Wednesday, November 11, 2009

Money & Business

No Ideas? You're Not Alone

If you're in a group, you'll have a better shot at being creative

By Justin Ewers
Posted 6/10/07

Quick: Be creative. Go on, think of a new product or idea that will dramatically improve your company's sales, cut costs, or even just make the daily commute a little more bearable. Still haven't come up with anything? Not to worry. Conventional wisdom has it that breakthrough ideas come only from the minds of geniuses. Edison, Tolkien, Darwin—history's biggest brains are responsible for its biggest innovations. Inventors, in popular history, are loner-savants, solving the world's problems solo in musty labs and libraries. Many companies are organized with this idea in mind.

Checking Gore-Tex fabric at W. L. Gore & Associates, an organizationally "flat" workplace
JEFFREY MACMILLAN FOR USN&WR

But here's the thing: Thomas Edison didn't work alone. The invention of the light bulb was the work of an entire lab team; it was one of his assistants who came up with the idea of screwing the bulbs into sockets instead of just mounting them straight up. Same goes for J.R.R. Tolkien, who wrote his Lord of the Rings novels at the same time C. S. Lewis was creating The Chronicles of Narnia. Both authors generated ideas for their stories in a weekly literary group of Oxford scholars called the Inklings. Charles Darwin's work on evolution wasn't dreamed up in a vacuum, either: While doing his research, he was corresponding with dozens of scientists across Europe.

No "I" in team. Creativity, in other words, isn't a solitary affair—and it's not the exclusive domain of the brilliant and gifted. In fact, research shows that people working in groups are far more innovative than previously thought. A handful of academic papers in the past decade have found that team-based organizations consistently outperform traditional bureaucracies, largely because they allow better ideas to bubble to the top. Phrases like the "wisdom of crowds" have entered the lexicon, and companies like YouTube and craigslist have taken advantage. According to one recent study, 14 percent of the "substantial innovations" that come out of small groups account for 61 percent of all profits. "Most people think the creative economy is artists, musicians, and sculptors," says Richard Florida, author of The Rise of the Creative Class. Actually it's not: Whether you're a lawyer or a factory worker, he says, companies are relying more and more on your ideas.

So what can businesses do to take advantage of their employees' creativity? Two books published this month, one by Keith Sawyer, a professor of psychology at Washington University in St. Louis, and another by Richard Ogle, a business consultant and researcher, offer the beginnings of an answer. Sawyer and Ogle maintain that group effort always has been the best source of innovation—and they offer a glimpse into companies that are finding new ways to harness the ingenuity and entrepreneurship of their employees.

Generating new ideas, they point out, isn't as simple as pouring money into R&D. Indeed, a 2005 Booz Allen Hamilton study found no relationship at all between the dollar amount companies spend on research and development and the growth of sales or profits. Kind of makes sense: Microsoft, with its massive $5 billion research budget, isn't known for its innovations (witness the Zune), while Toyota, only the third-biggest R&D spender in the auto industry (behind Ford and DaimlerChrysler), not only came up with the most popular hybrid vehicle on the market but is well on its way to becoming the world's largest automaker.

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