March 3, 2009

Vega: innovation and brand communities

Had a really cool time again today. PDF (1 MB) of slides here - one day I'll get going with using Slideshow...

Companies/Books mentioned (from what I can remember):
All Marketers are Liars - Sith Seth Godin
10 faces of Innovation - Tom Kelly
IDEO.com
The Cluetrain Manifesto
Bob Garfield - transcript - also updated version here

And apropos the conversation in the lecture around the Dept of Home Affairs as a brand, it could help a lot in re-imagining how that transform that organisational failure.

Posted by sdehaast at 2:32 PM | Comments (0)

September 9, 2008

IMASA Academy - IMPI programme slides

Coaching investment management professionals at IMASA today takes me back my meanderings in this industry more than a few years ago..spent a while doing various things at Syfrets - asset management, private banking reengineering, risk management, and of course the multiple CFA attempt (Rhett I blame you for my lack of focus! :)

Anyway here's the presentation [pdf, 2MB - right-click and save as..].

Also, talking about the macro, systems view of the world, I found this book - Investment Biker: Around the World with Jim Rogers quite fascinating.

The most succinct quote to capture the essence of how to see differently, to be creative, is through collecting different thinking frameworks, is this one:

"What you need is a latticework of mental models in your head. And you hang your actual experience ... on this latticework of powerful models. And with that system, things gradually get to fit together in a way that enhances cognition...." - Charlie Munger (Warren Buffet's partner)

Posted by sdehaast at 12:28 PM | Comments (0)

April 23, 2008

Metropolitan Insider Club

Here's the copy of my presentation I gave at Metropolitan Life, on "Outsourcing Marketing and Innovation to your Customer".

This is the blurb I used to position it:

Outsourcing Marketing & Innovation

Innovation is a hairy, woolly thing. Difficult to define or plan for. Invisible. Google counts at least 91 million results for the word. It has become the new stock phrase in corporate reporting, the holy grail for new earnings growth. Spraying cash at R&D (a traditional proxy for innovation) as compared to advertising is increasing; US stats from Ad Age[1] support this. 50 years ago: Advertising:R&D ratio was $3:1; in 2006: $1.34 is spent on advertising for every $1 spent on R&D.

But has this proven effective? Traditional approaches to innovation strategy revolve around a steady flow of goodies from the tech centre, with marketing packaging these new ideas into flashy campaigns - a one-way pipeline. Little thought to the end user experience is sought - focus groups and market research rarely yield fresh new insight or uncover new connections.

So what are the secrets of Apple and co. in getting groundbreaking products and services out there, and in doing so leave in their wake completely reinvented industries (with very little ad spend)? Welcome to the world of design thinking and the new marketing. How can organisations co-opt their customers into helping with the innovation and marketing?

Join me on a jam session through these topics: understanding what innovation really is, framing this against the status quo; why designing one's organisation from the outside-in can help to create insight conduit; how to harness the internet in transforming user-led marketing; and why redirecting funding for traditional marketing into redesigning customer experiences is the new 'R&D function'.

[1] 1 May 2006 Ad Age

PDF of slides here [1.3 MB pdf]

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August 29, 2007

Think Indaba

Below some of the rich pictures - more to follow.

Posted by sdehaast at 11:38 PM | Comments (0)

August 22, 2007

Notes on the Knowledge Management conference

Ok, just done with another speaking gig, this time courtesy of The Business Zone. My talk is here [pdf 800 kb].

Some interesting riffs coming through, and it was encouraging to hear from various speakers the importance of a systemic view of organisational knowledge.

Of course I continued with my mantra that context of knowledge is far more important than the knowledge itself (duh), but a lot of this initiatives miss out on acquiring key knowledge FROM the customers' context.

(As opposed to knowledge ABOUT the customer, which to me is just CRM.)

And maybe we should examine the language around knowledge management itself McLuhan style; how about creating "Wisdom Creation" roles, if that's the ultimate aim of gathering data. Or even "Chief Storyteller".

Because knowledge on it's own is of no value (assuming that it's being captured in the first place).

Some links and references as promised to the delegates:

KM and Web 2.0 - taxonomies vs folksonomies

"For organisations, harnessing the capabilities of Web 2.0 could involve replacing the traditional taxonomy with a user-defined folksonomy. “A taxonomy is where people analyse and prioritise ways for classifying information,” says Dawson. “A folksonomy is built by everyone, there is no architect and no designer. It’s created by the people who actually do the work."

Etienne Wenger - Communities of Practice

Blogging = Open-source knowledge management

Concept Mapping tools - CMAP

Some interesting views on Facebook and the Enterprise:
- Facebook and the Enterprise: Part 1
- Facebook and the Enterprise: Part 5: Knowledge Management

One of the key points was the difficulty in capturing what's in peoples heads on to paper, as a lot of the nuances are lost, as we struggle to articulate concepts. So one route is to interview people, but then as the data becomes less structured, it becomes more difficult to find again.

Well, what happens if we could search video?

Check this out: The future of video search

Posted by sdehaast at 4:09 PM | Comments (0)

April 28, 2006

Innovation in Africa conference: speech notes

I was in Jozi for another conference earlier this week. Marcusevans asked me to chair and speak, something I relish doing as it gets me to interact with a wide variety of people.

As promised to the delegates, here is a reference to things I spoke about, and some things I didn't get to discuss, but think relevant to the topic at hand.

My slides have been saved in a pdf format to retain layout and font, and is available here [4mb pdf, right-click and save-as]. You can also have a copy of the text of my speech in MS Word here.

There are a bunch more references and articles that I have which are available in the extended portion of this posting below.

A book all people involved in innovation should read: The Sources of Innovation, by Eric Von Hippel.

Another book about the selling ideas, a key skill, is Free Prize Inside, by Seth Godin.

Relevance to Africa

In discussion during the conference, I spoke a few people about the relevance of innovation to Africa, to shift the thinking away from high-tech to appropriate tech (which is not to say that the latest WiMax network isn't relevant, but rather, let's not get seduced by the technology). I did a speech in 2003 that keyed into this theme (excerpt here).

EF Schumacher wrote about this in Small is Beautiful: Economics as If People Mattered. A classic. An example of appropriate technology meeting up with business model innovation is this company, KickStart. Their tagline is "Tools to End Poverty". (I can't believe Chuck Norris pops up here too, only because he has an organisation with a similar name!)

An interesting document that talks to this theme is Poverty Alleviation as a Business [4.4MB pdf]. This gives some interesting insight into the approach. Of course this also relates to CK Prahalad's The Fortune at the Bottom of the Pyramid [pdf].

Regarding business model innovation, I referenced a quote from John Seely Brown in my talk. I got it from this article [pdf], a useful lens on something that product innovators forget.

Posted by sdehaast at 11:43 AM | Comments (0)

November 24, 2005

Customer Insight Management Conference

Been busy in Joburg at another conference, this time on a subject key to innovation, Customer Insight Management .

Download my presentation "Innovation starts with an eye" here [.ppt 1.8MB] - (Right-click on link and choose save-as).

From GrowthPartners, here are the promised workshop notes and conference learnings:
CIM Conference Learnings [.ppt 82KB]
Value Proposition Templates [.doc 58KB]
Value Proposition Presentation [.ppt 200KB]
(Right-click on links and choose save-as).

Visit them here.

PS Made on a Mac so the quicktime movies may not play on all PCs

Posted by sdehaast at 10:44 AM | Comments (1)

September 8, 2005

The Big Idea

If you have an emerging business (who came up with that limiting term small anyway?), you have to attend the Big Idea conference happening in Oct/Nov. Even if you're still stuck in the corporate closet, it'll help you start thinking like an entrepreneur. Visit www.thebigidea.co.za for more info.

Oh, and we're running some workshops on creativity and innovation there too! Bonus.

Call Louise now - 021 970 1050 - and book your place.

Posted by sdehaast at 1:18 AM | Comments (2)

March 5, 2005

My talk at the African Telecommunications conference

I was asked to give a talk on 3G by Marcus Evans last week, and was kindly hosted by Valeria (who looks just like Laura San Giacomo from the TV show Just Shoot Me :). Thanks for the hospitality.

For those interested in my talk it is available after the following link.

The key messages I tried to convey were:
1) Think out the box, or at least the device

3G = wireless broad(ish)band + billing system + authentication service (SIM card). Think to developing applications and services that can be consumed through a 3G appliance. It doesn't have to be a phone. Users are tired of turning a phone into more than a voice & SMS device anyway.

2. Key component 'technologies' to think about

The Long Tail effect & Time-shifting. Read my speech for more on this.

3. More ranting about rear-view innovation...

I've written about this before.

Any way here is the speech. My slideshow [600kb .ppt] can be downloaded here, and a word doc of it here.

3G: more of the same, but faster? Or a chance to create a real innovation platform.

Simon de Haast, Ideafarm

www.ideafarm.co.za/blog

The things we fear most in organizations -- fluctuations, disturbances, and imbalances -- are the primary sources of creativity.
~ Margaret J. Wheatley ~

------------------------------------------------------------------

Hello everybody.

3G… If you’re getting a feeling that you’ve heard this all before, you may be right.

Some call this feeling deja moo - the feeling that you’ve experienced this BS before. This acronym took over as the leader from the WAP and MMS hype gang some years back and there has been much evangelising about the promise of this technology. Then the spectrum auction bubbles popped and everyone went back to pickup the pieces. [Humpty Dumpty] Except that quietly in the background, engineers and technicians were busy rolling out the necessary infrastructure, and next thing – Bam! – 3G networks are a reality.

But before we get too excited, let’s first examine some alternative viewpoints regarding 3G.

I hope that in this afternoon I can offer up some new thinking frameworks and tools to help you re-perceive the telecoms industry and the opportunities, within and around that fast shifting space. And in so doing, help inspire you to develop great products or services.

Wireless broadband. Always on. Networked everything. Deregulation. Lot’s of juicy disruptive influences. This is the territory of the innovator. And in this ocean of change, the business-as-usual incumbents and start-ups competing within the framework of yesterday are bait-ball frenzy-fodder for the convention-busting sharks circling the opportunities.

Ok so I’m being a bit melodramatic here, but I had to use this great slide somewhere. But I’m not that far off. What do you think shareholders do, when a company mis-steps. Just ask Carly. But it’s exceedingly difficult to make sense of what path to follow when technological change surges. As Alan Kay’s framing quote for the conference says, "The best way to predict the future is to invent it”. But how?

Let me try offer some viewpoints on this.

I love metaphors. They are such useful things to view life with.

Last year, I was driving in Cape Town below Devil’s Peak and the Cape Doctor was really howling. The next thing I noticed was that the canopy of my bakkie was moving from side-to-side! Suddenly I had visions of my canopy flying off onto the road, colliding with another car, or even worse, tumbling down into Woodstock and flattening some poor drug dealer.

These increased levels of anxiety continued for the next couple of minutes until I realised, in a flash of blindingly obvious hindsight, that it wasn’t my bakkie canopy moving at all.

Instead, it was my rear-view mirror, thanks to a loose fitting. What I was seeing, was the product of a faulty lens (the mirror), and the extreme discomfort I felt, was all an invention of my mind.

How often in business do we suddenly see things in a new way? Another name for this, is innovation, a term not only related to the latest technologies being developed in a lab somewhere.

Marshall McLuhan was the guy that gave us the “the medium is the message” and “the Global Village” phrases. He was a keen observer of the media in the sixties and seventies, and his theories on how to consume and make sense of media are directly applicable as a lens to make sense of the future.

He hit the nail right on the head when he made this comment:
"When faced with a totally new situation we tend to attach ourselves to the objects of the most recent past. We look at the present through a rear view mirror. We march backwards into the future."

As we come across new technologies, social trends or geopolitical events, we rely on our familiarity of similar experiences in the past to help make sense of these new events.

Computers use keyboards based on typewriters. The Internet borrowed content structure and style from traditional newspapers. The design of online-shopping websites was at first modelled after malls.

It took the movie industry a decade or so after the first silent movies before it realised that a completely different cinematic effect could be achieved by simply liberating the camera from the tripod. This also liberated the movie industry from the thinking traps imposed by seeing it through a stage play lens.

However useful these prior experiences are in designing the present, we usually get caught up with the conventions used before, and they trap our thinking.

The template for the accidental success of SMS and ringtones was appplied to the development of MMS services, with the expectation that it would be even more successful – hell it was a no brainer. SMS, only better. Except consumers haven’t thought so.

The underlying riff in my talk today is about challenging the way we see how 3G services can be consumed, and urging you not to fall into default thinking traps based on past successes.

Operators are hamstrung by the embedded worldview they have because they started off being a mobile TELEPHONE network. With the transition from mobile voice to untethered data, new thinking is needed to truly ride this wave.

The prevailing wisdom is that 3G is centered around the handset, and the handset is itself is a much smarter and faster version of previous versions. Even the name “3rd Generation” assumes a linear path in development, yielding significant improvements over the last generation. Ja right. In the same way Henry Ford introduced a 4th Generation ox-wagon.

My argument, is that the mobile industry is especially focused on the device, a voice one at that, and this is creating the box of thinking, that traps truly innovative models to emerge. The device is where the money starts flowing, so it’s only natural to expect this. Where do you think this irritating fascination with video-calling comes from.

So, if you founded your business around the establishment of a portable telephone network industry, everything after that will be based on certain conventions and thinking models around voice services.

Linear thinking creates a breeding ground for industries that you won’t see coming.

So what if you were able to take a blank slate and define a business with all the ingredients being offered up now with wireless broadband? How differently would it look like?

I intend to take you a guided tour of some of the things that will influence compelling ideas around the wireless broadband space.

I’ll be discussing what impact the Long Tail has on business model design, and what relevance the concept of time-shifting (and time-killing) has for 3G. By deconstructing and recombining the parts that make up a mobile network service, I will also attempt to how this can be made into a platform for user-led innovation, my biggest crusade, as well as what it means for the rest of us that have no communication services at all.

But before I take you on a trip of what innovation possibilites could be dreamed up using another set of lenses, let me revisit what innovation is about.

What is Innovation
I know there’s a bunch of wordy definitions out there, but this is my take on the topic: innovation is a process or culture, of seeing new connections between old and new stuff. Innovation happens in areas of technology, as most people associate it with, but more importantly it also about challenging the status quo [Machiovelli quote], whether it is how consumers are understood, how staff are employed, or businesses are structured. Creativity is a related component: it is a raw material to the innovation process.

IDEO is a San Francisco design firm that has absolutely mastered this art form. They say that innovation begins with an eye, and rightly so; deep insight and understanding about a problem, customer behaviour, or the opportunities that a piece of technology can open up, are the starting points for creating value out of these insights.

A guide that can be used here is to remind oneself that a customer values the outcome of a product or service, not the thing itself. For example, a DIY customer ultimately wants a hole in a wall, not a drill.

Coming up with the ideas is only half the story. One commentator takes about innovation as being ideas in action.

So this innovation thing is primarily about seeing stuff differently.

We get so caught up in our immediate world that we forget to check whether the lenses we’re using are doing their job properly. Just remember my bakkie canopy story. So the trick is to keep asking “what aren’t I noticing about this situation, what aspects could be different this time.”

And looking outward at your competitors isn’t necessarily that useful either. If you’re all drinking from the same cup of best practice, nothing will seem new.

If you're defining your business in terms of your competition, you're living in what Seth Godin calls the “echo chamber”. Companies and organizations don't grow fast at the expense of existing competitors. They grow fast for reasons that have nothing whatever to do with whether your service is 5% better or your product is a little more convenient. At the same time, looking at your customers with the same tired focus groups won’t yield breakthrough insights because customers lack the ability to articulate their desired future.

As our friend Alan Kay puts it:

We don't get many new ideas … because if you ask most people what they want, they want just what they have now, just 10 percent faster, 10 percent cheaper, with 10 percent more features.

So back to creating your own future:

By reacting to competitor positioning, you have little control of your firm’s destiny.

Try this little exercise:
- Get a piece of paper and a pen.
- Write the word “REACTIVE” on this piece of paper.
This is the mode most businesses are in.
- To shift to a more PROACTIVE mode, all it takes is some letter jumbling.
- Take the letter “C” in the word you’ve just written and move it to the front.
- What do you get: “CREATIVE”.
So you see, it all depends on how you “see” things :)

Here are some quick techniques to see differently, to become aware of the environment of industry shifts?

You can do this by looking at your business with lenses borrowed from other industries, areas of knowledge or unrelated domains. Ask the question: how can I describe my business and what’s happening to it in terms of this other ‘world’ I’m borrowing from.

An example: someone in the distribution business could ask the question-“what other things ‘get’ distributed…hang on, DNA gets replicated and sent around genetic structures according to certain rules and instructions from RNA. I wonder how a genetic scientist could describe my business in these terms. And in so doing, help me make new connections on how I could do things differently in my business.”

The other benefit of getting a naïve expert, as it’s called, into your business, is that dumb questions will follow. Except these questions won’t be so dumb, as they will expose deeply rooted assumptions and conventions that you have long since forgotten existed and take for granted. In that sense then, these rooted assumptions are the boxes we place ourselves in, and to break out of this default thinking, we first have to become aware of them.

There’s a great twist on a common saying that really describes innovation well: vu ja de. This is the ability to see old things in new ways. The following anecdote describes this well:

A statistician, Abraham Wald, was asked to do some research on where to put extra armour on Allied warplanes during World War II. The British and US air forces were concerned because many planes were being shot down. To find out where extra armour could be best applied, Wald put a mark in every bullet hole in the airplanes that returned from battle. He found that two major sections of the fuselage - one between the wings, and the other between the tails - had far fewer bullet holes.

He decided to put the armour in these places, where he saw fewer, not more bullet holes.

Why? Since the planes were hit randomly, and the ones he analysed had not been shot down, it stood to reason that it was the holes he wasn't seeing - in the planes that _weren't_ returning - that needed extra protection.

So what do armour plating, DNA, and fishy stories have to do with opportunities in the 3G space?

Well they help set the scene for understanding the thinking blocks we have because of our vantage points.

Back onto the 3G wagon.

Ok, so now you’re equipped for creative challenge ahead of you, making sense of the world of 3G.

Let us now examine why the hype machine for 3G is back again. We’ll do this by heading back a century, to discuss the evolution of the DC-3 airplane. This comes from Peter Senge’s seminal book on organisational learning, The Fifth Discipline.

In Dec 1903, Wright brothers proved that powered flight was possible when they invented aeroplane. However it took more than thirty years before commercial aviation could serve the general public.

Engineers say that a new idea has been invented when it is proven to work in a lab.

The idea becomes an innovation only when it can be replicated reliably on a meaningful scale at practical costs. If the idea is sufficiently important, such as the telephone, the digital computer or commercial aircraft it is called a basic innovation and it creates a new industry or transforms an existing industry.

When an idea moves from an invention to an innovation, diverse ‘component’ technologies come together. Emerging from isolated developments in separate fields of research, these components gradually form an ‘ensemble of technologies that are critical to each others’ success. Until this ensemble forms, the idea, though possible in the lab, does not achieve its potential in practice.

Back to the Wright brothers: thay proved that powered flight was possible, but the McDonnell Douglas DC-3, introduced in 1935, ushered in the era of commercial air travel.

The DC-3 was the first plane that supported itself economically as well as aerodynamically. During those intervening thirty years (a typical time period for incubating basic innovations) a myriad experiements with commercial flight had failed. The early planes were not reliable and cost effective on an appropriate scale.

The DC-3 for the first time, brought together five critical component technologies that formed a successful ensemble. They were: the variable pitch propeller, retractable landing gear, a type of light-weight molded body construction called ‘monocque’, radial air-cooled engine, and wing flaps.

To succeed, the DC-3 needed all five; four were not enough. One year earlier, the Boing 247 was introduced with all of them except wing flaps. Lacking wing flaps, Boing’s engineers found that the airplane was unstable on take off and landing and had to downsize the engine.

However, although the DC-3 revolutionised commercial air-travel, the airline industry didn’t become a major industry until widespread use of two additional technologies more than 10 years later - the jet engine and radar (the latter being a by-product of the war effort, not ‘aircraft’ research.)

Jet engines and radar fostered a burgening infrastructure of airports, pilots and mechanics, aircraft manufacture, and commercial airlines. This was the foundation upon which the modern airline industry was built.

The key issue here is the ability to see integration possibilities of the ensemble technologies; all the DC-3 technologies were invented by 1925. The following 10 years were spent making incremental changes and figuring out how or what to integrate.

This example underscores the power of making new connections between stuff that’s already there, but sometimes quite far out of your industry’s field of view. It’s also very difficult to see opportunities when you’re immersed in an industry.

McLuhan said it best: “I’m not sure who discovered water, but I’m pretty sure it wasn’t a fish.”

So, while 3G wireless broadband was hyped up some years ago, the appropriate mix of component technologies and business models were and are still being formed. Certainly the mobile space has created massive disruptions outside the industry. Who would have thought the Nokia, Sony-Ericsson and Samsungs of the world would become the biggest sellers of digital cameras?

Here’s some ideas I have on what to look out for that could have a significant impact of how the 3G space plays out.

First up is the concept of the Long Tail.

The Long Tail as related to this discussion, is a term coined by Wired editor Chris Anderson in highlighting business models of Amazon and Netflix, the DVD rental business. In it he observed that products in low demand or have low sales volume can collectively make up a market share that rivals or exceeds the relatively few bestsellers and blockbusters, if the store or distribution channel is large enough.

The long tail of course has it’s roots in statistics, where it shows few population items making up a significant chunk of the data count, with a long stream of items having very little impact.

This graph from Nokia depicts it well from a mobile operator perspective [Intelligent Edge graph].

When storage and distribution costs are insignificant, it becomes economically viable to sell relatively unpopular products. Coupled with tools to expose these ‘hidden’ products, like Amazon’s recommendation engine, the opportunity to sell into the Long Term en masse is significant. Anderson writes about how Touching the Void, an account of a harrowing mountain climbing experience, got good reviews, it was only a modest success and was soon forgotten. Then a decade later, another book about a mountain climbing tragedy, Into Thin Air, became a publishing success. Suddenly, the first book, Touching the Void, started selling again. A docudrama movie was released, and now it outsells Into Thin Air two to one.

What happened? Amazon’s recommendation system kicked in and noted patterns in buying behaviour and suggested that readers who liked Into Thin Air, would also like Touching the Void.

Bang goes the 80:20 rule, of bestseller and movie hits. The thinking trap that we’ve become accustomed to thinking is in terms of hits, not sales. In a non-digital, narrowband world, the structures of storage and Roland Coasian transaction costs support the 80:20 rule. If it’s not a hit, it doesn’t make money. But as we move into a bit dominated world, that’s another convention is about to be trashed.

The size of the Long Tail in books, movies, and music is astounding. When that tail wags, money can be made.

Here’s where I make the inevitable connection to the iPod. But with a twist. The cellphone over the years has evolved into a very personal device,, from being purely a voice-based communicator, to a digital hold-all, of contacts, photos, email. One way of underscoring this shift is to measure the reaction of unwanted mail: we’re irritated when we get junk mail stuffed into our mailbox at home, but we just end up chucking it in the bin. The next on the list is what I call tar-spam, is all that junk under your car’s windscreen wipers. Email spam starts getting really frustrating, but boy are we pissed off when some schmuck sends us SMS spam. That’s because it’s invading our real personal space.

So, ignoring my device centric rant earlier for a bit, the natural tendancy is for handset manufacturers to add digital music players to their range, much like what they did by adding cameras.

By combining wireless broadband connectivity, a DRM-based music subscription service that allows users to download as much music as they want at a flat monthly rate, and fat storage on the phone, (think iPod Shuffle meets cellphone) interesting things start happening.

The music that gets downloaded has a life of a month, then it is marked for deletion on the device, unless the user flags it for purchase to keep permanently. Based on initial user choices on music, the subscription service, somewhat like Amazon, recommends other music that they might like. Suddenly, with easy distribution and awareness tools, the Long Tail kicks in after a while – obscure stuff starts getting bought en masse.

Yes, those in the DRM space will know that there are some serious problems with various proposals floating around with transferring to other digital devices, but this could be solved by using a “lease” renewal system that renews the licence periodically if the other devices are in proximity to the core content device, using wifi or bluetooth.

The second concept is the idea of time-shifting. This was first introduced many years ago with the introduction of the VCR, allowing consumers to alter fixed broadcast scheduling to suit their lives, not the TV stations. Of course this was greeted by a lawsuit by the networks and content owners against Betamax, which thankfully didn’t go anywhere. Now we have Personal Video Recorders like Tivo overseas, which has created an unprecidented level of customer evangelism (who says user interface design has no strategic relevance).

With broadband becoming more widely available, the internet is now also being used as the virtual VCR, with services like RSS, BitTorrent and Google Video allowing access to all sorts of programmed content, on TV, radio and conferences like this.

Now, I’m not saying all of this is perfectly legal, in terms of content owners having their work freely available, but what I am arguing is that technology now allows us to record stuff all over the place (TV, radio etc) and the relevant licensing options need to be innovated. Not to be shut down just because the incumbents don’t have a clue how to deal with this disruption.

3G networks allow the user to use their hand held almost as a life remote control, time shifting their entertainment demands using their phone as an interface to me-tv. Think of it as Tivo-on-a-phone. And you’re not tied to a fixed location. Oh, and I’m not suggesting that one consumes all this content on the phone – I envisage a situation where it can be feed to a another screen or sound system, using the phone as a personal content server.

The same DRM licencing structures found in the music model would enable this.

Remember the key difference between the Internet and the mobile phone network is that on the internet, you’re effectively annonymous. On a mobile network, you’re a known entity.

But now it’s time to take the disruptive thinking further.

Discussions so far have related everything to a single device.

But according to surveys done by various consulting firms, user want less, not more features on their phones. In one study, 70% of consumers polled ranked advanced features very low in what they look for. This is in stark contrast to operators regarding advanced services as a key differentiator.

Operators want to increase their ARPU, and the one way to do this is to provision more and more services to the SIM card. Users aren’t buying this. So how does one reconcile this disconnect?

Well, think out the box for a start, or in this case, think outside the handset. Lets examine the components of a mobile phone service:
- Handset
- SIM card
- Wireless network
- Content and services provision
- Billing system
- Customer relationship.

Innovation is all about creatively seeing novel combinations. So lets try recombine.

What if you took the SIM card, Billing System and the Wireless network components and put them inside another box of electronics. Suddenly you have a 3G Appliance that can plug into your existing home devices (TV, PC, Playstation, alarm system) in which you can consume the above mentioned Long Tail and Time-shifted services. Think DSTV decoder meets wireless broadband.

Because of the customer relationship, the network operator now has the chance to sell the user ANOTHER sim card, and leave the phone alone. Suddenly they are no longer only in the Mobile Voice network business, but also have created a completely new space to play in. Those business units heavily invested in the status quo ie. voice won’t feel that data is cannibalising their core business, because it becomes a separate business.

What I’ve tried to do with the concept of the 3G Appliance is not to say “This is the path to go”, but rather create tangible scenarios for creative recombinations to emerge.

If you’re in this space, as a product developer, as an organisation that needs to deliver information or services, or as a content owner, thinking beyond the handset suddenly opens up new possibilities.

This also has implications for the various players in the mobile ecosystem in that reflections on “what business am I really in” start to emerge.

So what of the rest of us that have no means of communication? Borrowing from the banking industry term, “the unbanked”, we are dealing with a massive section of the population that we could term the “undialled”.

With the shift to new generation handsets globally, already there are initiatives in place to recycle those 2G phones to those in the developing world.

What about creating a industry-wide initiative to bring low-cost no-frills telecommunication service to the poor, call it a Mnsanzi for telecoms? SIM cards can be provisioned specifically for this service thereby reducing fraud or abuse. Above and beyond the voice aspect of this service, government service delivery can be enhanced through the extension of notification services already in place for ID books, pension payments etc. Of course 3G networks in place can also provide low cost narrowband data services like flood and fire warning systems remotely connected in a mesh, in a so called Smart Dust network.

Ok so I’ve rambled on somewhat about developing new paradigms in which to view 3G networks, and so I think it’s nearly time to go have some tea.

Conclusion
My goal today has been to create some food for thought about the telecoms landscape.

We get so caught up in the immediacy and urgency of the what new technologies and regulatory shifts can bring, we forgot sometimes to take a step back and reframe what is really happening.

To reiterate this point, McLuhan is worth repeating again: "When faced with a totally new situation we tend to attach ourselves to the objects ... of the most recent past. We look at the present through a rear view mirror. We march backwards into the future."

So I hope I have been able to provide you with alternative ways of framing the 3G opportunity, helping you break out of default thinking . There is so much that this technology can offer in terms of radical new business models, compelling new services and, generally, a platform for innovation.

I’d like to end off with one more story that illustrates the hazards of having a limited perspective on ones’ business environment, a perspective that is conditioned by how we are ruled by our assumptions.

There was a man who, during wartime, would come to the country’s border with a wheelbarrow full of dirt. The border guard looked at the man’s papers and all was in order for him to cross. But the guard was certain the man was smuggling some sort of contraband in the wheelbarrow. So the guard took a shovel, poked around in the dirt, but found nothing. The man was allowed to cross.

The next week, the man once again comes to the border with a wheelbarrow full of dirt.

Again, the border guard found that the papers were in order and dug through the dirt, but still found nothing. And again, the man was allowed to cross.

Week after week, it was the same story: Man approaches the border with wheelbarrow full of dirt. Guard finds nothing of interest and the man crosses.

At the end of the war, the guard sees the man and asks him: “Look, I know you were smuggling something across the border, but I could never find a thing hidden in the dirt. What were you smuggling all those years?”

The man answered: “Wheelbarrows.”

Thank you.

[References]
I have to acknowledge the following references as providing some of the inspiration and stories in this talk:

Allan D., Kingdon M., Murrin K., Rudkin D., How to Start a Creative Revolution at Work, Capstone, London, 2000
Federman, M., How to Determine the Business You’re Really In & Other Tales of McLuhan Thinking, Innovation and Integral Awareness, McLuhan Program in Culture and Technology, University of Toronto
Kelly T., & Littman J., The Art of Innovation: Lessons in Creativity from IDEO, HarperCollins Business, London, 2001
Majaro, S., Creativity in the Search for Strategy (in Crainer 1999), Prentice Hall, 1999
Sutton R.I., Weird Ideas that Work, Penguin, London, 2002
Von Hippel E., The Sources of Innovation, Oxford University Press, New York, 1988
Walsch, N.D., Conversations with God Book 1, Hodder & Stroughton, London, 1997
Zander B., and R.S., The Art of Possibility, Penguin Books, London, 2000

Posted by sdehaast at 8:20 PM | Comments (1)

November 24, 2004

Cape Town's Creative Class

I spoke last night to a gathering of Cape Town's Creatives about Richard Florida's book "The Rise of the Creative Class".

What I tried to do was to create an alternative lens to view the potential impact that the creative sector can have on economic prosperity. Integrating multiple perspectives is one benefit that this 3T model offers.

Just prior to the evening's talk, I had a chat to the team that runs the Creative Class regional rankings, Catalytix. One of the key shifts from the traditional ways in which we analyse regional economies is the preoccupation with industry analysis.

Lou Musante of Catalytix instead offered an alternative approach: look at what people actually do within these industries. Are they get paid to execute, or to develop ideas. The latter is where value is created. So when analysing a region, not only is the industry breakdown important, but also the breakdown of non-creative/creative roles within that economy.

There's a bunch more I can talk about related to this, but I'll leave that for another time.

In the meantime, here is a copy of my talk that I gave to the group.

The Rise of Cape Town’s Creative Class
Cape Town Creatives' Club, Cape Town Tourism
23 Nov 2004

Hello everyone. My name is Simon de Haast and I’m here this evening to share some thoughts on a topic that I’m passionate about – and that’s making Cape Town one of the creative capitals of the world.

I get such a kick out of helping people see things in new ways that I decided to start a business that does just that. And in the course of my reading and google gorging about the topic of creativity, I came across some really interesting research that made be really excited about Cape Town.

We all know how on the map this city has become, thanks to the buzz about property, film production, celebrity events etc.

I’m going to talk about another aspect of Cape Town, that of it as being a creative epicenter, thanks to various structural factors in its favour.

And I’m not only talking about creativity for its quality of content, but also how this impacts a region’s economic potential.

Some years ago I came across some work by Richard Florida, a professor of regional economic development in the US.

He wanted to find out why certain regions and cities attracted new businesses, while others struggled to retain them. From questions posed to new graduates like “How do you choose a place to live and work”, his research led him to writing a book called the “The Rise of the Creative Class” in 2002.

First some background.

The increased availability of lifestyle options (whether or not they are exercised) is starting to govern our decisions about where we work, and what kind of place we want to live in.

The world in our eyes is not compartmentalised and structured in neat segments – work, play, home - like our parents’ worlds were. In fact, instead of thinking out the box, we’re living literally out the box.

More and more people are making choices about their lives that allow them to create meaning and purpose on their own terms, and not conforming to social, marketing, or peer, norms and pressures.

Technologists talk of the convergence between different forms of media and digital devices – your cellphone is your camera is your mp3 player.

Similarly, there is a convergence of lifestyles, that the distinction between work/play/home is becoming blurred, even completely challenged. City loft living, for example, is transforming once deeply industrial environments into luxury urban spaces.

What is creativity?
To build the argument that a region’s economic potential is related to its store of creative talent, we need to first clarify what I mean by creativity. I regard it as the raw material to innovation; it’s the behaviours and thinking behind action. Webster’s dictionary puts it as the “ability to create meaningful new forms”.

It comes from people, and the more widely one casts a net for fresh thinking, the more original the result. The alternative to casting wide is to attract the creative fish to one place.

Innovation, (being ideas in action), and creativity (the raw material for innovation) come from the intersection of cultures, beliefs and ways of thinking. It is at these intersections of multiple cultures where creativity is born.

Connecting to South Africa’s natural resource heritage, we have a history of extracting just the base material and exporting it to developed countries for beneficiation, whether it be jewelry or catalytic converters. In the last decade though, we’ve come a long way in the processing and adding value to those raw materials domestically. The same goes for our creative natural resources; we are finding our voice collectively as a nation.

The dotcom era gave us books like “the Death of Distance” – how digital technologies were going to make irrelevant the need to be in physical proximity to add value. For sure, email, IM and related communication technologies allow for collaboration across continents, but nothing beats the buzz of creative space. Clusters are one manifestation of this – just look at lower Green Point or Kloof Street to see the groupings being naturally formed. Watch Muizenburg transform itself into sea lifestyle space. Long Street can in a way be seen as a tourism cluster. Cape Town’s recent tragic history shows the negative impact of ignoring this concept of place as being a well-spring of creativity when the powers that be removed District Six, a massively vibrant meta-cluster.

In fact, the regeneration of clusters can act as catalysts for spurring the creative economy engine, helping to regenerate the city.

Innovation and creativity happens in places, in cities and regional clusters. As Richard Florida puts it: “Cities have become cities of ideas and cities of consumption. They are no longer cities of production….Place has become the central organising unit of our time, taking on many of the functions that used to be played by firms.”

So where is this taking us? It’s clear that there is a new ‘order’ emerging, or as Florida correctly terms, a new class. However our notion of the term class needs to be rethought: A class here is a cluster of people who have common interests and tend to think, feel, and behave similarly, but these similarities are fundamentally determined by economic function – by the kind of work they do for a living.

In this context it is not meant to refer to an elite, nor an excuse to demarcate and develop yuppified areas.

Florida calls this new order the Creative Class, whose primary economic function is to create new ideas, new technologies or creative content. The difference between the Creative Class and other ‘classes’ lies in what they’re primarily paid to do. Those in the Working Class and the Service Class are primarily paid to execute to plan, while those in the Creative Class are paid to create and have considerably more autonomy and flexibility than the other two classes do.

The Creative Class is composed of two dimensions. There is the supercreative core, which are the scientists, engineers, tech people, artists, entertainers musicians – so-called bohemians. In addition to the supercreative core, Florida includes creative professionals and managers, lawyers, financial people, healthcare people, technicians, who also use their ideas and knowledge and creativity in their work.

Whether they are artists or engineers, musicians or computer scientists, writers or entrepreneurs, they share a common creative ethos that values creativity, individuality, difference and merit.

Ok, so we’re seeing an emergence of this so-called creative class around the world.

Why is Cape Town so special you ask? We know it’s an awesome place to live but what makes it have the attributes to become a creative Mecca?

3T
In his research, Florida explored what factors caused a region to attract talent and business. He came up a 3 T theory: technology, talent and tolerance preconditions that help predict regional economic performance.

Technology relates to having a research universities and other institutions, and focused investment in technology.

Talent relates to having a place that attracts and retains talent, one that has the lifestyle options, the excitement, the energy, the stimulation that talented, creative people need. This factor has since been split into two, a fourth T – Territory Assets.

And lastly, tolerance of diversity is necessary to attract all sorts of people – foreign-born people, immigrants, gays as well as straights, punk rockers and maskande divas.

His research team came up with really interesting indicators to measure the relative impact of these predictors:

For technology, they use an innovation index which is a measure of patents in an area of population, and a high-tech index which is an index of high-tech company concentrations.

He measures talent using a creative class index, which is the percent creative class and supercreative core of total population,

Tolerance is measured through a melting-pot index – immigrants, and Gary Gates’ Gay Index, which takes people living in households where partners in the household were of the same sex. Florida goes as far as to say that gays are the canaries of the creative economy. Where gays will be a community – a town or region – that has the underlying preconditions that attract the creative class of people from a variety of backgrounds.

In essence, the theory argues that people are drawn to places not amenties.

As you can imagine, Cape Town would score highly on all these indicators.

On the technology front we have numerous facilities and projects such as the Cape IT Initiative, Cape Biotech Initiative, Capricorn Science Park, TechnoPark in Stellenbosch, viticulture research (the only one in Africa). Hey we even have space man that has just developed a unique flavour of Linux called Ubuntu Linux.

As far as talent attractiveness goes, you only have to look at the huge variety of lifestyle options that people can pursue: mountain biking, surf-skiing, forest walks & hikes, wine farms, opera, world-class jazz…the list really is endless. The Design Indaba is on the global map; Cape Town Jazz festival and the MCQP bash are also. Where else can you hop off a mountain and float down to a Café del Mar style beach bar. This town is Art Deco heaven.

Tolerance for diversity speaks for itself in that Cape Town is one of the gay capitals of the world. The French-speaking car guards outside is another clue to the diverse set of immigrants this town attracts. Yes sure, there’s still plenty of room for downsizing in the xenophobia department, but this city is a magnet from far a field. The melting pot factor really helps to break down unquestioning thinking that permeates a community that has been around for a long time – this so called social capital as actually a big inhibitor to innovative thinking as no one challenges accepted wisdom.

I have to acknoweldge here that this last factor is an area we still have a lot of work to do. Infrastructures issues like transport access is one of the stumbling blocks to the mixing of ideas, above and beyond the attitudes that permeate amongst the the residents of Cape Town. But that is changing.

So where can this take us?

Organising for creativity I believe is an obvious oxymoron. So we must take care not to suggest nor lobby for institutional arrangements to help make a creativity-driven economy prosper. It happens as a natural consequence.

The best the bureaucrats can do is to get out the way, to remove obstacles to letting creatives thrive and prosper. Create enabling environments for this to happen. From what I’m seeing, this is starting to happen, with support for craft based small businesses, SME support through the RED door initiative. The Cape Film Commision streamlining the permit process. Fashion week’s workshops and the organising of a fashion route.

But other stuff can happen. Cape Town can be actively positioned as a destination of choice for creative types; with each Design Indaba for example I see more exposure in magazines like Wallpaper.

This should be sustained through the year. What will make this place thrive is attracting more and more niche travelers, creating more diversity, and getting them to stay. Create a design route.

Set-up sabbatical programmes with overseas design and creative agencies to send their people to Cape Town for a dose freshness and new thinking. I’m busy trying to do that with Virginia-based Play Advertising.

Let’s take the concept of city twinning and pair with other cities that are embarking on their own creativity-led economic development strategies. Immediate examples that come to mind are the Creative London project, Memphis, Michigan’s Cool City initiative and Boston.

Wifi enable the city, giving free access to the web at very low cost. Follow Philiadelphias attempts to create a municipal wireless network – you’re creating foundations for unpredictable stuff to happen.

We have so much to offer the rest of world in the way we think – collectively we must have something special if we managed to navigate the transition to democracy in the way we did.

Ok, so what have I tried to do here? I used Florida’s model of a creative class to re-perceive how Cape Town is viewed, The 3T lens creates a new way to see Cape Town, integrating the various perspectives that people have of Cape Town, and how this can be harnessed, or coalesced into a much bigger force.

Let’s for a minute bear in mind the relevance of this talk of the creative class to the realities right here at home. You can’t eat ideas. Bridging the digital divide won’t create a roof in itself.

What’s different here at home, is that instead of using our creative talents to buy more time to have more leisure or freedom as in the ‘West’, the challenge is to use the abundance of time that we have, that is, our vast labour resources, to creatively develop massively productive solutions using what EF Schumacher called appropriate technologies.

Keying to the Proudly South African movement, lets look to our own collection of wisdom, stories and heritage and not apply without reflection, thinking created in other contexts.

Truly creative and inventive solutions are born in environments of extreme constraints. One way to reframe this within our socio-economic challenges is to see this environment as an incredible palette of opportunity.

Move from the “ we can’t do this because we don’t have that” to a “this is what we’ve got, let’s see how we can make new connections and win.”

Imagine Cape Town and its related projects are doing this, are unlocking mindsets one community at a time. Pretty soon they’ll reach the inflexion point and there’ll be no stopping the momentum.

My goal here tonight has been to put this idea out there to you, to give you another way of looking at this gorgeous city, and to encourage dialogue around this. I am in active discussions with Richard Florida’s team with a view to bringing him out here to talk to key stakeholders as to how to catch this creative class wave. I welcome any challenges to this topic, or ideas around how to catalyse this process.

Since this talk has been about the economic impact of creative industries, let me end off by borrowing from celebrated new growth economist Paul Romer:

He says the economic advances come from ideas. Ideas come from people.

So, creating a people climate must be an integral part of any economic development agenda, not as an add-on or an after thought, but rather as a strong pillar or our economic agenda.

Thank you.

Useful Links
http://www.creativeclass.org/
http://www.memphismanifesto.com
http://www.creativelondon.org.uk
Driving the Creative Industries In the Western Cape [.doc]

Posted by sdehaast at 8:47 AM | Comments (0) | TrackBack

November 23, 2004

Wheelbarrows, Insight & Innovation

If anyone's interested, here's a talk I gave at the Small Business Week, where I facilitated the "Innovation Station" workshop.

Some entertaining stories about seeing things differently. Some overlap with my "Rear View Innovation" article.

Insight & Innovation by Simon de Haast
Ideafarm :: innovation and creativity catalysts
Landline 021 423 9328
Cell 083 326 3496
Email simon@ideafarm.co.za
Web www.ideafarm.co.za

Given at Innovation Station workshop as part of the Small Business Week 2005 expo
With acknowledgements to reference material noted at end of document.

My goal in this afternoon’s session, is to give you new thinking frameworks and tools to re-perceive your business and the opportunities, within and around it.

During the panel discussions, the objective is to give maximum opportunity for the various sector leaders to promote the clever stuff that’s happening in their areas, while offering up opportunities for cross-pollination across sectors to occur, and giving you the chance to investigate how these opportunities can impact your business positively.

We will also, during the course of the panel discussions, open up to the floor for any Q&A at various intervals.

The key theme this afternoon is creating possibilities. Everyone knows about the glass half-full/half-empty thing.

Of course accountants would argue that the glass is too big in the first place!

But here’s another take on it.

People that consider that the glass is half-empty are focusing on the intangible, invisible stuff. You can’t touch, feel, experience half-empty. It is purely a mental construct.

However, if one prefers to think that the glass is half-full, the focus is on the real, tangible stuff. You can touch, feel or experience the half-full portion.

Especially if it gets thrown in your face :)

So, with possibilities thinking, let’s focus on the stuff that we can work on, do or create. Let’s not revert into worst-case scenario thinking, worrying about potential impacts or imagined consequences of ideas before we’ve finished with the idea generation.

Also, borrowing from Appreciative Inquiry, let’s not dwell on what’s missing in our business like access to funding, but try see how effectively we can use what we’ve got eg. skills, talent or market access.

But before that, let me tell a couple of stories about innovation.

Firstly, let’s talk about what innovation is about..I know there’s a bunch of wordy definitions out there.

This is my take on the topic: innovation is a process or culture, of seeing new connections between old and new stuff. Innovation happens in areas of technology, as most people associate it with, but more importantly it also about challenging the status quo, whether it is how consumers are understood, how staff are employed, or businesses are structured.

IDEO is a San Francisco design firm that has absolutely mastered this art form. They say that innovation begins with an eye, and rightly so; deep insight and understanding about a problem, customer behaviour, or the opportunities that a piece of technology can open up, are the starting points for creating value out of these insights.

A guide that can be used here is to remind oneself that a customer values the outcome of a product or service, not the thing itself. For example, a DIY customer ultimately wants a hole in a wall, not a drill.

Coming up with the ideas is only half the story. One commentator takes about innovation as being ideas in action. The action part is key, and this is what most people struggle with. The key to action is not to be a perfectionist: making an idea real can achieved by creating rough prototypes or simulations – the key thing is to remember that the doing process is far more important than the early look and feel.

And it's the company that actually implements the new idea successfully, not the one that does all the hard, creative work above, that makes all the money from the idea. The value isn't realized until customers actually start paying (enthusiastically) for the innovation.

But this is a topic that is another whole seminar.

So this innovation thing is about seeing stuff differently. Let me offer up a couple of anecdotes to reinforce this.

This one is from my own experience. A couple of months ago, I was driving along De Waal drive, and the South Easter was really howling. As I carried on, I notice that my bakkie canopy was shifting and moving, and became quite concerned that the next thing I was going to see, was my canopy flying off into Woodstock somewhere, flattening a poor drug dealer or something. This anxiety continued on for a minute or two before I realised, with blindingly obvious hindsight, that my canopy wasn’t moving at all, but rather, my rear-view mirror was vibrating on a loose mounting.

Wow, all that anxiety and misinformation thanks to a faulty lens.

We get so caught up in our immediate world that we forget to check whether the lenses we’re using are doing their job properly. Catch yourself next time you encounter a situation in your business, that, at first glance, seems to be clear cut and ask yourself “what aren’t I noticing about this situation, what aspects could be different this time.”

I’m sure you don’t need me to remind you how, during the course of business growth and expansion, our initial external focus gets sucked into managing the internal aspects of running and administering a business.

Before long our immersion makes itself felt with increased stress levels, dropped customer opportunities or competitor manoeuvring. Marshall McLuhan, the guy that gave us the “medium is the message” and the “global village” phrases once said: “I’m not sure who discovered water, but I’m pretty sure it wasn’t a fish.”

Also, looking outward at your competitors isn’t always that useful either.

If you're defining your business in terms of your competition, you're living in the “echo chamber” [Seth Godin]. Companies and organizations don't grow fast at the expense of existing competitors. They grow fast for reasons that have nothing whatever to do with whether your service is 5% better or your product is a little more convenient.

By reacting to competitor positioning, you have little control of your firm’s destiny. Try this exercise:
- Get a piece of paper and a pen.
- Write the word “REACTIVE” on this piece of paper.
o This is the mode most businesses are in.
o To shift to a more PROACTIVE mode, all it takes is some letter jumbling.
- Take the letter “C” in the word you’ve just written and move it to the front.
- What do you get: “CREATIVE”.

So you see, it all depends on how you “see” things :)

So how does a business owner get to see differently, to create the space to sense the water around them, to become aware of the environment of the business?

You can do this by looking at your business with lenses borrowed from other industries, areas of knowledge or unrelated domains. Ask the question: how can I describe my business and its operations/processes/problems in terms of this other ‘world’ I’m borrowing from.

An example: someone in the distribution business could ask the question-“what other things ‘get’ distributed…hang on, DNA gets replicated and sent around genetic structures according to certain rules and instructions from RNA. I wonder how a genetic scientist could describe my business in these terms. And in doing so, help me make new connections on how I could do things differently in my business.”

The other benefit of getting a naïve expert, as it’s called, into your business, is that dumb questions will follow. Except these questions won’t be so dumb, as they will expose deeply rooted assumptions and conventions that you have long since forgotten existed and take for granted. In that sense then, these rooted assumptions are the boxes we place ourselves in, and to break out of this default thinking, we first have to become aware of them, much like the fish, being acutely aware of the water once it is on dry land. Except that surfacing assumptions and conventions about a business or industry is safer.

There’s a great twist on a common saying that really describes innovation well: vu ja de. This is the ability to see old things in new ways. The following anecdote describes this well:

A statistician, Abraham Wald, was asked to do some research on where to put extra armour on Allied warplanes during World War II. The British and US air forces were concerned because many planes were being shot down. To find out where extra armour could be best applied, Wald put a mark in every bullet hole in the airplanes that returned from battle. He found that two major sections of the fuselage - one between the wings, and the other between the tails - had far fewer bullet holes.

He decided to put the armour in these places, where he saw fewer, not more bullet holes.

Why? Since the planes were hit randomly, and the ones he analysed had not been shot down, it stood to reason that it was the holes he wasn't seeing - in the planes that _weren't_ returning - that needed extra protection.

So how do these stories help you in your business, to see new opportunities?

Well, the first thing, is that they serve as timely reminders about the danger of immersing yourself in the internal side of your business: if you’re doing the books, get a bookkeeper. Fiddling around with your network and Pcs? Get someone whose business it is, to do the IT support.

Get creative in finding ways to afford this “outsourcing” – barter your skills maybe.

But these are merely stepping-stones to rekindling the external focus you started the business with.

A way to break-out of the thinking habits that you have collected is to apply some structured thinking tools to aspects of your business that concern you, or areas you need to grow.

Because our minds cluster information based on similar past experiences, over time we develop deep rivers of knowledge in a particular area. The human brain is evolved to spot patterns, not the absence of patterns. In fact the root of the word “information” comes from pattern. Think of this a one large filing cabinet.

This is especially so where we are specialists in a particular area. Our ability to preconceive in new ways is diminished, because we dip into our existing rivers of experience. Much like a mountain stream, this river gets deeper and deeper, the more we hang out in the same knowledge space. Our filing cabinet has very few folders, but the contents of which are very thick with content.

To develop new ideas then, requires us to river jump, to develop new streams of knowledge and insight, without the constraints and anchors of prior knowledge or experience.

The more diverse stuff we read, experience, or practice, the easier it is to generate and draw upon new these new streams. When we open up the filing cabinet, we have a wider range of folders to choose from, to guide our thinking.

So, do stuff you haven’t done before.

Stuck with an engineering or manufacturing problem? Spend a morning at the aquarium looking at the amazing way nature creates interfaces and symbiotic systems.

Go to the bookstore and browse through a magazine you’d never normally read. The idea is to look anywhere for new concepts or triggers – increasing your store cupboard from which to make these all-important connections.

Keep a bug list: we always come across really poor design, services or products that really suck. Note these experiences in a journal. This becomes fodder for innovation. Keep asking, “Surely there’s a better way to design this?”

Don’t stress that an idea that you may get is ridiculous or outrageous. The key to being creative is not to judge too soon. Think of these as “intermediate impossibilities” – thinking gateways to highly original and effective new products or services.

Specific thinking triggers that you can take away with you today are the 4 R’s of fresh thinking: Re-expression, Revolution, Randomness, Related worlds.

By Re-expressing a concept or problem, I mean to examine the vocabulary used in describing it, and then to change the words used, or unpack the meaning behind those words.

Revolution relates to examining the conventions that drive a particular business model or industry, and challenging why they exist; maybe it’s time the rules were changed.

Randomness is simply opening a dictionary and selecting some words at random, and then forcing connections between your problem or challenge, and the random word. This helps break your pattern of thinking into new spaces.

Related worlds is a particularly powerful source of innovation. I alluded to it earlier when I spoke about going to the aquarium. Find another industry, thing, or domain that has similar characteristics to the challenge at hand.

For example, if you’re busy trying to redesign a photocopier, and one of major problems identified with the current models is that paper feeds get jammed or blocked, thereby making the unit useless until serviced (if a major jam).

Well, what else gets blocked or jammed. Rush-hour traffic gets jammed. But only at certain times. Also, our noses get blocked when we get colds. But hand on, only one nostril at a time gets blocked for some reason. Applying this to our photocopier feed problem, why not create two paper feed channels so that if one gets jammed, we can at least use the other channel until we can get a service call. Ok this is a simplistic example, but you get the picture.

You can tie multiple triggers together.

If you want to design a savings account that has a unique approach, start by examining the language used by consumers of savings accounts and re-express what is said. One of the phrases that are sometime heard is that people like to “park funds” for a while in a savings account.

So let’s unpack this term ‘park’. What other ‘related worlds’ park. Well there’s the world related to parking one’s car: we’ve got parking meters, traffic cops, car guards, and being towed away. There’s also the leafy park we take our kids, walk our dogs, and lie under trees. Unpacking to the extreme, there’s even South Park, the foul-mouthed animated series, along with its various bizarre characters and storylines. Remember what I said earlier about intermediate impossibilities!

What these exercises do, is to offer up alternative lenses to view the issue at hand, giving you more stimuli for fresh ideas. By reconnecting these alternative worlds to the original issue at hand, ie. designing a new savings account, you now have a much broader palette to draw upon. Forcing connections between these related worlds helps one to break out of default thinking traps.

I’d like to end off with one more story that illustrates the hazards of having a limited perspective on ones’ business environment, a perspective that is conditioned by how we conceive of the reality around us. Another way of putting this is realising that there’s a world of difference between what we know about our business and our customers, our conception, and what we think our customers think about our business, our perception.

There was a man who, during wartime, would come to the country’s border with a wheelbarrow full of dirt. The border guard looked at the man’s papers and all was in order for him to cross. But the guard was certain the man was smuggling some sort of contraband in the wheelbarrow. So the guard took a shovel, poked around in the dirt, but found nothing. The man was allowed to cross.

The next week, the man once again comes to the border with a wheelbarrow full of dirt. Again, the border guard found that the papers were in order and dug through the dirt, but still found nothing. And again, the man was allowed to cross.

Week after week, it was the same story: Man approaches the border with wheelbarrow full of dirt. Guard finds nothing of interest and the man crosses.

At the end of the war, the guard sees the man and asks him: “Look, I know you were smuggling something across the border, but I could never find a thing hidden in the dirt. What were you smuggling all those years?”

The man answered: “Wheelbarrows.”

[References]
Allan D., Kingdon M., Murrin K., Rudkin D., How to Start a Creative Revolution at Work, Capstone, London, 2000
Federman, M., How to Determine the Business You’re Really In & Other Tales of McLuhan Thinking, Innovation and Integral Awareness, McLuhan Program in Culture and Technology, University of Toronto
Kelly T., & Littman J., The Art of Innovation: Lessons in Creativity from IDEO, HarperCollins Business, London, 2001
Majaro, S., Creativity in the Search for Strategy (in Crainer 1999), Prentice Hall, 1999
Sutton R.I., Weird Ideas that Work, Penguin, London, 2002
Von Hippel E., The Sources of Innovation, Oxford University Press, New York, 1988
Walsch, N.D., Conversations with God Book 1, Hodder & Stroughton, London, 1997
Zander B., and R.S., The Art of Possibility, Penguin Books, London, 2000

Posted by sdehaast at 8:15 PM

November 20, 2004

We march backwards into the future

Rear-view innovation

I love metaphors. They are such useful things to view life with.

Last month I was driving below Devil’s Peak and the Cape Doctor was
really howling. The next thing I noticed was that the canopy of my
bakkie (pickup) was moving from side-to-side! Suddenly I had visions of my canopy flying off onto the road, colliding with another car, or even worse, tumbling down into Woodstock and flattening some poor drug dealer.

These increased levels of anxiety continued for the next couple of
minutes until I realised, in a flash of blindingly obvious hindsight,
that it wasn’t my bakkie canopy moving at all. Instead, it was my
rear-view mirror, thanks to a loose fitting. What I was seeing was the product of a faulty lens (the mirror), and the extreme discomfort I felt, was all an invention of my mind.

How often in business do we suddenly see things in a new way?
Another name for this is innovation, a term not only related to the
latest technologies being developed in a lab somewhere.

Sixties media theorist Marshall McLuhan (the "global village" and "The medium is the message" guy) once said: "When faced with a totally new situation we tend to attach ourselves to the objects ... of the most recent past. We look at the present through a rear view mirror. We march backwards into the future." ...more>>

As we come across new technologies, social trends or geopolitical events, we rely on our familiarity of similar experiences in the past to help make sense of these new events. Computers use keyboards based on typewriters. The Internet borrowed content structure and style from traditional newspapers. The design of online-shopping websites was at first modelled after malls.

However useful these prior experiences are in designing the present, we get caught up with the conventions used before, and they trap our
thinking. That's why asking dumb (or more accurately, naive) questions are so useful. That's the opinion of Michael Ray, in his book Creativity in Business. Creativity always begins with a question, and the quality of your creativity is determined by the quality of your questions, and by the way you frame your approach to circumstances, problems, needs, and opportunities, argues Ray.

It took the movie industry a decade or so after the first silent movies before it realised that a completely different cinematographic effect could be achieved by simply liberating the camera from the tripod.

So a dumb question is dumb in the same way as a child is wise. What's your industry's fixed, tripod-anchored movie camera? What dumb questions can you get people to ask?

But it's difficult to see those opportunities when you're immersed in the day-to-day stuff. Borrowing from McLuhan again: "I'm not sure who discovered water, but I'm pretty sure it wasn't a fish." A fish only becomes acutely aware of water only when it's taken out of it. Pretty dangerous for any business for it to be the fish out of water.

One way to do this safely is to look at other unrelated industries or
knowledge domains for vague similarities between activities or problem areas. Just how different is DNA replication from the shipping of products from the warehouse to store? The key is not to see a perfect fit, but to use these as lenses to your business.

Another anecdote, this time from Robert Sutton's book, Weird Ideas that Work, serves as an illustration.

A statistician, Abraham Wald, was asked to do some research on where to put extra armour on warplanes during World War II. The British and US air forces were concerned because many planes were being shot down. To find out where extra armour could be best applied, Wald put a mark in every bullet hole in the airplanes that returned from battle. He found that two major sections of the fuselage - one between the wings and the other between the tails - had far fewer bullet holes.

He decided to put the armour in these places, where he saw fewer, not more bullet holes. Why? Since the planes were hit randomly, and the ones he analysed had not been shot down, it stood to reason that it was the holes he wasn't seeing - in the planes that _weren't_ returning - that needed extra protection.

Hey you, get off out of your tripod!

An edited version first appeared in www.mediatoolbox.co.za

Posted by sdehaast at 11:19 AM