
• The third question is when company is attempting a culture transformation; do they need a vision of what they want to become? Is there a genuine need to diagnose their present culture so that they can define the current state and the future state? And if the gap is too big, how do they know if the transformation is too drastic and simply not achievable?
• The fourth question is when organization culture gives people a sense of self and identity and determines, rituals, beliefs, style, meanings, values, norms and language, the way in which ‘things are done that way around here’, who should own it or is it possible for any function to own?
• The fifth question is around maintainence. An empowering executive management team can better assess the current status of an organization with an eye to shaping /modifying / eliminating the parts that are dysfunctional or ineffectivel, then replacing them with qualities that will improve the speed of decision making, productivity, and employee engagement. Corporate culture needs a maintainence plan. Do you have one?

Organization culture is not a vision, mission or management system. It is the strategy that guides how a company makes decisions disregard of what industry they compete in or where they play along the value chain and how decisions are made when the CEO is not around. And in particular today’s fast pace turbulent business conditions, a strong corporate culture can provide the strategic agility and empowerment needed to reduce the recovery time from any unavoidable setbacks or disruption.

Organizaion culture is the glue that holds a company today, even when lacking a robust business strategy. Far too many CEOs and executive leadership fail to make the connection between a “hard” strategy and a “soft” strategy and not putting enough effort to make creating, building, and nurturing a winning corporate culture the heart of the company strategy.

“To be an enduring, great company, you have to build a mechanism for preventing or solving problems that will long outlast any one individual leader.”           

                                                                - Howard Schultz

"We needed to integrate as a team inside the company so that we could integrate for the customers on their premises.” 

                                                                - Louis V. Gerstner, Jr.

The New Battlefield Between iPhone, BlackBerry and Android Smartphone: The Keypad.

Apple iPhone has officially become the “defender” instead of the “attacker”. The battlefront so far has been on the screen and apps and now the battlefield is switching back to the keyboard. There are two camps: physical keyboard and virtual keyboard. I definitely belong to the group that I needed a real keyboard and therefore I use Blackberry. And there are those who can type at lightening speed on iPhone virtual keyboard.

Since last week, there were rumors that the next generation of Blackberry will come without a physical keyboard (which Blackberry CEO Heins reassured that RIM is not getting rid of its tried-and-true physical keyboard) and this is no easy decision.

One exciting new feature for the BlackBerry 10 is the redesigned user interface. The clean design features "cascades," which let users flip through apps with a simple swipe gesture, replacing a back key or physical button. It will also feature an intelligent virtual keyboard that takes touch-screen keypads to another level. It learns the words that you often use, your typing style and compensates for sloppy typing (I admit I am one of those sloppy typers). If they solve this problem, another good reason for me to stick with Blackberry. I currently have three BlackBerry and a Playbook.

There were reports that now Apple is considering offering a real keyboard for the iPhone 5. While this is highly unlikely, it will be a smart move for them to change the game again if they can completely rethink the design and engineering of a physical keyboard. The next competitive front will not be the camera, screen size or processor speed, it will be battle of the keyboard.

I speculate that RIM is betting (and committed) on winning the keyboard battle because they know it well, typing for BlackBerry users is everything and this is the last defense.  And now RIM is properly equipped with the smarter, faster QNX platform.

Let the battle begins…..and here's a few free advice:

• BlackBerry should seriously push the design front and explore the BlackBerry DNA and go against Apple’s simple design and opt for more sophisticated European asthetic.
• BlackBerry should turn up the keypad battle and bring in new function and keys to allow new document management capabilities. 
• BlackBerry should stop engineering creeps and hold back innovation on those features to reduce distractions.
• BlackBerry should drop the Apps race and give that up completely. Don't fight a battle that you cannot win.
• BlackBerry should turn BBM into an open software and get mass adoption including all Android phones.
• Blackberry should explore innovative features on “identity” management. I think there are lots of rooms to innovate here.
• BlackBerry should innovate around “security” features (not data security) but real security and design service around it.
• BlackBerry should leverage the 200+ million cars are on the road using RIM's QNX operating system and create the most sophisticated integrated features. Most BlackBerry users like me take calls in the car for hours everyday.

I can go on and on for hours and give BlackBerry another 100 ideas to compete for the future. The big strategy is to ignore “Apple”. I mean completely ignore Apple.

Design Thinking Is A Cognitive And Intellectual Process That Balances The Rational And Emotional. Not Included With Your MBA.

What is Design Thinking? Because of the word “design” and many automatically associate it with the craft of design or design as a profession. Actually it is less to do with “design” and more with “system”. There are many ways to define "design thinking" and this list is not exhaustive:

• A way to instill customer-centricity and empathy
• A framework for exploration and experimentation
• An approach to sense-making and problem solving
• A methodology to foster exploration and experimentation
• A design buzzword to tell you a designer can do more than design
• A management buzzword sold as the “next” strategic tool
• A marketing slogan or tag line
• A self-gratifying term for those who think they are creative

The term “design thinkers” implies that designers are craftsmen and not thinkers, which is NOT always the case. It is also a stretch for traditional industrial or brand/graphic design firms to claim to be able to use "design thinking" to solve complex strategic issues. These firms need to go through a radical transformation and close a big capability gap before they can even attempt to implement it for others.

Today, "design thinking" is frequently compared and contrasted to business. This is often an over simplification that forces us into predetermined roles along with their associated rules, conventions, behaviors and formal expectations. It Is important to recognize that "design thinking" is NOT exclusive to designers or unattainable to those in another discipline. Design thinking is natural and inherent in all of us who are smart and creative.

"Design thinking" is a cognitive and intellectual process that balances the rational and emotional – in effect combining left brain and right brain thinking. When applied, it harmonizes with other modes of thinking and closes knowledge and information gaps, creating order and refining meaning. Because "design thinking" is a dynamic, constructive process that is iterative in nature, developing ideas requires ongoing definition, redefinition, representation and assessment.

To achieve those tangible outcomes, you need to open the process to multiple participants and socialize the process and outcomes, visualization is a very critical part of the process, not an outcome. Even the Department of Defence recognizes the needs to train "design thinkers" that are capable of critical and creative thinking to plan operations in dynamic environments with fast-changing uncertainties in extremely complex conditions.

People who are capable of using "design thinking" to identify and develop different military response options within the context of a big strategy are crucial to successful military operations. The development of such skills requires a shift in their focus from the operational and tactical environments to the strategic environment. This is an extremely challenging undertaking given that many military officers spend the majority of their career starting at lower levels and their advancement depends upon how well they perform tactically. This is very much like managers in large organizations who were promoted based on their ability to execute tactically.

To develop senior commanding officers with "design thinking" capabilities require DOF to train them new skills including analysis as well as synthesis. "Design thinkers" possess the ability to think critically on a "system" level; break concepts into simpler parts and mapping out their relationship and system impact before rearranging the elements into a new whole; in other words, to produce something through imaginative skills and quick experiments. And yes, imagination is always needed.

Successful Business Transformation Requires A New Logic To Handle Ambiguity And Change.

The future is scary and there are reasons for it. I have been giving a lot of keynotes lately to different professional organizations and senior executive roundtables and my keynote topic of strategic innovation and design thinking went beyond innovating to find growth and adapting to new economic, market, political and social order. I shared ideas on the future of economic development, the come-back of manufacturing, developing glocal innovation networks and creative or self-destruction of old establishments and the renewal and transformation of the modern enterprise.

There were never ending questions from the audiences on these topics. I can write a book on them, I guess I won’t have time. I hardly have time to get enough sleep. Everyone is looking for a theory to anchor. The future has never been so uncertain and almost any economic theories invented decades ago has become another working white paper again. The very old ideas of management and strategy taught in b-schools are so dated and when I look at the 800+ management books I have on my bookshelf, I am guessing 80% of them are completely irrelevant (50% were irrelevant when they were first written).

Some turn to other knowledge disciplines to look for sources of inspirations. The field of business strategy borrowed heavily from industrial economics and the filed of management sciences borrowed heavily on organizational psychology. What about "Strategic Foresights?” Where can we look for anchors and new inspirations? How about mathematics?

Fuzzy logic is the branch of mathematics that says that science isn't about absolute truth; it's just a heap of guesses at a reality that's much more complicated than that. The term “Fuzzy Logic” emerged in the development of the theory of fuzzy sets by Lotfi Zadeh (1965). A fuzzy subset A of a (crisp) set X is characterized by assigning to each element x of X the degree of membership of x in A (e.g., X is a group of people, A the fuzzy set of old people in X). Now if X is a set of propositions then its elements may be assigned their degree of truth, which may be “absolutely true,” “absolutely false” or some intermediate truth degree: a proposition may be more true than another proposition.

Professor Bart Kosko (Professor of Electrical Engineering in the University of Southern California's Viterbi School of Engineering and a Professor of Engineering and Law in USC's Gould School of Law) draws out some pretty interesting applications of that theory. He lost his faith and rediscovers it in science. The fuzzy future is part bog-standard libertarianism (with a side of Reaganomics), part extropian hooting-and-hollering, part small boy reveling in the Tolstoy and Clancy school of military exchange, and part Rube Goldberg engineering of unlikely theory, all bound up in hundred of pages of inscrutable equations in the footnotes.

My teaching on 'Design Thinking" goes beyond many simple (and shallow) creative tools. Forget those three wheels of design, technology or whatever. Those are complete BS. "Design thinking" is comfortable with change, it is disruptive and provocative by nature, and promotes new ways of looking at problems, often through new lenses. The strategic framing of complex and ambiguous issues requires thinking approaches that are free from organizational dogmas, codified limitations and old assumptions.

A large part of the design thinking process is to step out of roles conventions and free oneself from these dogmas and explore new frames of thought and approaches to problem solving. I am using "Design Thinking" to push us to rethink everything from scratch, including the tools of logic itself. Most people believe creativity means there is no logic. But what is creativity anyway? Or what is design? We need to look at the world or our business or social challenges with a fuzzy prism. It is like watching 3D movies without the 3D glasses. You can never make sense of the present and the future by using conventional lenses and logic.

In a world of full of chaos, unpredictability and fuzziness we need to look at the world through a fuzzy prism. Here is what Dr. Bart Kosco has to say, "How do you upload yourself onto a chip?" The fuzziest fact of all. The problem with current schemes in theory is a binary shock, when all of a sudden you die in meat, and wake up in chip. So how do you do it consciously? We could cut out that little chunk of your brain and replace it with an equally functioning chip, maybe a more powerful chip. We could keep doing it, while you're wide-awake. So in the end, you've completely transferred to a network of chips, and your brain is a bunch of sodium chunks in a jar of formaldehyde.

For the modern enterprise to evolve, survive and even prosper in the future, any change and transformation effort cannot just be putting on bandages. There is no one single future state to map against current state. There could be a range of different strategic futures and companies need to be ready for all of those. It takes a very different kind of transformation process when the future state is unknown.

Design Thinking And Creating Social Capital. Here's An Example From Tampiquito, Mexico.

Creativity happens everywhere. Not only in design firms or creative agencies. And you can easily find the results of creativity all around you; you don’t need to seek out a gallery. People think creativity only happens in art schools and innovation don't usually happens only in a lab. Design Thinking and Strategic Creaitivty is all around us and funny enough many don't it Design Thinking. In fact, they happen more often than in a design environment. Design is not Design Thinking.

Creativity is everywhere and you need the eyes to see them. One example is PARK(ing) Day, an annual, worldwide event that invites citizens everywhere to transform metered parking spots into temporary parks for the public good. The beauty of these guerrilla installations is in their ability to engage and energize people. If all advertisers take 5% of their ad budget and use it for street installations, I think it would be a very valuable addition to their media mix. Imagine using this space for activation in creating social capital?

Meet Luis Alvarez who is an engineer by training and owns and runs a car repair shop, Autocity, in Tampiquito, Mexico. Luis also run an art gallery and an Artist-in-Residence program that aims to engage young local and international artists in projects for the development of the neighborhood’s social capital. Both the Gallery and Art Studio are located within his auto repair shop. Yes, people create art to the sounds of auto equipment and mechanics shouting, the entire process blends into a performance all its own.

It is a first for sure. And It brings me to the question, why doesn’t this happen in other spaces? In other places of business? What about shopping malls? This is one of the most creative ideas I’ve come across this year and I think Luis’ idea has legs. So far, two Artists-in-Residence projects have started up in Tampiquito. In 2009, the urban artist Eltono came to Tampiquito, stayed for two months, and painted the facades of about 50 houses in the neighborhood.

In 2010, Luis and his friends, El Narval, invited the Colombian sculptor Ana J. Haugwitz to join them. She also stayed for two months and worked together with the neighborhood’s craftsmen. The result was a collection of nine works of art, which were exhibited publicly in the neighborhood. Each work of art reflected the young artist’s collaboration with the talent she found in the workshops. I think art itself needs innovation more than anything else. It should get out of the studio and galleries and be part of our everyday lives. We can use a few more Luis in every neighborhood.

There Is An Inherent Conflict Between Logic, Emotion And Creativity. So How Should We Deal With It?

When peope ask the quesion "Do you know the correct answer?" I don't like that question at all. It is not a smart question as a start. The biggest problem with our formal education systems is our over-emphasis on finding the correct answer to a particular problem. While the quest for correct answers helps us to function at work, it also impedes us when it comes to making the bigger, more important decisions, largely because many bigger, real-life business issues are ambiguous, complex and dynamic. If you have been around for over 50 years and have travelled to more than 20 countries and speak a few languages and have a few degrees under your belt, you probably know there is no right answer, may be a lot of wrong answers.

Creativity is not a license to be wrong (you have been reading too much Fast Company), strategy is not a license to be boring or lack of imagination (Reading too much HBR). A PhD degree is not a license to overintellectualize and being irrelevant to the real world and use words that you need to explain what you mean. And an MBA is not an automatic license to make key business decision, you need to earn it.

However an MBA does teach you a few important concepts if only if you understand how to apply them. You should know how to re-org your in-laws into a 'team-based family.' You learn to refer having babies as pilot market testing. You should understand the cost structure and sytem implications of starting a family. You know the cost of capital when your spouse decided to purchase a Hermes Birkin. And most of all, you know how to talk about your past relationships as ‘sunk costs.’

I definitely school needs to teach more creativity. Not the crazy useless exercises but applied creativity and design thinking in everyday life from science to economics. Today (and I should say it has always been) creative thinking is critical to business strategy and innovation; however, If you look at the top 20 MBA programs around the world, you will be challenged to find any courses, core or elective, which teach, train or even inspire students to be truly creative. Instead, most MBA programs and courses focus on numbers, analysis and the logic of deductive reasoning.

There is an inherent conflict between this kind of logic and creativity, and in most business settings, logic is usually quick to get in the way of creativity. Creative ideas can run into the walls of business logic because 1/ it does not quickly, clearly or at all connect to 2/ business strategists often operate within the boundaries of defined roles, and decisions are made based on those boundaries – they draw on what they know and what they have learned including formulaic behaviors, processes and the “best practices” that have evolved through mass consensus – to shape how they think and act.

That explains how many MBA students had Adam Smith on their reading list. The 18th Century idea that people – given their limited time, information, resources and budgets – act purposefully to maximize their own satisfaction is epistemologically central to business thinking. In Smith’s view, all human behavior is rationally self-interested and we are innately selfish. Thanks to this model convinces many how “easy” it is to predict individual or organizational behavior. It is not quite that simple.

When it comes to human behavior, this is where many economic principles, particularly Smith’s, break down. I am not rational (ask those people who work wiht me) and many of us are not. The economist's notion that people act rationally only implies that they try to act in ways that are consistent with their own personal objectives, even if those objectives seem absurd to outsiders. That's the beauty of being human. Read more about creativity in this coming issue of M/I/S/C - The Creativity Issue.

On Building The Creative Culture And Learning How To "Forget" Creatively.

We had our Idea Couture Christmas staff part last week. Looking back there were a lot being accomplished and a lot more to do. What started as a little experiment bringing multi-disciplinary design thinkers together and now becoming a key driving force and intellectual engine advancing the practice of design thinking in innovation and business applications. Idea Couture is where multidisciplinary thinkers come together with shared purpose and where creativity flourishes. I am looking forward to have our London and Mexico City offices running in 3-6 months. I feel I have the right people in place and that's a great start.

At Idea Couture, creativity means more than just novelty ideas. It means new ways to frame problem, using new lenses and developing new perspectives. I am so happy when I see happy people in the company doing great things. I am happy to see people growing and that's gives me tremendous satisfaction.

At the end of the day, we're in the business of producing the non-conforming super smart and creative thinkers and doers. I am pushing the envelope everyday and so far no one is complaining. Heartiest thanks to my management team who did a great job of putting togther the first Idea Couture Award.  You guys rock!

On the road this week and spending time with people hearing them talk about their innovation challenges and how they apply design thinking. Lots of great meetings. We're aware of the big changes coming ahead. Every business, government and instirutions will be impacted. Change does not creep up on us every 10 or 20 years, it is an ever-present business and organization phenomenon that is disrupting industries and causing firms and industries to disappear. Although the degree and velocity of change is unprecedented.

Everyday we’re dealing with more and more unknown and unknowable, but decisions still need to be made. Many of the challenges today are unique and have few or no precedents, so textbook solutions (and no guru don’t waste time buying whatever best sellers) or trying to find aHarvard Business School case study. Past solutions do not necessarily apply today. The external environment is constantly absorbing shocks from technological advancement, cultural change and systems failure.

Creativity is needed everywhere to rethink and reimagine products, experiences, companies, processes and even industries. Top executives are looking everywhere for new thinking and solutions that are outside the routine of orthodox strategies and old paradigms. So where can you look for new ideas? And how can you design an environment in which creative people can survive, thrive and flourish? We can begin by asking, how can you make people creatively forget what they know in order to reinvent the future? This is where sensemaking comes into play.

A big part of sensemaking is creative “forgetting” and it is first thing you must do. We all create our own environments and then constrained by them. Being able to aware and realize the impact of our own behavior in creating the environment in which we’re in is a very important first step. Forget who we are is something worth practicing. There may not be any scientific evidence to suggest that those who know what to forget can think more creatively about the future, but in the formulation of business strategy, creativity can be seriously constrained if it is burdened by the past. The problem lies in the notion of “core competencies,” which suggest that companies should stick to what they know best. If that’s the case, then why many of those once great companies should still be around.

Apple Is Gearing Up To Attack The Living Room And To Turn Siri Into The Next Google?

I am exciting seeing the advance copy of M/I/S/C next issue - "The Creativity Issue". It will be in bookstores in 22 countries sometime first week of December. Now starting to work on the next one - the "Big Insight Issue". I have a few great ideas and now looking for some good guest contributors. Publising is painful but fun and thank you for those 50+ emails that compliment our effort. It is great to see that people are really liking it.

I’ve been following and speculating how Apple will be using Sirri acquisition strategically to compete in the next white space. Imagine Apple is now working on creating the next home entertainment experience, a place that is still not occupied by Microsoft?

I can’t wait for the day that I throw away every remote control that I have in my living room. First it is hopeless for me to figure out their functions and second they are ugly and don’t fit in my modern and elegant living room. What I want to see is I can just say a command and the TV or the controller will translate them and activate them.

The Siri in the living room will be different from the one on your iPhone. It will be your personal entertainment assistant and understand whether you’re in the mood of a movie, convert, news or just some soft jazz. I think this is the killer app for TV and will give Apple TV a real chance to take off. Up till now Apple TV is just a little experiment. I think we are 18 months away. There are still a lot of challenges such as bandwidth in some cases and voice recognition accuracy. May be there will be a tactile interface control or gesture-based control in additional to the voice command. The beauty is Siri doesn't need a rigid set of voice commands an able to interpret natural phrases by picking out keywords and some other cues.

And then the whole idea of “search” will bring Google into the game. It is reported that they are throwing resources into a refreshed Google TV and Apple has bought its third mapping company, beefing up its cartographic portfolio with eye-popping 3D imagery based on declassified missile-targeting technology.

Apple will be playing the same new game strategy as it did to the music industry creating an industry breakpoint. It will be a hardware, software and integration play powered by the iCloud. They still need to soft the gaming piece which Xbox and PS3 are the last defensible positions. I hope the Apple TV set will be available in black other than silver and white.

Innovation Is A Discipline Like Marketing And Finance. It Needs To Be Designed, Managed And Optimized.

I am writing about a few articles on creativity for the next issue of M/I/S/C The Creativity Issue. The editorial deadline is this week so I am now selecting the pieces that goes into this issue and art directing the design. I am still not sure what to do with the cover yet, I have a few days to think about it. May be 2 or 3. Busy week with cocktail paties and b-school alum events. Here are pictures of IC end of summer party, but arn't we just a week away from end of fall?

Creativity is an easy subject to write about but also a difficult one. Creativity is too heavily linked to novelty rather than purposeful creativity that powers up innovation and create positive and sometimes disruptive change. I am looking forward to finish writing this and move on to my day job – which is helping clients with design thinking tools, frameworks, processes and organizational design to make innovation a discipline.

The key difference between creativity and innovation is that while any idea can be an expression of creativity, it must create both customer value and economic value, and preferably social value, for it to be considered innovation. Innovation is a discipline. It is not a group of people pumping out ideas (which is the easy part); innovation is essentially the application of high creativity, applied across different disciplines from product design to marketing and channel strategy.

How can innovation be turned into a discipline? It is the discipline of getting deep customer insight;the discipline of sense making from different data sources; the discipline of managing ideas along the innovation life cycle; the discipline of capturing the imagination of customers and employees; and the discipline of managing internal resistance and stakeholder expectations.

The discipline needs to crossover with strategy, marketing, insight and product development in order to create breakthrough ideas, to fuel growth, to completely transform the ways that companies are managing themselves on the front end and the back end of their processes.

There is an interesting event Optimizing Innovation 2011 (3rd Annual Cross-Industry Event) to be held in New York City, Oct 19th and 20th. A very interesting speaker list includes Fabienne Jacquet (Director, External Innovation Global Technology at Colgate Palmolive), Pascal Mignolet (International Marketing/Intelligence Director Coffee & Tea at Sara Lee),Jorge Carbo (Senior Innovation/Project Director at Nike), Dondeena Bradley (VP, Global Design & Development at Pepsico) and Hannes Erler (VP Innovation at Swarovksi). It is a great opportunity to get to learn the secrets of success from the most experienced innovators so to put these ideas into practices. See you there.

Let's Be A Little More Creative About Creativity. And What Does Collective Creativity Means?

What is creativity? According to Wikipedia: Creativity refers to the phenomenon whereby a person creates something new (a product, a solution, a work of art, a novel, a joke, etc.) that has some kind of value. What counts as "new" may be in reference to the individual creator, or to the society or domain within which the novelty occurs. What counts as "valuable" is similarly defined in a variety of ways. BTW the above picture was taken at the annual Sausalito Art Festival just this weekend.

Scholarly interest in creativity ranges widely: Topics to which it is relevant include the relationship between creativity and general intelligence; the mental and neurological processes associated with creative activity; the relationship between personality type and creative ability; the relationship between creativity and mental health; the potential for fostering creativity through education and training, especially as augmented by technology; and the application of an individual's existing creative resources to improve the effectiveness of learning processes and of the teaching processes tailored to them.

Creativity and creative thinking are studied across many disciplines from psychology to cognitive science, art, education, philosophy, technology, theology, sociology, linguistics, business studies, and economics. As a result, there are a multitude of definitions and it all depends how you use it. What’s the motivation for people to be creative? Or people just want to be creative because they are creative? Sometimes this is the case and sometimes people are motivated by problems that need to be solved or jobs that need to get done and conventional approach is not effective.

Creativity comes in all shapes and sizes. Often we are not creative enough about what's creativity is or who is considered a 'creative' person. Sometime people can just pull an idea out from nowhere; and sometimes people scan for alternatives and quickly come to what they believe the best idea. It is sometimes a quality game and sometimes a quantity game - good idea versus lots of ideas. When creativity requires analysis and other more qualities of thinking, such as flexibility, tolerance of ambiguity or unpredictability, is that still consider creativity? Or it should be called 'Design Thinking?' Does creativity be just novel or it is not enough for it to be novel; it must have value, or be appropriate to the cognitive demands of the situation and the context.

The creative domain is basically nested in culture - the symbolic knowledge shred by a particular groups, society or by humanity as a whole (visual arts, performance art, craft-based professions etc.) and then there are gatekeepers (curators and producers). The person who involves in the act of creativity includes musicians, engineers, designers, architects, business strategists etc. But being in one of these professions, does one automatically qualify as a member of the ‘creative class?’ This one I am not sure.

Creative people have a great deal of energy; an urge to look at things differently but they also have a combination of playfulness and discipline, or responsibility and irresponsibility. The best creative people alternate between imagination and fantasy on one end, and rooted sense of reality at the other. And what about ‘collective creativity?’ We need to be more creative about what's creativity? What about creativity and co-creation', that’s a topic for another post.

'Purpose' Can Consciously And Authentically Infuse Workplace With Positive Emotive Energy Beyond Money Can Buy. There Is No Strategy Wihout 'Purpose'.

Teaching and practicing strategy is what I love. Strategy or strategic innovation is like a chess game except the chessboard keeps morphing into different shapes and there are always players entering and leaving the game. My experience is that it is subject that is undertaught in business schools and least understood in the business world. It seems like my students at CEDIM Master of Innovation Program are all having a good time. And I got a bottle of Tequila from Carolos and Michael. You need that to teach innovation I supposed.

First you cannot separate strategy from strategic innovation, competitive strategy can sustain you but cannot leapfrog others. Second strategy has a soft side, such as the putting ‘Purpose’ into the strategy equation. You cannot differentiate around something that you don’t have a heart for it.

Finding differentiation is hard enough, making sure it is relevant and sustainable is even more difficult. Putting ‘Purpose’ into it is the most difficult, you simply can’t fake it. When it comes to strategy implementation, purpose is even more important. Often you will have to make very difficult economic trade offs, without that, you will simply make those decisions based on short term economic benefits.

If Zappos did that, they would not have offered one year return policy or have their call center in India instead of Las Vegas. These all add up to the happiness indexes of Zappos which is the core of its strategy. Strategy implementation is also iterative, a process inducing various forms of individual and organizational learning, because both external threats and strategic responses are shaping these decisions on an everyday basis.

What every organization needs to achieve enduring success and power up true differentiation is ‘Purpose’. It is critical and can break the most robust strategy if there is a lack of one. It is not a mission statement or something that hangs on the wall. It is core reason for people to come to work and to mobilize all managers and employees to act consistently, responsibly and decisively. It triggers innovative thinking and trustful working relationships.

‘Purpose’ can consciously and authentically infuse workplace with positive emotive energy can impact every aspect of performance. It is the heart and soul of strategy.

Can We Really Quantify Future Innovation Opportunities? Or Is It Just A False Sense Of Predictability?

What a month, from Phoenix to Cincinnati, then New York City, then Monterrey (Mexico) to Moscow and now in London. Meetings after meetings and I don't know where I am. It is like that guy in the movie. I need to have a week sitting down and do some work. Perhaps next week. Saw my magazines in Selfrides and it is flying off the shelves everywhere. We still need to expand the distribution from the current 22 countries to 30. And getting the iPad version out. This has been a productive couple of days in London. I realized I haven't have the chance to work with Morgan for a long while. We just finished our deck for tomorrow's presentation. It is going to be a good one. And really looking forward to meet some of the people there again. Just adding a few more slides on intuition. I always love talking about this topic. And I like Morgan's Burberry shirt.

Henry Mintzberg once suggested some twenty years ago that managers need more than just analytical skills to do their jobs well; they also needed the intuitive (right brain thinking), he was right but he didn’t write a book about it. He should have.

Intuition is hard for many and good use of intuition often requires deep introspection. Chester Barnard in The Functions of the Executive (1968) suggested that managers use non-logical decision-making, which balances rational and intuitive.

“I have found it convenient and significant for practical purposes to consider these mental processes consist of two groups, which I shall call ‘non-logical’ and ‘logical’. These are not scientific classifications, but I shall ask you to keep them in your minds for the present, as I shall use them throughout this lecture. In ordinary experience the two classes of intellectual operations are not clearly separated but meld into each other. By ‘logical processes’ I mean conscious thinking which could be expressed in words or other symbols, that is, reasoning. By ‘non-logical processes’ I mean those not capable of being expressed in words or as reasoning, which is only known by judgment, decision or action."

Not that I suggest we need to start a MA degree in Strategic Intuition. Although it might attract a good number of students, I think it should be part of business school foundational teachings. I teach this at my Harvard Design Thinking Program and other in-company programs, people were excited as if they have just discovered this untapped potential. Intuition is something that should be reorganized and managed like any other element in the decision-making environment, particularly in a team environment.

The over reliance on quantitative analytics are common, numbers are very important, but it needs to be combined with other things. Often the most promising innovative ideas with long-term strategic upside are exactly those that are impossible to quantify. And they ended up being shelved.

Freek Vermeulen of London Business School just wrote a very good piece on how insisting on early quantitative validation is creating a problem. He said the reason why companies are still so eager to see numbers because the long-term, uncertain aspects of strategic investment decisions make us rather insecure whether we’d be doing the right thing; therefore, we really would like to see some numbers to lull ourselves into the belief that we’ve been thorough and have uncovered the facts and have a solid basis on which we’re accepting or rejecting the proposed course of action. Of course that’s just make-belief (you can make numbers say whatever you want them to say) and may make you quite myopic; missing the things that are difficult to quantify but just as important.

He is obviously not suggesting that we should get rid of numbers in strategy altogether. Heck no; forcing yourself to go through some sort of quantifying exercise can sometimes make you uncover and realize things that you hadn’t thought of before. He suggests that once we’ve carefully and painstakingly produced all the numbers then toss them aside and sort of make a decision based on our gut feel and experience. Very good advice.

Strategic Innovation And The Quest For Breakthrough Ideas

Innovation is now a very hot topic at the C-Suites. I have speaking a lot on the subect the last 5 years. The funny part is I am talking about Strategic Innovation and many still talk about Technology Innovation as if it was the sole source of innovation. People are very interested in my interpretation of Build-to-Last and the idea of Build-to-Fail-Fast. (Photos by Anddres Ahues)

Every large companies is thinking about it and most have little idea how to integrate that with the organization’s strategic intent; how to make it work within certain organizational structure; how to decide which project to fund; how to create a balance between reenergizing the core and attaching white space; what types of people to staff the innovation function; or simply what capabilities gap are needed to fill.

We just finished a comprehensive study of 42 top companies across 5 industries to understand what challenges and barriers that exist as well as little success stories. Generally speaking there are less success stories as we dig deeper but it is fine since they are at the early stage of the learning curve. We codified the knowledge in lessons learned as well design and implementation options as well as capabilities gap and how to fill them. It is not a 50,000 ft view but a very pragmatic understand of the situations and every company can learn from it.

The most common mistakes fell within the following:

• Focus too much on break-though ideas or staying too close to the core
• Not focus enough on creating break-through ideas and results in only incremental ideas
• Using existing (advertising and market research) vendors and infrastructures as well as toolkits that are not designed for innovation but apply them anyway and not getting the results desired.
• Fail to articulate the core purpose of innovation and how it is driven by the strategic intent and value creation
• Totally don’t understand the concept of ‘whitespace mapping’ let along the sense-making process behind it, and just called it ‘brainstorming’
• Fail to create a space that allow people to play and experiment and fail safely. A physical space that people with shared interest to play with ideas.

The idea of an innovation space is a good one. Even Microsoft has a space called Garage, a place opened last week that gives their staff access to tools such as a soldering bench, a laser cutter and a 3D printer to make prototypes and connect people with shared interest.

The Garage is in one of the oldest Microsoft buildings in campus but lots of windows. They filled the building with new "pods," basically temporary work spaces where teams of 2-6 employees can set up shop to collaborate on projects for a couple of weeks.

It is an attempt to create a safe place to fail. Fail as much as you like that and you wont get demerit points. Like all large companies, any good idea can get lost quickly because the initial market size is too small or it is threat to the core. Every company should explore having a space like this. Or they can house them in one of our offices that are even better.

The New Game Of Strategy: Applied Design Thinking In Business Innovation And Transformation

Just when I thought I can have 2 days in an office then I realized I have to be In NYC tomorrow for a few days. I am writing this post on a flight after missing my connection in Houston, and just finished teaching a three days Strategy graduate course with a focus on strategic innovation and design thinking. What I did was bringing the Harvard Business School case study method of teaching and apply it to design thinking and innovation, it is really interesting and probably an innovation itself because innovation means going against the conventional analytical thinking.

The shift from teaching competitive strategy to strategic innovation changes how the case studies were originally written for. I am using the same teaching material but instead applying atotally different pedagogical focus – which is how to avoid the very obvious and how to develop and apply ‘New Game’ in strategy making. It was intense for the students but they were liking it. I theorize, practice and teach these concepts and so for me, it is not academic, it is real.

Strategy is never that simple as picking the right competitive positioning, segments or competing on different dimensions. It is often complicated because it involves changing of mindset and mental models – mindsets that inspire individuals and teams to think imaginatively, to take risks, to seek out, and to expand the boundaries of a business or redefining customer value. It is hard.

Then there are structural, systems and processes for sharing of ideas, sense-making of data and working together. This includes developing new perspectives and collaborate on ‘white space mapping’ which was never taught at business schools. The very nature of competitive advantaged has changed and I challenged anyone who tell me if they really have a real and relevant competitive advantage that they thought they have.

The information revolution continues and is enabling companies to easily (and sometimes cheaply) match current competitive differentiators and rapidly create new ones. The result is that competitive advantage is evolving from simply focusing on differentiation, low cost or focus. The idea is to do all, the stuck in the middle can be a desirable position if you understand the underlying economic forces. Most business school students and even professors hardly understand how to apply the Five-Forces properly and let alone adapting it to a very different business environment where speed, empathy and community become key strategic elements in addition to bargaining powers and competitive dynamics. We need a new framework that takes into consideration the use of community in business strategy development. I’ve used cases including Method, Microsoft X-Box, Loco Motor and a few others to illustrate the concepts.

I think I should start developing teaching notes based on the original case study but with a different teaching emphasis. Classic views on strategy include Joseph Schumpeter focuses attention on innovation and entrepreneurialism. He suggested that bigger the company the more resources and diversification one can bring to R&D and as a result get better return on innovation. Michael Porter, following Alfred Chandler, focuses attention on business organization and competitive strategy and introduces the concept of cluster to explain competitiveness.

Today’s the nature of strategy and competitive advantage is drastically shaped by strategic innovation -- powered by customer co-creation; desire of consumer to change the status quo and powerful social innovation networks; integrates customer deep into business organization; demand chain into supply chain and contrasts inter-firm relations in terms of market, and closed or semi-closed and open-networks.

The attempt to develop competitive advantage is only the first step. It is sustaining the advantage that is far more challenging. How often companies invested millions and millions of dollars to create barriers for entry only to find out they lasted only for a short a few months. Waking up one morning seeing that your industry value chain was being reconfigured and the expiry date of your business model was last week is not exactly a fun thing. If you find that every six months you have to innovate on something the market will embrace is too exhausting, it is time to embrace design thinking.

The Economics of Co-Creation. Can What Happened To Microbrewery Happens To The Auto Industry?

A lot of talk and interest around the concept of co-creation. It is no question that this is going to have asting implications of how products and experiences are designed, developed and marketed. In 3-5 years, customer co-creation will be the part the norm of everyday business. Much like early days of ecommerce when people struggled with the legal, technical, operational issues. Slowly these issues will work their way out and we would look back and say “that’s simple…. makes perfect sese.”

What’s a great example of co-creation? Let’s first try to define it here as sometimes people refers it to anything from idea crowd-sourcing to technical expert groups to simple product/service/marketing customization. One good example of real co-creation is a company called Loco Motor.

I met Jay Rogers (founder and CEO) at the PDMA Co-creation Conference when I was moderating a panel. He was hosting the event and I was extremely impressed with what he is trying to do and has achieved to date. It is the first co-creative automobile design and purchase experience in the world. Just as the auto industry is dying for new ideas and change and Detroit needs a new strategy and it is more than making a better car. There are many structural issues to deal with and it is complicated. Jay is attempting to disrupt the auto industry by using co-creation as the strategic core.

The people in the car industry that have tried to innovate in the last 100 years and mostly fail, what makes him think he has a chance? Perhaps Detroit should concentrate on redesigning the business model and the whole experience before redesigning cars.

The first product Rally Fighter sells for just under $60,000. It’s an incredible car that looks like a life size HotWheel and gives me fond memory of my childhood. Remember the Hot Wheels yellow track?

The Rally Fighter is designed by the online community and ismanufacture at the microfactory in Phoenix, Arizona with a sustainable and highly efficient process. Jay wanted to build cars all his life, after raising $10 million seed capital, he launched the company with a simple idea that is extremely difficult to pull off. Loco Motors hosts a passionate online group of car-lovers or fanatics who compete to design vehicles for some regional communities in contests that run about once a month. The winning designs is then produced and sold to the communities.

There is more than to the flexible and customizable micro-factory, the concept here is when you give people tools, a strong community network with shared passion, some inspiration, small incentive you are in game. In fact, he is reinventing the customer co-creation experience for automotive. There are more than needs to be done in order to reinvent the economics of the industry. I think every business should look at Loco Motots and see what is relevant for their industries.

Will Loco Motors remains to be a niche business or eventually springing into a platform that supports a auto-cottage industries I don’t know. But we also need to think how we reduce traffic including rethinking local supplies network for certain products and cutting down unnecessary traffic.

An example is to look at how we replace pizza or UPS delivery with perhaps flying delivery drones – pizza right through to your windows. I am not sure if someone has thought about flying delivery drones man by 14 year old part-time students that doesn’t even have a driving license. The military drones can be converted to do the job. It is more realistic than flying personal transport, because in the event of an accident the worst is you don’t get your pizza. May be this is another idea of Jay, his Marine Corps background can be very useful. A central drone delivery operations theater that supports the nation’s takeout industry.