CHAPTER 6
Not Invented Here (NIH)
Many years ago I played a dirty trick on a group of senior leaders inside a particular business unit of a fairly large organization that had hired me to help improve performance at a customer call center. Through my consulting work I had discovered that a group of about a dozen managers and supervisors of the command-and-control persuasion were causing some fairly serious issues. In one part of the operation, I discovered that a number of improvement suggestions by customer service representatives had simply never seen the light of day—ideas that would have made customers’ lives easier and benefited the company. In another part of the operation, some extremely lucrative opportunities had been dismissed, each with what I considered a relatively high lost opportunity cost.
I presented my findings in a report that described how a number of managers (including some of the senior managers on the panel that had hired me) would not allow their subordinates to pursue ideas. They had various ways of shooting ideas down, many times dismissing them without consideration and, in one case, going so far as to have a no-suggestion policy.
The leadership panel took issue with my presentation. They argued vehemently that “that’s not our culture,” that “our people are our greatest asset,” that “we value all ideas,” and that I was way off-base. I held my tongue, realizing that the collective mindset was so deeply embedded in the culture that they could not see they were doing the very thing to me I was reporting on, right there and then. Luckily, an upcoming off-site presented me with the opportunity to demonstrate what I was talking about to them, because I got to design part of the agenda.
At the off-site, there were about 120 people of varying degrees of seniority and rank. We had a dozen table rounds, and I put an organizational cross-section of people at each. In other words, at any given table, there might be a management trainee or administrative assistant sitting next to a senior manager.
I gave the assignment, one of those widely available group priority exercises whereby you rank a list of items individually and then as a group and compare results . . . sort of a “wisdom of crowds” exercise to show that “we” is smarter than “me,” that great ideas and solutions can come from anywhere, and are always better when developed collaboratively.
The specific exercise was called “Survival on the Moon,” and the goal was to rank the 25 items with which you’ve crashed on the moon in relation to how important they were to your survival in making the 200-mile trek to the ship from which you’ve been separated in the crash. NASA had compiled the correct ranking, so there was actually a suggested “expert solution,” but only I as the facilitator had it.
Except I wasn’t the only one. I added a twist. At each table I put a ringer. I gave the lowest-ranking or most junior person the answer. When it came time to do the exercise as a group, I told them that it was their job to convince the highest-ranking and most senior people that they knew for certain what the right priority ranking was. They could say anything they wanted, short of telling the table that I had given them the NASA solution. I told them they could say that they had done the exact same exercise before at another company, or that they used to work at NASA, I didn’t care. They just couldn’t tell anyone our little secret.
During the group part, not a single table got the right ranking, even though the best solution was in their hands.
After debriefing the exercise in the regular way, which of course proved the point—but knowing the Aha! would be lost on the offenders—I had the ringers stand up. I announced that these individuals had the solution in their hands, because I had given it to them in advance.
I wish I had a camera to catch the red-faced managers. They terminated my contract shortly after that. But I had made my point, which was that Not Invented Here syndrome was alive and well, and wreaking havoc with the business.
THE NIH FLAW
When advertising executive Alex Osborn introduced the world to brainstorming over a half century ago, he proposed four rules for applying one’s imagination, half of which focused on preventing idea rejection: defer judgment and build on others’ ideas. He was well aware of NIH before it was called NIH, and unfortunately, his rules have had little effect on our tendency to do just the opposite: impose judgment and reject others’ ideas.
NIH is defined as a strong resistance to, or automatic rejection of, concepts—knowledge, ideas, solutions—produced somewhere else, somewhere external to the individual or team, often resulting in an unnecessary reinvention of the wheel. The pairing of these two aspects, external idea origination and immediate internal devaluation, is the defining characteristic of NIH.
Recall from the opening thought challenge that I clearly stated that previous solutions had included reminders, penalties, and incentives, none of which worked. Yet over a third of regularly proposed solutions are essentially some form of these: loyalty program, discontinue the shampoo, separate fee for shampoo, sell the shampoo at cost, “most wanted list” of offenders, shampoo in unmarked bottles, “do not remove shampoo” signs, free sample-size bottles.
The same is true of the videotape challenge. I believe that since I was an “outsider” to the teams trying to solve the challenges, my knowledge and solutions were rejected out of hand. So while the teams worked fairly well under Osborn’s brainstorming rules, there was an unconscious and unspoken consensus that the rules did not apply to my ideas as stated in the challenge setup. There has been uncanny consistency over the years in my observations, and the result is always NIH and wheel reinvention.
History is littered with stories of initial NIH-type responses to new and novel ideas that eventually found success and have become so much a part of our collective experience that we can only marvel with glorious 20-20 hindsight at the apparent stupidity of the NIHers.
Take the case of the now ubiquitous hashtag (#). When Chris Messina, a former Google designer, conceived of a simple way to filter content and create channels on Twitter in 2007, he blogged about his idea:
Every time someone uses a channel tag to mark a status, not only do we know something specific about that status, but others can eavesdrop on the context of it and then join in the channel and contribute as well. Rather than trying to ping-pong discussion between one or more individuals with daisy-chained @replies, using a simple #reply means that people not in the @reply queue will be able to follow along, as people do with Flickr or Delicious tags. Furthermore, topics that enter into existing channels will become visible to those who have previously joined in the discussion. And, perhaps best of all, anyone can choose to leave or remove topics that don’t interest them.34
His idea was complete with syntax (rules) for how it would work, such as “No one owns or administers a tag channel,” and “A channel is created the first time someone posts a status with a channel tag.” He included Twitter page prototypes, as well as a test case focused on the popular SXSW conference. In other words, he had validated his concept through Prototesting. Twitter’s reaction to his proposal? As Messina told the Wall Street Journal six years later, “[Twitter] told me flat out, ‘These things are for nerds. They’re never going to catch on.’ ”35
The hashtag was an external solution to an important user problem, which to Messina’s way of thinking was how to enable Twitter users to “express more about the content they share in order to connect with more people.”36
While NIH in popular business literature is almost always discussed in a social context—organization, team, even a two-person partnership—it is my experience that it is entirely of an individual origin, perhaps a special strain of Fixation (see Chapter 2). I say this because over the course of the quarter century in which I’ve counseled senior leaders, I’ve seen hundreds of cases of NIH, even when a particular bit of external ingenuity is in the best interest of the larger organization. I’ve seen NIH play out under different situations and to several degrees, and it is not always directed toward concepts and knowledge developed outside a company. I’ve seen it happen inside teams, especially when the team members are geographically separated, and it doesn’t seem to matter whether they are located on opposite ends of the campus or opposite ends of the earth. I’ve seen it happen, curiously, even when a senior leadership team spends millions of dollars on outside firms to conduct studies and offer objective recommendations: the information and ideas presented are perceived as less than brilliant, impractical, or not worth implementing, and so never are. One of the most prevalent strains of NIH, though, and perhaps the most deadly to a culture because of its power to stifle creativity and alienate people, is the kind related to pecking order, which is why I began this chapter the way I did.
Where there is some sort of real or perceived barrier—space, time, structure—across which concepts must travel, NIH can literally keep you out of the game.
WHY NIH HAPPENS
Wikipedia offers a good starting point for understanding what drives NIH:
In many cases, Not Invented Here occurs as a result of simple ignorance, as many companies simply never do the research to know whether a solution already exists. Also common, however, are deliberate cases where the organization’s staff rejects a known solution because they don’t take the time to understand it fully before rejecting it; because they would have to embrace new concepts in infrastructure or terminology; because they believe they can produce a superior product; or because they would not get as much credit for finding an existing solution as inventing a new one.
A study of the literature devoted to NIH reveals that it is above all a predisposition—acquired attitude or bias—arising out of perceived burden, mental load, or possible threat.37 It lives in our FAST thinking more than our SLOW. Obviously, there are many rational reasons to reject any idea or solution. In fact, far more ideas should be rejected than accepted, because the ratio of good ideas to bad is hundreds if not thousands to one. Most people are familiar with the Linus Pauling quote: “The best way to have a good idea is to have a lot of ideas.” Logical, rational rejection of ideas is a good thing, but, thankfully, it is not NIH.
NIH becomes more prevalent as we develop subject matter expertise, which is a form of power . . . “knowledge is power.” Subject matter expertise is the mother of all biases. Chris and Dan Heath in their book Made to Stick referred to it as a curse, the “curse of knowledge.” We saw in our discussion of Fixation (Chapter 2) how our brain patterns can prevent us from being able to see challenges in new or different ways. Special knowledge adds new wrinkles.
Psychologists maintain that deep but narrow bands of knowledge, aka subject matter expertise, provide us a bounded personal and social domain closely integrated with our self-image. As result, we perceive anything that may breach that domain as a potential threat to our status, position, or power base. This helps explain why NIH is so often discussed in the context of social groups and organizations.
NIH, then, is tied to domains of knowledge and activity we believe we own. If we’re the expert, we should be the one with all the great ideas, or so the thinking goes. Irrational as it may be, if someone else gets an idea or conjures up a solution that lies within our domain of expertise, we somehow get a sense of diminished capacity: I should have thought of that. Fear then creeps in if we feel as though others may perceive us to be somehow less of an expert, especially if those others happen to be bosses, employers, or clients. That’s when we double down on defensive maneuvers like NIH to protect our status, position, or power base.
If we take a step back from the neuroscience and psychology, and add a touch of Synthesis, it would seem reasonable to conclude that mental cost-benefit comparisons get made unconsciously when one is trying to absorb the ideas of others, and the perceived benefit erroneously ends up on the losing side of the cognitive scale. This is not an easy flaw to fix, given our neurological wiring. Like all of the previously discussed fixes, NIH requires us to flip the paradigm, engage our mind over our brain matter, and create the very connections that are so rewarding.
The best way to do this is to invoke the wisdom of Pablo Picasso, who famously said that “bad artists copy, great artists steal.” Such a true anti-NIH approach enables you to look at how others have solved a problem, and thus avoid reinventing the wheel. Fixing the NIH flaw may just bring out the great artist in you!
THE FIX: PROUDLY FOUND ELSEWHERE (PFE)
Had he suffered from NIH, Steve Jobs might never have even considered the pleas of Apple engineers Jef Raskin and Bill Atkinson to visit the Xerox Palo Alto Research Center (PARC) in 1979, much less be persuaded to do so. He might never have struck a deal with the Xerox venture capital division allowing it to buy 100,000 shares of Apple stock before it went public in exchange for allowing Jobs and his colleagues to get a good look inside PARC. He might never have persuaded Xerox scientist Larry Tesler to show him everything PARC was working on concerning computer user interaction. He might never have seen the graphical user interface PARC had developed, designed to look like a desktop, and converting traditional computer command lines and DOS prompts to icons of folders and documents that you could point to and click open by using something Xerox called a mouse. He might never have seen a new way to render characters on a computer screen, called bit-mapping, which enabled a stunning graphic display. He might not have seen a Xerox prototype computer called Alto running on an object-oriented programming language called Smalltalk. He might never have seen the future of computing, embraced Picasso’s “great artists steal” notion, and taken the Xerox interface for Apple’s use, boasting later that “we have always been shameless about stealing great ideas.” He might never have dramatically improved on the concept, nor hired industrial design firm IDEO to redesign the Xerox three-button mouse to a one-button device. He might never have taken a team of Apple engineers and designers to a Xerox dealer to observe the Xerox Star, the first machine to feature the graphical user interface. He might never have hired Larry Tesler and Xerox hardware designer Bob Belleville to help Apple develop what would eventually become the first Macintosh computer.
And, in the second chapter of his career, after retaking the Apple helm after years of non-Jobsian leadership characterized by an acute case of NIH syndrome, Steve Jobs might never have brought in industrial designer Jonathan Ive to help him revitalize the company. And had Jonathan Ive suffered from NIH, he might never have “stolen” the design stylings and aesthetics of one Dieter Rams, genius designer of Braun fame.*
But Steve Jobs and Jonathan Ive were immune to NIH, as great artists are, and as a result achieved an unparalleled level of co-created product design that produced world-changing commercial elegance. They wore that immunity like a badge of honor, one that is now called Proudly Found Elsewhere (PFE), a term coined at Procter & Gamble (P&G) in 2000, when P&G came under the leadership of A. G. Lafley.
The Jobs-Ive blend of creative execution and commercial value is rare. A. G. Lafley recognized as much when he evaluated the impact of P&G’s innovation efforts. As Roger Martin tells the story, Lafley inherited a disastrous innovation effort that under previous leadership had tripled internal research and development investment but returned dismal results, with only 15 percent of innovation projects meeting sales and profit projections. Lafley knew more investment wasn’t the answer, and began looking for a better way to innovate. As Martin explains it, Lafley “looked outside P&G to see how other organizations solved their innovation.” He saw that it was the smaller entities that were more inventive, but it was the big companies that had the resources to develop and distribute innovations in ways the little guys couldn’t. “Free of preconceptions about the ‘right’ way to innovate,” Martin writes, “he set a target for P&G to obtain 50 percent of its innovations from outside the company by connecting with a wide array of outside innovators. P&G would then exploit its huge resource advantage to develop and commercialize the innovation. Lafley believed this strategy, dubbed ‘Connect & Develop,’ would enable P&G to parlay a relatively modest investment in innovation into above-average growth.”
Yes, you read that right: fully half of P&G’s new products must be originated from outside the company!
In a collective display of NIH, P&G’s innovation staff resisted. But when you’re the CEO of a multibillion-dollar global company, an executive edict is often all you need to banish NIH. Still, Lafley heard them out, realized they had assumed Connect & Develop was code for outsourcing, and quickly corrected their thinking by assuring them that the goal was to double or triple the commercial productivity of the innovation efforts. He then credited the top three innovation executives with formulating the initiative, two of whom—Larry Huston and Nabil Sakkab—wrote a popular article for the March 2006 issue of Harvard Business Review, in which they introduced the world to the term Proudly Found Elsewhere, writing,
Lafley made it our goal to acquire 50% of our innovations outside the company. The strategy wasn’t to replace the capabilities of our 7,500 researchers and support staff, but to better leverage them. Half of our new products, Lafley said, would come from our own labs, and half would come through them. It was, and still is, a radical idea. As we studied outside sources of innovation, we estimated that for every P&G researcher there were 200 scientists or engineers elsewhere in the world who were just as good—a total of perhaps 1.5 million people whose talents we could potentially use. But tapping into the creative thinking of inventors and others on the outside would require massive operational changes. We needed to move the company’s attitude from resistance to innovations “not invented here” to enthusiasm for those “proudly found elsewhere.” And we needed to change how we defined, and perceived, our R&D organization—from 7,500 people inside to 7,500 plus 1.5 million outside, with a permeable boundary between them.39
Permeable boundary. That is Synthesis (from Chapter 4 on Satisficing) at its finest.
What do you do if you don’t happen to have the clout of an A. G. Lafley to mandate a company-wide permeable boundary? What do you do if you’re essentially the CEO of You, Inc.? The two salient features of a PFE strategy are an outside-in flow of ideas, and an inside-out connection with sources of new (to you) ideas. I have found the following tools to be among the best ways to achieve both.
Open Hackathons: Bringing the Outside In
Edmunds, a company with whom I’ve worked for over a half decade, is a family-owned business focused on using a blend of big data and the human touch to personalize and ease the car shopping experience for U.S. consumers. Each year since 2013, Edmunds has hosted an annual multiday innovation competition called Hackomotive, inviting individuals, teams, and even entrepreneurial companies to hunker down at their Santa Monica headquarters to create innovations that radically improve automotive retailing. Aside from the three cash awards given each year, a few winning ideas are invited to participate in an internal three-month-long accelerated development program, called Fastlane. Occasionally, these accelerators result in acquisitions, hirings, or a blend of both. It has become an enormously productive PFE effort, generating breakthrough ideas that create real customer value in ways the Edmunds-proper organization may never have considered.
Hackathons like Hackomotive have moved well beyond the technology-only focus that “hack” conjures up, to become a valid method of bringing a diverse and passionate group of people—designers, storytellers, marketers, coders, entrepreneurs—together over a short time to solve real-world problems and produce a basket of strong ideas. Innovation is a contact sport, and having dozens of talented individuals rub shoulders and put their heads together is bound to produce something profound.
Hackathons need not be open to the public; internal hackathons bring the same boundary-breaking enthusiasm and engagement that help to rid the culture of NIH.
Knowledge Network: Reaching Out to Connect
During my tenure at University of Toyota, we encouraged individuals to engage fully with the outside, and to create what we termed a Knowledge Network, in much the same way P&G created a network of innovation partners with whom they could connect. Today, it’s easier than ever to “connect and develop” with a wide variety of knowledge sources—you probably have dozens of ways in the palm of your hand, on your mobile device.
The goal of creating a knowledge network is much the same as A. G. Lafley’s was in rethinking P&G’s innovation framework: to become more productive and commercially valuable by exploring and exploiting the talents of others and bringing their ideas into your own repertoire through a more permeable boundary than you might have right now. This will help squelch any NIH-type tendencies you may entertain.*
One way to visualize a knowledge network is as a radar screen or target, segmented by categories of knowledge sources you find valuable and helpful.
YOUR KNOWLEDGE NETWORK
To turn this visual into a useful tool, think about three possible levels of connections: the outer circle representing your loosest connections, and those in your innermost circle being your highest-quality connections. A high-quality connection is one that you reference and connect with constantly. The information, knowledge, and guidance you receive is excellent, and enables you to be faster, better, and smarter. The connection is also characterized by easy access. Your relationship to individuals is characterized by high levels of dialogue, responsiveness, and collaboration. Your high-quality connections enable you to get ahead.* To continuously improve the value of your knowledge network, focus on deepening ties to those with the potential to become part of your inner circle.
When I taught an experimental course on creativity and innovation for second-year MBA students at Pepperdine University in Malibu, California, I encouraged them to “connect and develop” through a knowledge network. Years later, I still receive notes from students telling me how their knowledge network has helped them to be more successful business professionals.
One of the best places to launch a knowledge network is at a hackathon. And if you’re participating in a hackathon, don’t give NIH a second thought. Your flaw is fixed.
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* There are many articles showing the uncanny resemblance between Braun and Apple products, including Gizmodo.com’s 1960s Braun Products Hold the Secrets to Apple’s Future (2008) and Forbes.com’s Jony Ive’s (No Longer So) Secret Design Weapon (2013).
* One of the things that has helped me squelch my own NIH is writing book reviews and conducting author interviews for the American Express OPEN Forum. Over four years and about 100 articles, I not only learned to appreciate the ideas of others, even if they conflicted with mine, I discovered that I truly enjoyed promoting them.
* In crafting a strategy for this book, I developed a project-based knowledge network. You have met some of my inner circle of THINKING PARTNERS throughout this book; individuals that I count on to mentor and advise me: Roger Martin, Jeffrey Schwartz, and Michael Schrage. Other cited individuals and works occupy the middle and outer rings.