Perspective # 16 – Diversity is the mother of Innovation

Diversity is the mother of Innovation : Guess who said “We are a nation of communities... a brilliant diversity spread like stars, like a thousand points of light in a broad and peaceful sky.” ? Don’t be surprised ! It is George W. Bush :)

Well! Jokes apart .. Diversity is perhaps the only mandatory prerequisite for Innovation. We have seen that patriotic organizations with isolationist cultures are poor in innovation. There are organisations like IBM and Emirates who got this right though.As Indian companies fared low on this aspect (most of the top brass are in same age group, male and even look alike! ) they are in a race to ‘clock’ diversity by enrolling different nationalities and women.

What many miss is that diversity that can spark innovation is more than gender and race – it includes physical and mental capabilities, demographic differences, differences in religion, cognitive differences, sexual orientation, political and social differences – more diversity the better – the more the merrier!

Diversity also is not just people – it includes products, technology and markets. It is much challenging when it comes to ‘supplier diversity’ which is a global concern for corporates who compete using their global supply chains.The challenge is to invest and develop existing ‘trusted partner’ suppliers,but at the same time encourage supplier diversity which brings in Innovation.

The challenge lies in managing diversity – we all come with our own mental models and it is not easy to value diversity . Though we all love to talk about 'inclusive diversity' , by human nature we love like minded social networks!

We also dont buy the 'diversity is the fountainhead of innovation' argument as we are taught that only smart Einstein types can ideate. But like it or not – If you want to drive innovation embrace diversity. Period. As David Ogilvy said "Diversity turns out to be the mother of invention (not necessity, as the mechanists thought)."

Perspective # 15 - Business Model Innovation

Business Model Innovation : Ever since IBM's Global CEO Study 2006, Business Model Innovation is a sexy topic. The study revealed that most CEOs felt Business Model Innovation is becoming the new strategic differentiator. In the financial analysis for the study, companies that have grown their operating margins faster than their competitors were putting twice as much emphasis on business model innovation as underperformers. Ever since this study innovation in a company's core processes and functions are not fashionable!

But there is nothing new here – Biz model keep changing in various industries. Famous legend is how Dell shocked the market with its Direct selling model. Another great example is Bharti - they discarded the sacred ARPU telco model and focussed on minutes and network utilisation, and outsourced almost everything and focussed on the customer.

Many say Business Model Innovation is going to be the future as ‘Technical Innovations’ are dying ( Remember the quote of - Charles H Duell,Commisioner,US Office of Patents 1899 “Everything that can be invented has been invented”) Not sure though :) But if you combine ‘Business Model Innovation’ and ‘Technical Innovation’ you have a blockbuster! Google is the best example.

VCs love Business Model Innovation ! I am told that in US a dating company is offering a ‘rent a dog’ service for single souls to impress others! If you cant afford (real ones!) a Prada or Louis Vuitton bag it is okay, you can rent from http://www.bagborroworsteal.com/ for a small fee. Endless possibilities in Business Model Innovation, but obviously ‘god is in execution’.

Perspective # 14 – Creative Abrasion

Creative Abrasion : One key component required to create the ‘innovation culture’ is to foster a organization climate which promotes healthy conflicts within – the jargon is called ‘Creative Abrasion’.

The challenge is to create a non threatening environment where different ideas and perceptions collide in the melting pot which can raise new ideas or models. Good problem solving managers always allow different approaches which may include silly or disruptive ones.

Though creative abrasion looks like a no brainer, it is very hard to implement..why ? Because one of the unwritten rule of the game in most organizations is not to rock the smooth sailing boat – conflict is often seen as negative.

Sorry but the sad fact remains that your growth in the organization depends not on your functional competence but on your ‘value capability’ – the organization filters out those who are not on the same senior management ‘wavelength’ . The obvious disadvantage of this ‘behavior norm’ is ‘Groupthink’ originally described by Irving L. Janis. "...a quick and easy way to refer to a mode of thinking that people engage when they are deeply involved in a cohesive ingroup, when members' strivings for unanimity override their motivation to realistically appraise alternatives of action." The non obvious disadvantage is that it sublimaly discourages ‘Creative Abrasion’.

Also if you are not careful conflicts becomes disputes and personal, the creative process breaks down.

Sometimes ‘abrasive’ defiant guys are seen as a negative influence on others as they bring conflict and disturb our ‘friendly cohesive climate’! The key is to train personnel to embrace ‘Creative Abrasion’ and to watch out against groupthink. Managers should be trained in this fine art.