Graham Horton's Posterous

One of the greatest pains to human nature is the pain of a new idea. It makes you think that after all, your favourite notions may be wrong, your firmest beliefs ill-founded... Naturally, therefore, common men hate a new idea, and are disposed more or less to ill-treat the original man who brings it.

Walter Bagehot

Kaiser Wilhelm II of Germany said about automobiles in 1902:

"Solange ich ein warmes Pferd habe, besteige ich einen derartigen Stinkkarren nicht."

(As long as I have a warm horse, I will not get on one of those stinking carts.)

Only one year later he owned three automobiles and had become a big fan.

Link http://en.wikipedia.org/wiki/War_of_Currents

I found the following quote in J. Gardner's "The Little Innovation Book". It succinctly sums up the point made by Clayton Christensen in "The Innovator's Dilemma":

The sensible behaviour for a manager facing a disruption is to reinforce the success of the past at the expense of the innovation. They are highly motivated to do so, since the alternative looks remarkably like failure.

I tell the following story in my innovation course at the university. It illustrates occupational blindness and shows the need for questioning "the way things are done around here".

Once a week, a young married couple ate fried fish for dinner. One day, the husband said to his wife, "darling, your fish is delicious, but I can't help noticing that the head and the tail of the fish are always missing. Why do you always remove them?"

She replied, "I don't know the reason. It's just how my mother taught me to fry fish."

So they both went off to visit the wife's mother, and the wife asked, "mother, why did you teach me to cut off the head and the tail of the fish before frying it?" The mother replied, "I don't know the reason. It's just how my mother - your grandmother - taught me to fry fish."

So all three of them went off to visit the grandmother, and the mother asked, "mother, why did you teach me to cut off the head and the tail of the fish before frying it?"

And the grandmother replied, "because 40 years ago, I only had a very small frying pan!"

---

What rules or habits do you have which may have once been valid, but are now superfluous (or even harmful)?

When consulting with companies who are looking for ways to innovate, the most difficult hurdle to overcome are often inaccurate beliefs about what innovation is or how it is supposed to work. One of these beliefs which we have recently had to deal with is the idea that innovation consists only of new product innovation. Several members of the client's team saw innovation only as the introduction of completely new products (which in their case meant that they would have had to have originated in their R&D department.)

Recently, I stumbled across an article by M. Sawhney, R. C. Wolcott and I. Arroniz in the MIT Sloan Management Review entitled "The 12 Different Ways for Companies to Innovate". The article discusses this problem and proposes that there are in fact 12 different dimensions for companies to innovate. The article contains the following quote:

Business Innovation is About New Value, Not New Things. Innovation is relevant only if it creates value for customers - and therefore for the firm. Thus creating "new things" is neither necessary nor sufficient for business innovation.

This thought nicely sums up the point I needed to get across to our clients.

I took this photo at the BASF business hotel in Ludwigshafen, Germany. It shows the carpet in the elevator in the seminar wing of the building. As you might guess from the writing, this carpet is replaced every day. This was a surprise to me, since it is a basic assumption about carpets that there is only on of them for any particular location.

One way to come up with surprising ideas like this is to use provocations. Provocations (a name coined by Edward de Bono) are deliberate challenges to reality as we know it. In order to create them, we need two steps:

1. Make an observation about the world as we know it.
2. Challenge this observation.

Step 1 is the more difficult one, because the most productive observations are those which are so obvious that it is very hard see them. In the case of the elevator carpet, the necessary observation would be something like:

1. A carpet has a fixed location.

Or perhaps:

1. Every location only has one carpet.

Observations like this seem obvious after the fact, but most people find it quite difficult to create them themselves.

Once a good observation has been made, it is comparatively easy to generate provocations:
* No carpet has a fixed location.
* Some carpets have three homes.
* Carpets may change their locations.
* Every location has several carpets.

Many innovative ideas were created by changing a reality that was "obvious". (Think of the credit card changing the reality "You need money if you want to buy something" or cash value life insurance changing the reality from "life insurance pays someone else if you die" to "life insurance pays you if you survive". What ideas could be created by challenging the following "rules"?

* The goal of our company is to make a profit.
* You have to concentrate on your most profitable customers..
* You must listen to your customers.
* Customers pay for our service in Euros.
* It's our sales force that has contact with the customers.

I like to collect examples of innovation rejection errors for my university teaching and professional seminars.

A rejection error is made when an idea which in fact turned out to be (would have been) successful is turned down during the evaluation phase.

There are many famous examples of these; probably the most well known is Western Union's rejection of the telephone in 1877.

Today, I discovered a new case:

In 1959, the Haloid Xerox Corp. was considering developing the first fully automated plain paper copier (later to be known as the Model 914)

Haloid Xerox hired Arthur D. Little to evaluate this idea. Their report concluded: "[...] the Model 914 has no future in the office-copying-equipment market."

Xerox went ahead anyway, and the product became a huge success.

(Source: Tecado)

The chief cause of failure and unhappiness is trading what you want most for what you want now.

In a similar vein, one definition of self-discipline calls it being able to choose what you want most instead of (yielding to temptation and) choosing what you want now.

In personal life, success requires a long-term perspective and the willingness to act on it. However, this choice can be strenuous, and it competes with more comfortable alternatives that promise instant gratification. For example, a student is faced with the choice of preparing for an exam or going out on the town with their friends, an athlete must make the choce between training or lazing on the couch, and almost every adult who wants to remain slim has to choose daily between healthy foods and less healthy, (but more tasty) sweets and fast food.

In our consultancy work at Zephram, we get to know many companies and their approaches to innovation, and I am occasionally reminded of the above quotation. Especially in publicly-held companies, there seems to be a short-term mindset which only reaches as far as the next quarterly result. The approach to innovation is correspondingly limited to the so-called "quick wins" - small innovations that can be implemented cheaply and quickly and which promise a rapid payoff. On the other hand, ideas with a long-term return or with a more strategic benefit are ignored. It is different with medium-sized, privately-held companies, which are not subject to the profit expectations of external shareholders and fund managers. Here, we tend to see a more balanced approach, which encompasses both short and long-term innovation projects.

Ultimately, it must be the company's long-term survival and profitability which interest its owners most. However, in order to ensure these, investments, fundamental innovations and risk-taking are needed, all of which conflict with short-term profit maximization - in other words, with what the owners want now.

Of course, this observation is hardly new, and the problems that arise from incentive schemes that encourage short-term profits have become clear to everybody during the financial crisis. In order to achieve a sustainable solution, company owners and directors need to do what they already know from their personal lives: to plan for a long and healthy life by eating an apple more often and leaving the chocolate in the refrigerator.

Arthur C. Clarke once said about scientific theories:

When a distinguished but elderly scientist states that something is possible, he is almost certainly right. When he states that something is impossible, he is very probably wrong.

I wonder if something analogous is also true for innovation, for example

When a distinguished but elderly businessman claims that a radical new idea for a product will be successful (when all around him say the opposite), he is almost certainly right. When he claims that it will fail (when all around him say the opposite), he is very probably wrong.