Nov 29th 2009
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Loading ...Tapping the creative core
Even the most creative companies can lose their way, reports John Bessant, Director of Research and Professor of Innovation and Entrepreneurship at the University of Exeter. Continually tapping into their people’s ideas is a long term, strategic project.
In 2004, Lego, the Danish toy manufacturer, was on the verge of bankruptcy. Its business model, by then decades old, had run its course. Its patents were running out, it was besieged by low cost competitors, its customers were no longer interested in its traditional offering, preferring instead to play computer games or other forms of play rather than build models out of plastic bricks. More importantly, the company had to refocus strategically and start being creative in new ways.
Like many companies in dire straits, it was no longer a matter of incremental change – it had to shake things up dramatically if it was going to survive. The company’s new CEO, Jørgen Vig Knudstorp, says that when he arrived in the chair, much was being blamed on external factors, but that in fact the world had run on faster than company had, and although its principles and values remained firm, there was a mismatch with the world as a whole.
“If you had asked me five years ago, what does the Lego Group exist for? I’m not sure I would have been able to provide you with an answer,” he says.
To change this, Vig Knudstorp had to engage with his people in a way that they had been unused to previously. A very charismatic leader, he would show up at creative workshops I was running for the company and implore the people to put their heart into the process: “I need your help,” he would say.
Vig Knudstorp realised something that many companies still fail to – that the creative heart of the firm lies with every one of its people. As a manager once said to me: “I now realise that with every pair of hands comes a brain.” A brain is supplied with every model. Every human being is creative. The challenge for companies, and where most fail, is mobilising that creativity, and doing it on a long term basis.
The most innovative and creative firms understand that creativity is not a luxury to be assigned just to those with a creative “licence” – those in marketing or product development or other creative enclaves. It is something that must be distributed widely, to all people within the firm, who must be engaged and committed enough to provide their discretionary effort in the form of ideas and intellectual capital for the benefit of the company. They also realise that it is often not radical ideas that make the difference, but small, incremental changes that collectively make a difference.
Toyota, as a famous example, has systems and processes designed to elicit ideas from its people continuously, to collect them, act upon them and provide formal feedback. The company reckons it extracts on average one idea per week from each of its employees – a huge wealth of intellectual capital.
It is not a matter of waving a magic wand and expecting people to be creative. They must be motivated and rewarded for doing so, and there must be structures in place that capture, sort and use the creative input the company receives from its people. Nothing turns people off more than doing nothing with their ideas.
It is hard work, and not a short term project. But the good news is that, as Jørgen Vig Knudstorp and Lego have discovered, the rewards are there for those who seek them.
This is a summary of a presentation delivered by Professor John Bessant at a panel discussion: “Do Australian Business Systems Fail Our Best People?” hosted by UTS on 10 September, 2009.
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