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By Chad McAllister

Avoid the Herd to Create a Culture of Innovation: Product Development and Innovation Training Lessons from the News

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Product Management ConceptThink back to the times in your life when you have felt most excited and creative, and then think back to the times you have felt less creative.

If you are like most people, engaging with others who surround you on a routine basis may provide an occasional inspiration, but steady engagement with this group alone generally is unlikely to spur creativity. The routine—however comfortable or amiable—generally doesn’t lead to inspiration or innovation.

On the other hand, as I noted in a recent blog on successful collaboration, successful innovations typically are not developed by loners, either. For creativity and innovation to occur, we need to seek out and build new relationships. It is through meeting new people and experiencing new ideas that we encounter inspiration for innovation.

What the research reveals

It turns out that reaching that “happy medium” is key to creating a culture in which innovation is likely to flourish. In the case of a corporate culture, that happy medium consists of the right mix of engaging with others on a routine basis and exploring new people and ideas outside of that routine.

How do we know? As The New York Times reports, M.I.T. researcher Alex Pentland, a computational social scientist and director of the Human Dynamics research group at the M.I.T. Media Lab, has mined personal data which he believes can reveal “knowledge about the flow of ideas” which then can “accelerate the pace of innovation.”

Pentland’s conclusion? “The best decision-making environment … is one with high levels of both ‘engagement’ and ‘exploration.’”

His data suggest that over-engaging in a routine way is a type of herd behavior—or worse—that stifles the creative juices. In order for creativity and innovation to occur, significant levels of routine engagement need to be paired with similarly frequent levels of “exploration,” or the deliberate seeking out of new people, ideas, and experiences.

Pentland developed his conclusion primarily by reviewing millions of data points on an online day traders’ website, tracking the various strategies used by the traders, and then analyzing the traders’ success rates.

Pentland looked at loner-type traders who worked in isolation, “echo chamber” traders who copied the strategies of other successful traders (the herd behavior types), and the traders whose strategy hit that happy medium—a good balance between engaging and exploring. Here are his findings:

“Those with a balance of diversity of ideas in their trading network — engagement and exploration — had returns that were 30 percent ahead of isolated traders and well ahead of the echo chamber traders, too.”

The lesson

Applying the idea of the happy medium for collaboration is a key to a corporate culture that successfully supports its employees’ abilities to think and act creatively, leading to product development and innovation.

To foster innovation, the corporate culture should strive to encourage both a high level of employee interaction and an equally high level of opportunities for employees to be exposed to outside influences—new people and new ideas.

That balance—that mix—is the recipe for stimulating new thinking, disruptive thinking, and product redesign.

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Filed Under: Concepts, Uncategorized

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Chad McAllister - Product Management and Innovation TrainingThe primary responsibilities for an organization are product management and innovation. They deliver value to customers. They're also exciting responsibilities for those properly equipped. That is my job - equipping product managers and innovators.
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