Wednesday, September 24, 2014

Innovation needs more than the Internet

It's common today to talk about globalisation and how the Internet helps to overcome geographical constraints. However, it's easy to overlook the impact face-to-face human interaction has on creativity and innovation. My research on creativity in business with teams has shown me the stark contrast in creative outcomes when teams collaborate successfully.

Professor Adam Jaffe, Director of the Wellington-based Motu Economic and Public Policy Research, believes the answer is "to build an innovation system that encourages people to work collaboratively." He believes that the information available online is less important and less valuable because it tends to concern things that are easy to codify and to standardise. That which is tricky, complex and subtle, and which requires tacit knowledge that is hard to communicate, is best handled by individual human interactions. (Jaffe, 2014)

Start your own innovation system – head down to your nearest cafe with a few colleagues and start collaborating!

Sunday, September 21, 2014

The 7 traits of effective digital enterprises

Tunde Olanrewaju and colleagues at McKinsey's London office recently published an article with this intriguing title (McKinsey, 2014). Titles like that always make me wonder, is there some secret or new tech among those 7 traits? In this case, the answer is no. Not only is there no secret, each of the traits the authors identify are simple truths that by themselves could be overlooked but together point to success!

Monday, September 8, 2014

The new digital economy

Oxford Economics, in their excellent report 'The New Digital Economy' (2011) gave early warning of the potential demise of top-down management when they said, "Traditional hierarchical decision-making is too slow for the realities of the new digital market." (p23). The reality they speak of is the need to make decisions in real time to stay ahead of the game. Not such an issue for me in my small consulting business as I am the principle customer interface; but for a company with multiple layers of management, how far removed is decision-making from the frontline?

Of course, in order to make decisions you also need access to the right information. For me – it's in my head – but what happens if I'm a decision-maker in a large company? Is the 'intelligence" you're paying me a lot of money for accessible to anyone who needs it in real time? In a strategy meeting with one of my clients, the GM complained that their problem was that their "assets" went home at 5pm. In other words the company didn't have an intelligence system that allowed critical knowledge to be shared with others.

The solution sounds easy:
  1. Enable people at all levels to make real-time decisions, and
  2. Provide access to the "intelligence" necessary to make those decisions.
I know many will say that doing this exposes a company to unacceptable risk, but surely managing risk is what management is all about?  

Sunday, September 7, 2014

Has your business got a creativity gap?

I was rereading Adobe's State of Create study (2012) today and was struck by how much of a "creativity gap" there is. 80% of people surveyed agreed that creativity is key to driving economic growth, yet only 1 in 4 people feel that they are living up to their creative potential. The problem, it seems, is that there is increasing pressure to be productive rather than creative at work.

This stems from the risk averse nature of many businesses. When the going gets tough we tend to become more introspective, focusing on squeezing more out of what we're doing now rather than thinking creatively about what else we could be doing.

When thinking about your strategy consider the Opportunity cost of every decision you make – yes, you might be able to squeeze an extra 2% out of what you are doing now but that might mean you miss the opportunity to get a 20% lift by doing some thing different.

Saturday, September 6, 2014

Talk and creativity

Carmaker, Carlos Ghosn, said in the McKinsey Quarterly (2012), "Business schools may prepare people to deal with internal crises. But I think we need to be more prepared for external crises, where it’s not the strategy of the company that is in question; it’s the ability of leaders to figure out how to adapt that strategy."

Carlos goes on to say that at Nissan they respond quickly to crises because they don't wait for solutions to problems to come from headquarters, they instead take advantage of their diverse, multinational culture and encourage their people to talk. I believe that in many businesses talk has been replaced by electronic communications. While that may be an efficient way to share information, it's not a good way to encourage people to find solutions. I've found that the most creative ideas come from vigorous discussion where multiple viewpoints are considered – why not establish regular opportunities for this type of interaction to occur (in multiple formats) and take advantage of Nissan's experience. As Ghosn says, "We are accustomed to always looking around, trying to find out who has the best ideas."

Friday, September 5, 2014

Give them facetime anytime

According to trends website www.trendwatching.com, last year 66% of consumers switched brands due to poor customer service. And if that's not bad enough,  82% of those said the brand could have done something to stop them. In a competitive marketplace it's hard enough to win a customer in the first place which means its unforgiveable to lose them unnecessarily.

I blame technology. While it has simplified many customer service processes, in some case it has taken out the human element to the extent that it is actually harder for the customer to get what they need. Plus humans have the ability (if trained and supported) to make decisions on the spot before small problems turn into big ones that cause customers to flee.

When re-engineering your processes make sure you identify the touchpoints where human interaction can add value, and then provide it. As the folks at Trendwatching say  - "give them facetime anytime". I loved their example of this strategy in action: "US insurance company Esurance now allows webcam-enabled accident appraisal via smartphone". Now that's an example of creative thinking at its best!

Thursday, September 4, 2014

Time to change our thinking about competitive advantage

Rita McGrath (2013), in her book, The End of Competitive Advantage, introduces the concept of transient advantage. Professor McGrath suggests that in today's fast evolving marketplace long-term advantage is no longer a realistic goal for most organisations. Instead she recommends companies create a portfolio of transient advantages by making eight shifts in the way they operate.
Those shifts are:
  1. Focus on arenas, not industries - competitive threats are very likely to come from outside your industry.
  2. Set broad themes and let people experiment - many creative minds on constant alert.
  3. Foster innovation by setting appropriate metrics - accept that sometimes you'll get it wrong (something that traditional metrics tend to punish).
  4. Focus on customer experiences - they'll help you find solutions to problems.
  5. Build strong relationships - they'll help you through the tough times.
  6. Avoid brutal restructuring - it might make financial sense in the short term bu could harm your core competencies in the process.
  7. Get systematic an early stage innovation.
  8. Experiment, iterate and learn - by creating a learning organisation you can take advantage of knowledge that is often lost.

Does Socrates have a place in business today?

In today’s hypercompetitive business environment there is an air of constant change as companies scurry to catch up to, or retain relativity with, their respective competitors. Often they must achieve this with fewer resources. The speed of this change means that companies “must become learning organizations; places in which everyone learns to do things better in an age of uncertainty.” (Sonnenberg and Goldberg 2007, 54). While the authors mention a number of different approaches, they highlight the Socratic Method as being one of the best options.

Socrates famous Method is explained by Kachaner and Deimler (2008, 41) as the “practice of asking the ‘right’ questions to stimulate thinking.” They say that companies who do, end up with a higher level of engagement and ownership of issues. Skordoulis & Dawson (2007) agree saying that this process is particularly useful in times of change where the status quo is being challenged.

After reviewing the research in this area I developed and tested a model based on the Socratic Method with surprising results - after a single session participants recorded a marked increase and confidence in their own creativity and engagement with their company. Encouraged by this I am extending this research to a range of different organisations and will report back on progress.

If you're interested in participating or in finding out more, just send me an email with your details and I will be in touch.