Taking Innovation Seriously
Innovation, that perennial favorite, has recently lost some of its luster. While people are still keen on pointing out that corporations need to encourage and manage innovation, there is an increasing amount of evidence that challenges the simplified tale that innovation, as it is currently understood, will solve all our problems. Studies on CEOs show that fewer and fewer feel they’re getting value for money from investments in innovation, and in several fields (e.g. biotechnology and advanced materials research) we can see that the development of radical new innovations has not progressed at the pace we might have expected. Why is this? Has something happened to innovation, and can we do something about it? It is my contention that something has happened, and that it is up to us to re-evaluate our position on innovation if we want to stay true to its radical nature. In this short “thoughtpaper”, I’ll try to outline some of these points, and suggest that in order to save innovation, we might need to go beyond the notion of “best practices” and instead bring back innovation to its radically creative roots.
One of the truly tricky things about innovation is that it is incredibly difficult to really take it seriously. You might not think this if you look at the frankly amazing number of books and articles that have been written on the subject, but you’d be wrong. The problem with innovation is this: Knowledge is about our past, innovation is about our future, and even though we all realize this on some level, the message herein is difficult to keep true to. The reason why it is difficult to take innovation seriously is that we as humans are conditioned and even neurologically programmed to focus on what we know and what we can infer from this. We’ve all gathered a lot of experience and know-how, and it is the natural tendency of the brain to want to utilize this every time we are posed with a new problem. This also leads to the fact that when we’re asked to think of innovation, we retreat into those things we already know, our history and our knowledge, and try to imagine a new world as springing out of this, while the point of innovation should be about breaking with our old frameworks and our history-laden ways.
Often when we talk of creativity and innovation, we tend to tell “weren’t they silly”-stories. The classics here is the story of the hapless record executive who said he didn’t see any future for the Beatles, or the famous (but in all likelihood false) quote attributed to Thomas Watson where he is said to have estimated that the world would never need more than five computers. These have been repeated so often as to have become clichés, but there is something interesting to them. We like laughing at the stupidity we can now discern in them, but at the same time we’re not learning from them. We could take more modern examples. Did you, dear reader, in the 1980’s predict that China would be the most important economic superpower in the world? If someone would have told you 15 years ago that it would be possible to carry 10.000 songs in your pocket, and that this magic box could also carry movies and books and a phone and a GPS (provided you knew what that was) and games and most any program you could think of, would you have believed them? I dare say you might even have laughed a little behind their backs. It is a safe bet that you, 15 years ago, did a lot of really bad predictions about the future – I know I did. But today things are different, right? This time, this time will be different, right? I doubt it.
The reason why we’re so very bad at predicting the new is because we are bound by our histories, and can only with the greatest difficulty imagine things beyond that which we already know. This is why it is so difficult to really take innovation seriously, because in order to do so we need to leave part of our rational, reasoned thinking behind, as that which we call reason is a product of history and the old. Problem is, our affection for history is not just a personal foible, it is something we build into our stories of the world, our ways of talking about what should be done. And nowhere is this more evident than in the curious survival of the notion of “best practice”.
The Problem With Best Practice
The definition of “best practice” is “stuff that worked in the past”. In practice (sic), best practice is a product of our history, and an attempt on our part to retell our history in a way that makes us seem to be both in control and having progressed to a state of certainty. In this manner, best practices represent the standardization of thinking, and also the way in which we try to limit it. The concept of best practice could in this way be seen as the opposite of innovation, where the latter celebrates the fact that the future will change how we see things, and the former focuses on what we’ve learnt from history.
Now, we should be aware that establishing best practices is something that the human mind is programmed for. When we were still hunter-gatherers, survival was a matter of knowing the best place to hunt and the best things to gather. The hunter who couldn’t learn how to best creep up on pray would get killed or go hungry, and the gatherer who couldn’t figure out what kind of areas were good for picking up edible roots would soon face starvation. In fact, the strive to establish best practices is something that other primates also like and get engaged in. Primatologists have shown that e.g. chimpanzees can learn new “good tricks” such as washing food and using tools to dig out termites or getting honey out of beehives. Such practices will then be imitated by other chimps, who may even teach them to their young. In other words, best practices are connected to learning, and thus obviously important. However, what differentiates us humans from other animals, and modern man from hunter-gatherers, is our capacity for thinking beyond best practices, to develop ways of acting that challenge historical best practices and break with the same.
This is not to say that best practices cannot be useful, on the contrary. Studying best practices is in fact necessary for innovation-work, but not in the way people usually think. What best practice-cases can be used for is to map the current mindset in a specific business area, and through this also see what options are not considered, what avenues are not pursued. Simply put, by studying best practices and exploring ways of doing something completely different from this, we can generate a number of innovative ideas that can help guide us towards an indeterminate future.
Consider the banking business. One long-standing best practice for banks was to lend out larger sums of money to stable, legitimate businesses, a practice that ensured repayment (one hoped) and relationships with what was seen as the best clients to engage with. This was best practice. Muhammad Yunus looked at this, decided to build a bank that worked in the opposite way, and created the revolutionary concept of microfinancing. By lending small, even miniscule amounts to women that could not even get the time of day from traditional banks, his Grameen Bank showed that going against best practice could generate an innovation that put much of the banking world to shame. Now, in the aftermath of the financial crisis, we’re seeing another former “best practice” – the over-financialization of everything – for the disaster it was, and are desperately looking for novel ideas and a developed framework for banking beyond what was previously seen as best. Or look at the industry for credit cards. Best practice would have it that you give everyone a massive line of credit, hope they overuse it, have trust in the opaqueness of your offerings, and make a killing through late-fees and astronomical rates. For all these businesses, best practice was in all likelihood a brilliant idea for a time, but proved in the end to be the thing that blinded them to more serious problems in their way of viewing the world and sensing when changed circumstances required being able to break with old notions – i.e. “best practice” as the enemy of innovation.
Innovation Beyond Best Practice
In our modern, troubled times, best practice might thus not be all that “best”, even if we can learn a lot from studying it. Still, the transformation away from the best practice-mindset towards a serious innovation-mindset is not a simplistic affair. What is required in such a transformation is to realize the manifold of ways in which innovation and best practice relate to each other – positively and negatively. The following points are in no way an exhaustive list, but rather points of departure for understanding the complex relationships between what has worked before, what works right now, and what will be seen as a smart move in the future.
Innovations start out as best practices, but best practices all become uninnovative. When a successful innovation enters a market, it is obviously a best practice in the sense that it offers up something new, something that challenges the current state of affairs. But this standing as best practice only holds until the innovation is really seen as best practice, at which point it will be copied and imitated in any number of ways and rapidly lose that which made it innovative in the first place – i.e. being a different approach, that which wasn’t seen as best practice. At the point when an innovation is accepted and turned legitimate, it will also be turned into something legitimate and standardized. What many proponents of best practice do not get is that there is a “Best Before”-date to all best practices, and this shelf-life is rapidly diminishing.
Best practices can blind us to more things than we might realize at first. The concepts of best practice and innovation share a similar problem that both are creations of our love of progress. Innovation obviously builds on the notion of the new and novel, but the notion of a (note the definitive article) best practice also refers to an idea of having found the one right way of doing something and thus that there are things that we have left to and in the past. While pleasing to a culture that loves progress, this might be a dangerous assumption. Often we can find that earlier forms of thinking and approaching problems can be very fruitful in opening up avenues for development, and the notion of best practices, while anchored in the past, may also be the things that makes it difficult for us to see other, beneficial things in history. Any story that sells itself as the one right way to understand something hides many other truths and many other teachings.
Innovation is not about agreeing on things. Best practices are agreed upon summations of what has been the best solution to a given problem. The problem here is not only the historical ties, but also the fact that best practices are results of a negotiation, where one has adopted a point of view that is acceptable to most stakeholders. However, while this makes political sense, it hides another problem. Best practices are agreements, and thus often things that live up to how a group wants to view itself and what is acceptable in that group. This makes best practices the equivalent of dogma, an agreed-upon orthodoxy that is politically expedient but also moribund by being wedded to the historical contingency of a group. To take an example, at the advent of the word-processor, there was a stable and (in the eyes of the group) healthy best practice among type-writer producers. They agreed with each other about the best way forward, and the industry walked merrily towards its death enveloped in a pleasant feeling of a shared perspective and developed best practice.
Best practices are too complicated. We live in a world where the next major source of strategic advantage will be simplicity, not additional layers of complexity. The notion of best practice, in comparison, tries to create a solution by adding yet another layer of complexity unto our processes – with checklists, benchmarking, and the deadening force of standardization. Business does not need another process that demands additional administration, but ways of developing business that simplify things for both producers, middlemen and end-users. Simply put, the notion of best practice is rooted in an industrial age when machine efficiency and optimization ruled the roost, but in post-industrial times such commitment to control and administration is the wrong medicine for an illness we’re not suffering from. Innovation today needs to be about simplifying things and getting by with less, not establishing another set of rules.
Please don’t misunderstand me here. Best practices do have their place in the conversation about how we’re to develop business, and innovation is not the only game in town. Instead, we should be able to see both the benefits and the flaws in both of these, and work hard on not just accepting one thing or the other as the one right way. What business constantly shows us is the one truth that cannot be underestimated: Everything works some of the time, nothing works all of the time.
Alf Rehn is a management professor, an internationally recognized business thinker (or something), an author and a speaker. He is currently holding the Chair of Management and Organization at Åbo Akademi University in Finland, was earlier the SSES Professor of Innovation and Entrepreneurship at the Royal Institute of Technology in Stockholm, Sweden, and has in addition taught at universities all over the globe.