Harvard Business Review/Tim Brown: Leaders Can Turn Creativity into a Competitive Advantage

Havard Business Review
Innovation
Leaders Can Turn Creativity into a Competitive Advantage

    Tim Brown

November 02, 2016  

In 1985, Peter Drucker made a hopeful case for an entrepreneurial society in which innovation and the creation of new businesses would more than compensate for job losses stemming from the retreat of manufacturing industries in the U.S. and other developed economies. Since then, the U.S. has increasingly come to rely on innovation and entrepreneurship to drive growth — but we haven’t achieved the scale of entrepreneurial society we need to offset the effects of globalization and automation.

One reason for this is the increasing speed of change itself. Technological innovations like high speed trading and digital marketing enable competitors to emerge, thrive, and disrupt companies far faster than ever before. This “VUCA” environment rewards innovation but it also punishes failure more harshly. The result is that while we may be creating many new businesses we are destroying existing ones faster than ever before. The average lifespan of companies in the Fortune 500 has dropped precipitously over recent decades.

A second reason is that our assumptions about good management practices are out of date. Since the 1980s, management practices like the Toyota Production System that promote efficiency, quality, and scale have done wonders to lift the quality and profitability of global manufacturing. But in a business environment that is spectacularly unpredictable in almost every way, efficiency is no longer the most sensible — or at least not the only sensible — strategy.

    Drucker Forum 2016: The Entrepreneurial Society
    This post is one in a series of perspectives by presenters and participants in the 8th Global Drucker Forum.

What we need is a shift in emphasis from operational competitiveness toward creative competitiveness —  the capacity of organizations and society to create, embrace, and successfully execute on new ideas.

How can we foster creative competitiveness, especially in big, established corporate ecosystems?

All of our management practices need to be updated: how organizations are structured, how we deploy capital, how we interact and collaborate with broader networks, what tools and technology we embrace and deploy, what we measure, what markets we target, who we hire and how we lead. Of these, how we lead and the kind of culture we create are the essential starting points.

When our goal is efficiency, our concept of governance includes ensuring standardization, high levels of coordination, careful assessment of risk, and, of course, the elimination of waste. When we want to be creatively fit, governance looks quite different. It should be, and feel, more nurturing. It should focus on speed of learning and rigorous experimentation. It benefits from an attitude of abundance.

Nurturing a creatively competitive organization requires curiosity above all else. Asking the right questions is more important (and more difficult) than having the right answers. One of my favorite Victorian entrepreneurs, Isambard Kingdom Brunel, asked the seemingly ridiculous question, “How can I create the experience of floating over the English countryside?” in his quest to building the first large scale, long-distance railway service in England.

At IDEO, we have identified three roles that leaders of creatively competitive organizations take on at different moments in the continuing cycles of innovation. Essentially, leaders need to be able to lead from every direction: from the front, from behind, and from the side.

The first of these roles is that of the explorer. This is the stance that is closest to the governing, decision-making, leading-from-the-front style we’re used to seeing in efficiency-led organizations, except for one crucial difference. The explorer leads from the front not by issuing directions, but by asking strategically purposeful questions. These set the organization off on explorative quests that, if they’re successful, will bring great value.

For example, when Dean Logan, Registrar-Recorder and County Clark for the County of Los Angeles, was charged with renewing LA’s voting system, he could have simply asked for quotes from the standard vendors. Instead he asked the following question: “How can we free ourselves of the constraints of the current state to allow for the possibility of a voting experience that is responsive to voters and adaptable to ongoing changes in human behavior and advances in technology?” This, along with a second question — “How can we design a voting experience, and a system that supports it, that conveys the significance of the act of voting – both on an individual basis and the significance for community?” — empowered his team to think differently. He gave them permission to explore ideas that broke with tradition, were more human centered, and even challenged assumptions about what was possible within the regulations. The resulting system promises to be more convenient, more inclusive of a wider range of citizens, and more adaptable to future change.

The second stance is that of the gardener, who fosters the conditions in which creativity can thrive. This kind of leading-from-behind requires forethought and careful investment. By nurturing new capabilities, providing spaces and tools that encourage creativity and collaboration, and protecting the tender shoots of innovation from the efficiency-led behaviors of the organizational core, the gardener releases the creative potential of the organization. Scott Cook, founder and Chairman of Intuit, has spent considerable time helping his organization develop rigorous methods for creative experimentation. He has hired new kinds of talent, including people with more creative experience and who have greater comfort with ambiguity. He worked to develop a playbook to aid teams in practicing innovation experiments, and he has sponsored experiments at the edges of Intuit’s markets (in developing countries for instance) so as to create opportunities for fast learning. These are all things that required the planning and forethought of a good gardener.

The final and most challenging role is that of the player-coach. This kind of leading from the side requires a lot of confidence. Leaders must engage in the act of the innovation without dominating it. The job of the player-coach is to anticipate obstacles that the team may not expect, to nudge and guide the cycles of experimentation required to bring ideas to life. Whereas the gardener can prepare the ground in advance, the player/coach must be ‘on the field’ working with teams as they are developing their ideas. To do so requires deep levels of engagement with the ideas and knowledge of the organization.

A case in point is Neil Grimmer, founding CEO of Habit. The lessons learned from co-founding his first venture were vital in the successful development of his second. This time, he relied on a talented cross-functional team to develop the new product, instead of being the lead product developer himself. As player/coach, he offered insights and perspectives on the business and how the design needed to meet those requirements. He was in the project room with the team but knew when to step back and let them do their thing.

While leading for creativity is just the first of many new practices required of creatively competitive organizations, it is the one on which all others depend. Nothing is sure to shut down the engine of innovation faster than leaders who behave as if creating and executing on new ideas is just another item on their efficiency oriented checklists.

Tim Brown is the CEO and president of the international design consulting firm IDEO and the author of Change by Design (HarperBusiness, 2009).
This article is about INNOVATION
Follow this topic
Related Topics:

    Entrepreneurship

Related Articles
Up Next in Leading teams
How to Nourish Your Team’s Creativity

    Ron Carucci

default image
Up Next in Creativity
Creativity and the Role of the Leader

    Mukti Khaire; Teresa Amabile

default image
Up Next in Crisis management
What VUCA Really Means for You

    G. James Lemoine; Nathan Bennett

Related Products
Leadership
Harvard Business Review Magazine Subscription
HBR All-Access Subscription
View Details
Leadership & Managing People
HBR's 10 Must Reads 2018: The Definitive...
Bundles
34.95
View Details
Leadership & Managing People
Amazon as an Employer
Case
8.95
View Details
Comments
10 COMMENTS

    DAVAF GERARD MD a year ago

    For the first time ever, I felt compelled to share this on Linked in with the following comments - This is a refreshing uplifting perspective - especially for those who find the role of leader becoming increasingly more constrained. If embodying inspiration is a key feature leadership, then this is a must.! Thank you Tim Brown
    Reply
    1 0

Join the conversation
Posting Guidelines

We hope the conversations that take place on HBR.org will be energetic, constructive, and thought-provoking. To comment, readers must sign in or register. And to ensure the quality of the discussion, our moderating team will review all comments and may edit them for clarity, length, and relevance. Comments that are overly promotional, mean-spirited, or off-topic may be deleted per the moderators' judgment. All postings become the property of Harvard Business Publishing.
Partner Center
Harvard Business Review
Subscribe Today + Save!
EXPLORE HBR

    The Latest
    Most Popular
    All Topics
    Magazine Archive
    Video
    Audio
    Webinars
    Subscriber Exclusives
    My Library
    Newsletters
    HBR Ascend

HBR STORE

    Article Reprints
    Books
    Cases
    Collections
    Magazine Issues
    HBR Guide Series
    HBR 20-Minute Managers
    HBR Must Reads
    Tools

ABOUT HBR

    Contact Us
    Advertise with Us
    Subscribe
    Information for Booksellers/Retailers
    Masthead
    Global Editions
    Media Inquiries
    Guidelines for Authors
    HBR Analytic Services

HBR SUBSCRIBER ASSISTANCE

    U.S./Canada:
    800.274.3214
    harvard@cdsfulfillment.com
    hbr.org/subscriberservices
    International:
    +44.1858.438.412
    (Asia Pacific: +612.8296.5401)
    hbr@subscription.co.uk
    subscription.co.uk/hbr/help

HBR.ORG CUSTOMER ASSISTANCE

    U.S./Canada:
    800.988.0886
    International:
    617.783.7500
    Email:
    customerservice@harvardbusiness.org
    Customer Service Help & FAQs
    Copyright Permissions

FOLLOW HBR

    Facebook
    Twitter
    LinkedIn
    Google+
    Your Newsreader

Harvard Business Publishing

    About Us Careers Privacy Policy Copyright Information Trademark Policy


Harvard Business Publishing:

    Higher Education Corporate Learning Harvard Business Review

Copyright © 2018 Harvard Business School Publishing. All rights reserved. Harvard Business Publishing is an affiliate of Harvard Business School.