Tuesday, September 15, 2009

Window of Foresight

Getting insiders to look outside is sometimes not as easy as it might seem, even when they are considered forward-looking thinkers. Internal mindsets can bias perception and outlook.

Several years ago we facilitated an Opportunity Foresight process with U.S. West, who was large enough in its market to be the dominant player. The division we were working with had responsibility for the Yellow Pages business. As we prompted the group to express their individual diverse beliefs about future external factors, we noticed a tendency toward a certain mind set. Like a car that needs its front end realigned, part of the group would tend to veer off into expressions of what the company should do. It was sometimes difficult for these insiders to put their industry analyst hat on and detach from the immediate concerns of the company’s present circumstances.

As these forward thinkers looked out the metaphorical window into the company’s future, it was difficult for them to avoid becoming distracted by the company’s own reflection in the window pane. Partly this was due to the relative position and size of the company in its competitive environment. Partly it was due to a chronic impatience to get to the strategy question (what are we going to do?) before answering a prior question—what do we see happening in front of us and around us?

Our colleague Jim O’Shaughnessy reminds us of the power of mindsets with a parable from the book, The Black Swan, of the domestic turkey prior to that fateful period in late October, early November. Imagine yourself a turkey. All your experiences with humans thus far would lead you to believe them to be benevolent caregivers. Every day one of these humans shows up with more food and water. Some days they clean up after you, give you medicine, even arrange for you to have sufficient exercise. This daily routine is part of the very fabric of the life of the turkey. The turkey has every reason to expect that the next 100 days will be the same as the last 200 days. Then, along comes Thanksgiving. External conditions change.

To avoid the fate of domestic turkeys, most of our organizations have some formal or informal process to periodically “look out the window” to see how economic, competitive, market, user, regulatory or technological conditions may be changing. Because this is done often enough, we might want to consider the ‘window’ itself, and how we are using it; our outlook or competitive environmental scanning process and competitive intelligence capability.

Some of you may be familiar with Johari’s Window developed in 1955 by Joseph Luft and Harry Ingham, which has become a staple for understanding interpersonal communications and interaction dynamics. This four-paned window may also be been useful for thinking about our organization’s outlook process. Try this thought experiment: Use Johari’s Window as roughly descriptive of the possible views through which your organization views the external future landscape.

The four quadrants contain an Open pane, which is filled with what you know and your competitors and external analysts know (the ‘known knowns’) about the future. The Hidden pane contains the insights or “foresights” that are known to your company, but may not be known to competitors or analysts (these you should regard as proprietary). The Blind Spot pane is filled with what competitors and analysts are likely to know but your organization may not. These may be ‘orthodoxies’ or mind sets that may be discernable only with the help of a detached observer. And finally, the Unknown pane contains those future factors that are yet to emerge and are currently outside of the awareness of anyone who may be interested.

For each of these panes in the window, the implications are different. For the Open frame we would want to make its contents explicit and widely disseminated throughout the organization. For what is in the Hidden frame we would want to both increase the quality and quantity of its contents to grow a competitive advantage as well as maintain its propriety character (i.e., trade secrets, proprietary user insights, and other intellectual assets). Clearly identifying what may be proprietary should be well understood by those who are aware of this frame’s contents.

For the Blind Spot frame the challenge is to discover what may be known by competitors or others of which we ourselves are unaware—or as Mark Twain said, “It’s not what you don't know that hurts you so much; it's what you know for sure that just ain’t so.” And finally, for the Unknown frame the challenge is to discover factors before your competitors do or before they are generally recognized.

To gain a complete and balanced picture, all the panes of the window must be considered. The blind spot and unknown frames are particularly of interest in our Opportunity Foresight process. The process helps companies clarify a shared outlook on the emerging external factors shaping their future. It is a more agile, cost-effective and robust process than scenario planning.

Having the organizational capability to see into the future and more quickly identify, understand and time opportunities, threats and strategic shifts is no less important for any company today than it was yesterday. However, exercising this capability in more varied contexts may be become more of a necessity than an optional luxury, particularly if we want to avoid the fatal mistake of the turkey. The trick is, of course, keeping the window clear enough to prevent it from becoming a mirror.

Tuesday, September 1, 2009

The Rememberers by Jane Gannon, Associate

The other day as I was pursuing my newly found passion of canning homegrown, vine-ripened tomatoes, I was thinking about my grandmother and how canning fruits and vegetables was part of her summer routine. Not being interested in learning this skill from her when I was a child forced me recently to seek out a friend to teach me how to can. Now as I filled glass jars with plump, juicy tomatoes, I was mindlessly listening to the radio when Katherine Paddack, the clan leader of the Tlingit Tribe of Alaska, started talking about a gathering of her tribe happening here in the Bay Area. 

Paddack spoke of her Tlingit tribe’s history and how they learned to work with the white explorers who came to Alaska rather then become a victim of the white conquest. Due to its harsh geography, white explorers depended on the Tlingit Tribe, and so the tribe itself survived and prospered, and its identity is still in tact. Even though the Tlingit’s lost many members due to diseases brought by white explorers; they did not lose their culture.  

Upon “white contact,” many other Native American tribes lost their leaders and people to disease and genocide. Many tribes were destroyed and lost their stories, their ways of life and their culture because tribes had an oral rather than written history. One of the ways the Tlingit Tribe was able to maintain its identity is through the role and discipline of the rememberers.  

Rememberers are those who hold and pass on the stories of the tribe. They carry the history and traditions and tell them to other members of the tribe orally. As they sit around the circle one of the rememberers will begin telling a story of the tribe. As he or she talks, others listen. If the storyteller gets something wrong in the story, another rememberer in the group will take over telling the story and correct the mistake, to the agreement of all the rememberers present. The first rememberer will then pick up where he or she left off, and continue telling the story. In that way, the members of the tribe all continue to learn the same history, through the collaborative and oral wisdom of the rememberers.  

According to the Journal of American Indian Education, “One of the sacred duties of certain elders of the tribes was the handing down of these histories to their successors. As they repeated them, they impressed upon the hearer the importance of remembering the stories precisely as told, and of telling them again exactly as he had received them, neither adding nor taking away anything.”

The rememberer is an honored person in her tribe like a shaman or healer, she is held in high esteem by others in the tribe. The rememberer is the history. He is the living record of all the stories of the tribe, telling the stories and tales that would be lost forever without them. As a result of the contact, conquest, and settlement of white explorers and pioneers, many tribes lost their rememberers and thus lost their memories and cultural histories. 

Many of you have heard Lanny talk about creating a “knowledge-creation and codification commons,” a human system of sharing what it is we know so as to enable the learning of what we don’t know. This is an essential and possibly the central element in Toyota’s innovation management system. 

We are struck with the how the role of the rememberer in the Tlingit tribe describes and offers a role and discipline for our organizations that may be necessary in building a sustainable innovation system. Rememberers can help us avoid re-learning and, by keeping the history, point us in the direction of where what we are learning may be applied to creating value. 

While I remember my grandmother so well, my memory is now hazy and it seems like such a long time ago those summer days spent in her kitchen. I wish I could see her again. I wonder what story she would tell me?  

This article was originally published in Innovating Perspectives in October 2008. For this and other back issues of our newsletter, please visit our website at innovationsthatwork.com or call (415) 387-1270.

Amid Chaos, Necessity is still the Mother of Invention

As the financial crisis is all around us, the old saying “it rains on the just and the unjust” comes to mind. It seems applicable to the realm of innovators as well. It rains on the operator and the innovator. Not that operators are just and innovators unjust, or vice versa. It's just that both are affected by the “rains of fear” coming down on us all from the dark storm clouds of chaos in our financial markets.

Typically Innovating Perspectives prefers to stay with principles and practices of innovation and its management, seeking timeless wisdom and practical experience to innovators in their networks and communities of practice. However, the turbulence and apparent chaos of the financial markets that is affecting all of us—and will likely affect us for some time to come—has given us pause. 

The speed, volatility and pervasiveness of what is raining down on all of us—our host organizations, our nascent and vulnerable innovations-in-development, our customer’s readiness for something new, our personal anxieties about our 401Ks, retirement plans, and stock options—all seems at risk, if not completely under water and thoroughly soaked. It is difficult not to ask, “what’s going to happen to us?” It is also very tempting to follow Chicken Little into the conclusion that the sky is indeed falling.

Thanks to the recommendation of our friend Ivy Ross, a very observant and wise leader and current EVP of Marketing at The Gap, I finished reading Margaret Wheatley’s Leadership and the New Science (1992, 2006). The essay is a fascinating thought experiment challenging us to rethink management and leadership by pointing us to what the new sciences of field and chaos theories reveal about how post-Newtonian nature really works. I am grateful to have read this book amidst this financial chaos. 

Here are a few lines that are helping me maintain some emotional balance: 

“It is chaos’ great destructive energy that dissolves the past and gives us the gift of a new future.” 

“We have held in us the dance of creation and learned that growth always requires passage through the fearful realms of disintegration.” 

“The destruction created by chaos is necessary for the creation of anything new.” 
The destruction of wealth that is happening around us and from which none of us can escape—as individuals, as innovators, and innovation sponsors in our host organizations—is undeniable. However, this chaos should not evoke in us a self-centered fatalistic cynicism, nor drive us to escape into a Pollyanna hope that “everything will turn out alright.” Instead, it might call forth in us the prophetic role many of us as innovators can and do play in the context of our host organizations, particularly with those colleagues who view themselves not as innovators but operators. 

In the role as prophetic catalysts for the future—the host organization’s future—we can and should bring the voice and perspective that there is opportunity here, even here and now, and it needs our attention. This is not to deny nor give in to the tragic and deterministic narrative to which simple straight-line projections confine us—too often the thinking of our counterparts in operations and finance. Many of them are just doing their jobs.

We ourselves need to remember our own experience and take careful pains to remind our organizations, the perennial truth that necessity is the mother of invention. That this potentially protracted period of necessity we are likely entering is not something that should shut down our innovation efforts. Instead, this time may prove to be a period, though painful, where necessity becomes a ‘tough love’ mother for our current and future innovation efforts, not the coroner. It may be a painful blessing in disguise.  

Joseph Schumpeter described the entrepreneurial pattern of creative destruction and postulated that dynamic disequilibrium brought on by the innovator rather than stability and optimization is the ‘norm’ of a healthy economy. Even before Schumpeter, J.B. Say, the French economist who coined the term entrepreneur, defined innovation not as either “innovation” or “entrepreneur” as is commonly understood. He defined it with this tough love mother in mind when he described it as improving the yield of resources. 

Innovators (or entrepreneurs) always shift economic resources from areas of lower productivity to areas of higher productivity and yield. Peter Drucker reflected on Say’s influence this way: “The essence of economic activity is the commitment of present resources to future expectations, and that means to uncertainty and risk. To be sure, people who need certainty are unlikely to make good entrepreneurs (innovators).”

These are times that call forth from us that most basic of all principles that quietly and implicitly animates so much of what innovators do—faith. By faith we don’t mean to refer to a religious or spiritual set of beliefs that you may or may not hold. Rather we refer to “the substance of things hoped for, the evidence of things unseen” that has enabled us to move forward in the past through these headwinds of fears—whether those winds of fear are coming from the prevailing Northerlies of uncertainty, the periodic Southerlies of rejection, or the powerful Nor’easters of loss (of control) and failure. By faith, we mean to recognize a common muscle that resides with innovators—prisoners of hope—who put that faith into forward movement through the winds of fear because their future expectations won’t let them do otherwise.

The inherent and inescapable discipline that comes from times of necessity can spur us to return to the fundamentals and roots of innovation, even open innovation—generosity, trust and transparency. Perhaps this will be such a period of radical, necessity-born innovation.  

This article was originally published in Innovating Perspectives in October 2008. For this and other back issues of our newsletter, please visit our website at innovationsthatwork.com or call  (415) 387-1270.