Wednesday, February 21, 2007

Innovations and Ethics in HBR Ideas List

Innovations was the buzzword for 2006, and ethics is on the horizon. I am on the train from NYC to DC, and finished reading the Harvard Business Review's Breakthrough Ideas List for 2007.

Innovations or ideas on new ideas was the topic of several the 20 ideas on the list. Duncan Watts argues that for ideas to spread, they need to be sold to ordinary people rather than to influentials (highly influential, connected types). Conducting thousands of computer simulations, Watts and his colleague Peter Dobbs found that global cascades (the propagation of influence through networks) are in the hands of a critical mass of easily influenced people. More theorizing on how to create buzz. Want to create buzz about something? Talk to people—everyone you meet. And I would add, get them involved in that thing.

Next, Yoshihito Hori identifies an "entrepreneurial Japan." Economic revitalization, the destruction of lifetime employment, the veneration of creativity, and the technologically networked aspect of Japanese society make entrepreneurship likely. The idea that Japan is and can be entrepreneurial pops up every few years. Innovation springs from many environments. Necessity can help innovation too. The question in my mind is whether this entrepreneurial spirit can overcome Japan’s declining population and fear of immigration.

Third, Eric von Hippel tells us that the Danish government is the first to place strengthening "user-centered innovation" as a national priority. It sounds a bit like the idea of prosumer—the producer and consumer have merged, and with the Internet have created a global marketplace of goods, ideas, and knowledge.

Fourth, Geoffrey West found that innovations benefit super-linearly from scale. People in larger cities and organizations are more innovative. That's why no organization ever matched "the creativity of Bell Labs in its heyday." Just comparing NYC and DC, this idea seems to make intuitive sense. Innovative ideas seem likelier in NYC not only because of the constant mixing and mingling between people but because of the breadth of industry. West should tell Hori about the need for Japan to maintain its population.

Finally, Yoko Ishikura suggests businesses act globally and think locally, by "harvesting" knowledge from various localities and applying it to a global strategy. Policy Innovations recently ran a special on the applications of positive deviance, the idea that a few people in every sample are outliers but in a positive way. And those practices can be applied more globally.

The common motif of these ideas on ideas is that we organize ourselves more like the way our brains are organized, which happens to be the way the Internet is organizing and hyperlinking. With all of this bleeding between the consumer, producer, influencer, and influenced, we expand the possibilities of a networked humanity. Ethics, our sense of fairness, which is deep in our primate DNA, must act as a guide.

Karen Fraser shows through UK surveys that many consumers are conflicted about the companies that make the products they buy. They worry that these companies are exploiting their workers or damaging the environment. These conflicted consumers buy these companies’ goods because there is no option or little information, and are ready to bolt for more ethical alternatives. "Their desire for an ethical choice represents a huge amount of potential energy in the marketplace." Who says socially responsible business models can’t be profitable? Business guru Michael Porter would seem to agree.

1 comment:

Leandro Herrero said...

I am puzzled by the hype created by the HBR ‘breakthrough’ music of Duncan Watts apparent discovery that spread of ideas require lots of people with ‘low threshold’ receptiveness to influence, an this as a supposed contradiction tot the presence or need for ‘influencers’. I suspect that we have carved out a part of the story that has spread in a viral manner thanks to the influent HBR altar!. I myself prefer the framework provided by Albert-László Barabási (http://www.nd.edu/~alb/) who in places such as the book “Linked” offers a broader perspective of network. I have used this approach in my work on organizational change described in my book ‘Viral Change: the alternative to slow, painful and unsuccessful management of change in organizations’ ( a short audiovisual can be watched in our website www.thechalfontproject.com) For me real change is viral. It requires a small set of non negotiable behaviours, spread first by a small number of individuals (activists, influencers, champions) creating tipping points via imitation and diffusion and infecting the rest of the organization. Different thresholds are ‘needed’ a different points. It is all-in-one. HBR implication that the real influence has less to do with ‘influencers’ than we think is misleading. Incidentally, positive deviance is also incorporated into Viral Change since it is a key ingredient to spread new ideas. There are at least two aspects of positive deviance in organizations. One is the deviance in itself as a source of, possibly, new ideas innovation, source of process improvement and so on. The second is that fact that ‘positively deviant people’ are often sidelined by the organisation and may carry some sort of ‘undesirable label’. However, one ‘deviant’ publicly converted to change or innovation, and accepted, is worth 100 ‘non-deviant’ complying. Network theory ( particularly when we have an unified theory) will take us to places we have not dreamt before and I am convinced that Viral Change mode will allow is to spread change faster, including social one at a large scale. – Leandro Herrero