Chapter One
Why These Ideas Work, but Seem Weird
To invent, you need a good imagination and a pile of junk.
— Thomas Edison
The question is not what you look at, but what you see.
— Henry David Thoreau
I realized that my competition was paper, not computers.
— Jeff Hawkins, describing the key insight that led his team to design the Palm Pilot
I admit it. I call the novel ideas in this book "weird" to get your attention.After all, unexpected, even strange, management practices are more fun andmemorable than bland old ideas. But there is another reason these ideas may seemcounterintuitive: To innovate, companies must do things that clash with acceptedmanagement practices, with common but misguided beliefs about the right way tomanage any kind of work. In company after company, managers act as if they cankeep developing new products, services, and solutions by adhering to customaryways of managing people and making decisions. This happens even in companieswhere managers say that innovative work requires different practices thanroutine work. Yet these same managers continue to use methods that force peopleto see old things in old ways, expecting new and profitable ideas somehow tomagically appear.
Last year, for example, I had a long conversation with an executive who wantedsome ideas about sparking innovation in a multibillion dollar corporation in amature industry. I can't reveal the company, but I can tell you it was a bookpublisher. Profits were falling, and so was the stock price. Wall Streetanalysts were complaining that the company wasn't innovative enough. Thisexecutive was exasperated because her company, especially the CEO, "hates takingrisks," and she believed that other senior managers wouldn't back any programthat might fail or distract people in the core businesses. She especiallyemphasized that any program that might further reduce quarterly profits would beunacceptable, even if it had long-term benefits. The CEO and other seniorexecutives were convinced that the business practices they were using to do thecompany's routine work, the things they did to make money right now, couldsomehow generate profitable new products and business models.
These executives were dreaming an impossible dream. To build a company whereinnovation is a way of life, rather than a rare accident that can't be explainedor replicated, people need to discard, and often reverse, their deeply ingrainedbeliefs about how to treat people and make decisions. They need to follow anentirely different kind of logic to design and manage their companies, eventhough it may lead them to do things that some people — especially peoplefocused on making money right now — find to be counterintuitive,troubling, or even downright wrong.
Trying to spark innovation with methods that actually stifle it doesn't happenjust in big, old companies. Entrepreneurs start new companies partly becausethey are purported to be more innovative, free from the pressures in establishedfirms to follow ingrained precedents. Yet, after coaching start-ups for over 20years, James Robbins finds that entrepreneurs can fall prey to ingrained habitsjust like managers in big firms. Long before it was a fad, Robbins was creatingand managing new business incubators, including an Environmental BusinessCluster in San Jose and in Wuhan, China, the Software Business Cluster in SanJose, the Panasonic Incubator in Santa Clara, and the Women's Technology Clusterin San Francisco The software Business Cluster has been especially successfulsince it was started in 1994. It has nurtured more than 50 new companies, whichhave attracted over $300 million in funding .
Robbins coaches the entrepreneurs in these incubators to build companies thatgenerate, rather than stifle, new ideas. A sign in his office — the only sign Isaw — says: The definition of insanity is doing the same thing over and overand expecting a different result. He posts it because so many entrepreneurssuffer from this kind of insanity, which makes it impossible to do anything new.These people are not crazy when they do the same thing over and over again,but expect to get the same result. That is the right way tomanage routine work, to make the future a perfect imitation of the past. Butrepeating the same old routines again and again in pursuit of innovation is pureinsanity.
Practices that are well-suited for cashing in on old, proven ways can makeinnovation impossible. To thrive and survive in the long term, companies mustkeep inventing (or at least keep uncovering) new ways of thinking and acting.
Organizing Principles for Routine versus Innovative Work
The difference between organizing for routine versus innovative work can be seenby contrasting "cast members" at Disney theme parks with the "Imagineers" atDisney Imagineering, the company's research and development facility in Burbank,California. The job titles are revealing metaphors for the two kinds of work.Cast members in theme parks follow well-defined scripts; Imagineers dream upwild ideas about new things that guests might experience. Whether they aredressed as Cinderella or Goofy, acting as guide on the Jungle Cruise, orsweeping the streets, precise guidelines are enforced to ensure that castmembers stay "in role" when they are "on stage." This is Disney's routine work.In contrast, Disney Imagineering is a place where people are expected to keeptrying different things, where creativity is the goal. As one former "Imagineer"put it: "You're encouraged to come up with all these great fantasies. Most ofyour ideas are never executed into reality. That is frustrating sometimes, butprotecting the brand, creating compelling guest experiences, and telling greatstories are important. The romance is still there. Where else are you asked tocome up with wacky ideas for the next great ride for Disneyland!?"
Stanford's James March expresses this difference as: exploiting oldideas versus exploring new possibilities. Exploiting old ideas meansrelying on past history, well-developed procedures, and proven technologies todo things that generate money right now. Exploiting old ideas happenswhen McDonald's makes and sells a Big Mac hamburger. Billions of Big Macs havebeen made in the past, so unless they ask for something special, customersexpect all Big Macs to look and taste the same. McDonald's goal is to use oldknowledge to make the next Big Mac exactly the same as the last one.
March points out that, in the long run, no company can survive by relying onlyon established and proven actions. To make money later, companies need to trynew things, to "explore" new possibilities. This means experimentingwith new procedures, hiring new kinds of people, and inventing and testing newtechnologies. New ideas need to be invented (or imported) to satisfy customerdemands, to enter new markets, to gain an advantage over competitors, or atleast to keep pace. McDonald's uses some of the cash from all those Big Macs toexplore new possibilities. The question is not whether McDonald's or any othercompany should do exploration or exploitation. It is silly to argueabout whether a company should do only one or the other; it's like arguing overwhich is more important for an automobile, the engine or the transmission, orwhich you need more, your heart or your brain. Both are necessary formoving forward. The real question is what proportion of the firm's time andmoney should be spent on which.
Like other companies that have performed well over the long haul, McDonald'sexperiments with new ideas. At their Core Innovation Center near Chicago, forexample, they constantly try new products, new ways of cooking old products, newways of queuing customers, and different ways of organizing work in their fullyfunctioning kitchens. Similar labs generate and test ideas for new products inother countries where McDonald's establishments are located. At the moment, forexample, McDonald's is experimenting with a technology for cooking their famousfries in about 65 seconds rather than the current 210 seconds. And experimentsdon't happen just in corporate labs; the Big Mac was invented and tested in 1967by Jim Delligatti, who operated a dozen stores in Pittsburgh. Other experimentshave also been successful, like the McHuevo (poached egg hamburger) in Uruguay,Vegetable McNuggets in India, and the "Made for You" innovation in the UnitedStates, where, instead of being kept warm until it is purchased, every sandwichis quickly assembled after it is ordered. But the majority fail, like the McLeanhamburger in the United States and a cheese and pickle sandwich tested inBritain called the McPloughman's.
My weird ideas spark innovation because each helps companies do at least one ofthree things: (1) increase variance in available knowledge, (2) seeold things in new ways, and (3) break from the past. These are thethree basic organizing principles for innovative work, but as the table shows,the opposite principles are right for routine work. This contrast is not onlyessential for understanding where I got my weird ideas and why they work, it isalso essential for understanding why so many managers unwittingly use flawedpractices that fail to spark innovation.
Variance: "A Range of Differences"
Companies where people want to do things in proven ways are wise to drive outvariation. This mostly means doing old things in time-tested ways. This is whytotal quality management experts emphasize that driving out errors, reducingcosts, and increasing efficiency of existing products and services requiresdriving out variation in what people and machines do. This is why Intel, whichhas dominated the semiconductor industry largely through its manufacturingprowess, uses a technique called "Copy Exactly." When Intel managers agree thatsomething is a good idea, there is a religious fervor about implementing it inan identical way in every Intel factory throughout the world, down to the colorthat things are painted. It is also why General Electric's CEO Jack Welch hasmade a fetish out of "six sigma," the quality control regime that aims to reducevariance down to one error in every one million repeated processes.
Driving out variation makes sense when organizations do proven things in provenways that still work. The exact steps for manufacturing a computer chip at Intelare known in great detail, as are the steps for flying an airplane, doing simplesurgical procedures like hernia repairs, or operating a ride at Disneyland.Straying from proven ways is rarely a creative act in such cases; rather, it isa sign of poor training, lack of attention, incompetence, substance abuse, orstupidity. For example, the captain of Aeroflot Flight 593 who broke the rulesby giving his children a flying lesson in midflight was stupid, not creative. Hefirst let his daughter fly the plane, then he gave his son a chance.Unfortunately, this 15-year-old boy made an error with the yoke, the planestalled, and went into a dive that his dad could not reverse. All 75 people onboard were killed. When people are flying an airplane or assembling a ToyotaCamry, there are enormous advantages to following proven methods. Safety is oneof them! Companies that use tried-and-true methods are not only usually safer,they do things faster, cheaper, and more consistently than those that rely onnew and unproven knowledge.
When innovation is the goal, however, organizations need variation in whatpeople do, think about, and produce. What might be called errors and mutationsin a system meant to do old things in old ways are the lifeblood of innovation.People need to constantly find and produce new ideas, which, like mutations inplants and animals, often fail to endure and spread. The notion that diversity,new combinations, and mutations of existing forms are required for creating newforms is, of course, inspired by Darwin's theory of evolution. The biologistStephen Jay Gould explains why amplifying, rather than dampening, variationleads to excellence in social systems, not just biological systems.
Excellence is a range of differences, not a spot. Each location on the range can be occupied by an excellent or an inadequate representative — and we must struggle for excellence at each one of these varied locations. In a society driven, often unconsciously, to impose a uniform mediocrity upon a former richness of excellences...an understanding and defense of full ranges as natural reality might help stem the tide and preserve the rich raw material of any evolving system: Variation itself.
Hundreds of behavioral scientists have borrowed and modified Darwin's theory ofevolution. One of the most robust findings in this vast literature is thatvariance in people, knowledge, activities, and organizational structures iscrucial to creativity and innovation. Research by Dean Keith Simonton shows thatthe success of individual geniuses like Mozart, Shakespeare, Picasso, Einstein,and Darwin himself, is best understood from an evolutionary perspective, whereexcellence results from "a range of differences." These famous creatorsgenerated a wider range of ideas and completed more products than theircontemporaries. They didn't succeed at a higher rate than others. They simplydid more. So they had both more successes and more failures. There arerenowned geniuses who defy this trend, but they usually have less impact thantheir more productive counterparts. The great artist Vermeer created fewer than50 paintings in his lifetime, all in a similar style. He achieved a singularexcellence that, despite the stunning beauty of his art, adds something lessthan Picasso's astonishing range and history-changing influence.
Research on groups and organizations suggests that variation is just asimportant to collective creativity. New ideas are generated when groups andorganizations have people who act and think in diverse ways, express diverseopinions, are connected to diverse knowledge networks outside the organization,and store and constantly make use of diverse technical knowledge. The beliefthat innovation depends on a broad palette of ideas was around long beforeacademics started studying innovation. Thomas Edison remarked that inventorsneed "a pile of junk." His West Orange laboratory had a "well-stocked storeroomand a collection of apparatus and equipment left over from previous experiments"that included "machine tools, chemicals, electrical equipment, loads of supplies— not only lengths of steel and pipe, but rare and exotic materials such asseahorse teeth and cow hair." This "big scrap heap" provided the raw materialsthat Edison and his staff used to invent new things.
An evolutionary perspective means that variation is essential because, to find afew ideas that work, you need to try a lot that don't. This is why scientificresearch mostly consists of trying things that fail. As Susan Greenfield, arenowned British neuroscientist, put it, "Safe is a word that goes much betterwith sex than science." A similar philosophy helps explain the success ofCapital One, which has been called the the most innovative credit-card companyin the world. Just a few years ago, all credit cards were pretty much the same;you could have whatever you wanted as long it cost $20 per year and had aninterest rate of 19.8 percent! Capital One has been the leader in offeringthousands of different credit cards, with varying rates, and limits, which aretargeted at people with different beliefs, hobbies, and affiliations: "Theytinkered with credit lines, mileage awards, with the design of the cards, andwith the color of the envelopes of their mailings. They tried different ways ofretaining customers and pursuing deadbeats. Essentially they made Capital One anendless experiment." The company tried about 45,000 experiments in the year2000, for example. Capital One has succeeded by targeting smaller and smalleraudiences for these experiments, like a "platinum MasterCard for middle-incomehikers who drive Saturn automobiles." Most of these ideas fail, but the constantexperimentation with one variant after another, and constant learning, are bigreasons why Capital One has over 30 million credit-card accounts.
The story is the same in the toy business. Brendan Boyle is founder and head ofSkyline, the toy design studio at IDEO, a product design firm in Palo Alto,California. Boyle provides compelling evidence that innovative companies need awide range of ideas and that success requires a high failure rate. Boyle and hisfellow designers keep careful track of the ideas they generate in brainstormingsessions and informal conversations, and that just pop into their heads. Skylinekeeps close tabs on its ideas because it sells and licenses ideas for toys thatare made, distributed, and marketed by big companies like Mattel andFisher-Price. Boyle showed me a spreadsheet indicating that in 1998 Skyline(which had fewer than 10 employees) generated about 4,000 ideas for new toys. Ofthese 4,000 ideas, 230 were thought to be promising enough to develop into anice drawing or working prototype. Of these 230, 12 were ultimately sold. This"yield" rate is only about one-third of 1 percent of total ideas and 5 percentof ideas that were thought to have potential. Boyle pointed out that the successrate is probably even worse than it looks because some toys that are boughtnever make it to market, and of those that do, only a small percentage reaplarge sales and profits. As Boyle says, "You can't get any good new ideaswithout having a lot of dumb, lousy, and crazy ones. Nobody in my business isvery good at guessing which are a waste of time and which will be the nextFurby."
Not all innovative businesses require — or can survive — such a high failurerate. Venture capital firms have lower, but still substantial, failure rates.Between 10 percent and 30 percent of the start-up firms that receive funds fromtop Silicon Valley venture capitalists yield big financial returns, and themajority fail. The optimal failure rate depends on the industry and technology,but all innovative firms keep importing, remembering, and trying a wide range ofnew things; they reach a lot of dead ends, and keep learning from theirsuccesses and failures. Variation is a hallmark of companies that arecontinuously creative, that keep coming up with exciting new ideas, products,and services that leave competitors running back to the drawing board to copythem, or wondering, "Why didn't I think of that?"
Another way to get varied ideas is to work with diverse people. The BrainStoreis an "idea factory" in Biel, Switzerland, using a network of teenagers togenerate solutions to clients' problems. Cofounder Markus Mettler says, "We'renot looking for average ideas. We're looking for crazy ideas. We use kids tofind those ideas, because they know how to talk without their thinking gettingin the way." Mettler's cofounder, Nadja Schnetzler, adds that the company blends"the professionalism of experts with the unbridled enthusiasm of kids." Theyassign 17-year-olds to work on products and advertising campaigns for companieslike Nestlé and the Swiss Railway. By mixing the ideas of experts andnovices, of young and old people, this company increases the diversity ofsolutions that can be generated for clients.
Any group can spark innovation by broadening "the range of differences." Thisfirst organizing principle is part of many quality programs, especially inbrainstorming sessions and experiments used by quality-improvement teams. Evenwhen companies want new ideas about how to drive out variation in establishedprocesses like manufacturing cars and running hotels, they increasevariance in the ideas generated, considered, and tested. Most work involvessome blend of routine and innovative tasks; the weird ideas in this book aremeant to help people, teams, and companies better understand the difference anddo a better job of switching between the two kinds of work.
As I show in the next chapter, creative firms don't just have diverse knowledge,but they keep trying to find different uses for it and trying to combine it innew ways. That's one of the main reasons my 11 1/2 weird ideas work; each ofthese counterintuitive practices brings a broader range of ideas into a company.
Vu ja de: Seeing Old Things in New Ways
The second organizing principle is seeing the same old thing in new ways, or the"vu ja de" (pronounced "voo-zha-day") mentality. If déjàvu is the feeling that you have had an experience before even though it isbrand new, then vu ja de is what happens when you feel and act as if anexperience (or an object) is brand-new even if you have had it (or seen it)hundreds of times.
The vu ja de mentality is not always a good thing. It can be a disasterwhen, as the result of stress, confusion, poor training, or sheer incompetence,proven techniques are forgotten when the stakes are high. Organizationaltheorist Karl Weick uses the term vu ja de in this pejorative way. Heshows how a group of 19 experienced smoke jumpers (firefighters who parachuteinto remote areas) responded to the stress of a fast-moving fire in Mann Gulch,Montana, by forgetting what they knew. These skilled and experienced smokejumpers were so distressed by their group's disorganization and the threat ofdeath that they acted as if "I've never been here before, I have no idea where Iam, and I have no idea who can help me." Thirteen of them died. But Weick'sexample is a case where mostly routine work was needed, not innovation.
The very thing that can kill a smoke jumper, or an airplane pilot, can save aworker who needs to be innovative. The vu ja de mentality can breedlearning and creativity. I first heard the term in the 1980s from Jeff Miller,who has won numerous sailing championships. Miller argued that great sailorshave a vu ja de mentality where "the same old stuff seems brand new"because it enables "you to keep learning small lessons from every race" and it"keeps you excited about the sport." Jeff's funny and insightful comment made merealize that innovative people and companies have this same ability. They cankeep looking at the same thing but keep changing which aspects they think aboutand which they ignore.
Miller also has a Ph.D. in biochemistry. Perhaps he is taking a cue from NobelPrize-winning biochemist Albert Szent-Gyorgi, the first scientist to isolateVitamin C, who said: "Discovery consists of looking at the same thing aseveryone else and thinking something different." Statistician Abraham Wald'sresearch on where to put extra armor on warplanes during World War II is awonderful example. The British and U.S. air forces were concerned because manyof their planes were being shot down. They wanted to use more armor, but werenot quite sure where to put it. Wald put a mark on every bullet hole in theairplanes that returned from battle. He found that two major sections ofthe fuselage — one between the wings and the other between the tails — had farfewer bullet holes. He decided to put the armor in these places, where he sawfewer, not more, holes. Why? Because it stood to reason that the planes were hitrandomly. The planes he analyzed had not been shot down! So it was the holes hewasn't seeing — in the planes that weren't returning — thatneeded extra protection.
A similar kind of vu ja de mentality is seen in innovativehigh-technology firms. Bill Joy is Sun Microsystems' resident technical genius.Joy was one of the primary designers of the UNIX operating system and of some ofthe most crucial chip sets in Sun's microprocessors, and other advances thatenabled the Internet to reach its current technical sophistication. Joy has beenhailed as "the smartest man in Silicon Valley" (although he lives in Colorado!)and the "Edison of the Internet." He is famous for seeing technical problems ina different light than others, for his "late-night programming epiphanies,way-outside-of-the-box thinking, and uncanny technical clairvoyance." This goesback to his student days. Most students look for Ph.D. programs that have thebest possible equipment, especially in technical fields like computer science.In contrast, Joy reports, "I went to Berkeley [rather than Caltech or Stanford]because it had the worst computer facilities of the three. I figured it wouldforce me to be more ingenious."
Vu ja de can also be a cultural characteristic of groups and companies.People can learn the vu ja de mentality; they don't have to be born withit. For example, although well past his 80th birthday, Ettore Sottsass remainsone of the most famous and prolific of Italian designers. Sottsass rose to fameas an industrial designer for Italian firms, including Olivetti and Alessi, aswell as a sculptor and photographer, and is a founding member of the MemphisDesign Group. In 1980, he and several young designers formed Sottsass Associatesin Milan, Italy. They have taken a radical approach to designing everything froman electronic telephone directory and a golf club and resort in China, torobots, the interior of an airport in Milan, televisions, telephones,prefabricated windows, and the interior of a New York City apartment. Thehallmark of their philosophy is that, while most modern designs are meant to bebland and rational, to be functional without being noticed, the things we useand see in modern life should provoke strong feelings. Their view is that astrong reaction, even if it is negative, is far better than none at all, that itis better to feel alive than numb and lifeless.
Sottsass Associates uses unusual colors, shapes, and sizes to jar people out ofthe numbness of modern life. Sottsass teaches his colleagues to see thingsdifferently by using his own work as a source of inspiration, like themuch-talked-about and commercially successful "Valentine" portable typewriter hedesigned for Olivetti in 1969, which was the color of bright red lipstick.Sottsass also gives explicit guidance, for example, by suggesting that hiscolleagues' designs "look stranger," by using colors and shapes that provokediscomfort rather than contentment.
The vu ja de attitude is also evident at BrightHouse, an "ideationcompany" that charges clients like Coca-Cola, Hardee's, and Georgia Pacific$500,000 to $1,000,000 for a single idea. Founder Joey Reiman rejects thetaken-for-granted assumption that doing things faster is always better. He bragsthat BrightHouse does "business at the speed of molasses." He emphasizes thatyou can't rush great ideas. "I tell our clients that we're the slowest companythey'll ever meet — and that we're the most expensive." BrightHouse works ononly one idea at a time, with everyone in the small company (about 20 people)devoting two to three months to creative approaches for the single client theyare serving. Reiman developed this way of working after running a conventionaladvertising firm for many years, which led him to believe that most of the workdone was so rushed and there were so many different clients to keep happy thatcreativity was stifled. BrightHouse has had impressive results. Reiman and histeam helped the giant fragrance house Coty Inc. to create "ghost myst," thefirst perfume to embrace values and spirituality ("inner beauty" rather thanphysical beauty) as the focus of its market positioning. Ghost myst became thebest-selling fragrance of 1995, and it launched a spirituality-in-beautymovement that many other fragrance and cosmetics companies have rushed to join.BrightHouse's competitive advantage is that they are a thoughtful tortoise in aworld filled with speedy hares. When you move more slowly than everyone else,the same old things look different to you, and you can think about them indifferent ways.
No matter how it is accomplished, the vu ja de mentality is the abilityto keep shifting opinion and perception. It means shifting our focus fromobjects or patterns that are in the foreground to those in the background,between what psychologists call "figure" versus "ground." It means thinking ofthings that are usually assumed to be negative as positive, and vice versa. Itcan mean reversing assumptions about cause and effect, or what matters mostversus least. It means not traveling through life on automatic pilot. Many ofthe weird ideas in this book are about how to make the vu ja dementality a way of life in a company.
Breaking from the Past
There is a lot of hype in the business press about the dangers of clinging tothe past, and much of it is justified. But all the excitement about buildingbetter products and companies can make us forget that most new ideas are bad andmost old ideas are good. After all, that is what Darwinism predicts. The deathrate of new products and companies is dramatically higher than old ones. Dozensof new breakfast cereals fail every year, while Cheerios and Wheaties persist.Hundreds of new toys are introduced every year, yet most are flops. Even toysthat are wildly popular for a while, like the Furby or Beanie Babies, fade fromthe scene, while Play-Doh persists. If there was truth in advertising, theslogan "innovate or die" would be replaced with "innovate and die." Tried andtrue wins out over new and improved most of the time.
My aim is not to convince you to discard every routine your company usesand to devote all efforts to inventing new ways of thinking and acting. On thecontrary; doing routine work with proven methods is the right thing to do mostof the time. It is wise to manage much of the time as if the future will be aperfect imitation of the past. Hospitals want surgical residents to performoperations exactly like their experienced mentors. Airlines want new pilots tofly a 747 just like the experienced pilots who came before them. McDonald'swants each new trainee to make every Big Mac just as it has always been done.
Does this mean that you should stop trying to innovate? Not at all. The problemis that the world does change, new technologies are developed, competitors comeup with superior products and services, and consumer preferences change. Theseare the times and places when innovation is crucial, when the ideas in this bookcan help you and your company. Many companies have made a lot of money bycreating new and better futures. So, although it usually entails a high failurerate and a lot of resources, every company — or at least part of it — needs tokeep trying to discard old ways and replace them with better new ways.
For example, tea bags had always been square since they had beenintroduced in 1951 to British consumers; no one ever thought of changing theshape. Then, in 1985, Lyons Tetley, one of the leading makers of tea bags in theUnited Kingdom, began doing research on consumer reaction to round tea bags.Research by Tetley's marketing research firm, Mass Observation, showed thatgroup after group of consumers had a strong preference for the round bags. Afteran initial marketing blitz in the south of England, Tetley went national withits round bags in January of 1990. Tetley's share of the English tea market rosefrom 15 percent to 20 percent, slightly behind PG Tips. Not to be outdone, PGTips launched its own, highly secretive efforts to develop tea bags in a newshape. The result was the PG Tips Pyramid tea bag, which has a 3-D shape that issaid to mirror the brewing process in a teapot and to make the brewing processfaster than the traditional square (or less traditional round) tea bag. PG Tipsintroduced their new bag in 1996 and soon reported that sales of Pyramid teabags had eclipsed Tetley's round bag in many regions. The shape of tea bagsdidn't change for 34 years until these researchers saw the same old thing in anew way — vu ja de!
Young industries and companies can cling to the past just as tightly as oldones. People form vehement beliefs quickly, often on the basis of flimsy orflawed evidence. Worse yet, once most people start acting in a certain way —often without even realizing it — they persist even when presented withevidence that what they are doing is ineffective. This pattern, whichpsychologists call mindless behavior, happens to companies as a whole. Beforethe Palm Pilot was invented, for example, product after product developed in thehand-held computer industry failed. Palm Computing, along with half a dozenother companies including Apple, Slate, Go, and Sharp, introduced failedhand-held computers in the 1990s. Palm's first product was called the Zoomer. Itwas crammed with features just like its competitors'. Palm's competitorsresponded to slow sales by developing hand-held devices that had even morefeatures, that were more like customers' personal computers. They clung tightlyto their ingrained belief that customers wanted an imitation of their personalcomputers, with as many of the same features as possible. In contrast, aftertalking to customers, Palm's Jeff Hawkins decided that his industry wasoperating under a flawed assumption. He realized that "my competition was paper,not computers." The rest is history. By seeing the same problem in a new way,Palm was able to discard flawed beliefs and invent one of the best-sellingconsumer electronics products of all time.
To break from the past, a company needs varied ideas and vu ja de, whichprovide the raw material and right attitude. But that is just part of the story.As you will see, my weird ideas help companies break from the past through othermeans as well.
The Weird Ideas
Table 2 shows 12 (really, 11 1/2) pairs of contrasting practices: The left sidelists familiar and conventional management practices for hiring and managingpeople, making decisions, dealing with the past, and interacting with outsiders.These practices help companies do routine work by driving out variance, seeingold things in old ways, and replicating the past. You probably aren't surprised,and may be bored, by recommendations that companies should hire people theyneed, use old-timers to indoctrinate newcomers, reward success and punishfailure, think of some practical things and plan to do them, replicate pastsuccesses, and so on.
Things get more interesting, however, when you realize that these practices —most of which are widely accepted as right for managing any kind of work — aredrastically different from my 11 1/2 weird ideas for sparking innovation (on theright-hand side of the table). Indeed, most are the exact opposite of practicesthat are well suited for routine work. These weird ideas work because they helpincrease variance in knowledge, help people see old things in new ways, and helpcompanies break from the past. These weird ideas also work because each isgrounded in sound academic theory and research. I combed through existingacademic writings to support (and refute) my emerging ideas, to get inspirationfor more ideas, and to make them more powerful to use and more fun to talkabout. I also did original research on these weird ideas, and talked about themconstantly with students and colleagues at Stanford University and elsewhere.
But that wasn't enough. I wanted to develop ideas that people could actuallyuse. So I picked weird ideas for this book that had actually been used, in someform, by real companies. I also gave ever-changing versions of my "Weird IdeasTalk" to over a hundred groups of senior executives, managers, engineers,scientists, lawyers, and other professionals during the last decade. I goadedeach group to argue with me about the ideas and point out flaws. They offeredconstructive criticism, told me how the weird ideas were already used in theircompanies, and suggested their own strange practices. The result is that theweird ideas in this book have both sound academic and practical underpinnings.
Why These Ideas Seem So Weird
The 11 1/2 weird ideas developed in this book are based on sound theory andevidence. Many are used in companies where innovation is a way of life. But thequestion that I raised at the outset of this chapter hasn't been answered yetand may seem even more puzzling if you believe that these ideas work: Why dothese ideas strike so many people as weird? One reason, as I confessed, is thatI made them sound weird to engage and amuse you. But that doesn't explain why Icould generate so many well-supported ideas that strike so many people asstrange, even downright wrong, at least at first. It also doesn't explain whypeople in so many companies reject these and other sound ways to sparkinnovation, regardless of how blandly the ideas are described.
There are several reasons that the 11 1/2 conventional ideas are treated as goodgeneric management practices, as the right thing to do under all circumstances.For starters, people almost everywhere believe that making money is good andlosing it is bad. Yet, in most companies, most of the time, generating andtesting ideas is something that loses money right now. The only way tomake money right now is by repeating a proven service or making a provenproduct over and over again. There are exceptions, including firms thatcommodify creativity, such as advertising agencies and design firms. For themost part, however, people who do and manage routine work — who use thepractices on the left side of the table — have more influence and prestige intheir companies than people who do innovative work. After all, they make moneywhile those mavericks keep losing it! There are companies like 3M and Novartis(a Swiss pharmaceutical company) where people who generate ideas havesubstantial power, but these are exceptions.
To make matters worse, most companies use the same standards for evaluating bothroutine and innovative work. They use conventional idea #6: Reward success,punish failure and inaction. This is fine for routine tasks. When knownprocedures are used by well-trained people, failure does signal impropertraining, weak motivation, or poor leadership. But applying this standard toinnovative work stifles intelligent risks. The usual reward scheme means that,because people who do routine work succeed most of the time, they are glorifiedas winners. In contrast, people who do innovative work fail a lot. So they notonly get few rewards, they may be denigrated as losers. In many companies,people who do routine work complain that "if those creative types just actedmore like us, they would be more efficient and wouldn't make all thosemistakes!"
Finally, my ideas seem weird because companies don't use them very much comparedto the conventional practices. Most companies devote the lion's share of theirpeople and money to supporting routine rather than innovative work. The rightbalance between exploration and exploitation varies across industries. But evenin companies that are much ballyhooed for innovation, only a small percentage isusually devoted to generating and testing new products and services. Thepercentage of corporate budgets devoted to research and development (R&D) versusmore routine tasks like manufacturing, marketing, and finance is one indicatorof this imbalance. This is a crude measure, as there is routine work in R&D, andinnovation elsewhere. But it is instructive. Most public companies spend lessthan 2 percent of their annual budgets on R&D. Even companies renowned forinnovation, like IBM, Lucent, Hewlett-Packard, Siemens, Xerox, and GeneralElectric, rarely spend much more than 5 percent or 6 percent. William Coyne,3M's former vice president for R&D, points out that 3M's financial successdepends largely on new products, but most of what 3M's people do (and most ofwhat 3M spends money on) are activities like manufacturing and marketing, whichenable them to cash in on these new ideas. In 1999, over 30 percent of 3M'ssales revenue was from products less than four years old, but the R&D budget was6.6 percent of sales, a ratio that has held fairly constant over the past fiveyears. If you consider parts of these companies that do path-breaking work, suchas research labs, the percentage is far lower. Xerox PARC in Palo Alto is famousfor inventing many of the technologies that made the computer revolutionpossible, everything from bit-map displays to pull-down menus to laser printers.Yet Xerox has never spent more than one-third of 1 percent of its budget tosupport PARC's activities in any year.
This comparative rarity helps explain why practices that support innovation mayseem odd and provoke discomfort, and why managers hesitate to use them even whenthey should. Study after study shows that, independent of other factors, themore people are exposed to something the more positive they feel about it, andthe less they are exposed to something the less positive they feel about it.This "mere exposure effect" has been found for "geometric figures, randompolygons, Chinese and Japanese ideographs, photographs of faces, numbers,letters of the alphabet, letters of one's own name, random sequences of tone,food, odors, flavors, colors, actual persons, stimuli that were initially likedand initially disliked stimuli." This effect is found when people have no ideait is happening and deny that it is happening. It is found in all populationsand all cultures, even in prenatal research on fetuses. One of the mostinteresting studies asked subjects which of two photographic prints of their [own] facesthey liked better — a normal or inverted print. The inverted prints portraypeople as they see themselves in the mirror, whereas the normal prints portraypeople as other people see them. Predictably, the subjects preferred theinverted prints of themselves, but the normal print of theirfriends.
The Best Way to Learn from the Weird Ideas
So how can you avoid getting trapped in routines that smother innovation? Thebest way to learn from this book — and from other counterintuitive ideas — isto keep asking yourself: What if these ideas are true? How might I helporganize or manage my company differently to make it more innovative? How shouldI act differently to make myself more creative? My ideas are designed not onlyto provoke readers to try them; I want to provoke you to imagine and try yourown ideas about sparking innovation, especially ideas that clash with theaccepted dogma in your company or industry.
Play with these ideas in your mind and experiment with a few in your company.Treat them like toys that you might buy to mess around with: Try to break them,try to take apart the pieces to see how they work, try to improve them, and mixthem (or parts of them) with your other toys. I offer these ideas not asimmutable truths, but as methods that have helped other companies producebeautiful and profitable mutations, and that just might help your company aswell. These are ideas about building innovative groups or businesses in anycompany, or about injecting innovation in companies that focus on exploitingtried-and-true ways. Even if your group or business thrives by doing mostlyroutine things, many of the practices here can still help you and yourcolleagues switch cognitive gears for a while, so you can learn some new things,see old problems in new ways, and break from the past.
One big question remains before the journey through the 11 1/2 weird ideas canstart, before I show why each one works, how it is already used in companies tospark innovation, and how it might be used in your workplace. I've talked aboutthe importance of creativity, but I haven't said what it means. As the nextchapter shows, much of the mystery about what it takes to build an innovativecompany disappears when you realize what creativity entails.
Excerpted from Weird Ideas That Work by Robert I. Sutton. Copyright © 2002 by Robert I. Sutton. Excerpted by permission. All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Copyright © 2002 by Robert I. Sutton. All rights reserved.
