When resources are constrained, the key to growth is pairing an analytic left-brain thinker with an imaginative right-brain partner.
Innovation is a messy process—hard to measure and hard to manage. Most people recognize it only when it generates a surge in growth. When revenues and earnings decline during a recession, executives often conclude that their innovation efforts just aren’t worth it. Maybe innovation isn’t so important after all, they think. Maybe our teams have lost their touch. Better to focus on the tried and true than to waste money on untested ideas.
The contrary view, of course, is that innovation is both a vaccine against market slowdowns and an elixir that rejuvenates growth. Imagine how much better off General Motors might be today if the company had matched the pace of innovation set by Honda or Toyota. Imagine how much worse off Apple would be had it not created the iPod, iTunes, and the iPhone. But when times are hard, companies grow disillusioned with their innovation efforts for a reason: Those efforts weren’t very effective to begin with. Innovation isn’t integral to the workings of many organizations. The creativity that leads to game-changing ideas is missing or stifled. Why would any company gamble on a process that seems risky and unpredictable even in good times?
In talking with executives about innovation, we often point to the fashion industry as a model. Every successful fashion company essentially reinvents its product line and thus its brand every season. It repeatedly brings out products that consumers didn’t know they needed, often sparking such high demand that the previous year’s fashions are suddenly obsolete. A fashion company that fails to innovate at this pace faces certain death. Understanding that, fashion companies have refined an organizational model that ensures a constant stream of innovation whatever the state of the economy.
At the top of virtually every fashion brand is a distinctive kind of partnership. One partner, usually called the creative director, is an imaginative, right-brain individual who spins out new ideas every day and seems able to channel the future wants and needs of the company’s target customers. The other partner, the brand manager or brand CEO, is invariably left-brain and adept at business, someone comfortable with decisions based on hard-nosed analysis. In keeping with this right-brain–left-brain shorthand, we refer to such companies as “both-brain.” They successfully generate and commercialize creative new concepts year in and year out. (See the sidebar “Hemispheric Conditions.”) When nonfashion executives pause and reflect, they often realize that similar partnerships were behind many innovations in their own companies or industries.
Hemispheric Conditions (Located at the end of this article)
The world’s most innovative companies often operate under some variation of a both-brain partnership. In technology the creative partner might be a brilliant engineer like Bill Hewlett and the business executive a savvy manager like David Packard. In the auto industry the team might be a “car guy” like Hal Sperlich—a major creative force behind both the original Ford Mustang and the first Chrysler minivan—and a management wizard like Lee Iacocca. The former track coach Bill Bowerman developed Nike’s running shoes; his partner, Phil Knight, handled manufacturing, finance, and sales. Howard Schultz conceived the iconic Starbucks coffeehouse format, and CEO Orin Smith oversaw the chain’s rapid growth. Apple may have the best-known both-brain partnership. CEO Steve Jobs has always acted as the creative director and has helped to shape everything from product design and user interfaces to the customer experience at Apple’s stores. COO Tim Cook has long handled the day-to-day running of the business. (It remains to be seen, of course, how Apple will fare given Jobs’s current leave of absence.)
Paired for Innovation (Located at the end of this article)
No industry has gone further than fashion, however, to incorporate both-brain partnerships in its organizational model. Of course it makes no sense for other kinds of companies to copy the fashion template exactly. But Procter & Gamble, Pixar, and BMW are among those that have borrowed heavily from fashion’s approach and enjoyed remarkable results.
The Fashion Model
Fashion companies understand one fundamental truth about human beings, a truth overlooked by all the organizations that try to teach their left-brain accountants and analysts to be more creative: Creativity is a distinct personality trait. Many people have very little of it, accomplished though they may be in other areas, and they won’t learn it from corporate creativity programs. Other people are inordinately creative, both by nature and by long training. They are right-brain dominant. Innovation comes as naturally to them as music did to Mozart, and like Mozart, they have cultivated their skills over the years. The first lesson from fashion is this: If you don’t have highly creative people in positions of real authority, you won’t get innovation. Most companies in other industries ignore this lesson.
It isn’t just innovation in the usual sense of products and patents that fashion companies pursue. Their creative people typically imagine a whole picture and see every innovation as a part that has to fit that whole. They are less concerned with perfecting any one component than with creating a brand statement that enhances the entire customer experience. At Gucci Group, for example, creative directors concern themselves with anything that affects the customer—the look and feel of retail stores, the typography of ads, and the quality of postsale service as well as the design of new products. Not every facet of the brand has to meet the narrow profit-and-loss test that many nonfashion companies require of their innovations. Gucci may only break even on its latest runway apparel, but those designs generate excitement among shoppers, who feel that they are sharing in the glamour of high fashion when they buy a Gucci item. Similarly, Starbucks doesn’t maximize sales per square foot in its cafés (heresy to many competitors), because it allows—even encourages—customers to linger for hours over a cup or two of coffee. Yet that innovative, homelike environment is precisely what distinguishes the chain from other coffee shops in the eyes of the customer.
Conventional companies look at innovation differently, and wrongly. Without creative people in top positions, they typically focus on innovations that can be divided and conquered rather than those that must be integrated and harmonized. They break their innovations into smaller and smaller components and then pass them from function to function to be optimized in sequence. The logic is simple: Improving the most important pieces of the most important processes will create the best results. But breakthrough innovation doesn’t work that way. What if a movie studio hired the best actors, scriptwriters, cinematographers, and so on, but neglected to engage a director? The manufacturers of several portable music players tout technical specifications that are apparently superior to those of Apple’s iPod. Yet they continue to lose sales and profits to Apple, because the iPod offers an overall experience—including shopping, training, downloading, listening, and servicing—that the others have not yet matched. Little wonder that many companies may increase their patent portfolios yet grow disillusioned with their innovation efforts.
What is required to harness this kind of creativity and apply it to the needs of a business? Creative people can’t do it alone: They’re likely to fall in love with an idea and never know when to quit. But conventional businesspeople can’t do it alone either; they rarely even know where to start. And a true both-brain individual—a Leonardo da Vinci, say, who is equally adept at artistic and analytic pursuits—is exceedingly rare. So innovation requires teamwork. Fashion companies have learned to establish and maintain effective partnerships between creative people and numbers-oriented people. They structure the business so that the partners can run it effectively, and they ensure that each is clear about what decisions are his or hers to make. These companies have also learned to foster right-brain–left-brain collaboration at every level, and so continue to attract the kind of talent on which their survival depends.
