Losing the difficult bastards

Some years ago I was commissioned by a client, a major multinational, to dig into the stories surrounding ten major innovations that had taken place in the company over the past decade.

How had the innovations come about? Who was involved? What sorts of personalities were involved? Who had had the original ideas behind them?

We conducted one-to-one depth interviews with everyone involved and it gradually became clear that the answer to that last question – the originators ‒ was that they had each left the company. Some had been fired. Some had chosen to leave. Several had set up their own businesses.

They were all described by surviving colleagues as highly creative, but difficult. Unable to fit in. Resistant to rules, systems, processes. Difficult.

And the company, which had previously recruited these kinds of people on a regular basis, now effectively excluded them at source.

There emerged consensus from the survivors that the company was better off without them, these mavericks. So much easier for them – and for us ‒ to be elsewhere. What I noticed over succeeding years was that senior managers in the company became highly conscious of the lack of breakthrough innovations now.

No one seemed to be prepared to connect these things together.   

Cutting back on innovation

A new research study* shows rather shockingly that a quarter of British businesses have reduced their commitment to innovation in the current economic climate. And more intend to do the same in the coming year.

Do they imagine that battening down the hatches will help them to emerge from the current double-dip recession stronger?

It’s always been my experience that recession is a great time to outperform timid competitors with new creative ideas that have the potential to change the game. 

*Allianz Insurance, 500 CEOs in Britain, 2012

First comes the discovery

I constantly see research reports (in business no less than in academe) that are filled with observations, but appear to lack any kind of initial idea. Who is commissioning and paying for these tomes? And why?

Without an initial hypothesis, they are destined for the great pile of the unread, unnoticed. A complete waste of everyone’s time and money.

The right sequence was clearly enunciated by the great Czech photographer, Josef Sudek:

“Discovery — that’s important. First comes the discovery. Then follows the work. And then sometimes something from it remains.”

Learning by shouting out

You may have seen that a recent study of primary school children by Durham University shows clearly that pupils who shout out in class do better, academically, learning faster than those who seem better-behaved.

And yet so many teachers (and parents) still regard this sort of behaviour as disruptive and rude, censuring pupils accordingly.

My belief is that a major side-effect of the repressive way teachers react is that children start to suppress their own creativity.

On the subject of enthusiasm, the great American choreographer, Martha Graham, hit the nail on the head: “Great dancers are not great because of their technique. They are great because of their passion.”

The real question is: how to encourage and support impulsiveness in children and re-awaken it in adults?

Desires we never knew we had

A funny thing happened to Dr Geoffrey Miller. He’s a leading American evolutionary psychologist.

At a conference that brought together economists and psychologists in London in 1999, he noticed for the first time a group of people who looked different from all the academics there.

They were marketers. And they were interested in psychology because they wanted to know more about people’s preferences and how these worked.

Talking with marketers, Dr Miller noticed: “A new world opened up.” He recorded the experience in his book Spent: Sex, Evolution and the Secrets of Consumerism, where he observed that marketers and marketing-oriented companies “help us discover desires we never knew we had, and ways of fulfilling them we never imagined.”

I don’t believe that traditional market research, nearly all borrowed from psychology, did any such thing. In my experience, that sort of enquiry, both qualitative and quantitative, was conducted in the present, holding firmly on to a rear view mirror. And this kind of research still holds sway in many of the more conservative organisations.

But over the past fifteen years or so, a sea-change has occurred whereby newly-developed “insight” processes (based on face-to-face interaction and walking together imaginatively into the future) have gradually replaced that rear-view mirror.

Of course, this work leads marketers to new and more interesting places – but it’s hard to replicate. So it can leave risk-averse managements very fearful of failure.

Trying things out is at the very heart of Darwinian evolution! The point for us is to manage the risks involved.

Betting the bank: not such a great idea

When Coca-Cola had the result of a blind taste test for New Improved Coke involving 200,000 consumers, it clearly indicated to the company that they should launch – and massively support – the new formulation. And that’s exactly what they did.

That’s most probably what I would have done too. And if you are honest, so would your organisation, faced with apparently overwhelming consumer preference.

Of course, we all now know that it was the greatest marketing blunder in living memory. The question is: how could (and should) they have handled it differently?

My own view is that they should have area-tested the whole new mix – product, packaging, promotion, advertising, pricing etc – in a discrete part of the USA and learned from the response in reality of consumers, while at the same time gauging the counter-attack of Pepsi. That way they would have limited the downside risk dramatically.

Many years ago, I worked on P&G’s Fairy Snow brand when it was a fairly distant follower of the great Persil in the British washing powder market. These two brands were the only remaining “heavy duty” soap powders on the market, all other brands having switched to be synthetic detergents. Unilever wanted to switch Persil to be a detergent brand too. They knew that this would give consumers clearly better results in their wash. And research showed that consumers massively preferred the new detergent-based product.

Just as with Coke, the company did not anticipate the effect of the strong emotional attachment that consumers felt for their existing, “kinder”, soap-based brand.

But here’s the difference: unlike Coke, the company did not immediately go national with their hot new formula, they test-marketed the whole thing in an area with no more than 5% of the UK’s population. P&G and Fairy Snow came back with a hard-hitting “we’re your only soap powder now” campaign – and Persil started to lose share immediately, hand over fist. At least in this case Unilever had limited their exposure and were able to go back to the mix that was tried and true.

However confident they are of success, I always advise clients not to bet the bank on their current hot innovation, but to try it out and be prepared to move fast, one way or another, when they have genuine market-place response.

Not to bet the bank: hmmm…maybe it’s not just a metaphor these days.

Do you have experience of this issue? What are your own learnings?