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Innovation is not just about the introduction of a new idea -- it is about how ideas diffuse," says Michael Schrage, a co-director at M.I.T.'s Media Lab. "Actually, it's not just how ideas diffuse. It's how the behaviors and perceptions and perspectives associated with those ideas diffuse."
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Michael says he used to be interested in how people think when they innovate or when they evaluate innovations -- when they try to do new things. But as he's gotten older, he says he's shifted his interest from rational thinking to behavior.
In other words, what are the ways that people look at things? What are the ways that people talk or gesture around things? Says Michael: "I'm looking at innovation as something more than just the product of intense thinking and rational thought."
You may know Michael Schrage as the first technology correspondent for The Washington Post or the first video columnist for Rolling Stone. Maybe you've seen his byline in the L.A. Times, Wired or ComputerWorld. Perhaps you've read one or more of his two-and-half books, most recently Serious Play, written with Tom Peters.
His other book was Shared Minds. The half-book, well, that was a "non-trivial" update of Shared Minds, which is all about collaboration -- collaborative tools, media and why collaborative relationships are different from other relationships.
So we're basically talking about a writer, here. A journalist, more exactly. But one who has a lot of ideas that anyone interested in creativity and innovation would be interested to hear about. And a writer who crosses the great divide into the business world as a consultant to the likes of AT&T, as well as into the academic realm as a researcher at the likes of M.I.T. "Writing books got me invited to do a lot of things," he explains.
Indeed, you might know Michael as a co-director of the e-commerce initiative for M.I.T.'s Media Lab. You know, Nicholas Negroponte's Media Lab? Michael met Nicholas ("a fabulous institutional entrepreneur," says Michael) while interviewing him for a story for New York Magazine. Michael subsequently was invited to take a fellowship beginning in 1988.
"It's one of the great pleasures in life to work in a place where pretty much everyone is smarter than you are," says Michael. "It was thought that having me around the Lab wouldn't be a bad thing, and it turned out not to be."
Okay, so you haven't seen Michael around the campus at M.I.T. You can, however, easily find his face looking back at yours from the pages of Fortune magazine, for which he is a columnist. One of those columns, recently, was about the relationship between art and business, and it was terrific. Really refreshing. Exactly what the business world -- especially its marketing inhabitants -- need to hear. You may remember we wrote about it in Cool News -- but we had a few more questions for Michael.
You've written that the art of business increasingly depends on the business of art. Why do you believe that?
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I genuinely believe that, and for very simple reasons. In many respects, technology makes it easier and easier to innovate. It also makes it easier and easier to imitate. So, no matter how good an idea you come up with, the ability of other people to emulate or imitate or fast-follow your innovation is increasing. And, by the way, many of those people who are fast-followers are not just going to slavishly imitate your innovation. They're going to come up with an interesting variant of your innovation.
So, the need to differentiate is becoming more and more important. Now, there are classic ways in business of differentiating -- reducing costs, changing distribution paths or offering better service. But even those differentiations lend themselves to certain forms of imitation and knock-off. Increasingly, organizations and institutions -- entrepreneurs and innovators -- are going to have to rely upon an aesthetic sensibility, an artistic sensibility, a design sensibility to differentiate themselves.
What steps do they need to take to accomplish that?
The first step is to re-examine the fundamentals. The problem that we all run into as human beings and as organizations is that we nod and say, "Yes, right, we need to have a better design sensibility." So what do we do? We continue approaching innovation the way we've always done it. We hire a design director, or a graphic designer. After we build the product, we slap the design on it. It's like the old approach to quality -- oh, we need quality; let's have a quality department.
The issue is not even one of hiring the right people. It's not even accepting that you need to have these kinds of capabilities. It's coming to grips with integrating innovation into what the organization does and who it thinks it is. That's the challenge. It's an integration challenge.
Do you think art classes should become part of MBA programs, for example?
I would try to do it by breeding art into existing classes rather than trying to create a separate class. Now, that's not easy to do, because how many marketing professors are capable of dealing with design people? Actually, there are pockets of marketing people who do understand and appreciate that you need design to differentiate.
You begin with collaborative teaching efforts. The marketing person has to invite the design engineer; the advertising person has to bring in the fine artist -- not just the graphic artist. There has to be reinforcement between theory and practice.
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The whole notion of Picasso as an artrepreneur is really under-appreciated. Maybe the question is, should art schools have a little seminar on how Picasso made a living?
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You've also written about the power of creative collaboration. How do you define creative collaboration?
Successful collaboration requires a shared space. It can be shared virtual space -- it can be shared physical space -- but collaboration requires a shared space.
But something else is even more important than the shared space. The real problem with a lot of organizations is that they get their managers in a room and they say, "We want you to collaborate. Here's your challenge: Cut 20 percent out of the budget." Top management has been too lazy in defining genuinely collaborative challenges.
Then you look at successful collaborations -- Watson & Crick, Hewlett & Packard, the Wright Brothers. Look at what these successful collaborators have in common. They faced big problems, used a shared space and had a willingness to subordinate their egos to the problem. And that is so important -- there must be a recognition that you can't innovate completely on your own, a recognition that you need to draw upon the resources and skills of other people.
How do organizations go about creating this shared space?
That's like a good news and bad news question. The good news is that organizations already have shared spaces. People are desperate for shared spaces. Organizations are now investing hundreds of millions of dollars in CAD, computer aided design equipment.
Now, here's the bad-news question: Do you let your marketing people have access to CAD technologies? Or do you limit the CAD to the design engineers? Do you assign the engineers to the marketers or the marketers to the engineers?
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Right now, even as we speak, there are rivalries between designers and engineers at automobile companies because both groups are now using the same software. Some of the engineers are now doing design, and that pisses off the designers. Meanwhile, the designers are doing engineering. It used to be that the engineers could say, "That's a beautiful design but we can't build it." They can't say that anymore because the design software is connected to engineering software. The designers know exactly whether it can be built or not.
What you're talking about requires people to change their behavior. How do you get people to change their behavior and collaborate?
You threaten to kill them! Well, actually, there are two things. One is you need the infrastructure -- the collaborative infrastructure -- the infrastructure that enables collaboration.
Equally important, you need to align the incentives for making that infrastructure work. You cannot say, "We want collaboration," and then reward people based on individual job reviews. I have seen many of these "collaborative issues" rapidly diminish in organizations that have instituted 360-degree job reviews. All of a sudden, the issue of "should I collaborate versus coordinate" becomes much more important.
Which companies do you consider to be the most collaborative the most innovative?
There are a lot of companies that I think are doing an excellent job of being collaborative and innovative. But just because a company is collaborative and innovative doesn’t mean they're necessarily successful in other things. I can design the most brilliant product around but if it gets priced twenty percent too high, I'm screwed.
I can transform any conversation I have with a client by bringing in a model. The ability to play with a representation of an idea is so important and so under-appreciated that it makes me sad and it makes me sick.
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What are the critical links between innovation and profitability?
That is literally the 100 billion dollar question. I'm going to stick my neck out and say something that I consider to be completely uncontroversial but a lot of people consider very controversial. I think there is no correlation at all between innovation and profitability. Anybody who thinks there's a correlation between innovation and profitability doesn't understand innovation and doesn't understand profitability.
Innovation is meaningless in terms of profitability unless somebody’s prepared to pay a premium for it. Now, it is absolutely true that there are industries where there's a correlation between innovation and the premium that people are willing to pay. I happen to think that personal computer software is not one of them. In fact, what's the biggest complaint that most people have about their software? It's reliability, because it crashes. That doesn't sound like feature shortages to me.
When the company that invented instant messaging was sold to AOL for several hundred million dollars, its revenues were zero. The founder's quote was, "revenues are a distraction," which is truly the ultimate Internet quote.
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Did AOL pay a premium for the innovation? Or did they pay a premium for millions of people who are using instant messaging, as a way to get them hooked into the AOL network? Is the innovation in the technology or is it in how it is used? Or is it in who is using that particular innovation? These are interesting questions.
How do you apply your concepts of collaboration and innovation to your work in MediaLab?
Oh God, all the time. But that's such a cheating question because you can't be at the MediaLab unless you're prepared to collaborate and innovate. You're expected to be interdisciplinary if you're at the MediaLab. You're expected to be able to articulate a design rationale every bit as rigorously as you're expected to argue a technology rationale. The flip side is we don't have a very good football team.
What exactly is MediaLab's e-markets initiative?
Everybody’s opening an e-business, but the fundamental issue is the role of electronic marketplaces, hot digital marketplaces. Everybody knows the phrase market mechanisms. The question is, when you enter into the digital marketplace, how well will various kinds of market mechanisms map?
For example, what do you think makes a better agent if you're going to use the Web? Would it be an agent that is as close as possible to you in your decision making style? Or would it be better to have a little portfolio of agents -- maybe thirty or forty agents -- with each agent focused on a specific task?
My own best ideas come from having playful and very serious -- but always rigorous -- arguments and discussions with people whom I respect.
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I would probably pick the latter.
Exactly. But what's the optimum number of agents -- forty, eighty, a hundred? And by the way, when you start talking about dozens and dozens and scores of agents, you know what you're going to discover? Microeconomics -- because you have a bunch of agents acting in the marketplace.
So you're really looking at the Web as a transactional medium?
No, no, no. That's my fear -- that that's the way that it will be interpreted. We're not just viewing the Web as a transaction medium but as a market. We're looking at the difference between a market, an audience and a community.
A market is an audience. If you're selling pop culture, a market is a community. Is e-Bay a transaction, a marketplace, or community? That depends on the auction. If you're dealing in memorabilia it's a community. These technologies force you to reevaluate these fundamental questions.
Are you optimistic that more organizations will become more innovative over time?
Well, actually that's not a question I would attach either optimism or pessimism to because the organizations that do not innovate will go away or not be able to survive in their current forms. So these are not nice-to-have issues; these are gun-to-your-head, need-to-have kind of issues. The issue is whether they will be handling these issues well or not. Like the airlines -- how long will they be able to get away with certain things?
Maybe I'm identifying the connection between art and business a little earlier than other people might -- so what? That’s the nature of being a columnist!
I guess the story to be done in the future will be -- what is the difference between organizations whose artists tend to have more of a musical sensibility versus a visual sensibility versus a filmic versus a fine arts sensibility or graphic arts sensibility? That kind of differentiation will become a source of meaningful interpretation.. |
