Innovation – BMNP Strategies

Overcoming challenges to creativity and innovation

The creativity needed to come up with innovative new ideas relies on novel connections being made in our brains, and on people having the courage to share their ideas with others. Think of it as depending two types of connections: first within the individual brain, and second between many brains within the organization and even beyond organizational boundaries. Both types of connection can be surprisingly hard to make in the face of individual and organizational challenges. Understanding how the human brain handles creativity will help you to overcome these challenges.

The following is an extract from Chapter 4 of my book, Innovation for Value and Mission – An Introduction to Innovation Management and Policy, published by De Gruyter Brill.

Creativity and the Human Brain

Creativity in business has been much in vogue the last couple of decades. No doubt it is partly influenced by the ascendancy and prevalence of the design-thinking movement since the turn of the century, and the importance which creativity has in that process. But it is perhaps also because there is a belief that human creativity is now better understood and, therefore, can be more easily marshalled. Advances in neuroscience, largely enabled by new brain-imaging technology and accompanying popular media articles touting insights into the workings of the brain, have put creativity on the business agenda. Almost every month, the Harvard Business Review publishes some piece that has creativity in the title or subtitle. Some of the neurological-research insights (Waytz and Mason, 2013) that have made their way into the management lexicon are:

The value of unfocused free time for coming up with breakthrough insights. For example, Google reportedly allows engineers to work 20 percent of their time on anything they want.
The effectiveness of nonfinancial incentives and rewards, such as praise and recognition, and intrinsically interesting work in stimulating innovation.
The potential usefulness of hunches and emotional impulses in decision-making, which makes them worth exploring instead of outright dismissing them as subjective.
The importance of focusing on one task at hand rather than multitasking (juggling multiple activities and objectives).

Creativity and the Human Brain

The value of unfocused free time for coming up with breakthrough insights. For example, Google reportedly allows engineers to work 20 percent of their time on anything they want.

The effectiveness of nonfinancial incentives and rewards, such as praise and recognition, and intrinsically interesting work in stimulating innovation.

The potential usefulness of hunches and emotional impulses in decision-making, which makes them worth exploring instead of outright dismissing them as subjective.

The importance of focusing on one task at hand rather than multitasking (juggling multiple activities and objectives).

Much lip service is paid to the importance of creativity in business. Creativity is, of course, an important element of innovation, and the business media love to feature stories about creativity and innovation. But in reality, there is a deep built-in reluctance in organizations to be truly creative and innovative. Indeed, we have all experienced how people can resist creative and novel ideas. Most of us have likely done it ourselves when we said, “That is a good idea, but here is why it won’t work.”

Despite the value that people seem to attach to creativity, they also have a paradoxical tendency to reject creative ideas. Research has shown that people associate creativity and novelty with uncertainty, and that a negative bias against creativity occurs when uncertainty is perceived, interfering with their ability to properly judge the creative idea offered (Mueller, Melwani, and Goncalo, 2012). In addition, people also implicitly associate what is proven with what is practical. If something has already been done, it is considered practical. If something has never been done, it is considered impractical. These two associations – creativity with uncertainty and unproven with impractical – together explain why new ideas are often rejected. Managers who would like to encourage creativity need to find ways of helping their team members to cope with the anxieties associated with uncertainty and doing things in new ways.

In the last decade, there were close to a thousand published studies on the neuroscience of creativity. Such studies typically rely on accessing the creative task performance of test subjects by means of brain imaging technologies such as functional magnetic resonance imaging (fMRI) and electroencephalography (EEG). These imaging technologies still impose major experimental constraints – for example, requiring subjects to lie down while they think creative thoughts. Nevertheless, these have proven to be powerful tools and neuroscience researchers have gained a deeper understanding of what it takes to put the brain into a creative mode for the purposes of innovating as neuroscience researchers. Neuroscientists Andreas Fink and Mathias Benedek (2019) explain the mental process of innovation as follows: “For example, envisioning possible improvements to products, requires memory processes to build novel representations of these products, sustained internally-oriented attention to guide active imagination, and vigorous executive control to realize effective and useful task solutions by evaluating/elaborating preliminary thinking results, and by inhibiting prepotent/conventional responses.” (Fink and Benedek 2019, 3)

In simple terms, this means that would-be innovators can get more creative about their product offerings if they frame these offerings in new and different ways, employ techniques that guide their creative thinking, and constantly guard against jumping to conventional solutions.

An important insight about the human brain is that it often optimizes for efficiency, which in many instances is the enemy of creativity. The human brain comprises only about 2 percent of body weight but uses 20 percent of energy consumed while the body is at rest. Researchers estimate that the human brain has about 86 billion neurons. For comparison, a cat’s brain has only 250 million neurons and a chimpanzee, 7 billion (Cherry, 2020). Regardless of its exact number of neurons, the human brain is clearly a marvelous organ capable of outstanding intellectual feats at higher efficiencies than any current computer can approach. But even so, it is subject to constraints imposed by its size and energy-consumption budget.

About two thirds of the brain’s energy is used to help neurons (or nerve cells) fire or send signals; the remaining third is used for housekeeping (Swaminathan, 2008). In its attempt to avoid wasteful thinking that consumes unnecessary energy, the brain takes shortcuts and makes assumptions all the time. An eerie insight from contemporary neuroscience is that what we perceive as our conscious reality is actually a type of elaborate virtual-reality simulation (some call it a “controlled hallucination”) constructed by our brains. Perception is a series of guesses by the brain, a reconstruction of reality. Put another way, perception is not a window on reality as it is, but more like a 3D desktop on a computer that is designed to hide the complexity of the real world and guide our adaptive behavior (Seth, 2021). We literally live our entire lives in a virtual reality created by our brains. If the brain gets it more or less right, this virtual reality is useful to us. If it doesn’t, we can make surprisingly big errors in judgement. Stage magicians have always understood this instinctively, which is how they manage to trick their audience by distracting them and making the audience “see” only what the magician wants them to see.

Breaking Barriers to Creativity

The more you know about a topic, the more your brain’s efficiency will become a barrier to seeing things differently. Experts can be the most intransigent and resistant to innovation because they have such strongly formed and well-practiced constructions of what they believe to be the correct reality. Experts feel that they have “seen it all before” and tend to think they already know the answers. They are also fond of conventions – well-established ways of doing things – because their conventions have served them well across their careers: “It’s just the way we do things.” Shortcuts are closely related – they are quicker and more efficient ways of doing things that people have done before, typically many times. Shortcuts are efficient, and therefore useful. However, when people take shortcuts, they are not fully applying their minds.

Young children are more disposed to creativity than most adults. As we further our education, we are trained well in asking the “What,” “Why,” and “How” questions. But we stop asking one question that young children ask all the time: “What If?” For example, “What if I could fly?”, “What if I could make myself invisible?” or “What if my dog/cat/teddy bear could talk?” “What If” questions have the marvelous ability to transport us from the familiar world of what is to the unfamiliar world of what could be. For adults to become creative again, they need to revive their childlike ability to ask “What If” questions.

In order to get well-trained brains out of conventional mode and into creative, innovative mode, they need to be jolted. Such jolts come in a couple of categories, but they both involve perception – what people perceive. Changing perspective to look at the same things in new and different ways is one way to jolt the brain out of the rut it is in. Techniques include leaving the office to spend a day in the customer’s shoes. Another way to jolt the brain is to present it with a strong dose of new information – strong in the sense of almost overwhelming it. That is why it is said the travel broadens the mind. Indeed, going on a trip to a place where things are done to different rules can deliver an inspirational jolt to the brain.

Coming up with creative ideas is only one half of the battle. The other half is to overcome the organizational resistance that creative ideas encounter all too often and that kills them in their infancy. While people like to think of themselves as open-minded and welcoming of creativity, they often resist creative ideas when these are actually presented to them. This bias against creativity has been confirmed in psychological studies and shown to be closely associated with the human desire to reduce uncertainty (Mueller, Melwani, and Goncalo, 2012). The bias against creativity is not overt, which makes it tricky to address. It lurks in the background, interfering with our ability to recognize the value of a creative idea.

Much of our resistance comes from our inability to see novel ideas as practical – we have a strong association between proven and practical and conversely, a strong association between novel and impractical. Indeed, innovators are often told by naysayers that while their idea is certainly novel and deserves to be applauded for its originality, it is unfortunately not practical and cannot be implemented successfully.

There is a social norm that requires us to value creativity, so people hide their opposition to creative ideas. They cloak their objections in other terms; with concerns about the lack of practicality of the novel solution being the most frequent tactic. This poses a great contradiction: Organizations say they want creative solutions, but frequently reject creative ideas when they are presented. Innovators need to pay just as much attention to getting organizational buy-in for their ideas as coming up with the ideas in the first place.

Good News for Frustrated Creators

The good news is that any individual, or any team, can be creative. It does not require special talent or innate abilities. Fairly simple techniques can unleash creativity in people at all levels of seniority, from the most senior executives to entry-level workers. In order to unleash the creativity of a team, people first need to be given permission to be creative. That may require a special occasion and a safe space, as well as an introductory talk by a senior leader telling them that the organization needs their creativity to solve real and valuable problems. Then, people need to be taught and walked through some creative exercises, ideally by a facilitator who has experience with the exercises and can help keep the session on track when people get stuck or veer off on a tangent, which will inevitably happen.

There are an almost infinite variety of creativity techniques, some more suitable for some types of problems and situations than others. In the next section of Chapter 4 of Innovation for Value and Mission, a few types of proven techniques are introduced and the principles behind them explained. The creativity techniques discussed include overthrowing orthodoxies, constructing analogies, thinking like the customer, and imposing constraints.

As with anything new and worth doing, the best way is to avoid analysis-paralysis and just make a start: Try something on a small scale, learn from the experience, and keep building your individual and organizational muscles so that you get stronger and better at creativity and innovation all the time. Anyone can be creative (again), it simply requires relearning what you could do when you were four years old!

This article was originally posted by the author on LinkedIn.

The hidden beauty of hitting singles – how modest new product development can quickly pay off

A company with an ageing product line doesn’t have to choose between a major new product development project that it may not be able to afford, or doing nothing. Incremental product improvements that can dramatically improve sales can often be completed within months and on a small budget, at relatively low risk.

Many small or medium companies (SMEs) were built on a few – sometimes only one – core products. Typically the founders started with a particular market segment that they understood well, and then developed an offering that met a clear need in that segment. Over time, the company expanded its geographical reach, and increased the number of product flavors, without necessarily developing any truly new product. Sometimes they acquired another small company to add an adjacent product line, or to enlarge their geographical footprint.

These companies have longevity because they are usually good at application engineering and customer service, which forge deep customer relationships yielding a reliable stream of repeat business. They maintain a healthy base of loyal customers whom they know really well. If they also sell to the retail market, they may have a couple of major retailers with whom they have long-standing relationships. Each year, the company is virtually guaranteed 90 percent or more of the previous year’s revenue as long as they just keep doing what they are doing. Gross margins are usually quite healthy.

The problem is that nothing lasts forever. Even long product life cycles come to an end eventually. A decline in the size of the customer segment, new technologies, changing customer needs, regulatory changes, and new entrants can all exert downward pressure on revenues and profits. These declines may be almost imperceptible at first, and too easily ascribed to random events, individual personalities or bad luck. But before too long a pattern of decline emerges. And a slow-motion death spiral is still a death spiral. Or more prosaically, from the dialogue in Ernest Hemingway’s novel, The Sun Also Rises: “How did you go bankrupt?” “Two ways. Gradually, then suddenly.”

Faced with a decline in their traditional business, companies too often make one of two mistakes: They try to hit a home run by developing a revolutionary new product. But an organization that has not done any major innovations in years, sometimes decades, may not have the institutional muscle memory and capabilities to succeed in such an endeavor. Expensive, reputation-damaging mistakes are made, putting the survival of the company in even larger jeopardy. The second mistake is to do nothing, and keep milking the cow for as long as possible. Why would a company do nothing? Sometimes the original owner is close to retirement, or the owners are planning to sell the company. Other times they are simply in denial.

Some years ago, I arrived at an industrial products company that were in the process of making the first mistake. Limitations with their current products had started to lose them sales to the competition. So they set out to develop a highly ambitious, industry-leading new product. Under pressure to create excitement among their clients, they made the additional mistake of marketing the new product before they had been able to make the technology work. Their engineering team front-loaded work on the flashy user-interface so they could demonstrate it, neglecting to do a proper proof-of-concept on the guts of the product, which was a technically very demanding application. The development project went on for two years and missed all its important milestones. The product technology was failing miserably because the architecture was overly complicated, designed by tenured company engineers who were not familiar with the latest processor technologies. In the end, the product launch had to be cancelled, and the lead engineer was duly fired.

As you can imagine, many painfully embarrassing conversations with customers and distributors followed in the wake of this disaster. However, in talking to them, it became clear that while they were not satisfied with the old product, in 80 percent or more of cases they were only looking for one additional important feature called for in new regulations and already offered by the competition. The company’s technical team had falsely assumed that they could not add that feature without designing a completely new product (to which they then wanted to add all sorts of bells and whistle). But it turned out that there was a low-cost chip on the market that could be easily be integrated with the existing design to add the desired feature. I helped them to build, qualify and launch the improved product in only three months. This was all done on a shoe-string budget. The customers were very satisfied with the product and sales rebounded. The company’s product kit was beloved by customers because it was always easier to install than the competition, and with that crucial new feature added customers could go back to buying their preferred product from their preferred vendor. We then set about to add the next new feature, which would further update the product and extend its life cycle.

Sometimes SMEs with well-established product lines, good cash flow, and latent potential for revenue and profitability improvements, are bought by investors like private equity companies. These investors then typically launch aggressive operational and sales effectiveness programs to increase the value of the company in a short period of time. But investors leave money on the table if they do not pursue incremental product improvements that can rejuvenate stale product line-ups. They may even be flogging a dead horse – sales effectiveness initiatives can only go so far in improving sales if the product is losing its appeal. In doing so, they overlook that carefully selected product-line improvements can be completed within about the same time scale as their other value-driving programs.

Here is where to find opportunities for incremental product improvements:

Missing features. In which cases did we lose sales because our competition offered features or specifications that we could not match? (Or maybe we only won after heavily discounting our product to win against to a superior competitive product.) Are there recent or future regulatory changes to specifications that can make our product less desirable?
Adjacent market opportunities. In what similar markets could our products be used with minor modifications or upgrades?
Cost savings opportunities. Is our product cost too high compared to the competition? Are our gross margins always under pressure? (A desired margin improvement of 10 percent or more usually requires some product redesign.)
New technologies. Is the market moving on to new technologies? For instance, do we need to enable our products for the Internet of Things (IoT) by adding new components and digital communication?
Competitors. What product updates have our competitors recently made, or are in the process of making? What do we see at trade shows that we don’t, but maybe should, have?

Whether you are the owner or senior management, the strategy you choose to rejuvenate your product lineup is crucially important, and you have to be realistic about the capabilities of your organization. If you start too ambitiously, by wildly swinging for the fences, the odds are that you will miss and get caught out or struck out. But if you go for hitting singles instead, you can dramatically reduce your cost, risks and time to market. And while you are doing that, you are also building up new competencies that enable you to take on gradually more ambitious projects. The product development muscles of your organization get stronger every time you successfully launch a new product, or do even a small enhancement to your current product.

This article was originally posted by the author on LinkedIn.

How to get good ideas from your team members

A culture of innovation needs a flourishing democracy of ideas. This means that in an organization everyone’s ideas should be valued.. and welcomed. However, it is surprising how often leaders miss out on opportunities to tap their team members for ideas. A few simple actions are all it takes to tap into your most precious resource, the creativity of your team members.

There are three types of ideas you can, and should, get from your team. Each require a slightly different technique to gather.

Type 1 – Spontaneous individual ideas

We continuously have experiences which spur ideas to pop up in our heads. At work such ideas may include seeing potential solutions to problems in our daily tasks (efficiency or process-improvement ideas), or thinking of better ways to bring value to our customers (product or service innovation ideas), or maybe better ways for people in the organization to work together (organizational improvement ideas). The problem is that so many good ideas stay in the head of the person who had them, with no benefit to their organization. This is a shame, and a waste.

Each person is a unique individual with a unique mind, life experience and perspective on the world. So even if you have 100 people in a factory doing exactly the same basic job, you will be surprised at the diversity of thoughts they have about the tasks they do. And, in many cases, simply asking people close to the action what they think about a particular issue or challenge may yield you extremely helpful ideas on how to solve it.

Senior people – who usually have no problem making themselves heard on any topic – too often do not appreciate that more junior people may be reluctant to speak up and share their ideas. But there are many reasons why people hold back: they could be shy, overly deferential, risk averse, or simply feel unqualified to provide input. Sometimes it is a cultural constraint, and sometimes there are language barriers.

Therefore leaders have to create an environment where it is clear to everyone that their ideas are not only permitted, but welcomed. Nothing can replace the one-on-one personal conversation for teasing out Type 1 ideas. And none of this needs to be complicated. Simply walk around, stop at someone’s workstation and chat, keeping your ears open for his or her ideas. You’ll be pleasantly surprised!

Type 2 – Solicited individual ideas

You can also spur ideas from your team members by directly asking for the type of ideas you are looking for at that point in time. The effective way to do this is to frame the issue or opportunity you want ideas for, clarify any constraints they have to take into account, and explicitly communicate any commonly assumed constraints that may be ignored or relaxed.

You can do this informally at a small meeting, or more formally as part of a large organizational initiative like an innovation competition of an efficiency campaign. Articulate a challenge in simple terms, e.g. “How may we reduce our customization process in production from four weeks to three weeks?” and encourage individual participation through a good communications campaign. Give visible rewards and recognition, not only for the winning ideas, but also for the most original idea, the most prolific proposer and so on. People like their contributions to be recognized and appreciated.

Additional ways that you can help people to get out of the rut of their routine thinking include exposing them to new environments and stimuli, like a field visit.

Type 3 – Collaborative interactive ideas

Putting many heads together is the most powerful way of gathering new ideas. Sadly, most organizations are not good at managing the process of collaborative idea generation, which is why they often need to rely on external facilitators like me to manage the group interaction.

The fatal mistake to avoid with any type of brainstorming, is to evaluate ideas as they are raised: If the idea seems good, the group will stop too soon and declare victory. And so they miss out on better ideas that would have come later in the process. If the idea seems bad or crazy, it will be rejected out of hand particularly if there is a strong hierarchy or peer pressure in the group. The inevitable result will be incrementalism – with nothing new really being proposed.

Another mistake is stopping the idea generation process too soon, when the first batch of ideas seems to be drying up, the room becomes quiet, and people look like they want to move on. Research has shown that the best ideas often come on the other side of this plateau, just like when you are trying to break through a barrier in athletic training.

There are many good brainstorming techniques available. Some are better for certain situations than others. But they all have one thing in common: that people should build on one another’s ideas, so that the winning idea is one that no one would have thought about on their own. That way my crazy, impractical idea makes Tom think of an unusual, but more promising idea he would not otherwise have considered, and when Tom mentions his intriguing new idea, it gives Sally’s thinking a jolt so she comes up with the brilliant winning idea.

And, of course, you are more likely to get a diversity of ideas when you have a diverse group of people, representing multiple functions, groups, levels, and viewpoints together for any collaborative idea generation exercise.

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In summary, here’s a simple guide to making sure you make the best use of all your people’s good ideas:

1. Type 1 ideas – Walk around, ask open-ended questions and listen

2. Type 2 ideas – Define the challenge to solve in simple terms, and ask everyone for their ideas

3. Type 3 ideas – Orchestrate one or more collaborative idea sessions, invite a diversity of people, and have rules of order that ban premature evaluation of ideas

Lastly, and very importantly, rather than just gathering ideas you have to be seen to act on them and implement one or more of the ideas generated. Not only is that the only way to actually get stuff done, but soliciting ideas which are never brought to fruition is an idea inhibitor in itself.

This article was originality posted by the author on LinkedIn.