Research Paper
Unleashing
Creativity and Innovation
The Proven Path to Revenue and Profit Growth
Madan Birla
When business leaders are asked what their companies need to
succeed in today’s highly competitive global environment, innovation is
always at or near the top of their list. Ask them why and they’ll tell you
something like the following which is a distillation of the answers I’ve
received:
In today’s economy there is no such thing as a sustainable
competitive advantage. We must tap into the creative potential of each employee
and harness it to create an innovation culture.…
For us to achieve our top line and bottom line targets we have to
innovate.
We can’t continue to do business the way we have been doing It.…To continue to
grow we have to outthink and outperform the competition. To have a competitive
edge we must have an
innovation edge.
If innovation is so critical to success and so many business
leaders know it, then why are there so few innovative companies and so many
mediocre, me-too products and services? Why in most organizations is
“innovation” nothing more than a buzzword?
People know that innovation is about doing something new or about doing
something old in new ways and there’s a vague sense that it’s related to
creativity. We’re all comfortable with the notion of creativity in an artistic
sense – Picasso forever changing the face of painting by seeing the world in
new ways and the Beatles mixing the sounds of the English Music Hall with the
beats of American rock and roll to create exciting new music, but what does it
mean to be creative at work in an organization that’s got to satisfy customers
and please shareholders?
Creativity in a business context is very much like artistic creativity but instead of seeing or hearing things in new ways, it’s thinking about the organization – its mission, products or services, customers, and processes – in new ways. It’s the process of
generating ideas that will help the organization become more competitive in the marketplace by improving the customer experience, product design or market positioning and making the operation run more efficiently. Creative business people keep asking “What if…?” not as an intellectual exercise, but for the purpose of creating and keeping customers.
“What if” we target wholesale customers instead of retail customers? “What if” we redesign our products so they appeal to women as much as to men? “What if” we reorganize our supply chain by manufacturing only what’s been ordered and shipping to our customers directly from our factories? Creative artists don’t repeat themselves and constantly push the envelope.
Walt Disney, asked “What if there was a place where kids and adults could play together”, Sam Walton, the founder of Wal-Mart, asked “What if we connect the cash register to our inventory planning and fulfillment systems so we always have what customers want and can offer it at a competitive price?” and Fred Smith, the founder and still CEO of FedEx, asked, “What if we use a hub and spokes system like the one that’s used to clear checks, so that all shipments would arrive late at night in a central location, sorted and then flown to their ultimate destinations before most people even wake up?” The innovation that started with these questions revolutionized their respective businesses and forever changed the way the world plays, shops, and works. All of us have natural creative potential and we all play important roles in the innovation process.
Asking “what if” questions often involves making connections between seemingly unrelated ideas or variables such as when Fred Smith wondered whether packages could be shipped in much the same way that checks used to be cleared. Let’s visualize this process concretely as connecting dots, with the dots representing all kinds of ideas or variables. Some of the variables are logically or thematically related; others seem quite unrelated to each other. The most creative notions link variables that at first blush don’t seem related. Yet when those connections work they really pay off.
Here are the four prerequisites for being able to connect the dots in creative or productive ways.
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More Dots (Knowledge & Experience) – means expanding your knowledge and experience base by reading widely, taking courses on and off the job, keeping your eyes and ears open wherever you are, and seeking out friends and associates who are different from you in a variety of ways. When faced with a problem, challenge or opportunity, our neurons first travel along familiar paths making connections they have made before. Sometimes a new connection will work but if those dots represent knowledge that is old or limited to a very small part of the total business process, even new connections are bound to be inadequate. That’s why we must all continue to learn.
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Imagination – Connecting dots in new and different ways is more of an imaginative or intuitive process than a rational and analytic one. It involves temporarily letting go of preconceived notions and allowing the mind to wander until new and unexpected connections are made.
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Nominal-Stress (Creative Tension) – Strings on a violin need the right amount of tension to produce music. Similarly, the mind needs a certain amount of creative tension, to engage in “What if…?” thinking and help us connect the dots in new and imaginative ways. But when we’re under too much stress, we’re more concerned about surviving than creating.
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Time – Since creativity involves expanding our knowledge base and allowing our mind to wander in unpredictable ways, we need time for those activities. We need time to explore “what-ifs” before we lock into “how-to.”
What can leaders do to unleash creativity? Leaders can grow the knowledge base (more dots). Ultimately, every person is responsible for his or her own personal growth but there are plenty of things that leaders can do to encourage their employees to grow cognitively and creatively. First, they can lead by example. They can read voraciously, take advantage of whatever training opportunities the company provides, attend classes at local colleges, enroll in online classes, and most important of all, share some of the things they’re learning with their colleagues informally and during meetings held especially for that purpose. What’s more, they can post schedules and course descriptions on department bulletin boards, disseminate such information in e-mail distributions, and encourage employees to take advantage of whatever tuition reimbursement programs their company may have.
Another thing that leaders can do to promote cognitive and creative growth is to keep finding new ways to remind their employees about their company’s customer value proposition, its goals, its strategies and tactics for achieving them. They can also education their employees about the immediate, mid- and long-term competitive threats, and whatever other changes in the external environment (e.g., demographic, technological and economic changes) may be helping or hindering their company. This is precisely the kind of information employees need to generate creative ideas that will keep their company moving forward faster than its competitors.
To cultivate the imagination we have to strengthen the right side of our brain which is where holistic, intuitive, subjective, aesthetic, random, synthesizing, and creative processes are said to originate. We’ll have to use the right side to come up with techniques, activities and exercises to strengthen that very side of the brain.
Here’s an example of one technique, using analogies that has helped FedEx employees understand their company’s mission. When you walk into the executive offices at FedEx, you’ll see beautiful, highly detailed models of clipper ships, the fast, narrow sailing vessels that were ideally suited to carrying low-volume, high-profit goods, such as spices, tea, silk, people, and mail during the middle of the 19th century. If you were to askFred Smith why those models were there, he would tell you that just as those fast ships revolutionized international commerce during the middle of the 19th century; FedEx is revolutionizing commerce today by connecting buyers and sellers of high value-added goods all over the world in a day or two. In other words, FedEx is the clipper ship of the computer age. What a graphic and concise way to characterize FedEx’s mission!
Typically senior management would say we need to innovate. That leaves people wondering what they really need to do. Setting up an improvement goal for the ‘Customer value/Total Customer Experience’ that the group directly impacts gives the group an innovation goal to work on. This produces Nominal-Stress, (creative tension) and focuses everyone’s direct line of sight to customers and aligns the entire organization around creating value for the customers.
We need time to think creatively. If we’re busy fighting fires all day or going from one meeting to another, we’ll lose sight of the big picture. Chances are we won’t be able to ponder new and different ideas. We need a balance between doing and thinking so that we can explore. For example, Google has recognized and dealt with this need by not just encouraging, but requiring its engineers to spend at least 20% of their time on their own ideas, on projects that may have nothing to do with the company’s formal agenda. Some would say that only a phenomenally successful company like that could afford such a policy. Insiders claim that the policy, itself, is responsible for much of the company’s success.
The creativity of generating ideas by exploring “what if” scenarios is just the start of the three step innovation process. As Rosabeth Moss Kanter says in her landmark book, The Change Masters, beyond generating creative ideas, innovation also includes acceptance and implementation of the creative ideas. In other words, it is applied creativity that requires the involvement of an increasing number of people as we move through the three-step process. Individuals need to be able to freely generate creative ideas, then a smaller group from a department and disciplines bound to be affected by the ideas, accepts them and works collaboratively to develop and refine them so that the end result is a sound business plan. Then finally, a much larger group, in some cases the whole organization, adopts the developed ideas and works to successfully implement them.
From the Author
It took a lot more than asking those “What if…?” questions to make FedEx one of the world’s preeminent transportation companies, but everything started with them. It was my good fortune to join FedEx relatively early in the game where I was able to use my engineering, logistics and leadership skills to help the company greatly expand its reach to customers all over the world. I cashed in a few stock options six years ago to share what I had learned about business creativity and innovation. That’s why I wrote FedEx Delivers: How the World’s Leading Shipping Company Keeps Innovating and Outperforming the Competition. The translation of the book in seven foreign languages shows the need and interest in innovation around the world. This document has summarized key concepts however, also important to successful implementation is knowing the 5 Most Common Roadblocks, 5 Dimensions of an Innovative Team and How to Gain Acceptance of Your Creative Ideas that is shared in the Unleashing Creativity & Innovation workshop and covered in detail within my book. I encourage you to visit
www.innovationculture.com.
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