Risk is critical for change but the spectrum of acceptable risk is personal—#BIF9

Stacy-PearsallThe range of risk explored, for the sake of self-discovery and innovation was quite extraordinary at BIF-9. It was humbling to see the extent to which people placed themselves, and their sense of self, at risk in the pursuit of revealing new truths.

Combat photographer, Stacy Pearsall opened with a story about joining the military and the elite combat photography troop and through her work received a traumatic brain injury in Iraq. The acceptance of death as a possibility was necessary to do her job and led to her project documenting, “America’s unsung heroes.”

Pearsall described her camera as one of the most powerful weapons possible. That said, after her traumatic brain injury, she discovered that there was a gap in what it meant to be a veteran and how veterans are perceived. She began to photograph veterans to be able to help broaden the definition of what it means to be a veteran and what their needs are in society today. The Veterans Portrait Project was created and she is self-funding the effort.

She wants no other veteran to experience what she experienced in her journey to recovery.

Through her Charleston Center for Photography, Pearsall teaches disabled veterans by giving them the tools they need to feel better about themselves. She finds inspiration in others and the ability to help and exhorted us to do something today—and together.

The concept of a bias for action was very much in play over the two days. Scott Heimendinger, started out as a passionate food blogger and fell into the traps of scrambling for SEO and page views, etc. It wasn’t great, but as Scott noted, doing work is good.

Doing work is important, even if you are not sure what you are doing.

In 2009 if you wanted to cook sous vide at home it cost $1200 to buy a lab device. It shouldn’t have cost that much. Make magazine published his slow food DIY project and he unlocked the Maker merit badge as a result. Heimendinger found the “right pond” to swim in through a process of taking more and more small risks on over time.

As someone who is very risk averse, I have come a long way.

Over time he created a molecular gastronomy cooking club and is establishing Culinary Jam Sessions. Jet City Gastro Physics, just filed its first patent on the way to making better French fries. Along the way he took a Modernist Cuisine course and snagged an internship during which he met Nathan Myhrvold former Microsoft CTO and molecular gastronomist, who created a guide. Now, after directly telling Myhrvold that he should hire him, Heimendinger is working there are as Director of Applied Research and recently had an amazing launch on Kickstarter for his $199 sous vide cooker.

For more on this topic listen to my post session interview with Scott.

Primed-in-5-logoPrimed in 5 with Scott Heimendinger

His efforts were rewarded by taking a series of risks that were manageable over time. All it took was bold passion and being unafraid to be passionate.

 

 

 

That kind of dedication and passion is something that Angela Maiers sought to tap into during her story. For Maiers, the act of contribution changes us. She sees that the moment we realize we have what someone else needs, in that moment our humanity is cemented.

To frame her story she noted that somewhere between preschool and grad school we have learned to hide our genius. And we need to change that. Then she launched into sharing the tale of a great project she conducted with some high school seniors on the last day of school before Summer. Maiers actively asked them to tap into their own genius, to risk a little by committing to something bigger than them selves. What occurred was nothing less than astounding. The students stayed for two days even though school was well and truly out for the year!

Oh, don’t mind me, I’m just changing the world.

The students felt that they were needed and were going to do something about it. Fifteen social enterprises launched and they all believed in themselves and in each other. By taking a risk they became invested in their own genius. And some of the participants joined Angela on stage at BIF-9 to share their own takeaways from the event and share their own stories, “These two days were really important to me…” which was great to see. Another risk taken…

FutureProjectIf Angela Maiers exemplified the process of leading others to recognize and take ownership of their own genius, Andrew Mangino illustrated the results of that journey of discovery from the student’s perspective. Arising from his work as a student journalist Mangino shared his path to eventually founding The Future Project,

 

 

 

High schools aren’t living up to what we all know they can be. Too many students drop out. Even more are disengaged daily. And the current thinking–to blame more teachers, impose more rules, and inject more money–just isn’t working.

At The Future Project, we see the problem simply: Our students aren’t pursuing their dreams. We’re out to turn high schools into Future Schools, where students develop the skills to do just that.

Here are the nine lessons he learned on the way:

  1. When we discover a passion, we discover we can do anything.
  2. Young people learn most when they are changing the world
  3. Schools are not really broken. They are working just as they were designed to work. And so they must be re-invented. [The performance system. Duh]
  4. A nation build on infinite possibility doesn’t feel like it.
  5. The most unjust gap in modern America is the inspiration gap. (seen as a luxury)
  6. The most solvable gap in modern America is the inspiration gap.*
    *But it is going to take a movement to do it.
  7. We don’t have to wait for permission to start.
  8. Nothing happens without a great team.
  9. It’s time for a new kind of leader in America—someone who stands for you.

The Future Project asked, what if there were dream directors? Now they have 16 dream directors across 4 cities in schools. Standing up for the infinite possibility of young people exemplified by Marielle, a student who stood up and began to transform her own school,

I have been a dreamer on stand-by for a long time. And that ends today.

Another way of looking at risk was presented by JoAnn Stonier, Chief Privacy Officer with MasterCard Worldwide. For Stonier, risk is not an immovable concept—it is highly fluid. One of the great challenges she sees for us as we innovate in an age of big data is that the risks to our privacy are not fully known and are not being considered widely enough to influence public policy and private behavior.

“The right to be let alone” arising out of the Gilded Age, is the early precursor to the right to privacy and at the time it was needed to create a retreat from the world due to the encroachments of the Industrial Age. That right to holding private some aspects of our identity and the data that is the manifestation of it is even more important now. Last year Stonier had spent the Summer months addressing the encroachment into private data by the NSA.

We are having these conversations because of the nature of the changes in our society today. Law lags innovation—they are never the solution.

If we look to law we are going to be waiting a very long time for a corresponding support. We need to be wrestling with what is at risk now. Privacy matters and it needs to be a part of the conversation for all who are innovating so that we can ensure that our own risk tolerance can be managed.

Perhaps Steve Blank captured the reframing of business risk best. As the author of The Four Steps to the Epiphany and The Startup Owner’s Manual, Blank has been uncovering the ways in which those who take risks to begin new enterprises go about their work. He noted that Joseph Campbell identified the hero myth in multiple cultures as essentially the same story. Campbell recognized the pattern in the data.

Blank did 8 start-ups in 21 years. At no time was he looking for patterns, as he had his head down the entire time. Yet he did identify patterns.

After retirement Blankbegan sitting on boards and had one a series of private investments over the course of time he began to write his memoirs. While writing he identified a pattern emerging that no-one else had ever called out.

For the last century everyone had been striving for success is by treating start-ups as smaller versions of larger enterprises.

He offered a countervailing view. He noted that no business plan survives first contact with customers and that the only people who use 5 year plans are VC’s (venture capitalists) and Soviet-era countries.

The best start-ups went from failure to failure learning as rapidly as they could. Blank observed the “pivot”—times during which companies changed strategy by changing the people (firing the VP of Sales) and recognized that there needed to be a different way of handling the failure as a result of risk taking.

What we should have been doing instead of firing the person we should have been changing the plan.

On their first day, Blank said, every start-up is a faith-based enterprise based on guesses and no processes to test those guesses. There is no way you are smarter than the collective intelligence of your customers, so experiment with them. Make the risk to the enterprise manageable by learning as fast as you possibly can.

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Problem-finding is more powerful than solution-creating—#BIF9

One of the skills that rose to the fore over the course of BIF-9 was the concept of problem-finding. In an age of relentless performance improvement and waster mitigation, solution creation has been the default position of most enterprises and their employee members. At BIF-9 we learned that solution creating is all well and good but if you are solving the wrong problem, or if you haven’t framed the problem appropriately, you will waste a whole lot of time, energy and resources—possibly evening compounding the very thing you were trying to improve.

I am not often moved when people share deeply personal experiences in public forums. When Whitney Johnson took the stage and revealed a deeply personal and tragic story from her life I had misgivings primarily driven from my own discomfort with bearing witness to her grief. The story she shared wove beautifully into her exploration of the notion of “showing up,” — being present and fully in the moment rather than paying casual attention to participation.

Do I dare disturb the universe? T.S. Elliott

Johnson noted that you can not give up without dreaming but you cannot show up unless you dream. The key is that you have to show up to make the kind of difference that you want to make in the world. When we show up we open ourselves up to disappointment and failure. Being a victim is a pretty seductive plotline.

Dreaming is at the heart of disruption. In order to make the leap from one learning curve to the next you have to show up.

Community SolutionsIf showing up is the first step in appropriate problem-finding then moving from symptoms to root causes is the next. People mostly spend their lives managing the symptoms of problems but very rarely address the causes, said Roseanne Haggerty. While working with homeless youth in Times Square in New York City Haggerty discovered that without a home to go back to the issues of homeless could not be addressed by interim housing solutions. A permanent home solution was required.

To highlight the importance of the right question, Haggerty shared a powerful story of her own experience providing support to homeless people in Time Square. A woman on staff called from Bellevue Hospital, she said that a service-resistant person, Sarah, had informed her that Haggerty was her next of kin. When they finally connected in person, Haggerty asked why Sarah had been service-resistant, she found it was because the right questions had not been asked. “You didn’t ask me if I wanted a home,” stated Sarah.

This lead to the realization that we needed a solution that we hadn’t recognized before.

They created a new project using an ex-military intelligence officer who mapped the homeless in Times Square and through the application of data mapping and management they developed appropriate individualized solutions to the needs of the homeless. 100,000 Homes Campaign came out of this effort. This resulted in communities becoming energized by providing long term solutions based on the right processes, learning tools, and collaborations. From the housing efforts you can move towards long term systemic solutions that address the problem at heart.

Solutions can arise out of the most remarkable realizations.

A human rights lawyer who is the CEO of a luxury fashion brand, Paul van Zyl grew up in apartheid South Africa. His parents said they lived in an evil society and it was their moral obligation to change it. He became a lawyer to change a system that demanded to be changed. There were few business leaders who were admirable role models; lawyers offered a more viable role model alternative.

Maiyet logoWith partners, van Zyl created a luxury brand, Maiyet (after the Egyptian Goddess of Truth and Harmony)  that is found on social justice and economic empowerment. At BIF-9 he shared a story about the Varanasi silk weavers in India, and noted that Varanasi is a seed bed of cross cultural and religious collaboration. The hand woven silk is some of the most beautiful in the world, and was in danger of being wiped out by low-cost Chinese manufacturers across the border. Maiyet seeks rare skills from unique and unexpected places in the world and have partnered with NEST to be able to bring products to market in a sustainable way. Working with David Adjaye to design and build a custom facility in Varanasi to ensure that this culture and these skills don’t die off.

You need to combine design with training and support and also access to markets, said van Zyl. Then you create real value:

  • Value for artisans – they are paid what they are worth
  • Value for brands – access to things of extraordinary and unique beauty
  • Value for consumers – ownership of things that would otherwise be unavailable.

While Pauk van Zyl offered solutions for ensuring cultural longevity, Carmen Medina tackled the need to transform the culture of one of our own lasting artifacts, the corporation. Along with her partner in crime Lois Kelly, Medina presented the case for Rebels at Work, a movement dedicated to unlocking the potential of those who question the status quo inside the corporate sphere (also, see the way in which David Butler, at Coke, is sowing the seeds to capitalize on this concept.)

There is a worldwide conspiracy for the preservation of meritocracy. Not all are conspirators but many of us are unwitting co-conspirators.

Medina noted that most of the people talking at BIF are independent agents. They are usually trying to change systems from the outside. They are building alternative models and creating places for people to go. Those who are heretics at work need to learn to be uncomfortable so that they can do similar work insider their companies and organizations. The world needs rebels at work now more than ever, because we cannot tear down everything and replace it with something new. We don’t have that kind of time. We must change what we have and unlock the value already resident in our organizations.

As we shift the dialogue about our organizations and our roles in them, we can begin to reframe so many of the things that we take at face value. The challenges of managing our health and how we age were two additional areas that were presented for reframing.

The CEO of VisualMD, Alexander Tsiaris, showed us the power of visual information in changing the choices we make about managing our health. VisualMD is the NIH meets Pixar. It is a home for visualization artists, fine artists, researchers, high-level programmers all working in concert with a collection of huge amounts of data – they produce 150TB for every project they do. His company tells stories based on the data —it is story that gives the soul to the data.

The beauty of visualization is that it speaks to everyone.

Tsiaris believes we have to change the paradigm, using storytelling at the beginning of the spectrum to help people tell stories about what is going on inside their body. VisualMD created an ecosystem that helps people build a story about themselves which can be a part of an holistic educational system about personal health. If all your personal health records can be supplemented by a whole range of relevant sources and resources they can help you contextualize your health state.

Little stories from big data that explain little things going on inside your body so that you can understand the implications and be un-intimidated by the process.

As Tsiaris showed us the power of information in reframing how we see ourselves, Alan Webber, co-founder of FastCompany magazine and author, shared the value of reframing the public and private discourse we have about aging. The conversation is not about aging. It’s the wrong label. The categories are wrong for the way we live today. It’s about living and how we choose to live our lives. It applies not just only retirees, it is everyone no matter where they are in life’s journey.

This is not about career. It’s about making all the transitions over the course of a life and is explored in Webber’s book (co-authored with Richard J. Leider), Life Re-imagined. The conversation needs to be about how to cope with pain and possibility—answering the question, “What’s Next?”

To that end Webber offered “What’s Next” words to live by:

  • Choice
  • Curiosity
  • Courage

Everyone’s life is an experiment of one – no one can tell you how to do it.

No one should do it alone – everyone needs someone to help them with their experiment.

A good question beats a good answer. How are you seeking out the right questions so you can focus on the right problem? And who are you asking to help you on the way?

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Great post on the power of Priming at FastCompany

Here at Primed Associates we are always looking for others’ takes on the concept of priming. This week we share a great post from the FastCompany site by Martin Lindstrom, who has a new book out, Brandwashed: Tricks Companies Use to Manipulate Our Minds and Persuade Us to Buy

Here is Lindstrom’s opening about the power of priming in order to increase the likelihood of a desired outcome…

Have you ever been primed? I mean has anyone ever deliberately influenced your subconscious mind and altered your perception of reality without your knowing it? Whole Foods Market, and others, are doing it to you right now.

Derren Brown, a British illusionist famous for his mind-reading act, set out to prove just how susceptible we are to the many thousands of signals we’re exposed to each day. Read more here.

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Innovation & Correspondence Bias – Misunderstanding motivation misreads meaning

We cannot create observers by saying “observe,” but by giving them the power and the means for this observation and these means are procured through education of the senses.
Maria Montessori

The more we learn about the individual and social psychology misunderstandings at play in organization life, specifically in the development of innovations, the harder it is to identify clear and unambiguous actions we can take to address them. We must become adept at inquiry, observation, exploration and reflection – any of which might be effectively preceded by the word “self”. Thankfully these are prerequisites for effective innovation which makes for some strong synergies if we can apply the skills effectively. The challenge, as highlighted previously, is that we seem to lie to ourselves. We suppose we are rational, clear-thinking beings when in fact we are often confused, frequently wrong, and willfully ignorant. And that misconception is a problem no matter how smart we might think we are.

Judge and jury
The power of accurate observation is commonly called cynicism by those who haven’t got it.
George Bernard Shaw

The next psychological influence on innovation performance is correspondence bias or, to call it by its more common name, fundamental attribution error. No matter what it is called it can mean trouble to any potential innovator or innovation team. I detailed how I personally experienced fundamental attribution error when I reran an experiment in this area in a previous post. (See: Seeing the world around us). At the time the post was focused on how this bias manifests itself and what it does to our perspective on the situation in which we find ourselves.

From my experience of that experiment it is clear that people tend to consider their own behavior as being driven by different influences and motivations than those that drive the behavior of others. We try to be logical yet we often fail because we neglect to see the wider context in which behavior occurs. As a result we are prone to making faulty judgments.

Stop. Look. And listen.
A few observations and much reasoning lead to error; many observations and a little reasoning to truth.
Alexis Carrell

When we employ limited observational studies to our clients, in our attempt to recognize unmet needs, we can often be caught in the trap of ascribing their behavior to something we perceive in their manner. The reason for this is that we tend to attribute an observed effect to potential causes that capture our attention. This means we can often miss underlying influences that have greater influence but remain hidden to us.

When we observe other people, the person becomes our reference point. All our assumptions about what they are doing and why they are doing are seen to come from an internal motivation. This tight focus on an individual’s behavior usually means that the situation in which they are acting is overlooked as if it is nothing but mere background. So, attributions for others’ behavior are more likely to focus on the person we see, not the situational forces acting upon that person that we may not be aware of.

The strange thing is that on those rare occasions when we observe ourselves, we are much more aware of the external forces acting upon us. Our bias is to infer that others are much more in control of their actions while we are more constrained by the impacts of our surroundings. It hardly seems fair, does it? Regardless, it is a pattern in which we derive greater meaning from observed behavior than all the factors that might be influencing behavior. The implication being that we are making design and innovation decisions based on a flawed perspective, especially if our observations are cursory.
That is not a winning prospect at all.

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Innovation Framing – the challenge of blinkered thinking

Two quite opposite qualities equally bias our minds – habits and novelty.
Jean de la Bruyere

The life of the mind has such a significant bearing on the ability to innovate. We know that a fruitful mind is fundamental to the applied creativity and invention of innovation. Our time and attention are studiously focused on the creative spark, the genesis of new ideas, and the process of ideation. In this effort the mind can be stubborn, unwilling or simply distracted. Recently we explored the power of anchoring and the ways it can prevent us from abandoning an idea that is past its prime, or how it might prevent us from seeing the value in a different perspective, or the usefulness of another’s fresh take. Unfortunately that is only one of many ways in which our minds can prevent us from being truly, madly, deeply…innovative.

It’s my hilltop and everything looks fine from here
We don’t see the world the way it is. We see the world the way we are.
Anaïs Nin

We think we are broad-minded and open to new ideas; actually, we look where we’re told and think in circles. Now, I’m not saying that we are all sheeple. But a little deluded about our good selves? Absolutely. There is a whole world of marketing that is based on self delusion.

Consider the concept of “green washing” – essentially the habit of nefarious companies painting a thin film of environmental friendliness on their products in order to appeal to our better natures. Oh, and sell more of their stuff. It’s objectionable. It’s dishonest. And it works a treat.

Why?

Well, many of us like to think of ourselves as being good stewards of the environment, as long as it doesn’t require too much effort. Those who recycle everything, have taken to growing their own food bio-dynamically in their backyards and have forsaken their cars for other communal or less aggressively carbon-footprint-enlarging forms of travel are among the minority. A vocal group, yes, but small. The keen but passive majority wants being “green” to be easy.

Willing and eager companies meet that need by framing their products in ways we immediately relate to. They use terms like, ‘eco-friendly’ and ‘energy efficient’ and use colors that evoke Spring days and clean lines. The contents of the packages are not so different as their ‘bad’ alternatives but because of the way these products are framed for us, we buy them. Often that purchase is at a premium. Because “it’s good for the environment” and we want to do good.

When it comes to how we see the world, we are the heroes of our own stories. We consider ourselves immune to marketing and yet statistically we fall prey to the same well-positioned point-of-sale display in the supermarket as the next person. We like to think we are open minded, but as was illustrated in the movie “Crash” we have deep-seated biases and prejudices that flash to the surface without us realizing it.

You really want to see the world the way it is? Really?
Bias and prejudice are attitudes to be kept in hand, not attitudes to be avoided.
Charles Curtis

We don’t want to see the world the way it is. In fact we have a whole series of techniques, cognitive biases, which we have developed to help us not see the world the way it is. They are there to help us cope. To help us sort through the nearly infinite number of sensory inputs we experience each day so that we can make meaning of our surroundings. Framing is simply one other dominant device in the bias tool kit.

If anchoring locks us into a particular perspective, preventing us from seeing something differently, framing has an opposite effect. Framing is a set of personal filters, emotional, psychological, and intellectual constructs that we use to gather, sort, organize and analyze information about the world around us. Frames are our mental blinkers. The shades that focus us on what we think we really want to be thinking about. Framing influences the background context of our choices, often as simply as in the way in which a question is worded.

Framing enables us to act with ‘pseudocertainty’. It eliminates or lessens doubt as a way of short-cutting our need for analysis. The old saw originated by Mark Twain, that there are “lies, damned lies, and statistics”, is another representation of the way in which framing occurs as it reveals the persuasive power of numbers. A key issue with framing is that it may be acted upon us, via marketing or through a desire to influence, or we may frame issues ourselves through our beliefs, education, ethics, etc.

How does framing influence innovation?

As a process of short-cutting our need to analyze or explore a situation or issue more deeply, especially our understanding of the immediate context, framing blinds us to possibilities and options. We simply don’t ‘see’ alternatives because of the influence of framing. We look where we’re pointed or only where our blinkered perspective will allow.

A classic example of this is from the work of Nobel Prize winner Daniel Kahneman and his partner Amos Tversky. (We’re big fans of Kahneman and Tversky at Primed Associates!) They offered a group of research subjects two scenarios, both with essentially the same data but framed differently. In it, the subjects were asked to make a choice between two alternatives. Due to the way the scenario framing changed, the majority of subjects flipped their choices. Same data, simply re-framed meant a very different result.

I am committed to my strategic focus on…Oh look! Kittens!
When you change the way you look at things, the things you look at change.
Max Planck

Framing is a psychological version of the Heisenberg Principle in action. In quantum mechanics, the Heisenberg uncertainty principle states “by precise inequalities that certain pairs of physical properties, like position and momentum, cannot simultaneously be known to arbitrary precision. That is, the more precisely one property is known, the less precisely the other can be known.” For the lay person – when you focus and look at one aspect of a situation, other aspects become less clear. Framing positions us to understand one perspective which lessens the impact, influence or even visibility of another alternative. We get blinkered.

We need to fight being framed. (Or stop taking our own framing at face value.)

In innovation, it is necessary to see things we haven’t seen before. To combat the influence of framing, to expand the range of possibilities, it is necessary to call it out. Questioning assumptions is one way of addressing the undue influence of framing. Another way is to literally take the opposite position on data. If we reverse our position previously unseen options might be revealed. As our perspective greatly determines what we see, changing that perspective means we see things anew. Finally, we can often build our way out of how we are framed by exploring new approaches through design thinking and prototyping. A prototype is a great tool for helping us reframe our view of a challenge.

What’s your perspective? How blinkered are you?

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Innovation Anchors – How unwitting fixation blocks delivering new ideas to market

What people want isn’t always what they really want.
Andrew Ellis
Using focus is a powerful technique for getting things done. It narrows our efforts and gives us a specific target to meet. A dancer, who has been asked to spin in place uses a technique called “spotting” to provide a stabilizing point of focus. Spotting has several benefits: it keeps a dancer oriented and aware of the movement, direction, and location of their body in space; it can prevent disorientation caused by lack of visual focus; it increases the overall speed of the rotational spin; it can make the spin appear faster than it is; and it also aids in reducing the dizziness associated with spinning. All of which are excellent goals that serve a purpose during particular sections of a dance that require that motion.

Using spotting to anchor yourself at other times while dancing may not be appropriate.

Find a spot then [re]turn to it

The challenge with focus is that once established it can be hard to break off, even when it might be best to turn our attention elsewhere. We have become anchored to an idea, such as, sticking with a new product in the marketplace when all indications are that it will not be successful. Or, always using the same criteria for selecting services to be developed even though market conditions and customer expectations have changed.

For those who seek to innovate this pattern of anchoring is deadly. For the oft-quoted but rarely ascribed comment bears truth of the matter, “if we always do what we have always done, we will always get what we always got.”

Falling in love with your own idea

Often during decision making, people anchor, overly relying on a particular piece of information or a specific value. This anchor then influences the way they account for other variables in the situation, regardless of any specific relationship between them. Usually once the anchor is set there is a bias toward that value. And each of us is prone to this pattern.

In organizations where ideas battle it out for supremacy, we can find ourselves furiously defending our position when the alternative may be better. We have fallen so in love with our own idea that we cannot see the power of another and perhaps we cannot see the power it holds over us.

One recent example of a whole industry becoming anchored (in the belief that the good times would continue to roll) was the financial services industry with regard to credit default swaps. Much has been written on the subject, such as the great post at Psychology Today is by Eric Jaffe. A great line boils down the entire sorry episode quite neatly, “…that our bubble wasn’t just one of bad investing, it was a bubble of bad thinking.” Rouler less bon temps, indeed.

The process of becoming anchored is not hard work either. We fall into anchoring with relative ease. It is one of our shortcuts for managing the large amounts of data with which we have to contend everyday. And once we anchor on a specific data point it is very difficult to change as Dan Ariely describes in his instant classic, Predictably Irrational. Early on in his book Dan describes an experiment with some students in which he asked them to take the last two digits of their social security number and write them beside a list of objects he provided on a sheet of paper. The objects were wine, chocolate, etc. Nothing of special significance. He then asked the students if they would pay more or less than that number (as expressed as whole dollars) and to indicate that on the paper. Finally he asked them to write down what they would be willing to pay for reach object.

We simply keep coming home
The end result of the Ariely experiment was that those who’s social security end numbers were 0-19 offered the lowest price points while those with social security end numbers from 80-99 offered the highest. And everyone in between offered graduating prices! When asked if their social security end numbers had any influence on the prices they offered everyone said absolutely not. Yet those very numbers anchored each group of students as surely as if they had been classified as such from the outset.

The students couldn’t help themselves because they didn’t even know what had occurred.

But even if they had known about the concept of anchoring another classic aspect of this behavior is that even if we do change our perspective and re-orient ourselves we fall back into an anchored state. We switch one anchor for another. Essentially clinging to our need for a mental shortcut.

Fighting the good fight
I am like a book, with pages that have stuck together for want of use: my mind needs unpacking and the truths stored within must be turned over from time to time, to be ready when occasion demands.
Seneca

For those focused on innovation, willfully introducing changes into existing stable systems, anchoring is one of many behaviors that needs to be addressed. Because at its heart an anchor is a habit we have created for ourselves. Either through repetition or proximity we have placed ourselves under its influence.

To tackle the effects of anchoring you have to call it out. Unless we do highly rational people will make decisions based on the highly illogical. Past experience, ill-considered under present circumstances. According to social psychologist Tom Pyszczynski, “when our livelihoods are threatened we lock into our current mindsets, ignore open discussion, and view those with opposing ideas not as different but as enemies.” When we seek to innovate, to explore new concepts we need to give ourselves the permission to leave old mindsets behind. This takes practice.

One excellent way to practice is the use of design thinking. Design thinking provides a structured way to explore new ideas to pressing challenges in a manner that is low-threat, yet high yield enough to push the envelope. An excellent recent explanation of design thinking as a model and practice comes in IDEO President and CEO Tim Brown’s book, Change By Design. Full disclosure: I now a reseller of a business simulation based on the design thinking approach developed by IDEO and ExperiencePoint. More on that later.

So, when you stop spinning are you dizzy or ready to weigh anchor to focus on the next new thing?

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Innovation Psychology – Innovation is a hostage to what we think and feel

No psychologist should pretend to understand what he does not understand… Only fools and charlatans know everything and understand nothing.
Anton Chekhov

Why explore the impact of psychology on innovation?
Organization psychology examines the relations between the individual and the tasks he or she is posed, between the individual and the surrounding social context in which he or she find themselves, and between the individual and the formal organizational structure. The practice of innovation, the creation and invention of new products, services, business models is very much at the heart of organizations seeking to increase their long-term success. The psychology of organizations plays a primary role in the effectiveness innovation practices and outcomes.

Also, when we consider a psychological framework for innovation it is also vital to include a broader understanding of social psychology. Social psychology is the scientific study of how people’s thoughts, feelings, and behaviors are influenced by others; regardless of whether or not that presence is actual, imagined, or implied. This influence is especially important when we factor in the influences on innovation of open source models which reach beyond the formal boundaries of organizations.

In order to create a wider understanding of the psychology underpinning innovation in the next few weeks and months regular posts will focus on those aspects of psychology that hold sway in the practice of innovation (whether we choose to acknowledge them or not.) Topics will include anchoring, heuristics, and biases, as well as cognition, group dynamics and resilience. The intent is to unlock their power and influence and improve their management in the development of robust innovation cultures.

For an innovation culture to be successfully created and fostered over time, it is a necessity to have a better sense of how people interact and engage. So let’s explore…

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Innovation Is Not Clockwork – The Challenges of Innovation Systems

A system is a network of interdependent components that work together to try to accomplish the aim of the system. A system must have an aim. Without the aim, there is no system.
W. Edward Deming

Everything is connected so beware the tragedy of the commons
Previously we addressed the need to create innovation processes that bear the risk of innovation. This boils down to two aphorisms, “if you can’t stand the heat get out of the kitchen” and “it is okay to make mistakes as long as you learn from them.” Not earth-shaking concepts, certainly, but creating an environment within existing business systems that might allow practicing that behavior is a true challenge.

Businesses are complex systems. They are not clockwork mechanisms. They contain myriad subsystems each of which is responsible for producing value through a series of interdependent relationships. This doesn’t even consider the ecosystem within which the business resides; such as, the external competitive market, supply chain and customer segments. The common mistake when attempting to build innovation practices within an enterprise is to “ring-fence” the practice within a functional domain. Relegating innovation to Research & Development or Product Development may provide it with a home but does not necessarily mean it will flourish. This misunderstanding, that innovation is not connected to anything else, almost always backfires as other functional subsystems respond in unanticipated ways.

Ignoring the interconnections between organizational subsystems causes havoc when innovation is demanded of all areas of the business, instead of one function, and the competition for resources becomes fierce. The heart of this conflict is called, “the tragedy of the commons” and it occurs when the subsystems in an organization are placed in a competitive relationship with each other and are forced to act in ways that are destructive to the organization overall. The current push for “innovation everywhere” is a pattern that is reinforcing this dilemma.

For example, without establishing strategic priorities, a consumer products firm I worked with decided that all departments without failure were going to improve their processes. The number of performance improvement projects proliferated tenfold overnight. As a result, project resources were spread so thin nothing was accomplished, but the effort was not canceled until six months had been burned. The result was “initiative fatigue”, a loss of support for organizational leadership, and a drop in market performance. The very opposite of what was desired.

Don’t control the players – change the rules
Is the system going to flatten you out and deny you your humanity, or are you going to be able to make use of the system to the attainment of human purposes?
Joseph Campbell

If we cannot change the system via simple choices how can we create a better environment for innovation within our organizations? Rather than telling people what to do, guide their behavior by changing business rules within existing business systems that drive the behavior you wish to see.

In his great book, Predictably Irrational, behavioral economist Dan Ariely explores how expectations, emotions, social norms, and other embedded social and psychological forces influence our behavior. One great insight he presents is the way in which the human brain is wired to adopt certain patterns of behavior based on first impressions and decisions. These impressions are imprinted on our brains and govern our approach to similar circumstances. We have “anchored” our experience and even in the face of evidence may act against our own interests because of its influence in our thinking. I also explored this process, which is directly related to priming, in a previous post.

To change this imprinted pattern of thinking it is necessary to change the rules. Luxury goods manufacturers understand this explicitly, as Ariely explains. He notes the case of black pearls which when first introduced to market were a flop. They were gun-metal grey and looked like oversize ball bearings. It took James Assael, an Italian diamond and pearl dealer, to change the rules. He made a deal with Harry Winston to display them in the window of his 5th Avenue jewelry store in Manhattan surrounded by other precious gems. Assael also placed full page advertisements in glossy magazines to promote this new luxury item. Suddenly, black pearls were all the rage. Why? In order to make someone want something he changed the rules and made it scarce. DeBeers has done this for years with diamonds, too.

It is much more effective to change the rules of the game so that it is to most people’s advantage to make choices that are good for the whole system of innovation. What current rules of innovation could you invert, subvert or otherwise transform to create the behavior you’re looking for in your organization?

Foresight always wins and preparation trumps reaction
Everything affects everything else in one way or another. Whether you are aware of that or not does not change the fact that this is what is happening.
John Woods

Innovative solutions to problems affecting complex systems take time to design, develop, test and implement. If we wait until the problem develops before applying our resources to addressing its root cause, we may be too late to take meaningful action. In the previous post on processes I addressed the notion of anticipatory behavior. That kind of foresight applied to present need can be a powerful tool for ongoing successful innovation.

Too many organizations pull the innovation trigger when faced with a crisis. Be it a market crisis or, more commonly, a product crisis the circumstances reinforce reactive behavior. If not outright panic, this scenario does not foster the use of structured and reasoned thinking to guide decision-making. Instead rapid fire solutions to address the changing conditions on the ground don’t solve the problem in the market and they may make the effects of the problem worse.

Across an organization’s innovation systems, looking ahead to anticipate problems is key. In the current pharmaceutical marketplace, many larger firms were faced with greatly diminished drug development pipelines yet they carry large commercialization operations. Blockbuster drugs are increasingly few and far between. With this realization, the action that most firms have taken is to re-double their development efforts in R&D as well as to identify as many smaller firms with potential marketable drugs as possible to acquire. What if their leadership teams had decided that, rather than reinforce their old business model (shoot for the blockbuster), they were going to anticipate changing market conditions and transform their companies from drug manufacturers to providers of comprehensive health services or another alternative business model. Would they not be better off heading off problems before they disrupt their market (and cash flow) entirely?

Why no great change? Because change is often painful, awkward and a dreadful inconvenience.

Don’t be fooled by system cycles – it’s not the climate it’s the weather

As human beings we love stability. Many of us are simply unable to recognize cyclical patterns around us, especially when they take years to unfold. The boom/bust cycle in the US economy is one such pattern which seems to elude many. This cycle seems to be on a fairly regular 20 year cycle and yet, during the peak (just prior to the bust) many people only see the positive “upside,” regardless of the Cassandras crying in the wilderness about the impending doom. And then the inevitable happens – the dip, slip, or worse yet, crash.

On the other side, when at the bottom of an economic recession, many struggle to see positive signs that economic systems might manifest. Their pessimism is only countered when they feel the positive impacts of the expanding economy directly. This cycle is present all around is. When job categories are oversupplied or undersupplied the negative feedback loops that cause people to go into a particular career usually lag the changing market needs. It’s also present in the climate. With recent record snows on the East Coast of the USA many were heralding the end of global warming. However, it is not case. The weather system is not representative of the climate system, it is a subsystem, and its cycle-time can be measured in months, weeks and days. The climate system is measured in decades, centuries and millennia.

As with the economy, the best time to capture the market is when everyone is contracting. When the present hoopla about “innovation everywhere” dies down those organizations that have embedded innovation into their business systems will find the opportunities ripe for capitalizing on others’ short-term thinking and rapidly fading memories.

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Stupid Wins In The Game Of Innovation – Phil McKinney

Phil McKinney’s latest blog post nails the way in which we are primed to think that creativity and innovation are domains reserved for the “gifted and talented”. So many times our ideas are beaten down by our own ruthless self-censorship, denial and embarrassment-induced conformity. McKinney notes that, “We are a race of innovators – born to use our imagination to create not only solutions to our most pressing problems (polio vaccine) but to also create the fun in our lives (pet rocks). We only have to look as far as our kids to rediscover that fundamental draw to use our imagination to create something out of nothing. Children are naturally superb innovators. They can create the most amazing toys from normal household items. Who would have thought of all the uses for a paper towel roll?…[For adults] It is demeaning to be called unoriginal, conventional or traditional (boring). We thrill at the idea of being the one that breaks the rule, being the one that creates the next big thing. But many people have a hard time seeing themselves in that role. In the process of growing up, they lost that ability to see themselves as creative.”

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Eyes on the Prize – In a CoIN a flexible approach to changing conditions means more wins

In his fascinating research on collaborative innovation Peter Gloor, a Research Scientist at MIT’s Sloan School for Management Center for Collective Intelligence, identified a model he termed CoIN for, Collaborative Innovation Networks. He first named this model in the popular press in his book, Swarm Creativity: Competitive Advantage through Collaborative Innovation Networks. His stated goal was to make CoIN’s the widespread model for organized innovation. A CoIN is a team of self-motivated people linked virtually that shares a collective vision, enabled by technology to collaborate in achieving a common mission (a specific innovation) by sharing ideas, information, and work.

motivational signs postNow for those business leaders sold on the concept, their primary concern may be that with limited resources they now feel that they must invest in creating CoIN’s across their organizations to create or sustain a competitive. This is not the case.

CoIN’s already exist across most organizations. What needs to take place is their rapid identification and ongoing nourishment. In order to achieve this we need to prime the organization to be receptive to fluid teams focused on delivering a specific value. The way these teams are buoyed is through shared context – they need to share a vision, mission, purpose that draws them together and they needs an organization that fosters the identification of those things and supports their pursuit.

Organizations improving their culture of innovation when utilizing CoINs create virtuous cycles of success. The shared victories of the teams over problems become their own reward. This environment of collaboration focused on innovation creates a collective efficiency that is self-perpetuating.

“When a company is growing and profitable, we tend to infer that it has a brilliant strategy, a visionary CEO, motivated people, and a vibrant culture. When performance falters, we’re quick to say the strategy was misguided, the CEO became arrogant, the people were complacent, and the culture stodgy.” – from The Halo Effect

One of the inherent pitfalls of CoINs (when they are working) is the the impact of the Halo Effect if they are not occasionally disrupted. The Halo Effect, based on the work of Phil Rosenzweig, highlights the fallacy of so much of the research of day which emphasizes the repetition of “best practices” and our tendency to make specific evaluations of performance based on an elemental impression. If a CoIN falls into a pattern of attempting to repeat it’s success it may make choices about it’s approach to innovation that are not based on the shifting business context.

The Halo Effect highlights the fact that performance is relative, not absolute. Based on this understanding it follows that the way in which companies succeed is when they make choices and do things differently than rivals. In essence it moves from a world geared toward management by via benchmarks and best practices to one which is governed by making choices under conditions of uncertainty. And this is where CoINs come into their own – they create a fluid platform for innovation that can respond effectively to changing conditions.

What this demands of leadership and innovation teams is a much more rigorous approach to reward-seeking and risk-mitigating behavior. The Halo Effect shifts our thinking about performance from one that looks for a formula for success, toward one that sees the world in terms of probabilities and possibilities. Innovation leadership is about making choices, under uncertainty, that have the best chance to raise the probabilities of success, while never imagining that success can be predictably achieved. Even good decisions may lead to unfavorable outcomes, but that doesn’t mean the decision was wrong. It simply provides an opportunity for the innovation team to make a new decision and find a new path to success.

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