Harnessing the Scarcity Principle: Driving Innovation through Consumer Psychology

GUEST POST from Chateau G Pato

In today’s fast-evolving business landscape, innovation has become the lifeblood of success. In order to stay ahead of the competition, companies must continuously find new ways to captivate consumers and create lasting impact. One powerful strategy that businesses can employ is leveraging consumer psychology, specifically the scarcity principle. By understanding and harnessing this principle, companies can drive innovation and maintain a competitive edge. This article will explore the scarcity principle and its application in two compelling case studies, highlighting how it can be effectively utilized to spur innovation.

The Scarcity Principle:

The scarcity principle, rooted in human psychology, states that people perceive scarce resources as being more valuable and desirable. When a product or service is scarce or perceived as limited, it creates a sense of urgency and triggers a fear of missing out (FOMO). This psychological phenomenon drives consumers to take immediate action, leading to increased demand and a willingness to pay a premium.

Case Study 1: Apple and Limited Edition Products

Apple Inc. has mastered the art of harnessing the scarcity principle to drive innovation and maintain a fiercely dedicated consumer base. Their approach revolves around the strategic release of limited edition products. For instance, they frequently launch new iPhone models with specific color variations, available in limited quantities. This scarcity tactic generates enormous buzz and compels consumers to line up outside Apple stores, eager to get their hands on the exclusive product. By leveraging the scarcity principle, Apple continues to innovate and maintain remarkable consumer loyalty.

Case Study 2: Supreme and Streetwear Hype

Supreme, the iconic streetwear brand, has garnered a cult-like following by skillfully exploiting the scarcity principle. Their business model revolves around producing limited quantities of products and maintaining an aura of exclusivity. Supreme creates an air of frenzy through limited drops of apparel items and accessories, coupled with secretive release information. This meticulously crafted approach creates scarcity, leading to long queues outside their stores and an immediate sell-out of their products. The brand’s masterful utilization of the scarcity principle fuels innovation in every collection release.

Harnessing the Scarcity Principle for Innovation:

The scarcity principle can be harnessed beyond the release of limited edition products. Companies can tap into this psychological phenomenon to drive innovation across various aspects of their business.

1. Limited Time Offers: Implementing time-limited promotions or discounts can be an effective strategy to create a sense of urgency and drive sales. Businesses can offer exclusive deals to a limited number of customers or for a specific timeframe, leveraging scarcity to spur innovation in marketing tactics.

2. Membership Programs: Implementing a membership-based model with exclusive benefits can tap into consumers’ desire for exclusivity. By offering limited spots or restricted access to events, content, or perks, companies can foster innovation by continuously enhancing the membership experience.

Conclusion

Innovation is critical for businesses to thrive in the competitive marketplace. By understanding and harnessing the scarcity principle, companies can drive innovation through consumer psychology. The strategic application of scarcity can create a sense of urgency, trigger FOMO, and lead to increased demand and loyalty. Through case studies on Apple and Supreme, we observed how brands effectively employed the scarcity principle to maintain their competitive edge and inspire innovation. By implementing limited-time offers and membership programs, businesses can successfully leverage scarcity, fostering innovation across various facets of their operations. Embracing the scarcity principle allows companies to tap into the power of consumer psychology and take their innovation game to new heights.

Extra Extra: Because innovation is all about change, Braden Kelley’s human-centered change methodology and tools are the best way to plan and execute the changes necessary to support your innovation and transformation efforts — all while literally getting everyone all on the same page for change. Find out more about the methodology and tools, including the book Charting Change by following the link. Be sure and download the TEN FREE TOOLS while you’re here.

Image credit: Pexels

Sign up here to get Human-Centered Change & Innovation Weekly delivered to your inbox every week.

Four Ways To Empower Change In Your Organization

1 Reply

Four Ways To Empower Change In Your Organization

GUEST POST from Greg Satell

In 1957, Ken Olsen founded Digital Equipment Corporation (DEC) with his MIT classmate, Harlan Anderson, and by the 1960s, the company had pioneered the minicomputer revolution. Much cheaper than IBM mainframes, but still powerful enough to be useful, these machines helped make DEC one of the world’s leading technology companies.

Hailed as a visionary, Olson was named “America’s most successful entrepreneur” by Fortune magazine in 1986. Yet as AnnaLee Saxenian explained in Regional Advantage, by that time the minicomputer industry was already being disrupted by PC’s and DEC would never recover. It was acquired by Compaq in 1998.

The truth is that everybody gets disrupted eventually, even a visionary entrepreneur like Olsen. What makes the difference is whether you are able to chart a new path. That takes more than merely being smart and ambitious, you need to empower change from within. It’s never easy, but there are some basic principles that can help you reinvent your organization.

1.Identify A Keystone Change

Much like DEC in the 80s, by the 1990s IBM had hit hard times. Squeezed between low cost PC’s made by firms like Compaq, Intel based servers and a software industry dominated by Microsoft, IBM was near bankruptcy. Many observers, both inside and outside the company, thought that it should be broken up.

Yet its incoming CEO, Lou Gerstner, saw things differently. As a former customer, he knew how important IBM was to running critical business processes of large organizations. As he talked to other customers, he found they felt the same way. In fact, they were terrified of IBM being broken up. If he could refocus the company on fulfilling that need, he could save it.

That was easier said than done though. IBM had a hardwired culture of “if it was a good idea, we would have already done it” that had been ingrained over decades. So he needed to identify a keystone change — one that would be clear and tangible, involve multiple stakeholders and pave the way for future change — to make a transformation possible.

So Gerstner built a new business model aimed at the customers’ “stack of business processes” rather than its own “stack of proprietary technologies.” That led to a successful new service business, an e-business initiative and a new line of Linux based servers. Within a few years, he had achieved one of the greatest turnarounds in corporate history.

2. Empower Change Agents

Probably the greatest misconception about change is that a leader can force it through. Even as skilled an executive like Lou Gerstner needed others to actually implement the changes at IBM, his role was mostly to inspire belief that it could be done. The truth is that you can’t force change. You need need to attract rather than try to overpower.

As Zeynep Ton explains in The Good Jobs Strategy, when the recession hit in 2008, Mercadona, Spain’s leading discount retailer, needed to cut costs. But rather than cutting wages or reducing staff, they asked their employees to contribute ideas. The result was that the company managed to reduce prices by 10% and increased their market share from 15% to 20% between 2008 and 2012

Or consider England’s National Health Service, a truly mammoth organization of with 1.3 million employees serving 54 million citizens. In 2013 it introduced Change Day, on which employees pledge to do one thing to improve the life of patients. In that first year there were 189,000 pledges for action and that figure rose to 800,000 in the second year.

Many of the initiatives were small, but multiplied by hundreds of thousands, it has created a significant impact. As Helen Bevan, Chief Transformation Officer for the NHS Horizons team put it to me, “Programmatic methods have their place, but if you want to create change on a truly massive scale, a top-down approach on its own doesn’t work so well. You need to get people invested in change. They have to own it.”

3. Network Your Movement

When Rick Warren first arrived in Orange County, California in 1979, he saw the opportunity to build a new kind of church. He had spent three months going door-to-door and found that while many residents identified themselves as christians, they found church services boring and irrelevant. So he began to cater his services and programs to meet their needs.

Today, his Saddleback Church is one of the largest congregations in the world, with 20,000 people attending sermons every week. Yet looks can be deceiving. What makes Warren such a powerful force isn’t those massive weekend services, but the thousands of small prayer groups that that meet during the week.

We tend to think of effective leaders as solitary figures, able to compel action through sheer force of will, but actually they are shrewd managers of complex ecosystems and that’s key to how they are able to empower transformational change. Martin Luther King Jr., for example, didn’t lead the charge for civil rights alone, but as one of the Big Six. In much the same way, Nelson Mandela had to build consensus among many competing interests within the African National Congress.

Today IBM, having had its core business disrupted by the cloud, is taking a network approach to quantum computing. Rather than having its scientists work alone in secret labs, it has set up a Q Network of leading companies, startups, academic institutions, and national research labs to advance the technology.

4. Survive Victory

The most important thing to remember is that the battle against disruption never ends. All too often, an initial victory soon reverses itself. Many turnaround efforts see some initial improvement as excitement about a new direction motivates people to perform better, then dissipates as harsh realities take hold.

The case of Ken Olsen and DEC provides some insight into why this happens. While he was hailed as a visionary leader, the minicomputer revolution he spawned was rooted in a particular technology. When that technology ceased to be compelling, as always happens eventually, his company could no longer compete effectively.

Now consider what Irving Wladawsky-Berger, one of Gerster’s key lieutenants, told me about IBM’s historic turnaround. “The Gerstner revolution wasn’t about technology or strategy, it was about transforming our values and our culture to be in greater harmony with the market… Because the transformation was about values first and technology second, we were able to continue to embrace those values as the technology and marketplace continued to evolve.”

That’s why, as I explain in my book Cascades, it’s critical that you make a plan to survive victory and that plan must be rooted in fundamental values rather than in a particular strategy or set of tactics. To overcome disruption for the long-term, you need to not just transform the organization but, more importantly, the fundamental beliefs that drive it.

— Article courtesy of the Digital Tonto blog
— Image credit: Unsplash

Sign up here to join 17,000+ leaders getting Human-Centered Change & Innovation Weekly delivered to their inbox every week.

Reinventing Wheels

1 Reply

Reinventing Wheels

GUEST POST from Dennis Stauffer

You’ve no doubt heard—and perhaps used—the expression: Don’t reinvent the wheel.

Or another overused cliché: If it’s not broken, don’t fix it.

Both get injected into conversations and ideation sessions to reject ideas perceived to be redundant or weak, and both are profoundly bad advice.

We had automobiles before Henry Ford and computers before Steve Jobs. Mobile phones before the iPhone, cabs before Uber, hotels before AirBnB, and electric cars before Tesla. Reinventing wheels can be very lucrative! Fixing things that aren’t broken is a pretty good summary of what innovation does.

This is so true that when startup founders seek investors, a common strategy is to describe their venture as the Uber of “X” or the AirBnB of “Y”. That’s shorthand for: We’re taking a proven business concept and applying it in a different context. Skilled ideation facilitators and idea management platforms encourage folks to build on each other’s ideas.

So don’t let anyone tell you, you have a bad idea just because they’ve heard it before. That may be one of its strengths! Especially when those ideas have proven successful. There’s nothing wrong with finding inspiration in current technologies and practices. Perhaps by applying it in some new way. The best innovators make a habit of it.

So, go reinvent some wheels!

For those of you who prefer, here is a video version of this post:

Image Credit: Pexels

Sign up here to get Human-Centered Change & Innovation Weekly delivered to your inbox every week.

Just Start Already

Leave a reply

Just Start Already

GUEST POST from Mike Shipulski

You’re not missing anything. It’s time to start.

Afraid to fail? Start anyway.

Don’t have the experience? Well, you won’t be able to say that once you start.

Just start. It’s time.

Don’t have the money? Start small. And if that won’t work, start smaller.

Start small, but start.

Worried about what people might say? There’s only one way to know, so you might as well start.

You’re not an imposter. It’s time to start.

Waiting isn’t waiting, it’s a rationalization to block yourself from starting.

Here’s a rule: If you don’t start you can’t finish.

The only thing in the way of starting is starting.

The fear of success is the strongest stopper of starting. Be afraid of success, and start.

There’s never a good time to start, but there’s always a best time – now.

Worried about the negative consequences of starting? Be worried, and start.

Don’t think you have what it takes? The only way to know for sure is to start.

There’s no way around it. Starting starts with starting.

Image credit: Unsplash

Sign up here to join 17,000+ leaders getting Human-Centered Change & Innovation Weekly delivered to their inbox every week.

Manage Every Moment

Leave a reply

Manage Every Moment

GUEST POST from Shep Hyken

I just heard an excellent motivational speaker, Antonio Neves, and one of his messages was called “The Last 30 Days.” He talked about visiting a marriage counselor with his wife, where they were asked to consider the question: Looking back over the last 30 days, if you asked your spouse to marry you again, would they say yes?

He then spun that question to business and specifically talked about employment. That version goes like this: Looking back over the last 30 days, would your boss rehire you?

When I do annual reviews of my team, one of the questions I ask myself is, “Based on the past year, would I be excited to hire this employee again?” It’s the same type of question. The point is that we validate our decisions based on our experiences in both our personal and professional lives.

So, let’s take it to the customer service and CX world. However, we aren’t going to look back for a year or even 30 days. We aren’t going to look back at all. We’re going to look at what’s happening right now, at this very moment. My version of this is what I refer to as the Loyalty Question: What am I doing right now that will make this customer want to do business with us again the next time they need what we sell?

Every interaction with a customer becomes your CX judgment day, especially when there is a problem or complaint. It doesn’t matter how long you’ve done business and how perfect the experience has been. The moment there is a negative issue, it becomes judgment day. Someone could have done business with you for 10 years, but when a problem or friction arises, that moment is your opportunity to earn the right to continue to do business with that customer for another 10 years.

The point of all these ideas – 30 days, one year, or even today – is about managing the moment, whether it be multiple moments over an extended period or the moment you’re experiencing right now. We must be focused and attentive to what’s happening at that moment. Jan Carlson, who I’ve written about and talked about since the beginning of my career, came up with the ultimate concept for successfully managing these interactions. He calls it the Moment of Truth, and this is how he defines it: Anytime a customer comes into contact with any aspect of a business, however remote, they have an opportunity to form an impression.

Manage every moment! These are the interactions that make our customers say, “I’ll be back!”

Image Credits: Shep Hyken, Pexels

Sign up here to join 17,000+ leaders getting Human-Centered Change & Innovation Weekly delivered to their inbox every week.

Customer Success is Everyone’s Job

1 Reply

Customer Success is Everyone's Job

GUEST POST from Geoffrey A. Moore

There was a time when CEOs liked to say that everyone is in sales, but nowadays, given the XaaS business model, lifetime value has become the focal point for both the customer and the vendor. This commonality of interest is good news indeed, as long as the customer is actually having success. And there is the rub.

Success is in the eye of the beholder, and with enterprise customers in particular, there are quite a few beholders to please. Here is the model we use to draw attention to the key constituencies:

In this model, the technical buyers are responsible for delivering a working system, the end users for improving their productivity by using the system, and the economic buyers for securing the intended ROI. All six constituencies have their role to play, and each needs attention. But no one person, indeed no one function, can connect with all six. That’s why to achieve customer success enterprises must reach out well beyond their Customer Success function.

Here are the best match-ups for securing long-term success:

Now, no one can afford to activate all these relationships all the time. The point is, when things start to get wobbly, these are the people who need to lean in to right the ship.

And then there is the rest of the company. Engineering has to make the product a platform for success, both in terms of function and user experience. Marketing has to frame the value proposition that sets the table for success. Sales has to win the opportunity for success. HR has to support a culture of customer success. Legal has to shape contracts that set both the customer and the vendor up for success. IT has to provide the systems that monitor, measure, and proactively engage to keep success up and running. It really does take a village.

Most importantly, it allows CEOs and other leaders to replace the shopworn mantra of managing for shareholder value with a more fit-for-purpose managing for customer success. At the end of the day, that is the engine that drives shareholder value. More importantly, it is a call to action that can get people motivated. We all want to make an impact. Customer success is what shows we have.

That’s what I think. What do you think?

Image Credit: Pexels, Geoffrey A. Moore

Sign up here to join 17,000+ leaders getting Human-Centered Change & Innovation Weekly delivered to their inbox every week.

Continuous Improvement vs. Incremental Innovation

Leave a reply

Are They the Same?

Continuous Improvement vs. Incremental Innovation

GUEST POST from Robyn Bolton

“Isn’t continuous improvement the same as incremental innovation? After all, both focus on doing what you do better, faster, or cheaper.”

Ooof, I have a love-hate relationship with questions like this one.

I hate them because, in the moment, they feel like a gut punch. The answer feels obvious to me – no, they are entirely different things – but I struggle to explain myself clearly and simply.

I love them because, once the frustration and embarrassment of being unable to offer a clear and simple answer passes, they become a clear sign that I don’t understand something well enough or that *gasp* my “obvious” answer may be wrong.

So, is Continuous Improvement the same as Incremental Innovation?

No. They’re different.

But the difference is subtle, so let’s use an analogy to tease it apart.

Imagine learning to ride a bike. When you first learn, success is staying upright, moving forward, and stopping before you crash into something. With time and practice, you get better. You move faster, stop more quickly, and move with greater precision and agility.

That’s continuous improvement. You’re using the same solution but using it better.

Now, imagine that you’ve mastered your neighborhood’s bike paths and streets and want to do more. You want to go faster, so add a motor to your bike. You want to ride through the neighboring forest, so you change to off-road tires. You want a smoother feel on your long rides, so you switch to a carbon fiber frame.

That’s incremental innovation. You changed an aspect of the solution so that it performs better.

It all comes down to the definition of innovation – something different (or new) that creates value.

Both continuous improvement and incremental innovation create value.

The former does it by improving what exists. The latter does it by changing (making different) what exists.

Got it. They are entirely different things.

Sort of.

Think of them as a Venn diagram – they’re different but similar.

There is evidence that a culture committed to quality and continuous improvement can lead to a culture of innovation because “Both approaches are focused in meeting customer needs, and since CI encourages small but constant changes in current products, processes and working methods its use can lead firms to become innovative by taking these small changes as an approach to innovation, more specifically, incremental innovation.”

Thanks, nerd. But does this matter where I work, which is in the real world?

Yes.

Continuous Improvement and Incremental Innovation are different things and, as a result, require different resource levels, timelines, and expectations for ROI.

You should expect everyone in your organization to engage in continuous innovation (CI) because (1) using CI helps the organizations change adoption and risk taking by evaluating and implementing solutions to current needs” and (2) the problem-solving tools used in CI uncover “opportunities for finding new ideas that could become incremental innovations.”

You should designate specific people and teams to work on incremental people because (1) what “better” looks like is less certain, (2) doing something different or new increases risk, and (3) more time and resources are required to learn your way to the more successful outcome.

What do you think?

How do you answer the question at the start of this post?

How do you demonstrate your answer?

Image Credit: Pixabay

Sign up here to get Human-Centered Change & Innovation Weekly delivered to your inbox every week.

Voting Closed – Top 40 Innovation Bloggers of 2023

Leave a reply

Happy Holidays!

For more than a decade I’ve devoted myself to making innovation insights accessible for the greater good, because I truly believe that the better our organizations get at delivering value to their stakeholders the less waste of natural resources and human resources there will be.

As a result, we are eternally grateful to all of you out there who take the time to create and share great innovation articles, presentations, white papers, and videos with Braden Kelley and the Human-Centered Change and Innovation team. As a small thank you to those of you who follow along, we like to make a list of the Top 40 Innovation Bloggers available each year!

Our lists from the ten previous years have been tremendously popular, including:

Top 40 Innovation Bloggers of 2015
Top 40 Innovation Bloggers of 2016
Top 40 Innovation Bloggers of 2017
Top 40 Innovation Bloggers of 2018
Top 40 Innovation Bloggers of 2019
Top 40 Innovation Bloggers of 2020
Top 40 Innovation Bloggers of 2021
Top 40 Innovation Bloggers of 2022

Do you just have someone that you like to read that writes about innovation, or some of the important adjacencies – trends, consumer psychology, change, leadership, strategy, behavioral economics, collaboration, or design thinking?

Human-Centered Change and Innovation is now looking to recognize the Top 40 Innovation Bloggers of 2023.

It is time to vote and help us narrow things down.

The deadline for submitting votes is December 31, 2023 at midnight GMT.

The ranking will be done by me with influence from votes and nominations. The quality and quantity of contributions to this web site by an author will be a BIG contributing factor (through the end of the voting period).

You can vote in any of these three ways (and each earns points for them, so please feel free to vote all three ways):

Sending us the name of the blogger by @reply on twitter to @innovate
Adding the name of the blogger as a comment to this article’s posting on Facebook
Adding the name of the blogger as a comment to this article’s posting on our Linkedin Page (Be sure and follow us)

The official Top 40 Innovation Bloggers of 2023 will then be announced here in early January 2024.

Here are the people who received nominations this year along with some carryover recommendations (in alphabetical order):

Adi Gaskell – @adigaskell
Alain Thys
Alex Goryachev
Andy Heikkila – @AndyO_TheHammer
Annette Franz
Arlen Meyers – @sopeofficial
Art Inteligencia
Ayelet Baron
Braden Kelley – @innovate
Brian Miller
Bruce Fairley
Chad McAllister – @ChadMcAllister
Chateau G Pato
Chris Beswick
Chris Rollins
Dr. Detlef Reis
Dainora Jociute
Dan Blacharski – @Dan_Blacharski
Daniel Burrus – @DanielBurrus
Daniel Lock
David Burkus
Dean and Linda Anderson
Dennis Stauffer
Diana Porumboiu
Douglas Ferguson
Drew Boyd – @DrewBoyd
Frank Mattes – @FrankMattes
Geoffrey A Moore
Gregg Fraley – @greggfraley
Greg Satell – @Digitaltonto
Helen Yu
Howard Tiersky
Janet Sernack – @JanetSernack
Jeffrey Baumgartner – @creativejeffrey
Jeff Freedman – @SmallArmyAgency
Jeffrey Phillips – @ovoinnovation
Jesse Nieminen – @nieminenjesse
John Bessant
Jorge Barba – @JorgeBarba
Julian Birkinshaw – @JBirkinshaw
Julie Anixter – @julieanixter
Kate Hammer – @Kate_Hammer
Kevin McFarthing – @InnovationFixer
Leo Chan
Lou Killeffer – @LKilleffer
Manuel Berdoy

Mari Anixter- @MariAnixter
Maria Paula Oliveira – @mpaulaoliveira
Matthew E May – @MatthewEMay
Michael Graber – @SouthernGrowth
Mike Brown – @Brainzooming
Mike Shipulski – @MikeShipulski
Mukesh Gupta
Nick Jain
Nick Partridge – @KnewNewNeu
Nicolas Bry – @NicoBry
Nicholas Longrich
Norbert Majerus and George Taninecz
Pamela Soin
Patricia Salamone
Paul Hobcraft – @Paul4innovating
Paul Sloane – @paulsloane
Pete Foley – @foley_pete
Rachel Audige
Ralph Christian Ohr – @ralph_ohr
Randy Pennington
Richard Haasnoot – @Innovate2Grow
Robert B Tucker – @RobertBTucker
Robyn Bolton – @rm_bolton
Saul Kaplan – @skap5
Shep Hyken – @hyken
Shilpi Kumar
Scott Anthony – @ScottDAnthony
Scott Bowden – @scottbowden51
Shelly Greenway – @ChiefDistiller
Soren Kaplan – @SorenKaplan
Stefan Lindegaard – @Lindegaard
Stephen Shapiro – @stephenshapiro
Steve Blank
Steven Forth – @StevenForth
Tamara Kleinberg – @LaunchStreet
Teresa Spangler – @composerspang
Tom Koulopoulos – @TKspeaks
Tullio Siragusa
Yoram Solomon – @yoram

Sign up here to get Human-Centered Change & Innovation Weekly delivered to your inbox every week.

We’re curious to see who you think is worth reading!

Hire for Diversity and Empathy to Drive Innovation

Leave a reply

Hire for Diversity and Empathy to Drive Innovation

GUEST POST from Greg Satell

One of the questions I get asked quite often, both at conferences and when coaching executives, is what type of personality is best suited for innovation so that they can optimize their hiring. Are technical people better than non-technical people? Introverts better than extroverts? Is it better to hire foxes or hedgehogs?

The first thing I tell them is that there has been no definitive research that has found that any specific personality type contributes to innovation. In fact, in my research I have found that there is not even a particular kind of company. If you look at IBM, Google and Amazon, for example, you’ll find that they innovate very differently.

The second thing I point out is that every business needs something different. For example, Steve Jobs once noted that since Apple had always built integrated products, it never learned how to partner as effectively as Microsoft and he wished it would have. So the best approach to hiring for innovation is to seek out those who can best add to the culture you already have.

Foxes vs. Hedgehogs

In Good to Great, author Jim Collins invokes Isaiah Berlin’s famous essay about foxes and hedgehogs to make a point about management. “The fox,” Berlin wrote, “knows many things, but the hedgehog knows one big thing.” Collins then devotes an entire chapter to explaining why hedgehogs perform better than foxes.

Yet as Phil Rosenzweig points out in The Halo Effect, this is a highly questionable conclusion. Even if it were true that the most successful companies focus on one core skill or one core business, that doesn’t mean that focusing on “one big thing” will make you more successful. What it probably means is that by betting on just one thing you increase your chances of both success and failure.

Think about what would have happened it Apple had said, “we’re going to focus just on computers” or if Amazon had focused on just books. There is also evidence, most notably from Philip Tetlock, that foxes outperform hedgehogs on certain tasks, like making judgments about future events.

So the best strategy would probably be to hire a fox if you’re a hedgehog and to hire a hedgehog if you’re a fox. In other words, If you like to drill down and focus on just one thing, make sure you have people around that can help you integrate with other skills and perspectives. If you like to dabble around, make sure you have people who can drill down.

Introverts vs Extroverts

We tend to see leaders as brash and outgoing, but my colleague at Inc, Jessica Stillman points out that introverts can also make great leaders. They tend to be better listeners, are often more focused and are better prepared than social butterflies are. Those are great qualities to look for when adding someone to add to your team.

Still, you wouldn’t want to have an entire company made up of introverts and, in Social Physics, MIT’s Sandy Pentland explains why. Perhaps more than anything else, innovation needs combination. So it’s important to have people who can help you connect to other teams, both internally and externally, bring in new ideas and help take you in new directions.

Consider Amazon, a company that is not only incredibly successful but also highly technically sophisticated. You might expect that it hires a lot of introverted engineers and I’m sure that’s true. Yet the skill it is most focused on is writing, because it understands that to create a successful product, you need to get a lot of diverse people to work together effectively.

So much like with foxes and hedgehogs, if you’re an introvert you should make sure that you have extroverts that can help you connect and if you are an extrovert, make sure you have people who can focus and listen.

Technical vs. Non-Technical People

By all accounts, Steve Jobs was never more than a mediocre engineer, but was clearly a legendary marketer. Nevertheless, he felt strongly that technical people should be in charge. As he once told his biographer, Walter Isaacson, in an interview:

“I have my own theory about why the decline happens at companies like IBM or Microsoft. The company does a great job, innovates and becomes a monopoly or close to it in some field, and then the quality of the product becomes less important. The product starts valuing the great salesmen, because they’re the ones who can move the needle on revenues, not the product engineers and designers. So the salespeople end up running the company.”

Yet the story is not nearly as clear cut as Jobs makes it out to be. When IBM hit hard times it was Lou Gerstner, who spent his formative professional years as a management consultant, that turned it around. Steve Ballmer clearly made missteps as CEO of Microsoft, particularly in mobile, but also made the early investments in cloud technology led to Microsoft’s comeback.

So much like with foxes vs. hedgehogs and introverts vs. extroverts, the choice between technical and non-technical people is a false one. Far more important is how you build a culture in which people of varied skills and perspective can work closely together with a shared sense of purpose.

Today, as we enter a new era of innovation, organizations will need a far more diverse set of skills than ever before and building a collaborative culture will be key to success.

Collaboration Is The New Competitive Advantage

Over the past few decades, the digital revolution has shaped much of our thinking about how we advance a business. Digital technology required a relatively narrow set of skills, so hiring people adept at those skills was a high priority. Yet now, the digital era is ending and we need to rethink old assumptions.

Over the next decade, new computing architectures like quantum and neuromorphic computing will rise to the fore. Other fields, such as genomics and materials science are entering transformative phases. Rather than living in a virtual world, we’ll be using bits to drive atoms in the physical world.

That will change how we need to innovate. As Angel Diaz of IBM told me a few years back, “…we need more than just clever code. We need computer scientists working with cancer scientists, with climate scientists and with experts in many other fields to tackle grand challenges and make large impacts on the world.”

That’s why today collaboration is becoming a real competitive advantage and we need to focus far less on specific skills and “types” and far more on getting people with diverse skills, backgrounds and perspectives to work together effectively.

— Article courtesy of the Digital Tonto blog and an earlier version appeared on Inc.com
— Image credit: Unsplash

Sign up here to join 17,000+ leaders getting Human-Centered Change & Innovation Weekly delivered to their inbox every week.

Neuroplasticity – the Innovator’s Edge

Leave a reply

Neuroplasticity - the Innovator's Edge

GUEST POST from Dennis Stauffer

Your mindset has a huge impact on how well you’re able to adapt and innovate. But mindset is one of those concepts that’s been used and abused in a variety of ways. It gets talked about as your attitude, feelings or personality.

Mindset is not personality as it’s traditionally defined. Rather than innate personally traits that are largely stable and unchanging, mindset is the mental framework you’ve created, although mostly subconsciously. That makes mindset almost the opposite of personality. You can actively shape your mindset, and whether you realize it or not, you already are. That’s because of something called neuroplasticity.

Elearnor McGuire of the University College London led a couple of famous studies of London cab drivers, that demonstrate just how malleable your brain is.

London is such an old city it’s not laid out on a grid. That’s makes it an exceptionally challenging place to find your way around. Yet, that’s what London cabbies need to do, learning the layout of 25-thousand streets and thousands of places of interest. It takes years of study and memorization to learn the city well enough to get an operator’s license as a London cab driver.

Using brain scans, McGuire and her colleagues found that those cab drivers who had mastered “the knowledge” as it’s known, had an enlarged posterior hippocampus. That’s the part of the brain you use for spatial navigation and memory—for figuring out where you are and where you want to go.

The longer they worked as cab drivers, the bigger those areas became. Bus drivers were used as a control group because they have a similar job, but they follow predetermined routes that don’t require the same constant figuring out. They didn’t show the same changes.

What Mcguire’s research reveals is that the way you use your brain changes your brain, in a way that’s similar to growing your muscles by exercising them. That means you can get better at things like finding your way around, by spending time doing those things, just like an athlete or musician practices their skills. It means you can get better at innovating by developing the needed mental habits.

Pretty cool, huh?

But the news isn’t all good. This and other research suggests that this kind of mental strength training is also how you form habits—both good and bad—by creating and reinforcing specific neural pathways.

As Aristotle said, “You are what you repeatedly do.”

If you want to improve your mindset—and your ability to innovate—you need to practice the kinds of habits of thinking that you want to have. That includes being creative, taking risks, and being open to new ways of understanding. These are habits it makes sense to practice even when you’re not attempting to innovate. So, your brain is shaped in ways that will be helpful when you are.

Here is this post as a video, if you would prefer:

Image Credit: Pexels

Sign up here to get Human-Centered Change & Innovation Weekly delivered to your inbox every week.