Stimulating greater imagination is now a key pathway to competitive advantage for all organisations, be they established incumbents or scrappy start-ups. That’s the view of Martin Reeves, senior partner at Boston Consulting Group and co-author of a new book, The Imagination Machine, that aims to show businesses how creativity can drive innovation and success.
“In the past start-ups were the ones who came up with new business models and large corporations coasted off those innovations for many years with incremental extensions. The duration of incumbent companies in leadership positions used to be 10 years or more but now its typically around one year. Large companies need to recreate their entrepreneurial roots,” he tells The Irish Times.
The reasons why companies lack imagination are many, but a recurring theme is that organisations have an inward focus and a bias for exploiting what is currently successful as opposed to engaging in risk-taking. With growth slowing in Europe from 5.5 per cent in the 1970s to around 2 per cent today, Reeves says companies need to be bolder and more entrepreneurial in their thinking.
“To be innovative you need to get out of the building, physically and metaphorically speaking. You need to think about customers and potential customers’ unmet needs. You need to engage in counterfactual thinking about things that are not currently the case but could be.”
In the book Reeves discusses a number of techniques leaders can use for shaking up routines in their organisations. These include going to the wrong meetings, gate-crashing gathering we are not expected at to bring some fresh thinking, and bringing in thinking from divergent fields.
Other techniques include the “what do you think I am going to say” game, and the “bad customer game” (turning a difficult customer into a source of inspiration), both designed to challenge conventional thinking.
Asking”‘what if?” questions can spark the imagination. What if a hospital could be more like a gym, for example, concentrating on health coaching and preventative therapies as opposed to treating illnesses? he suggests.
Looking to other industries and business models can prove inspiring.
With AI being deployed throughout many organisations, now could be an ideal time to encourage more imagination, the authors suggests.
Reeves says that as a management consultant AI has been hugely helpful and has transformed the more routine aspects of his daily work. AI can help assimilate huge quantities of data and help in decision-making. It can and will increasingly replace routine cognitive work in the way that machines automated labour-intensive work in the past. Much of this work is what we currently call management, he notes.
“Competitive advantage will accrue to firms that can shift their focus to getting the most out of human imagination and higher-level cognition while lower level analysis and decision-making are increasingly becoming automated.
“Like the revolutions that followed from steam, steel, electricity and the combustion engine, we won’t get the full benefits of the technology unless we reorganise the ways of working. When we invented the electric motor we didn’t get the benefit until we reorganised the factory.”
Serendipity has a role in innovative breakthroughs if businesses are alert to the possibility. Pfizer’s drug Viagra was originally developed to treat heart problems but researchers noticed an interesting side effect which led to the opening up of an unexpected new market in treating erectile dysfunction.
Similarly, the plastic modelling toy product Play-Doh was originally conceived as a wallpaper cleaner before the enterprising Joe McVicker overheard a teacher saying that his art class found modelling clay too tough to manipulate.
Being alive to new possibilities and having the temperament to be playful is the crucial thing. Reeves suggests that leaders should read and immerse themselves in experiences other than those involving their core disciplines as this opens up the imagination.
Lego was a modestly successful Danish wooden toy-maker before its founder, Ole Kirk Kristiansen, was inspired by a plastic injection moulding machine he saw at a trade fair in 1946. Kristiansen spent a year’s profits on a moulding machine, playing with multiple toy concepts. A key moment is when he hit on the idea of a kit for a Massey Ferguson tractor set, inspired by the tractors that were arriving at the time with the aid of the Marshall Plan. This led to a radical reconceptualisation of what the company could be.
Reeves says free thinking and openness to surprise and its possibilities are crucial. The key constraint is that it must be rooted in what is possible as opposed to what is impossible.
“Imagination allows us to explore the space of what is possible – like a mining expedition to an unchartered territory. It allows us to explore and it allows us to bring things back: early stage counterfactual ideas that may eventually transform the business. Becoming skilful at harnessing imagination means becoming skilful at doing this collectively within a company, exploring and moving things from the unreal to the real.”
Communicating the idea is crucial as it accelerates its evolution by involving others in its testing, development and adoption. In the Lego case the founder’s son Godtfred had a pivotal conversation on a boat trip with a toy-buyer from Copenhagen who talked about the idea of a system of toys where each new toy built on the last one. Over time Godtfred and his father developed the idea into what became the Lego system in Play.
It is important not to get dismayed if the initial results of experiments are not successful. Too often an innovation is only given one iteration before it is rejected. He cites the lubricant product WD40. The name references the fact that it was the 40th attempt to create the water displacement product.
The mental models we live by today are constructions, to be dismantled, altered and recombined, Reeves says, and we should remember that thinking radically is a free-risk activity. Letting go and opening up our imagination is the starting point, but we should tolerate uncertainty and even a degree of messiness along the way. “Think about what something could be rather than focussing on the difficulties in getting there,” he concludes.
WHAT BLOCKS IMAGINATION
Busy is the new stupid: Being too busy cuts time for reflection and therefore surprise. Filling up your calendar is an inefficient way to use your brainpower. Your brain can do more valuable things than busy work even thought it appears as merely wandering around or staring out the window.
Having only answers, not questions: Pressured to appear prepared and confident, we often want to be the person with the answers or with questions we only ask because we know the answers. This means we avoid being surprised. The solution is to ask questions to which there are no pre-existing answers. Good questions take us into new territory, increasing the chance of noticing surprise.
Deprioritising curiosity: Curiosity may seem like an indulgence but when we relegate it it reduces our exposure to novelty and our opportunity to notice surprises. In contrast to business culture where people only steep themselves in familiar domains of knowledge to support set goals, exposure yourself to a novel experience.
Over-engineering the environment: Routines and order are efficient up to a point, but don't overdo it. Balance order with some unpredictability in your environment and inputs by varying your routines, spending time with more distant connections in your network or observing parts of the business you wouldn't normally see.
Focusing only on averages and aggregates: We often neglect to examine intriguing individual data points – such as a unique failed or successful sale – in favour of looking at averages. Averages are useful in trying to summarise the impact of a complex effort, but we should remember to give anomalous outliers attention too as they may provide important signals of change or inspiring insights.
The Imagination Machine – how to Spark New Ideas and Create your Company’s Future, by Martin Reeves and Jack Fuller, is Published by Harvard Business Review Press.