Innovation

The last few days talking about teams was fun, and I suspect it doesn’t seem like it but I’m slowly spiraling in toward a broader goal, and it’ll take another week or so to get there.  For now now let’s shift gears a bit and talk about what you do with teams – you create change! 

The question is, how much change do you strive to make, how do you go about starting it, what direction do you head, and how do you manage it?  One model of innovation maps varieties or levels of integration into quadrants.  Actually, quite a few do, with different measures on the two axes, but in general they convey the same basic notion:  some innovation is small, some is moderate, some is major, and some is earth-changing.

Most of us working in major companies deal with the low-end of innovation – let’s call the Type 1 and Type 2 – little incremental improvements to existing products, or modest enhancements to make a product more appealing to current markets or perhaps to address an adjacent market.  These sorts of innovation are easier to budget, plan, and manage, and they have the sort of low-risk, predictable-ROI feel to them that really appeals to corporate management.  Honestly, if you could guarantee a few percent growth with no setbacks and decent working capital and inventory turns, but never have a great year and never take over a new market, you could have a very successful career in most major companies.

The more major innovation types are what we might consider inventions – either adopting a technology or approach from some other industry and disrupting a market in some unexpected way, or finding a new technology outright and creating new market wholesale.  Applying computers and communications technologies to products was a great innovation engine for the latter decades of the 20^th century, but it took the Internet and cell phones to really change the world in a wholesale manner.  We all know what sorts of companies tend to excel at such disruptions too – startups, and those few larger companies that somehow continue to think like startups. 

So why is this important, you ask?  Well, I think most of us are trapped thinking small at our jobs and in our personal lives, for the same reason that small, surer-thing bets are popular for managers:  we are averse to loss more than we desire gains.  This lopsided viewpoint is a well-established feature of our basic brain wiring, and since we can all extrapolate and foresee the small enhancements with little chance of loss, and we fear the possible (and even likely) chance of major loss with a big initiative, and the result is predictable. 

Think back to the first few monologues, where I made the point about terminology and lexicons:  to take a step up, we need a pretty firm base of thinking to start from.  It’s natural and easy for most of us to see those modest innovations, and really that’s why Lean (more on Lean later…) posits that there are always improvements that can be made at every level of the organization, because as humans we are good at it.  Incremental improvement is what makes the world of corporate continuous improvement go around, and here in a few days we’ll talk some about how to leverage small bets productively with a larger view in mind.

But when should we want to make bigger changes quickly, and if we do, how do we go about it?  Perhaps we can look at a few examples that came from the natural world (the world is, after all, ever-changing) but have already been proven in technology as well.  That’ll be tomorrow’s topic.

Effective Teams

Teams

Yesterday, I brought up how rare it is to have a highly effective team.  As it turns out, Google was really curious about this too, and had the tools and the team scope to do rigorous analysis.

From Google’s Project Aristotle that researched team performance, the following was forthcoming:  “The researchers found that what really mattered was less about who is on the team, and more about how the team worked together.”   

The most important single factor influencing team performance was psychological safety – such that each team member that they are safe taking risks, struggling, failing, or being dumb.  It doesn’t matter a lot who the team leader is, or what their style is, if the team is a safe place to experiment and learn.

A second major factor is dependability, where team members trust each other to deliver work on time and others in the organization do as well.

A third factor is clarity of expectations, including both the role and fit of each person in the team and the impact of individual performance.  Good goals are part of this, especially for short-term objectives, but alone they are not effective (hence the struggles of Management by Objectives).

Next in priority is having a sense of purpose, in the work or the product.  This plays somewhat into the dialogue about Vision and Mission – people like for their work to have value for the customer, the world, or SOMEBODY.

Last on the short list is impact for the company, as teams work best when their work contributes clearly to the success of their organization.

This is a brief synopsis, so if you want more detail just Google “Project Aristotle”.  All the above seems pretty basic and is hardly earthshattering, though the point about psychological safety was rather novel to me.   However, it isn’t easy to make a team “safe” in a less trusting culture, and few teams readily make the shift on purpose, and fewer by accident.  Even as a manager I can tell you it is hard to foster such team dynamics, and it is not easy to have a clear and consistent hand on the tiller without sometimes being too critical or too lax.

Another point worth making, that I don’t think the Google study reflects, is how to forge a good team from good people.  I’ve never seen it happen without a stringent target and high expectations, and generally an atmosphere of uncertain success. 

Actually, temporary teams in a harsh performance environment, may be the ones I’ve seen consistently perform.  Looking back, one reason I always liked being on proposal teams was there seemed to always be a solid combination of good, sharp people, a clear goal that mattered, a high performance bar, and a lot of uncertainty.  Long hours, late nights, too much fast food and caffeine, and finally midnight runs to FedEx were part of the fun, but the camaraderie was the clincher.

Dialogue Instead of Debate

A few conversational terms have become so blurred that they are almost considered synonyms today:  dialogue, discussion, and debate.  In fact, in politics (including, and perhaps especially, on social media), every interaction seems to have become a debate, with a desire to score points and get a positional win for a party, side, or agenda in an adversarial engagement. 

In some cases a debate is appropriate, where opposing arguments are carefully considered to weigh an important decision, but too often there is a “win at all costs” mentality to such interactions, with no real interest in considering other perspectives, and generally with no value forthcoming.  In many situations, a discussion should be an interactive exchange of ideas and information to reach a decision or to identify options and opportunities.  While differing positions may have pros and cons to various stakeholders the overall approach should generally not be one of determining wins and losses, but of coming to the best overall solution for the group.  This form of proactive engagements seems to be increasingly rare, and in political discussions it is uncommon to see perspectives other than the primary party lines.

More rarely still do we see open dialogues, as a non-confrontational exchange between colleagues, where intelligent people engage as friendly peers with a common goal of expanding understanding.  In a dialogue, each party provides ideas and information openly while temporarily suspending their preconceptions and assumptions with the goal of jointly learning and gaining insight without adversarial positioning at all.

Why is it that we like to hear our current opinions and prejudices repeated back to us, piling confirmations on top of our current biases, without the complications that come from alternative positions, inconvenient facts, and different worldviews?  Do we really wish everybody was just like us?  Are we really that confident we already know everything worth knowing?

A few more thoughts on vision before moving on: people are pretty good at vision for their personal lives, but often never get to “being part of the vision” at work. We've all heard about Maslow’s hierarchy, and that at some level employees want to be self-actualized, but even if we as employees get past the basic survival needs and into the psychological needs of esteem and belonging, somehow we too often short circuit at that layer and fail to make it up to the top. Why is it that we tend to settle for less, as employees and employers, for such an important aspect of our lives?

I don’t think this problem starts with the employee, but it certainly is curious how people act. The person who fearlessly dives into marriage and a mortgage, plans for 2.3 kids, and then find himself volunteering to be a coach for their kid’s team despite not knowing the sport can be the same guy at work who sticks with the down-rev tools and waits for Mgmt and Training to get their act together before adopting the new process roll-out, and avoids the promising upstart project because “it’s not what we’ve always done”. How can a person readily create and chase a meaningful vision in their personal life, but avoid it at work? How can amateur coaches of 13 year old kids instill a vision of greatness and get sacrifice and hard work while managers of adults struggle to get half-hearted buy-in of this year’s objectives and would happily settle for compliance with defined processes versus passive-aggressive cross-purpose efforts?

If you’re lucky, you’ve probably worked on at most two great teams in your life, often just one, and maybe none. If you have been on an unusually team or managed such an effort, you know the one: team members own the vision and believe in the project; strive tirelessly to make progress despite internal hurdles, technical issues, and competitive pressure; come in early and leave late not because they HAVE to but because they WANT to; back each other up and somehow identify and address issues before they become problems; and despite not being sure that success is even possible manage to succeed and exceed expectations. Customers are enthusiastic, the company is satisfied, and employees are energized. Why can’t we all have teams like that? Why are they so rare?

I don’t have all the answers, but some good studies and sharp observations have identified some of the key aspects. More on this in a day or two……..

The Fount of Creativity

We all know that “creativity” is an important trait, and it holds a place of honor for our cultural respect for genius inventors and artistic savants alike.  But for the business world, creativity, innovation, and the associated ability of imagination are most often leveraged for incremental improvements of existing products and processes, with occasional larger leaps into new technologies.

All that is well and good, but what is innovation and invention, and what drives it?  Why doesn’t it routinely manifest everywhere and every day?  Typically innovation is modest in scope, and reflects small improvements in efficiency, capacity, performance, or any other of a myriad of valuable product or process traits.  Often these can be viewed as simple hill-climbing optimizations, not major leaps, that serve to make things work just a little better.  Sometimes innovations are segmented into tiers, such as types 1 to 4, where 1 is a minor improvement for an existing product for existing markets, and 4 is at the radical side of the spectrum reflecting new technologies used in new products for novel markets.

Inventions are on the more significant side of the innovation scale, and reflect new ways of doing things, either using new technology or recombining technologies used in unrelated markets or products in some novel combination to address new needs. 

For any form of innovation, the new part tends to rely heavily on past work, either for existing solutions in the case of Type 1 or 2, or for unrelated markets for Type 3 or 4.  Even brand new inventions reflect building upon and remixing of earlier technology or inventions, and there is very little that is truly new under the sun.


So where does creativity come from?  Well, it often springs from creative tension – a situation that demands a solution.  “Necessity is the mother of invention” says the old truism, and it’s still true – creative ideas come because they are needed, in a situation where the work to communicate, dialog, ideate, and create becomes worthwhile.

Where does creative tension come from?  We said from necessity – problems – in the last paragraph, but that is a somewhat limited view.  Creative tension often reflects a dichotomy between our mental model of current reality and a model of how we wish it were – the delta between current and target reality. 

This isn’t a fundamental insight, but at least for me it is a perspective I didn’t have before.  We all have heard, at some point, “for want of vision, the people perish”.  If we want to create something new, either individually, as a team, or as a company, a necessary and good first step is to establish a vision.  A compelling vision thus is an important agreement point to reach if we want to make positive changes in the world, and at some point this monologue will shift to dialogue and hopefully we’ll do just that.

On the other side, the current condition, and accurate view of reality is important.  “The truth will set you free” is another common quote, and this is the other anchor for constructive creative tension.   It seems obvious that reality should be really obviously, but perspectives differ and often getting agreement on current reality is just as hard as forming a compelling vision. 

I think I’ve got one more day of basic terms and concepts to dig through, and then we’ll get into less commonplace concepts.

Speaking of commonplace, there used be a tool of learning and introspection that people created to organize and compile their learning, termed a commonplace book.  I wish I would have started such a book of my own 40 years ago, and I wish I had a digital one that followed my around now, making it easy for me to grab snippets of info and maintain a bibliography and reference list as I went.

Sources so far, at least a reasonably complete of memorable books and a website or two that helped form the basis for my musings.

The Lean Startup – Eric Ries

Little Bets – Peter Sims

Messy: The Power of Disorder – Tim Hartford

Everything’s a Remix

http://www.everythingisaremix.info/watch-the-series/

Smartcuts – Shane Snow

Why Information Grows – Cesar Hidalgo

Standing on the Shoulders of Giants

A day or two ago we discussed (lopsidedly, perhaps) the concept of matter and information, with objects as a means of encapsulating and replicating knowledge.

A related concept is communications networks as a means of communicating and storing information, and also conveying knowledge. We could be a bit pedantic and say that disk drives in computers are just another example of matter storing info (which they are), but that was yesterday's point. Instead, let's talk about the concept of networks as a means of providing connectivity between people, and language as means of conveying concepts.

Shannon and other brilliant inventors came up with exquisite theories of information, including that of communications channels, symbols, signal and noise, and data rates. Computers and data storage ushered in the "information age", where management of sets of data, it's storage, security, access, processing, and so forth, and its ability to offer new insights and efficiencies. Data without context -- additional information that enables it to be understood and consumed -- is nothing more than noise, and it is this context that is critical. Computer networks use defined protocols to define and interpret the context of the data they transmit, and people similarly use language to do the same thing.

Philosophers may debate about whether your "red" is the same as mine, and your mental image of "car" may not contain the same details as mine, but when you say "red car" you have an efficient if imprecise way of communicating a concept to me. We have a shared lexicon for such words an concepts, and over our lives our brains do an impressive job of encoding such knowledge in useful patterns. Importantly, though, you use your patterns to talk to yourself in your own head, and these known patterns significantly facilitate or impede your ability to easily comprehend new concepts.

If you have a base of related concepts, it's easier to understand a new, more complex construct. Recollect back to elementary school and think about learning math -- calculus builds upon algebra's symbolic base, algebra builds upon basic multiplication and division, multiplication builds upon addition, which builds upon counting. It isn't reasonable to jump into differential equations if all you can do is count, but it's just a modest leap. And, if you're like me, when you grasp a new concept you get a little dopamine burst as "Aha! I've got it!" occurs.

Similarly, I suspect that inventors of new mathematical theorems not only have the "Aha!" sensation, but that without a basis of underlying concepts it is not possible even for a genius to imagine that next step, and to make that mental leap of understanding. As Newton and others said: "If I have seen farther, it is because I stand on the shoulders of giants." Each of us can readily do this, as we can readily be carried along on a mosh-pit of giants with a few minutes of Googling on any topic of interest.

Humans communicate effectively when they have shared languages, and today every field and specialty has its specific set of terms, acronyms, and concepts that make this possible. Companies, university labs, professional societies, and industry standards groups all create functional networks of such similarly-equipped experts who can efficiently employ existing knowledge and potentially expand the base with new concerpts.

And that's where today's monologue leads; to two places actually:

1) Much of human know-how is captured and maintained by networks of people, and more recently also their computer networks, and their shared concepts and work paradigms that enable them to leverage existing knowledge and to create new leaps of perception. Useful concept can quite readily be communicated to others on the same knowledge network, and the beauty of the information age is that ideas can be rapidly and accurately replicated in the minds of others, and thus become part of the collective base of networked knowledge.

2) Creativity and imagination are to a large extent enabled and limited by a person's or a network of people's mastery of related and underlying concepts. However, when imagination manifests a new concept, it can replicate quickly, and a valuable aspect of our specialized economy is its ability to engender creation of new insights and knowledge.

Matter is Information Solidified

I read an interesting quote: “Impressive displays of rhetoric and linguistic force are a good way to seem important and invite a particular kind of admiration, but they tend to silence dissent and discourage deeper modes of engagement.” - Emily Wilson

I agree with the latter part, that lack of a shared lexicon impedes communications and discourages healthy interaction, but I'm not so sure about the first. While some people, at least some of the time, may have "seeming important" as their goal, I think often it's just a curse of knowledge -- you get used to thinking the way you think with the concepts you have available, and in communicating in short-hand with others who share the same set of terms and concepts. It's easy to lose others who may be sharp and interested, but just aren't facile with the same terminology.

I've got a few points about globalism, competition, opportunity, equality, and the American Dream that I think are worth sharing and discussing, and I know I've spent a lot of time reading, listening, and learning, so I'm worried that communication fidelity will be poor and my influence will be nil. My goal is to "remix" some key concepts from others (everything is a remix!), so I'll attribute the underpinning concepts, while adding what may perhaps prove to be, hopefully, my own novel personal contributions and perspectives.

Before launching off in the coming days as I get some time to think and write over the holidays, I'll see if I can create a lexicon of terms and concepts for us to build upon.

Here's a good one: matter as a persistent store of information - fundamentally, it's just frozen knowledge. We're all used to the notion of communications -- sending information from here to there -- and perhaps more vaguely of signals, noise, entropy, and such, but the valuable facet here is more subtle: matter encapsulates knowledge and makes one person's skills and knowledge readily accessible to others.

Examples abound: you don't know how to design and build a car, or an oven, or probably even a hammer, yet you use these and many other devices everyday and obtain valuable utility from them. Such re-use is perhaps the single largest contributor to our complex society, with ever-expanding stratification and specialization.

So, if we can solidify and transport information via objects, and those objects add utility and value, then production itself is the replication of useful knowledge as much as it is an arrangement of raw materials. Computers that help with such replication, whether a complex AI or a simple process controller, are a related encapsulation of know-how, another form of information.

I'll just leave this concept here for rumination and comment, and then build upon it next time.

Debt in the USA

Social security is zero issue -- that money does not exist today, except as a past tax that has been reapportioned already.  It is a purported obligation of the gov't, and gov't money backs it up.  Really the only issue there is the size versus GDP.  Now, 401Ks would be a bit of an issue, but mostly because of inflated equity markets more than personal debt.   National debt is a problem more as an ROI on spending and whatever interest gets paid than the size per se, but all of that is obfuscated by the funky and unnecessary Fed and fractional reserve banking.  Treasury could do what is needed alone.

The tricky part of bank debt is there is no real line between individual assets and banking assets and individual debt and bank debt, as it's all "private debt", though the private banks are acting like part of the public money creation by issuing loans........and also investing on their own behalf.

Most basically, though, from what I've gathered is that when rate of return on capital exceeds rate of wage growth, wealth aggregates toward the wealthy.  The last bust just vacuumed up real property to institutions and investors.  The next bust will finish off corporate ownership, as it washes out individuals and their 401Ks. 

This whole notion of capitalism focused on modest inflation and 2% raises and 4-6% unemployment but a 6% stock market skews toward the wealthy.  Really, a democracy should lean toward work for all, welfare for few, more production and less service fraction, and wage growth eating most of the benefits of production.  Of course that goes against globalism, but that is dying anyway, as the currency race to the bottom continues -- everybody wants to be an exporter, and yet all they'll likely export is deflation.

All 4% inflation guarantees is that people fight for jobs instead of wages fighting for workers.  I fully admit there are crappy workers, but good ones should be in demand, and the best should get better raises than the investors who own their company's stock.

I read that prisons cost the US 240B yearly.  Nowhere near as much as healthcare, but a LOT.  Yet another "service industry" on both sides of the bars that produces nothing to improve quality of life or national wealth.  Except for dangerous criminals, we need to get people out of prison and making stuff.  Since we're paying $30K or more for each already, any sort of marginal return would be a big improvement.

The service economy in general is a misnomer too, except for where a modest level of service support adds efficiency to the productive workers.  No way a "mostly service" economy can be wealthy in the long term, as to do that requires producing more goods to share around.  If we're producing more than we need (food, houses, whatever), then there shouldn't be worries about retirement or welfare, as what remains is a distribution problem.