Smart people are more important than good ideas.If a growth mindset is critical to driving creativity in the CreativityWorks Framework, then environment, which I define as leadership plus culture, is probably the next most essential component. You can have the most creative people in the world but if you don’t give them the encouragement and space to thrive, the company will go nowhere.
I saw this firsthand when our marketing agency helped Apple launch Newton, a new type of personal digital assistant (PDA). I am not going to question the timing of this product development or whether the product actually had a customer segment waiting for it. It was conceived and produced as an innovative forerunner of handheld computers. The problem lay with what was happening at Apple at the time when Steve Jobs was not there. Even with John Sculley as CEO, there was no real leadership and the culture was dysfunctional at best. The senior vice presidents and department managers from consumer to education to corporate accounts were all fighting for their own share of the marketing dollars, and the product design leaders seemed lost turning out so many new products without a clear product strategy. There was no one person who approved product design and development the way Steve Jobs did when he was at Apple. The best way to describe it would be chaos.
Our agency was hired by Apple to handle the integrated marketing for the Newton product launch at about 6,000 retail locations in the USA. Key to our marketing effort was an interactive kiosk we designed and built (yes, 6,000 of them) for use at retail stores so that consumers could demo the Newton. The only problem was that Newton itself had so many bugs even as it approached the shipping date that it was crashing our demo software. We notified the project manager, who notified the director of the group, who notified the general manager of the division. Who promptly said, “Ship it.”
I cannot describe to you the feeling among the Apple Newton project team and our agency team of about ten people. We knew the demo software would crash, rendering Newton to be basically a pretty piece of plastic sitting inside a beautifully designed retail kiosk. We knew the handwriting recognition software was not working properly. It seemed like madness. Who ships thousands of products knowing they are going to fail? A company that has no leadership and no real values or beliefs that is devoid of any meaningful culture. While the product was a failure, our agency executed the marketing campaign brilliantly, convincing 60,000 customers in the first ninety days to purchase a Newton that probably would not work. And that is what happened. The handwriting software and multiple bugs crashed the operating system, which essentially locked up the device continuously. The consumer outcry was deafening. Amazingly, our agency avoided any real negative fallout from this disastrous product launch. However, Apple was not so lucky. Apple continued to flounder, going through successive CEOs until Steve Jobs returned in 1997.
No matter what you think of Steve Jobs as a person, he led Apple from the brink of insolvency to again become one of the most innovative companies on the planet. In his first meeting with employees on his return, he indicated that Apple was not going to cut its way to profitability but innovate its way there. He immediately shifted focus to four products and introduced the “all in one” beautifully designed iMac to the world and sales took off. That’s how much leadership and culture matter to a company.
Companies that are faced with rapid innovation in their industry have two choices. One, they can constantly innovate, even if it means eventually abandoning the original products or services (e.g., Starbucks now offers breakfast foods and juices and is introducing wine bars, etc.). Two, companies can choose to acquire a competitor or a startup. I guess there is a third choice, which is to do nothing or do all the wrong things. This is essentially what Kodak, Borders bookstores, and Blockbuster did. Quite frankly, what happened to the leadership at those three companies? How could the “captains” at those companies sit in their ships’ towers and ignore the innovative “tips of the iceberg” they saw coming from competitors? All three ignored innovation in their industry and in effect steered their respective company ships right into the iceberg. Why? What were these executives thinking? They were running multibillion-dollar companies with thousands of employees. What happened to the innovative culture that made them successful in the first place?
If you keep doing what made you successful, you are a willing “slave” to your success. Until you are not successful. Clayton M. Christensen was very curious about why companies failed. In his 1997 book, The Innovator’s Dilemma, he argued that very often it isn’t because company executives made bad decisions but because they made good decisions—the same kind of good decisions that had made those companies successful for decades. (The “innovator’s dilemma” is that “doing the right thing is actually the wrong thing.”) As Christensen saw it, the problem was the velocity of history, and it wasn’t so much a problem as a missed opportunity, like a train that takes off without you, except that you didn’t even know there was a train and you wandered onto the train tracks, which you thought was a cool hiking trail, and the train ran you over. For example, manufacturers of mainframe computers made good decisions about making and selling mainframe computers and devising important refinements to them in their R&D departments—“sustaining innovations,” Christensen called them—but because they were busy pleasing their mainframe customers, one feature at a time, they missed what an entirely untapped customer wanted: personal computers. The PC market was created by what Christensen called “disruptive innovation”: the selling of a cheaper, poorer-quality product that initially reaches less profitable customers but eventually takes over and devours an entire industry.
So, how do you avoid the “innovator’s dilemma”? You need to be constantly paying attention to what’s going on around you to the point of being obsessed with being put out of business by a competitor or even a new division you create. Andy Grove, the former CEO of Intel, had a great quote: “Only the paranoid survive.” Once I heard this quote, I never forgot it. As a leader, don’t be self-absorbed in your current innovation. Look over the horizon or behind you. Be paranoid in a good way. Self-disrupt or self-destruct or your competitors will do it for you.
The qualities and traits of good leadership, and the mistakes to avoid, are the focus of this chapter. You will learn more about company culture and how to create an amazing customer-driven culture in your own department or company. If you are not yet a leader, pay attention and start to adopt leadership qualities and traits now.
I think everyone, at one time or another, wants to be a good leader. I don’t care if it’s in your local neighborhood or your corporate job or as a founder of a company; we want to be perceived by others as having the ability to lead. Unfortunately, good leaders are hard to come by. Why? Because, contrary to your own beliefs, you were not born with the knowledge or traits to be a leader. You learn how to be a leader through mentors, advisers, and experience. And you have to have a growth mindset, one that understands you will never stop learning and being curious. Let’s look at the top qualities a leader might have.
Honesty: Whatever ethical plane you hold yourself to, when you are responsible for a team of people, it’s important to raise the bar even higher. Your business and its employees are a reflection of yourself, and if you make honest and ethical behavior a key value, your team will follow suit.
Ability to Delegate: The art of executing your brand vision is essential to creating an organized and efficient business, but if you don’t learn to trust your team with that vision, you might never progress to the next stage. It’s important to remember that trusting your team with your ideas is a sign of strength, not weakness. Delegating tasks to the appropriate people is one of the most important skills you can develop as your business grows.
Ability to Communicate: Knowing what you want accomplished may seem clear in your head, but if you try to explain it to someone else and are met with a blank expression, you know there is a problem. If this has been your experience, then you may want to focus on honing your communication skills. Being able to clearly and succinctly describe what you want done is extremely important. If you can’t relate your vision to your team, you won’t all be working toward the same goal. Have an open-door policy and have employees feel they can come to you with anything. Create a feeling of trust with excellent two-way communications.
Ability to Laugh: If your product launches late, you lose that major client, or your funding dries up, guiding your team through the process without panicking is as challenging as it is important. Morale is linked to productivity, and it’s your job as the team leader to instill positive energy. That’s where your sense of humor will finally pay off. Encourage your team to laugh at the mistakes while learning from them instead of crying and wondering what to do next. If you find the humor in the struggles, your work environment will be happy and healthy. Employees will look forward to working in this environment, rather than dreading it.
High Degree of Confidence: There may be days when the future of your company is in jeopardy and things aren’t going according to plan. This is true with any business, large or small, and the most important thing is not to panic. Part of your job as a leader is to put out fires and maintain the team morale. Keep up your confidence level and assure everyone that setbacks are natural and the important thing is to focus on the larger goal. By staying calm and confident, you will help keep the team feeling the same. Remember, your team will take cues from you, so if you exude a level of calm damage control, your team will pick up on that feeling. The key objective is to keep everyone working and moving forward.
Commitment: If you expect your team to work hard and produce quality content, you must lead by example. There is no greater motivation than seeing top leadership down in the trenches working alongside everyone else, showing that hard work is being done at every level. By proving your commitment to the brand and your role, you will not only earn the respect of your team, you will also instill that same hardworking energy among your staff. As a senior partner when our company was around $350 million in revenue, I came in on a weekend with other staff members to stuff envelopes for a major client. Walk the talk.
Positive Attitude: You want to keep your team motivated toward the continued success of the company and keep energy levels up. Whether that means providing snacks, coffee, relationship advice, or even just an occasional beer in the office, remember that everyone on your team is a person. Keep the office mood a fine balance between productivity and playfulness. If your team is feeling happy and upbeat, chances are they won’t mind staying that extra hour to finish a project or really leaning in when you need them.
Open, Creative Mind: Some decisions will not always be so clear-cut. You may be forced at times to deviate from your set course and make on-the-fly decisions. This is where your creativity will prove to be vital. It is during these critical situations that your team will look to you for guidance and you may be forced to make a quick decision. As a leader, it’s important to learn how to quickly come up with ideas that will potentially solve the problem. Don’t immediately choose the first or easiest possibility; sometimes it’s best to give these ideas some thought and even turn to your team for guidance. The key is to have an open creative mind.
Honed Instinct: Guiding your team through the process of day-to-day tasks can be honed to a T. But when something unexpected occurs, or you are thrown into a new scenario, your team will look to you for guidance. Drawing on past experience is a good reflex, as is reaching out to your mentors for support. Eventually, though, the tough decisions will be up to you to decide and you will need to depend on your experience and gut instinct for answers. Learning to trust yourself is as important as your team learning to trust you.
Ability to Inspire: Creating a business or launching a new product often involves quite a bit of trust. Especially in the beginning stages, inspiring your team to see the vision of the successes to come is vital. Make your team feel invested in the accomplishments of the company. Whether everyone owns a piece of equity or you operate on a bonus system, generating enthusiasm for the hard work you are all putting in is so important. Acknowledge the work that everyone has done and commend team members on each of their efforts. Praise them in front of company leadership. Give them more responsibilities and encourage them to lead. It is your job to keep spirits up, and that begins with an appreciation for hard work. Celebrate the small successes. Always remind them of the big picture.
Being a leader today is different from what it was ten or twenty years ago. Today’s workplace has a fast pace of change and many more demands. It also involves working with many teams usually across different time zones. It’s a complex environment out there. Leading and managing have moved well beyond just commanding the troops to “get it done.”
How many of these key leadership qualities and traits do you really have? Seriously, do your own audit and, no matter what, strengthen your leadership weaknesses. Discuss them with your mentor and work to remedy them. Now, let’s take a look at the other important partner of environment—culture—and how great leadership can help create a great company culture.
How does Pixar do it? One animated movie hit after another. I use the Harvard Business Review Pixar case in my Creativity and Innovation course not just to talk about a creative habitat (the topic of Chapter 5) but the leadership and “culture” that must exist to make it all work. You cannot mix art, technology, and design without purposely creating some healthy dissent among employees. And yet Pixar succeeds amazingly well. Based on my research, here are my top observations about the leadership and culture at Pixar, so many of which were also true for our own agency:
Smart people are more important than good ideas.
Create as many interactions between all types of people as possible.
Everyone is a peer and there is no peer hierarchy.
Everyone has the freedom to communicate with anyone.
It must be safe for everyone to offer ideas.
Stay close to innovations happening in the academic or industry community.
Be introspective and try not to become irrelevant.
It sounds so simple, but if you look closely at the attributes of culture at Pixar, how many of these qualities even really exist at “normal” companies, Fortune 500 leaders, or chaotic startups? Having worked with a wide variety of companies in my career, I can only think of four or five companies that had great leadership and an amazing culture somewhat resembling what the leaders at Pixar have crafted. So how do you “engineer” a creative culture?
If innovation is important to the growth of your company, nothing will help you more than creating a company culture that is deliberately fluid and creative. No matter the size of your company, its industry, or your budget, certain environmental and behavioral changes are almost guaranteed to improve your team’s creative output, attract the right talent, and ultimately move your company beyond what you can even imagine today.
Here are ten “observations,” taken from my learnings with some great companies, that will help you create an amazing company culture:
1. Inspire great work with an inspired workspace. It all starts with the workspace. Remember the cubicle farms that emerged in the 1980s and 1990s? Quite a few still exist. But in today’s designcentric, user-focused world, companies have to move quickly and innovate constantly, and that certainly won’t happen from behind a beige cubicle wall and under dull overhead fluorescent light. Open spaces, living room setups, big windows, inviting kitchens, and convenient facilities like showers and bicycle parking are what’s needed. Even if you aren’t building an office from scratch, try adding bright colors or lots of whiteboards and markers. Providing your team with imaginative workspaces will help to nourish the outpouring of their creative juices.
2. Be more flexible. I’m sorry, does the world still work from nine to five? While stable work hours make for organizational order, creative energy cannot be simply willed into set hours. People have different rhythms that make them more or less productive during certain hours. If you want to encourage productivity and inspiration, allow flexible work hours for members of your team.
Flexibility also attracts a creative talent pool of people with a variety of interests and commitments in life. I once recruited a highly talented web developer from San Francisco to Portland. He stayed at our home for two months in a guest cabana and usually rolled into work at the agency office around 11 a.m. Then he worked until midnight or later. My young son saw him so infrequently around our house, and never in the daytime, he once asked me if Nico was a vampire. No, just super creative.
3. Allow unlimited vacation days. I know this sounds crazy, but Netflix has been doing this for years and the company has amazing growth and high morale. The people on each team just hold each other accountable. And it works. Why? One of the surest ways to get inspired is to take a break from work. Inspiration is more likely to come when people are freed from the daily routine of familiar surroundings and motivated by new stimuli. Think about how many times you’ve had a brilliant idea during a flight or on a train ride or on a vacation. Offering your team unlimited vacation days—and taking them yourself—encourages not just “staycations” or a lazy beach break but also more experiential travel to faraway places that can open up a person to new ways of thinking.
4. Build a diverse team. Many business owners often complain that they have trouble finding good staff people. Perhaps what they’re trying to find is a replica of themselves. They wrongly assume that having a professional twin would double their business overnight. Instead, build a diverse team whose strength lies in its members’ range of work experience, education, and cultural backgrounds that play off of one another. In one technology company turnaround situation in 2001, I built a new marketing department where no one had any technology experience, but together the team members had what it took to successfully transition that company to a sale three years later for $110 million.
5. Put your team first. To have a truly creative company culture, your employees have to be your biggest priority. While you may think that your customers should always come first, take a cue from powerful CEOs like Virgin Group’s Richard Branson, and Tony Hsieh of Zappos, along with Jim Sinegal from Costco, who have proved that putting employees first makes customers and even shareholders happy. When asked by Wall Street analysts about high employee labor costs, Jim Sinegal would say that the order of priority, in order for Costco to be successful, was employees, then customers, and then investors. Based on Costco’s current stock price, that seems to be working.
6. Reward risk-taking. Now that you’ve created time and a workspace to fuel creativity, further encourage it by rewarding risktaking. Think of the companies that inspire you: How many of them achieved success by following tradition and sticking to the rules? Building your own company one day could be a huge risk. So why not surround yourself with people who can take risks to help further your vision? Companies like Google, Virgin, Apple, and others are dedicated to encouraging risktaking behavior within a controlled environment. For example, Google allows employees to spend 20 percent of their time on nonwork-related projects. Truly disruptive ideas don’t arise out of stability; allow a bit of chaos.
7. Allow for disagreement. Nothing fights complacency better than disagreement. You don’t have to wage an internal office war or create psychological discord. No, disagreement between professionals is the foundation of debate, and debate is exactly what you need to make sure your company is constantly putting its best foot forward. Once, in our Portland agency office, I had a pretty strong disagreement with my other partner, the creative director, about the marketing strategy we were working on for Amazon. From my point of view he was just being stubborn for stubbornness’ sake. After a full sixty minutes of arguing with him in his office and getting nowhere, I was so frustrated about him ignoring the strategic points I was making that I felt I needed to make a defining statement. So, I tipped his desk over. Mad, then laughing, we had a pretty strategic conversation and came up with a strong marketing strategy for our client. The key is to not make it personal; fight for your point of view on the client’s or the customer’s behalf.
8. Try mixing up your project team. At a small company or in a department in a large company, people often have to help one another to complete big projects. Someone from the design team might end up working with someone from the technology group. Creating a situation where people with entirely different skill sets and perspectives must work together can stimulate the best type of creativity and bring unexpected breakthroughs in thinking.
9. Don’t hurt anyone but be direct. Discourage the need for diplomacy. Let people voice what they feel. Encourage your team members to talk openly rather than worrying about being “nice” or whether they hurt the feelings of others. Create a culture where employees ask tough questions of one another without being defensive. This ensures that people don’t fall into complacency and are constantly thinking and talking about only the most relevant issues and problems and asking the smartest questions. And that means being focused on solutions your customers need.
10. Provide some freedom and inspire responsibility. At a small company with a big vision or at a big company with small departments, even the most junior employees bear a lot of responsibility. Hold people accountable to big expectations but be ready to give them the autonomy to make their own decisions (with minimal guidance). This creates an atmosphere of resourcefulness and scrappiness that strongly supports creativity. In helping to create our company, all I ever wanted was to be able to lead the creative strategy and solutions for our clients and customers, not be micromanaged by someone in Cleveland (no disrespect to people from Cleveland). Of course, I will then be responsible for my decision making. No problem.
Great leadership and culture go hand in hand. You usually can’t have one without the other. And when they feed off each other, you have created a place where creativity can flourish and problem solving is the everyday norm. And that environment will potentially ignite innovation.
As a current or potential leader you need to have employees feel motivated that they will succeed and achieve. More important, you need to give them the creative freedom to do what they need to do; it gives them a counterbalance to those redundant tasks that have to be completed well in a normal day. As a leader, you want to engage employees and bring a positive atmosphere to the company because it makes the job a lot easier and sparks creative problem solving, which can spark innovation. Without your creative leadership, you won’t have a creative atmosphere. Your role is to enthusiastically engage employees in the company’s mission. When employees feel engaged it betters the company culture; people will want to do more for the company and make sure that they are pleasing their bosses and their peers. They feel as if they’re a part of a strong team on an important mission.
However, when employees aren’t engaged and their leaders don’t do anything to correct matters, work becomes a grueling slog and the office more a prison than a fun place to learn and create new ideas that solve customer needs. One Mayo Clinic study found that for each one-point increase in composite leadership score, there was a commensurate 3.3 percent decrease in likelihood of burnout and a 9 percent increase in the likelihood of job satisfaction. Think about how that translates into bottom-line dollars—less attrition and turnover, higher patient/client satisfaction scores, and a reduced instance of errors. Leadership decides how the workplace will take shape; it’s what separates the weak companies from the great ones. That’s why when you hear of amazing company leaders, you imagine people with a clear, transparent, and fun company that other people want to go work at. Leaders make companies thrive. If you’re a leader or want to be one, make sure that you’re doing your best to motivate and inspire others, as you will drive your company’s creative culture.
Leadership and culture have a huge impact on employees’ “mindset,” but there is another attribute of the Creativity Works Framework that only makes it better—habitat. That’s a subject I will cover in Chapter 5.
CREATIVE / INNOVATIVE INSIGHT
This company had a meteoric rise from its founding, creating a brand so powerful that some people felt they could not live without their products. As the company grew, the founder brought in senior managers and groomed his replacements. All seemed well. Then several things happened simultaneously soon after the founder left the day-to-day operations. Investors in the public company wanted more, and when sales revenue slowed, the stock price got hammered down. Then the 2008 recession hit. The founder looked around and did not even see his original company. He decided to step back into the company as the CEO. He wrote a frank and honest letter to all employees and visited hundreds of retail locations. He finally admitted the company had lost what it once had and had stopped listening to customers and innovating. He bravely put into action a strategic plan to get back the company’s “mojo” and to once again be a market leader. He restored original traditions, looked at customer trends, and acquired tea, juice, and bakery companies, extending the company’s original product line and better serving customers’ needs. Howard Schultz was back as the company’s leader. Starbucks was back.
Key Takeaway
As a company, it does not matter how big you become. Your size does not insulate you from mediocrity or the competition. Never stop meeting and exceeding your customers’ needs and innovating your brand forward. If you don’t, the competition happily will.