Management Creativity and Its Form: Lecture on Corporate Creativity

Management
Creativity & Its Form
Lecture on Corporate Creativity

Creativity
Innovation 56s

23-Sep-11 IMT - Management Creativity 1

LOGO Contents

1. CREATIVITY AND MANAGEMENT

2. Planning for Corporate Creativity


CREATIVITY AND
MANAGEMENT


LOGO CREATIVITY
The concept of creativity has been around long before management
speak in many disciplines (the term has16th century etymological
origins). For example:

In Mathematics – as the art of making useful combinations from an
almost infinite number of possible useless combinations

In Philosophy – especially connected with serendipity (which is
not pure luck or chance) but results from identifying 'matching
pairs' of events that are subsequently put to practical use.
Baudrillard uses the analogy of the billiard game – playing off the
cushion – to characterise the rebounding and richocheting nature
of actions and ideas.

Business examples of such a process can be found under the
topic “innovation” and include the invention of the Swatch (new
combinations or “pairings” of technologies developed in other
industries).


LOGO LEGAL DEFINITIONS
Creativity falls under the rubric of intellectual
property for the legal profession. For
organisations these concern outputs (rather than
processes)

For example
New Ideas (which are protected by patent laws)
New Products/Services (which are protected by
copyright laws)


CREATIVITY IN ORGANISATIONS AND
LOGO CREATIVE ORGANISATIONS

Creativity in organisations focuses on achieving
innovation, competitive advantage and social
benefits by enhancing the ‘level’ of creativity in
the organisation.
This, typically, involves:
Examining the personality traits and styles of individuals
Developing an organisational context in which creativity
might be fostered (organisational cultures etc)
Examining systems (collectivities of organised efforts
coupled with the physical environment) to see how the
systemic tendencies toward stability might be
interrupted .to stimulate new actions and/or different
activities.

LOGO TO SUMMARISE ..
CREATIVE INTERNAL
CONTEXTS

EXTERNAL

CREATIVE
CREATIVE
PROCESSES
INDIVIDUALS

LOGO Creativity .
Management theory typically assumes creativity
is solely about the creation of new ideas. This is
innovation
• Hence the breathless talk of improvisation, jazz and
unstructured music, commedia del’arte etc .

But creativity in the implementation of existing
ideas and technologies is equally important.

Creativity is therefore a broader concept
incorporating both innovation as well as existing
ideas, structures and processes.


LOGO Creativity Involves
Concepts: ideas and/or technologies

Competences: the repertoires of skills and
abilities of individuals (and the opportunity to use
these skills in the organisation).

Connections: the relationships which individuals,
teams and organisations create (networks).
Sustained by collaboration and can be re-
configured as new ideas emerge/are created.
Inspiring Invention (Kanter 1999)
Suction_Tires-30s


LOGO Creative Organisations
Typically, advertising, media, music, arts and
entertainment organisations.

Creative organisations survive by their ‘creative output’
be that a magazine, and advertising campaign or a piece
of music.

To achieve this, they need to employ professional
creative individuals, but also professional managers to
ensure business success.

This can create tensions which have typically been
called ‘creatives versus suits’ (See Chapter 7 in Images
of Strategy by Bilton et al).


LOGO Hierarchy, Power and Creatives .
Professional managers have to deal with creatives,
many of whom feel they have been forced to the bottom
of the organisation. (Silos, hierarchy and managerialism)

Many creative organisations have become
“managerially” professionalized with the individuals who
actually produce the ‘creative’ product being at the
‘bottom of the pile’.

Media organisations are just as full of structures, limits
and routines as any other type of organisation. And
creatives are likely to feel constrained and alienated by
them.


LOGO Creatives and the Strategy Process

The disengagement of creatives from strategic decision processes
in a range of creative organisations is striking.

To what extent would it make sense to involve creatives to a greater
extent in the strategy process?

There are countless conflicting arguments about this point. Kanter
and others would argue that greater involvement would release
greater levels of innovation and Hickson et al (2003) would argue
that implementation (and performance) would benefit

Managers of organisations might take the alternative view and argue
that only ‘suits’ should be involved in decision making since getting
creatives involved will be disastrous (they assume they don’t want to
be involved and they are not skilled in strategic thinking).


Comparing Creatives and
LOGO
Knowledge Workers .

There are similarities in some of the above
dilemmas between organisations employing
creatives and professional service firms
employing knowledge workers.

In the same ways as creatives, knowledge
workers are the core competence of the
organisation. They both present similar
difficulties for management.


LOGO Retention is a Key Issue
Some creatives inhabit a fluid labour market. They can
sell their skills freely and can move from job to job, from
contract to contract and from organisation to
organisation (dangerous in a competitive market) ..

Some will leave at the slightest hint of dissatisfaction and
seek a job elsewhere. Management’s role in maintaining
a supportive context is therefore crucial.

Professional/knowledge workers display many of the
same characteristics.


LOGO The Knowledge Base and Performance

On the basis of empirical evidence, it would be
better to involve ‘creatives’ in the strategic
decision process rather than marginalise them
and keep them away from the process.

They are the ‘knowledge-base of the
organsiation
(Hickson et al 2003; Kanter 1999; Miller et al 2004)


KNOWLEDGE BASE AND ORGANISATIONAL
LOGO CONTEXT/ PERFORMANCE

Knowledge
Base
high
Nestle Carlsberg-Tetley
Philips Nokia
(very high

Organisational
Organisational
(high performance)
performance)

Context
Low high

National Grid
Marks&Spencer (moderate
performance)
(poor
performance)
Low

Planning for
Corporate Creativity

BMW Defining
Innovation-1m05


LOGO The True Nature of Corporate Creativity

Creative potential greatly exceeds creative
performance in most companies
Most creative and innovative acts in companies are
not planned for and come when least expected
Impossible to predict what they will be, who will be
involved, when and how they will happen

The real power is in the unexpected


LOGO Japan Railways (JR) East

Largest rail carrier in the world
How construction of a bullet-train through Mount
Tanigawa led to Oshimizu beverages with sales last
year greater than US$60 million!


LOGO Plastic Lids at American Airlines

Used as a cover for the metal pots flight attendants
use to serve coffee
Each lid cost only 1.5 cents -- reducing number by 5
per flight led to savings of 7.5 cents per flight. Not
much . . .
2,300 flights per day -- 365 days per year
$62,000 annually saved!


LOGO The Real Truth . . .
The majority of creative acts in corporations,
whether dramatic innovations or incremental
improvements are:
Unplanned
Completely unexpected


LOGO Japan Management Association
Projects awarded from 1986 to 1990
More than 1/2 of these projects initiated by
individuals and not anticipated by anyone else at
their companies
Novelty and impact of these projects far exceeded
those projects initiated by management!


LOGO Managerial Challenge
How can we promote unanticipated creative acts?

Perhaps first by recognizing that management is not
as much in control of events as it believes it is!


LOGO Human Imagination
“Microsoft’s only factory asset is the human
imagination.” New York Times Magazine (Fred Moody)

If this is true, we had better figure out how to
“manage” the human imagination


LOGO Korean War and POW Training
Challenge was to identify factors most critical for
survival for pilots and crews captured
Plan was to identify factors and create training
programs
Finding was unexpected

Those who survived combined elements of their
training and life experiences to create a completely
new survival technique -- one that had not been
taught!


LOGO Paul Torrance’s Conclusion
“Creativity and innovation are adaptive forces which
have perhaps been given too little attention in
connection with problems of survival and survival
training. Successful survivors describe many creative
and imaginative behaviors which not only solved
immediate problems for them but apparently gave
them renewed energy for continued adaptation.”


Tomoshige Hori’s Absent-minded
LOGO Mistake
Snow Brand Milk Products (Japan)
Attended symposium in Tokyo unrelated to his area
Measure thermal conductivity of a liquid using a “hot-
wire”
Began to measure thermal conductivity of milk

Quite a “curdling” experience!
Interestingly, several years lapsed before any action
taken within company


LOGO Daewoo Employee Eliminates Own Job!

DCM-Daewoo medium-sized truck plant in Surajpur,
India
Adjustment of windshield-washer jets was a two
person job, right?

Everyday innovations need not be spectacular!

Creators vs
Enhancers-2m42


LOGO Yellow and Black Tags?
British Airways baggage handler frequently asked
himself the same question
“Why do the bags with yellow and black tags always
arrive first at the carousel?”
In 1993 BA initiated the “First & Fast” procedure
Reducing average time for first-class luggage to
arrive at carousel from 20 to 7 minutes on most
routes!
Ian Hart received US$18,000 and 2 Concorde
tickets for his suggestion!


Another Definition of
LOGO Corporate Creativity
Earlier we defined creativity as any behavior that
caused a reaction. Can we make this a bit more
practical?
How about . . .

Corporate creativity occurs when employees do
something new and potentially useful without being
directly shown or taught.


LOGO therefore. . .
In much the same way, companies cannot where
specific creative acts will come from or what they will
be, they can take actions to increase the frequency
with which these events occur

However, a bad system will beat a good person every
time.


LOGO Lessons Learn

Alignment of the interests and actions of all
employees with the company’s goals
Self-initiated activity links ideas of employees with
intrinsic motivation to solve problems
Unofficial activity gives ideas a safe haven where
they have the chance to develop until they are
strong enough to overcome resistance


LOGO Lessons (cont.)
Serendipity: Discovery made by fortunate accident
in the presence of sagacity (keenness of insight).
Creativity often involves recombining or making
connections between things that may seem
unconnected.
Companies can bring diverse stimuli to their
employees -- but this will have only limited impact
Most stimuli arise in connection with daily life or with
the work itself


LOGO Lessons (cont.)
It is far more important that companies provide
opportunities for employees to tell each other about
the stimuli they have received
Increase within-company communication
Provide opportunities for employees who do not
normally interact with each other to meet
Important not to have preconceptions
Creativity is limited to the same extent that a company
acts on preconceptions about who will be creative,
what they will do, and when and how they will do it


LOGO Kathy Betts and Massachusetts
Part-time employee with the Department of Public
Welfare processing Medicaid reimbursements
Recommended charging “uncompensated care” to
Medicaid, rather than through Department of
Medical Security (home-grown agency)
Three-year bill of US$520 million; additional $150
million to $200 million annually since!
Kathy awarded $10,000 -- but . . .


LOGO Can we “Motivate” Creativity?
Edward Deci and his studies of extrinsic and intrinsic
motivation

Deming: Some extrinsic motivation helps to build
self-esteem. But total submission to external
motivation leads to destruction of the individual.
Extrinsic motivation in the extreme crushes intrinsic
motivation.


Out with Suggestions and In with
LOGO Kaizen Teian

Company Total proposals Proposals
per person
Matsuchita 2,427,015 17.9
Toshiba 2,222,042 52.6
Idemitsu Kosan 1,073,256 118.3
Toyota 764,402 13.8
Sanyo 660,427 27.5
Kubota 537,389 35.3


LOGO U.S. vs Japan (2005)

U.S. Japan
Suggestions per
employee 0.16 18.5
Adoption rate 38.0% 89.7%
Participation rate 10.7% 74.3%
Average reward $458.00 $3.88
Avg. net savings
per suggestion $5,586.00 $175.66
Net savings per
employee $334.66 $3,249.71


LOGO In Conclusion

History is a record of “effects,” the vast
majority of which nobody intended to
produce.
Joseph Schumpteter

Think_out
of_the_Box-1m41


LOGO Selected References
Hickson DJ, Miller, S.& D. Wilson ‘Planned or Prioritised? Two
Options in the Implementation of Strategic Decisions, Journal
of Management Studies, 47 , November 2003.

Bilton C. (2003) Strategy as Creativity, In S. Cumming and
D.C. Wilson ‘Images of Strategy’, Blackwell: Oxford.

Kanter, R.M. (1999) ‘Change in Everyone’s Job: Managing the
Extended Enterprise in a Globally Extended World’
Organizational Dynamics, 28,1, pp. 7-23.

Miller S., Wilson D.C & Hickson D.J (2004) ‘Beyond Planning’
Long Range Planning.


www.themegallery.com


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