“What’s the Big Idea: Creating and Capitalizing on the Best Management Thinking” by Laurence Prusak and Thomas Davenport

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Table of Contents

Introduction
Creativity
Creativity in the work place
Knowledge Management
The P Cycle of a Successful Business Idea
Conclusion
Reference list

Introduction

In an interview conducted by Ubiquity, Laurence Prusak (a researcher, scholar of management and a consultant) provided a few meaningful insights on management generally and specifically on the content of the book he co-authored with Thomas Davenport titled “What’s the Big Idea: Creating and Capitalizing on the Best Management Thinking,” published by the Harvard Business School Press.

In this interview, Prusak identifies that the people who generate business ideas are not exactly superhuman with unprecedented capabilities rather, they channel and direct their thinking and mental faculties in a specific area that most people will consider unproductive or wasteful. The result of their effort is the generation of ideas that can transform the fortunes of an organization.

Prusak further observes that idea generators in a business environment are not necessarily gurus, but they are most often the unsung heroes whenever the idea picks up. Others may simply be agents who pass over the idea rather than the originators of the same (Rodgers,1983).

Ideas are gathered in a number of different ways and these ways are neither formal nor structured, one may gather insights from reading certain literature, newspapers, journals having discussions with colleagues at work, whenever or even while attending conferences. The whole process need not be planned, Prusak further discussed the entire cycle and ecology of business idea generation, the origin of these ideas how they come about to be introduced into the organization and their final resting place (fate) after being disclosed.

The main problem with most executives and people in management positions in most organizations is the fact that they always like to maintain the status quo. A number of top executives are conservative and lack the spirit of adventure and transition (change). People tend to be comfortable with the current state of affairs as long as it still generates the requisite revenues and enables the entity to break even.

This in essence explains why a number of newly generated ideas will never live top see the light of day. In a number of business organizations, there exists a certain state of affairs that is considered stable, most executives are usually unwilling to disrupt this steady-state and therefore refuse to accommodate new ways.

An idea though attractive; its sustenance in an organization can only be guaranteed by an adventurous chief executive. Idea practitioners in most entities will, therefore, find it increasingly difficult to break this conservative barrier; some managers may be extremely intolerant to the extent that persistent idea practitioners who threaten the current state of affairs may be fired.

Since ideas will always tend to be in competition with each other, it is advisable that a number of ideas be picked up at the same time, this is because an idea may be hot this minute and then other factors or ideas come into play and neutralize the anticipated gains. This is why it is essential to focus on either three or four ideas and assess progress so that when one of them comes out to be predominant, then it can be selected at the expense of the rest.

Creativity

This is essentially a process involving the mind. It is concerned with the generation of fresh insights and knowledge in a given field and may occur either consciously and systematically in a programmed manner or out of the subconscious mind (accidentally).

Many fundamental discoveries and inventions that changed the shape and destiny of the world today were purely accidental inventions a case in point being, Sir Isaac Newton’s discovery of the location of the centre of gravity being in the earth’s crust while enjoying the shade of an apple tree.

It is of fundamental importance to distinguish between creativity and innovation. Since both may be used synonymously to mean the same thing, there exists a small distinguishing aspect. Where as creativity is involved with the generation of new thoughts, new ways and fresh products unprecedented before, innovation by contrast takes the new ideas further to implementation. It encompasses the entire process of creating and converting the said ideas into viable products or services that will find commercial application.

Graham Wallas in his 1926 publication of the text titled Art of Thought. The entire system of creativity can be explained in five staged model that starts from preparation, incubation, intimation, illumination and verification. At the preparation stage, the individual mindset focuses on the problem in question and tries to discover a number of avenues to solve it.

During incubation, the process is synthesized internally with no external manifestation of actions or happenings, at intimation, the solution is just about to be discovered and at illumination or insight stage the idea bursts out after it is conceived. The verification stage involves a further elaboration and explanation of the idea by putting it into action and proving/ assessing its viability (Wallas, 1926).

Creativity in the work place

In the context of the workplace, creativity may result into both positive and or negative effects. Particular mood changes that may precede idea generation may be experienced. Research has shown that the activities succeeding the process of creativity are often associated with happiness, jubilation and emotions of elation, this can be justified by the breakthrough that was advanced by Albert Einstein in the field of physics, asked about his discovery of the theory of relativity, he mentioned that it was the happiest thought of his life.

The more positive the working environment is the more creative an individual becomes. It should, therefore, be an important lesson for line managers and chief executives to maintain a positive work environment to provoke calmness of mind and creative mental activity. This can be achieved in an organization by removing any obstacles that may cause anxiety or uncertainty. For example, a manager may remove instances of uncertainty on job security by guaranteeing security of tenure to the workers.

Further research has also indicated that people tend to be more creative when they are faced by an aggregate of positive and negative conditions, as a manger, therefore, it is essential to strike a balance between these conditions, while maintaining and sustaining a positive and conducive work environment, in order to incubate more creative ideas and thoughts a few negatives should be systematically and artificially introduced into the work environment to enhance thinking this can be achieved by introduction of complex problems to an individual with a few clues on how to solve the problems.

The process of introducing complex problems should be systematic in the sense that it should be done progressively and in phases so that the individual is not overwhelmed.

Teresa Amabile, a scholar of management, proposes that within the context of an organization three variables are required as key components to enhance creativity.

One of them is Motivation; motivation provides the urge and impetus to do certain things. Motivation can be used to moderate behavior within an organization and is either intrinsic or extrinsic. Intrinsic motivational attributes originate from the individual (employee’s) personal orientation. Aspects that can be used to determine whether an employee is intrinsically motivated include the level of job satisfaction and personal gratitude as well as enjoyment of the work one does.

Extrinsic motivational attributes are manifested from the events surrounding the job and include elements such as money and the operational reward system as well as threats of being sacked.

A number of managerial practices can, therefore, be employed to encourage motivation and thus creativity: First, Organizational Support through deliberate actions that are aimed at collaborating and cooperating with top management through which an organization can enhance creativity, the top management should encourage and be interested in any new ideas that are advanced by workers.

Secondly, Challenges in the workplace, in as much as it is important to match the available work assignments with the right personnel and the various jobs available, jobs and tasks should be slightly varied so as to not only reduce monotony of work but also expose employees to fresh challenges.

Thirdly, Freedom is also important to maintain tolerable levels of autonomy within the work environment to enable workers stretch and experiment with new ideas, freedom of thought and expression should be encouraged so that workers can be allowed to reason without fear of victimization.

In any successful business organization the levels of creativity can be fostered through among other things, providing the right levels of training to equip workers with the requisite competencies, providing moral and material (resources) support to creative minds, encouraging self-confidence and an attribute of taking up risks as well as providing an unlimited opportunity to explore new horizons. Management needs to change its mindset and attitude towards risk and be more receptive to agents of change (Thomas et al., 2003).

Knowledge Management

This includes a number of strategic management practices that an organization should adopt in order to help in the creation, distribution and eventual adoption of new ideas, insights and fresh experiences. Proper knowledge management is important in among other things helping an entity achieve its strategic objectives of increasing productivity, reducing costs, minimizing wastages and idle time, increase innovation and creating a suitable competitive advantage against rival firms within the same industry.

Organizations should try and develop new knowledge development and management strategies incentives that should include putting up measures that encourage the dissemination and sharing of organizational information.

Making such sharing a mandatory requirement will encourage synergy and cooperation in the development of business solutions, this also enhances collaboration, interdependence and unity of purpose. Another way to encourage an effective knowledge management scheme is also through the incorporation of performance reward schemes in an organization. A problem that is shared is considered half solved and a desirable incentive should be set aside to the creative minds that provide workable solutions to complex organizational problems.

Another way that could effectively contribute to the management of knowledge within the organization is through the consultation of authorities and experts in a given field. Expert guidance and advice received from such authorities should be considered and their applicability assessed as this could be one of the ways problems can be solved.

In order to encourage the dissemination of knowledge, the organizational should develop a culture that encourages passing of information that includes even historical information about prior organization heroes, heroines and legends through acts of storytelling. In many organizations, this rich history is preserved in artifacts and cultural monuments and the knowledge of important personalities and their deeds or contributions to the entity retold in what can be considered as the entity’s folklore.

History can also be preserved through naming of important buildings or structures within the organization after influential individuals who contributed in developing certain skills or competencies or management that helped the organization sail out of tough times in the past through their acts of creativity and innovativeness.

Management may also adopt the best practices transfer as a method of maintaining knowledge and insights. In settings that are divided into a number of departments or regions, a pilot project that was a result an individual’s creativity may be set up and operationalized, results of this project may then be assessed and if they are found to be satisfactory, then knowledge transfer should be encouraged to other departments or regions experiencing similar problems.

The culture of apprenticeship should also be encouraged by managers. An apprentice is an individual who learns about the execution of tasks or acquires varied skills in an organization through observation (Rodgers,1983).

An apprentice works under supervision of an experienced employee. This apprentice-master relationship may be adopted by an organization if they want to socialize new employees into the system. Using this strategy, knowledge is transferred from one employee to another and key attributes about the functions and operations are established by one worker as transferred to another.

Experimentation is also a key variable in both the management and acquisition of new knowledge and competent solutions to organizational problems. A number of entities have invested heavily in research a fact which should be emulated if information about new product lines, efficient markets or better production methods is to be obtained.

Experiments encourage new inventions that may be useful in among other things integrating and establishing the desirable mix between new and old technologies, establishing a balance between the use of manual labor and automated labor and establishing which combination of goods should be produced to optimize returns and/or minimize production expenses.

The results of the research can also be disseminated in an s-curve model so to reach other persons outside the organization in a diffusion process. The s-curve model of knowledge transformation is used to match the growth in output against the increase in firm revenues.

The Innovation Life Cycle Curve, Source: Rodgers Everett M (1983) Diffusion of Innovation p.18

The assumption in the above framework originates from the fact that a newly invented idea will undergo the birth, growth and eventual decline phase. A newly invented idea will not sell much, but constant growth in the demand of a product resulting from this invention shall expand the market and sufficient levels of technology will be introduced to expand and thus yield more revenues over time.

With the stabilization of the newly introduced technology, steady-state equilibrium is attained whereby there are visible manifestations of a constant production process, output is optimized and a better level cannot be attained. Costs are moderated and there is minimal input in terms of new trends, modifications or adjustments.

People are used to the technology at this point and especially executive management now fully understands the innovation. As the confidence levels increase, it is important to start out researching and developing fresh ideas and technology because the current technology will soon level off and become largely obsolete.

It is of great importance to note that the technological failures witnessed in most organizations are largely because of timing; management should time and accurately determine a new technology is supports to replace an existing one. Certain evident characteristics like a constant return to scale or declining returns and increased cost of repairs and maintenance should be enough to signal to the executives and line mangers that a shift in technology is required.

At that point when an existing technology becomes obsolete, a new form of technology emerges to replace the obsolete level and therefore maintain the prior output levels witnessed and the innovation cycle continues.

The P Cycle of a Successful Business Idea

Davenport and Prusak illustrated a continuum through which creative business ideas move from their initial inception and introduction into the entity to the final level where the new ideas are seen to be too common and pervasive to the extent that no particular individual in the organization feels that they carry any new significance.

Progenitor

↓↓

Pilot

↓↓

Project

↓↓

Program

↓↓

Perspective

↓↓

Pervasive

At the progenitor stage the idea is conceived by an individual in the enterprise, it is at its initial levels and the originator still considers it young. It may or may not materialize depending on the external environment around the organization and particularly the attitudes of line managers towards encouraging newness, this is a delicate phase of the idea and in case the idea finds the ground to be unreceptive, just like a newborn who is not taken care of, it will shrivel and die.

At the Pilot Phase the idea is first brought into action and practically applied in management. At this point, the level of credibility is quite insignificant and the scale is equally modest. The idea is still being explored to establish deeper insights and understanding.

The Project Phase sees the idea gradually emerging from the closet, there is a tentative awareness of this new idea operating and this captures the attention of top management. Key executives within the organization just appear to notice this new development but no keen interest is taken to acquire further knowledge.

At the Program stage changes begin to appear to the organization as a result of the implemented idea, the invention hits the ground in a massive way and there is a much-broadened awareness of the successful effects of the new idea. The levels of credibility rise and at this point the idea receives perfect response from executive management.

The next stage is the Perspective Phase where the innovation is established. There are sustained levels of progress and success. At this point a new equilibrium is established because the idea has been tried and tested, executive managements are unwilling to let in another new from of technology that is not tested and whose results cannot be easily predicted (Andriessen, 2004).

Executives will rather stick to the current form of technology in which they have full confidence in terms of performance and returns rather than introduce something else that will destroy the status quo. The Pervasive Stage closes the cycle and by this time several years have elapsed, the level of awareness of the invention suddenly drops to zero, no one seems to notice it because it has become too common. Executives become unconscious that the idea ever existed in the organization.

Conclusion

Knowledge and creativity management is of great significance to managers and employees of an organization. The obstacle that is with management is the fact that they fail to recognize the need for change and struggle to maintain the status quo. This is a characteristic that stems from the executives being uncertain about the impact of the new technologies on profits. They will not be willing to accept any idea that will tamper with this (Amabile, 1996).

Top executives should be in a position to allow change to happen, they should also be able to adopt appropriate management styles that will not only attract but also retain highly motivated and creative employees. It is generally a difficult task to manage workers that are creative.

Management of brainpower is fundamentally different from managing other non human factors of production like land and capital. In most cases the generally accepted and largely bureaucratic approaches that are currently used in the management of organizations may not find any meaningful application when managing creativity and brainpower (the human intellect).

In order to breed new ideas it is important that management provides a perfect condition that will encourage conception of fresh ways. This can be done by modifying the working environment both internally and externally in order to provoke creative ideas. In order to reduce boredom and instill change that will keep workers on toes, new elements should be introduced in what is commonly referred to as job enrichment.

Employees could also be reshuffled after a given duration of time in order to expand their knowledge in a particular field. When a person is moved into a different job they tend to think differently and this may spur them into deducing new strategies and methodologies to be applied in providing solutions.

Re-engineering in itself may have started off as a good thing with well-intended purposes but it later grew into an undesirable evil. It was meant to re-do a number of old processes using modified technology and skills but ended up causing majority of people to be sacked or laid off because of redundancies.

Quality movements have since been established in the place of re-engineering and this coupled with knowledge management has been successful in helping individual employees in asking lead questions such as “what do we really know about this organization?”, “how much are expected to know about this particular production process?” “How do we know what we know?”

In the interview alluded to in the introductory pages, Prusak himself identifies the origins or causes of the P cycle as either being innovation, efficiency or effectiveness. This is all attached to the fact that everything is in wary or another inter-connected to the quest of finding a solution to current day problems in organizations.

Therefore the above three elements that give rise to the Ps in the cycle must be considered objectively and comprehensibly by both line managers, employees and top-level executives in the dominant coalition (decision-makers).

Reference list

Amabile, T. et al. (1996). “Assessing the work environment for creativity”. Academy of Management Review39 (5): 1154–1184.

Andriessen, D. (2004). “Reconciling the rigor-relevance dilemma in intellectual capital research”. The Learning Organization11 (4/5): 393–401.

Rodgers, M. (1983), Diffusion of Innovation. New York, NY: Learning

Thomas et al, (2003) What’s the Big Idea – Creating and Capitalizing on the Best Management Thinking. Boston, MA: Harvard Business School Press

Wallas, G. (1926), Art of Thought. New York, NY: Willey publishers

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