Thinking Inside the Box: How Organizational Innovation Really Works
A recent Wall Street Journal article captured the challenges most organizations face in trying to be innovative. Authors Drew Boyd (a former J&J executive and current professor at University of Cincinnati) and Jacob Goldenberg (a professor at Hebrew University) reveal a startling statistic. They have asked executives around the world over the last decade two fundamental questions: “on a scale of 1-10, how important is innovation to the success of your firm?” and “on a scale of 1-10, how satisfied are you with the level of innovation in your firm?”
On the first question, senior leaders rate innovation very high – usually a nine or 10. It is a key driver of growth, a necessary factor to stay competitive, and a way for organizations to create and sustain value for their customers, owners, and other stakeholders. However, most senior leaders give a much lower rating – usually below five – regarding their satisfaction with innovation. The reason? They contend (and I believe they’re absolutely correct) that innovation is difficult – that organizations find it challenging to successfully and consistently innovate, simply because they don’t know how to…
“Innovation” is a tough concept to define. The dictionary says it’s creating “something new or different.” Wikipedia (I know…consider the source) says it’s “the application of new solutions that meet new requirements, inarticulate needs, or existing market needs.” The Baldrige Criteria define innovation as “making meaningful change to improve products, processes, or organizational effectiveness and create new value for stakeholders…[it] involves adopting an idea, process, technology, product, or business model that is either new or new to its proposed application.”
With those working definitions, some of you might have an image of highly-talented, highly-educated engineers experimenting to find the next hot product or solution; others of you may envision employee suggestion programs used to uncover hundreds, if not thousands, of small improvement ideas; still others have an image of marketing professionals locked in a room with whiteboards and flip charts, “brainstorming” the next big solution for their customers. I guess all of those images are somewhat correct, and all of them are somewhat incorrect.
True innovation rarely comes from – as what Boyd and Goldenberg describe – “employees wasting hours, even days, sitting in beanbag chairs, tossing Frisbees and regurgitating ideas they had already considered.” In fact, Boyd and Goldenberg assert that true innovation rarely comes from brainstorming at all. The problem, they say, is that the traditional view of innovation – of having an unstructured approach to brainstorming solutions to various problems – does little to actually find relevant solutions for your products or services. So “thinking outside the box” really can waste time and resources simply because it generates ideas that oftentimes have very little to do with the problem you’re trying to solve.
By contrast, thinking “inside the box” requires employees to consider solutions when they constrain their options rather than broadening them. Boyd and Goldenberg state: “By defining and then closing the boundaries of a particular creative challenge, most of us can be more consistently creative—and certainly more productive than we are when playing word-association games in front of flip charts or talking about grand abstractions at a company retreat.”
Their method works by taking a product, concept, situation, service, or process and breaking it into components or attributes, and then using one of five techniques to manipulate the components to develop new-to-the-world ideas that create value.
This approach, by the way, is very consistent with Systematic Inventive Thinking’s (SIT), a partner of the Performance Excellence Network and host of a workshop August 19-20 in the Twin Cities on innovation. Read more on the workshop below or on our website.
Method 1: Subtraction – Remove seemingly essential elements. Boyd and Goldenberg claim that many products – many solutions – are created by simplifying existing products. For example, if you subtract the frame of glasses, you get the contact lens. Subtract water from soup (or lemonade, or hot chocolate) and you have powdered soup. Subtract a teller from a bank and you have an ATM. Sometimes innovation is the result of addition by subtraction.
Method 2: Task Unification – Bring together unrelated tasks or functions. This is the synthesis of two or more existing things to create a new thing. So, bring together a pull cart and a suitcase and you have the roller bag. Bring together the iPod, a cellphone, and several other smart devices (remember Palm Pilot for your calendar?) and you have the iPhone. Integrating multiple products or services that have value usually creates a new product or service with even more value.
Method 3: Multiplication – Copy a component and then alter it. This involves taking a product, service, or component and adjusting it to create something completely new. For example, consider the razor, which for hundreds of years was a single blade until Gillette introduced a two-blade shaving system (which revolutionized the shaving market: the first blade lifts the hair up, and the second cuts it deeper than before). Other examples of multiplication include bifocal glasses, double-sided tape, three-way lightbulbs, or for an example of multiplication in a service business, home equity loans.
Method 4: Division – Separate the components of a product or service and rearrange them. Really, this is about sub-dividing a product or service (or process) into its various parts so that when they are reconfigured, they add new value. Examples include central air conditioning (where the motor, fan, and hardware were separated from the original window-unit box in which they used to be housed), or airline check-in where you can now do so at home and print your boarding pass (or on-the-go with your cell phone and even avoid printing anything), or fast-food drive thru windows that now separate payment from collecting your food to increase the speed of the process.
Method 5: Attribute Dependency – Make the attributes of a product change in response to changes in another attribute or in the surrounding environment. Basically, this type of innovation is making one product/service variable dependent on another – a cause-and-effect relationship. Examples include transition lenses (where they change from light to dark as the level of sunlight changes), car headlights (that come on automatically when it gets dark), baby diapers that change colors when they are wet, or any number of services (cable or satellite TV, restaurants or resorts, banking and insurance) that offer discounts or perks for referring friends. Sometimes different variables apply to different products: take for example, iced coffee – which is a fairly new product that encourages coffee consumption in the hot summer months, a time where coffee consumption usually goes down due to a variable (the weather).
All five of these methods consider the constraints and reality of a situation to find new applications for existing products, services, processes, or business models. In many ways, it’s the opposite approach of what has become the traditional model of innovation: instead of starting with a problem and trying to find solutions, you start with a solution(s) and work to find problems that it can solve.
Boyd and Goldenberg claim that “the key to being consistently innovative is to create a new form for something familiar and then to find a function it can perform.” Which is why, they contend, that most new product ideas are met with a response like “Gee, why didn’t I think of that?” Indeed, the most innovative ideas usually are right under our noses, connected in some way to our current reality, our current view of the world, and/or our current constraints.
The implications of this for organizations are significant. It’s true that organizations should create an environment that supports innovation, giving their employees the time and space to “tinker,” to solve problems and identify improvement opportunities, and to consider solutions that add value for the company and its customers. But it’s not simply more brainstorming sessions. Rather, it’s about creating a process that systematically understands the current situation – the constraints (time, money, capabilities, capacity) and attributes that already exist today – and applies that knowledge in new ways to create new solutions. Really, it’s about thinking inside that proverbial box.
To learn more about innovation – about how to systematically create meaningful change to improve products, processes, or organizational effectiveness that creates new value for stakeholders – consider attending our day-and-a-half workshop August 19-20 in Minneapolis. Facilitated by SIT, this workshop will demonstrate how thinking inside the box has creatively solved problems for the City of Minneapolis, General Mills, Andersen Windows, Ford, Johnson & Johnson, and other highly innovative organizations. Details are on our website.
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Yours in Performance Excellence,
Brian S. Lassiter
President, Performance Excellence Network (formerly Minnesota Council for Quality)