Every business is an idea at some stage. The idea might be very simple. Do precisely what someone else is doing. Even hire people from the other operation to run yours. You can both do very well because the market is large enough.
Copying what someone else is doing and then doing it at less cost or to offer a lower selling price might be your idea. Or, you may promote it more effectively. Or, you could add some small wrinkle to the business, bells and whistles, etc.
You might have an original idea like selling insurance over the telephone or selling computers directly (like Dell Computers). Or the product itself might be the new idea.
The business is then organised to work the idea. The more profitable the business, the more deeply the idea is entrenched. A very success business like McDonald's is an example.
Where then does creativity get involved? McDonald's does offer new products now and then. The idea of opening in time for breakfast was successfully implemented by McDonald's.
So creativity is involved both in finding better ways to deliver the original idea and also in adding different products like new fruit on the same tree. But does McDonald's do any banking? It would not fit in with the core concept to offer banking.
There are lots of examples of companies that moved right away from their original concept (such as ITT and the Rank Organisation). A process of evolution and drift is often the way this happens. There are as many examples of companies which tried to move into different fields and failed.
An example of a company which has successfully taken the brand image and the management style into many new fields, though, is Virgin.
There was a belief that management excellence could be transferred to any field in the times of the conglomerates. This concept was not too successful, possibly because it was badly handled and applied much too widely.
All successful organisations have both tangible and intangible assets:
- Production plants exist
- Brand images exist
- Distribution networks exist
- Skilled people are employed
- Technical know-how available
- Market acceptance exists
- Financial reserves exist
- Effective managers are employed
All ideas are designs. A design is a way things are constructed to deliver value. An architect who designs a house does not need to work out the tensile strength of the steel beams or the porosity of the roof tiles because these things are known and the design is formed by the way known things are put together.
Notes and Music
Every piece of music makes use of the same basic notes. The new value is delivered by the way the same notes are put together. That is what design represents. If the design process was completely logical then computers would be writing all the music we needed.
Too many people believe that the analysis of information will produce new ideas. Because the brain can only see what it wants to see, this is not so. If you analyse information you will see only the existing span of ideas.
You have to prepare new ideas first in your mind to see them. Then you can see them in the data. There are 39,916,800 ways of sequencing only eleven items. So ideas are very unlikely to be found by exhaustive search. This is where creativity comes in.
Use of Assets
One of the purposes of creativity is to put together existing assets to make new value. There might be a need to bring in some outside asset occasionally to complete the design.
So where does this sort of thinking take place in a company?:
- The marketing people do it to some extent, but focusing on existing products.
- The research people do it to some extent, but focusing on technology or data.
- The strategy people do it to some extent, but focusing on trends.
Everyone does creative thinking from time to time, albeit in a somewhat haphazard way. Yet the most important thing in business in the future is going to be ‘ideas’ because everything else will be commodities. Is it enough to just hope that ideas will come about? Why do corporations not prepare their own advertising campaigns? Because they realise that the creativity necessary in advertising may not be found in-house. They also recognise that it would be unlikely that a really creative advertising person would want to work in-house. So outsourcing advertising is logical.
Outsourcing ideation is just as logical. The difference is that with advertising the people within the organisation do not have much input other than to accept or reject the ideas. This is because advertising agencies have successfully convinced them that they have a greater knowledge of advertising than production executives do. This might well be true. With outsourcing ideation there would have to be more of a joint involvement of those within the organisation and the outsource agency.
How Many Ideas?
I regularly come across organisations that claim to have all the ideas they need. Indeed, they have more ideas than they can deal with. My experience has shown that such claims are false and demonstrate a failure to understand the purpose of ideas.
An idea without implementation is worth little. But the value of implementation without ideas is even less. Competence is only of value when it comes with an idea. An unused idea stays full of potential.