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Creativity Is The New Productivity
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Creativity Is The New Productivity

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As companies pursue optimization through standardization or quality regimes like Six Sigma, they don't realize there is a diminishing return over time. Employee-based creativity is a way to improve …

As companies pursue optimization through standardization or quality regimes like Six Sigma, they don't realize there is a diminishing return over time. Employee-based creativity is a way to improve competitive position on a company's top-line and bottom-line. 2011-July at SBS - 3M

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  • Thanks, Louis. I shall.
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  • Very inspiring...and challenging. I appreciate your passion for creativity as well as your support for using social business tools to help unlock the ideas embodied in all of individual souls of our organizations. Keep it up.....and let me know if there is ever anything I can do to assist you and 3M.
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  • Fab. I especially like the comment 'Hire good people and leave them alone'! And great sentiments too - yes, the essential gains are about actual gains and not reductions, or cuts but all whilst stressing the need for balanced management of the processes rather than draconian control or a free for all.
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  • This is a fantastic deck -- verve, vitality, and a clear message.
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  • For 10 years we’ve streamlined our processes, cut overhead and made our organization lean and fit with the aim of increasing productivity. Like most other American companies since 2000 (February 2011 McKinsey Global Institute (MGI) report on productivity2 ), 3M’s increased productivity gains have come by reducing inputs into production.
  • Article:http://www.businessweek.com/magazine/content/07_24/b4038406.htm
  • The story of nonwovens (decorative tape to filterete) can be found on pg. 59 of 3M Century of Innovation.  The quote from Spencer Silver is on Page 58. 
  • To make room for 2010's freshmen, a half-dozen American giants on 2009's list got dumped: AT&T, ExxonMobil, 3M, Johnson & Johnson, Southwest Airlines, and Target. Quote from Businessweek article: http://www.businessweek.com/magazine/content/07_24/b4038406.htm2004 – Originally, the list was Boston Consulting Group’s Most Innovative Companies list. Quoted in the article noted above.2005 - http://www.businessweek.com/magazine/content/05_31/b3945407.htm2006 - http://www.businessweek.com/magazine/content/06_17/b3981413.htm2007 - http://www.businessweek.com/interactive_reports/most_innovative.html2008 - http://www.businessweek.com/interactive_reports/innovative_companies.html2009 - http://www.businessweek.com/interactive_reports/innovative_50_2009.html2010 - http://www.businessweek.com/interactive_reports/innovative_companies_2010.html
  • Return on assets (ROA) for U.S. public companies declined by a staggering 75% since 1965. This long-term view of company profitability calls into question the health of U.S. corporations. http://blogs.hbr.org/bigshift/2009/06/measuring-the-big-shift.html
  • Article:http://www.businessweek.com/magazine/content/07_24/b4038406.htm
  • First step is to focus on engaging and strengthening each node in the network, each part of the collective brain…
  • Google’s 70-20-10 for everyone (Core – On another team – Blue sky)
  • Google’s 70-20-10 for everyone (Core – On another team – Blue sky)
  • Google’s 70-20-10 for everyone (Core – On another team – Blue sky)
  • http://edgeperspectives.typepad.com/edge_perspectives/2010/11/2010-shift-index-passion-and-performance.html
  • http://edgeperspectives.typepad.com/edge_perspectives/2010/11/2010-shift-index-passion-and-performance.html
  • http://edgeperspectives.typepad.com/edge_perspectives/2010/11/2010-shift-index-passion-and-performance.htmlHow much success can you have without creativity?How much creativity can you have without passion?How much passion can you have without autonomy?
  • http://edgeperspectives.typepad.com/edge_perspectives/2010/11/2010-shift-index-passion-and-performance.htmlHow much success can you have without creativity?How much creativity can you have without passion?How much passion can you have without autonomy?
  • http://edgeperspectives.typepad.com/edge_perspectives/2010/11/2010-shift-index-passion-and-performance.html
  • Lockheed Martin, which reported 2009 sales of $45.2 billion, employs about 140,000 people worldwide. “Just trying to get collaboration across that enterprise is a daunting task,” says Tom Vitale, Unity’s program manager. “Unity is one of the attempts to foster collaboration across the enterprise and to get information sharing not only between those business areas, but across them.”http://www.interactyx.com/blog/internal-collaboration-communication-knowledge-sharing-works-at-lockheed-martin-a-make-it-work-for-you
  • The discussions have helped restart plants destroyed by tsunamis, and solved countless problems in subjects ranging from bolts to keeping garage floors clean when servicing equipmenthttp://michelemartin.typepad.com/thebambooprojectblog/2008/11/two-videos-on-online-communities-of-practice.html
  • “Social media are important for getting ideas to market more rapidly,” says Dr. Thomas Lackner, who is responsible for Open Innovation at Siemens. “The consolidated knowledge of individual employees and the different perspectives they bring to the table are important drivers.” http://www.siemens.com/innovation/apps/pof_microsite/_pof-spring-2011/_html_en/social-media.htmlBernhard Lang, a Siemens researcher in Russia, won the competition with his idea for “smart levees” — a monitoring system that uses sensors to predict the stability of a dike down to the last meter. The image is from a series of “press images” for the smart levees on the website - http://www.siemens.com/press/en/presspicture/?press=/en/presspicture/pictures-photonews/2011/pn201101.php
  • Dan Pink refers to McKnight in this way.
  • When employees are plugged into the 3M network, it creates the conditions for the development of a renewable, sustainable source of energy. The collaboration platform can be a place where the cross-pollination of ideas, and the conversion of ideas into tangible solutions, never ends…
  • Transcript

    • 1. Creativity is the New Productivity John Woodworth 3M IT Lab Collaboration1 © 3M 2011 All Rights Reserved.
    • 2. Productivity = Outputs / Inputs2 © 3M 2011 All Rights Reserved.
    • 3. There are two proven ways to increase productivity Reduce the inputs  Materials  People  Time  Taxes and fees Or increase the outputs  Market share  Sales  New products  Shipments3 © 3M 2011 All Rights Reserved.
    • 4. Quality regimes like Six Sigma, TQM, and ISO 9000 are all about reducing inputs, and have been one of the most important business trends of past decades4 © 3M 2011 All Rights Reserved.
    • 5. As a result, thousands of companies have become more efficient, profitable competitors5 © 3M 2011 All Rights Reserved.
    • 6. But… what about creativity and innovation?6 © 3M 2011 All Rights Reserved.
    • 7. “The more you hardwire a company on total quality management, the more it is going to hurt breakthrough innovation. “ – Vijay Govindarajan, Dartmouths Tuck School of Business7 © 3M 2011 All Rights Reserved.
    • 8. Deviations are discouraged in a quality regime8 © 3M 2011 All Rights Reserved.
    • 9. But deviations can lead to innovation In 1938, Al Boese didn‟t know that a detour taken to study non-woven fibers would lead to decorative ribbons, scrubbing pads, and filters. “The key with serendipity is: you must recognize it as discovery.” - Spencer Silver, 3M retired corporate scientist9 © 3M 2011 All Rights Reserved.
    • 10. The competitive landscape is more dynamic than ever  U.S. competitive intensity has more than doubled during the last 40 years  The “topple rate” at which big companies lose their leadership positions, has more than doubled, suggesting that winners have increasingly precarious positions  The life expectancy of a Fortune 500 firm - has decreased to 15 years and is heading toward 5 - Deloitte Center for the Edge, 200910 © 3M 2011 All Rights Reserved.
    • 11. Productivity pressures are only increasing Outputs Inputs  Nimble competitors  Everyone has an optimized  Adjacent competition supply chain  Flattening world  Increasing COGS  Fickle customers  Strength of suppliers  Diminishing new product vitality  Exhausted workforce11 © 3M 2011 All Rights Reserved.
    • 12. What if you don„t know the nature of the problem?12 © 3M 2011 All Rights Reserved.
    • 13. Ok, so where do we go from here?13 © 3M 2011 All Rights Reserved.
    • 14. More input reductions, more process standardization?14 © 3M 2011 All Rights Reserved.
    • 15. Maybe, but if most operations are already standardized, what can an enterprise do to gain more sustainable competitive advantage?15 © 3M 2011 All Rights Reserved.
    • 16. Energy is at hand, untapped potential ….16 © 3M 2011 All Rights Reserved.
    • 17. The boundless creativity of the collective employee mind17 © 3M 2011 All Rights Reserved.
    • 18. Productivity = (Outputs / Inputs) * Creativity18 © 3M 2011 All Rights Reserved.
    • 19. “Creativity changes the game, whatever game is being played. - Seth Godin19 © 3M 2011 All Rights Reserved.
    • 20. “Creativity changes the game, whatever game is being played. „We‟re going to run out cash by the end of the year,‟ is accurate unless you count creativity into the equation. - Seth Godin20 © 3M 2011 All Rights Reserved.
    • 21. “Creativity changes the game, whatever game is being played. „We‟re going to run out cash by the end of the year,‟ is accurate unless you count creativity into the equation. Then the accurate statement is, „Under the current rules and assumptions, we‟re going to run out of cash…‟ - Seth Godin21 © 3M 2011 All Rights Reserved.
    • 22. “Creativity changes the game, whatever game is being played. „We‟re going to run out cash by the end of the year,‟ is accurate unless you count creativity into the equation. Then the accurate statement is, „Under the current rules and assumptions, we‟re going to run out of cash…‟ Big difference” - Seth Godin22 © 3M 2011 All Rights Reserved.
    • 23. So what workplace practices and conditions encourage creativity?23 © 3M 2011 All Rights Reserved.
    • 24. We need to engage every employee in the employee network Good ideas can come from anywhere Success depends on our ability to tap into expanding and diverse flows of knowledge, enhanced by a digital and physical collaboration infrastructure24 © 3M 2011 All Rights Reserved.
    • 25. Let employees find ingenious ways to improve business “Create an environment where asking why things are the way they are, and wondering if they can be done in a different way – where you look outside your own field for an idea.” - Eric Schmidt Google‟s Innovation – And Everyone‟s? (Forbes, July 16, 2011)25 © 3M 2011 All Rights Reserved.
    • 26. Build a collaboration infrastructure  Self-forming groups  Communities  Boundary and Hierarchy- free  Passionate, devoted ownership  Social Discovery  „Folksonomy‟  Tagging  Hunches26 © 3M 2011 All Rights Reserved.
    • 27. Build a collaboration infrastructure  Venue choices  Mobile -- desktop -- browser  Home – office – field  Porous firewall  Social business platform  Internal  External  Embrace „socially transmitted software‟27 © 3M 2011 All Rights Reserved.
    • 28. Motivation and Creativity  Complex tasks require different motivation  Daniel Pink proved people will rise to a challenge if given:  Autonomy  Purpose  A chance to Master technique28 © 3M 2011 All Rights Reserved.
    • 29. Feed innovation and growth through employee autonomy “Researchers at Cornell University studied 320 small businesses, half of which granted workers autonomy, the other half relying on top-down direction. The businesses that offered autonomy grew at four times the rate of the control-oriented firms, and had one-third the turnover rate.” - Daniel Pink, Drive (2009)29 © 3M 2011 All Rights Reserved.
    • 30. Feed innovation and growth through employee autonomy “Researchers at Cornell University studied 320 small businesses, half of which granted workers autonomy, the other half relying on top-down direction. The businesses that offered autonomy grew at four times the rate of the control-oriented firms, and had one-third the turnover rate.” - Daniel Pink, Drive (2009)30 © 3M 2011 All Rights Reserved.
    • 31. Harvard Business School study “…When you are doing a piece for someone else it becomes more work than joy. When I work for myself, there is the pure joy of creating and I can work through the night and not even know it.” (A participant in the study) - from Daniel Pink, Drive (2009)31 © 3M 2011 All Rights Reserved.
    • 32. Harvard Business School study “…When you are doing a piece for someone else it becomes more work than joy. When I work for myself, there is the pure joy of creating and I can work through the night and not even know it.” (A participant in the study) - from Daniel Pink, Drive (2009)32 © 3M 2011 All Rights Reserved.
    • 33. Why? Lack of autonomy = lack of passion Fewer than 25% of employees are passionate about their work – and the larger the company, the lower the level of passion among the workers. The most passionate workers are those who are self-employed or working as independent contactors. – John Hagel33 © 3M 2011 All Rights Reserved.
    • 34. Why? Lack of autonomy = lack of passion Fewer than 25% of employees are passionate about their work – and the larger the company, the lower the level of passion among the workers. The most passionate workers are those who are self-employed or working as independent contactors. – John Hagel34 © 3M 2011 All Rights Reserved.
    • 35. Command and control worked… …when the people at the top knew more and had access to more and better information.35 © 3M 2011 All Rights Reserved.
    • 36. Command and control worked… …when the people at the top knew more and had access to more and better information. Is this still the case?36 © 3M 2011 All Rights Reserved.
    • 37. Why hire the best people if we don‟t trust them to do a great job?37 © 3M 2011 All Rights Reserved.
    • 38. This is as true in the back office as the lab…38 © 3M 2011 All Rights Reserved.
    • 39. Worldwide Daily Sales Reporting CEO mandate to improve international sales accuracy Finance, IT, Supply Chain, Quality and Marketing got permission but no direction. Tight timeline. Global phone conferences. Networking with dozens of countries. Built a platform for future innovation.39 © 3M 2011 All Rights Reserved.
    • 40. Worldwide Daily Sales Reporting Now used for tracking value of brands and trademarks. Essential for Global business Team merged earlier innovations into a new platform Driven by volunteers, a mix of idealists and pragmatists Self-formed team who „knew‟ the right people.40 © 3M 2011 All Rights Reserved.
    • 41. Lockheed Martin: Employee Social Networking “Unity” facilitates a breakdown of communication barriers by rank, location, division, and social group. Logistics professionals created a “proposal toolkit” that explained best practices and helped colleagues build proposals. The result: Logistics doubled its business in three years.41 © 3M 2011 All Rights Reserved.
    • 42. Comments about Unity from Lockheed employees “I can post a topic: „Hey, I‟m working on XYZ program and have the following challenge.‟ Other people can see that and, if they have the knowledge, can reply back on it. That‟s how we‟re getting that cross- pollination.” “My team gets an RSS feed when I‟ve posted to my blog, and then in the meetings we‟re able to focus more on the work that they‟re doing rather than worry about the general stuff – the noise – that gets in the way of work.”42 © 3M 2011 All Rights Reserved.
    • 43. Caterpillar – 4000 Communities of Practice “The benefit is really the discussions – the benefit we measure is the speed of answers to questions. For example, a new engineer, faced with a new problem, can spend 2-3 days researching a solution, or post a question and get 4-5 answers within a day.” - Dave Vance, former President of Caterpillar43 © 3M 2011 All Rights Reserved.
    • 44. Siemens – Rapid knowledge sharing  Siemens uses an internal wiki, employee blogs, departmental forums.  Siemens‟ “Technoweb” forum allows anyone, from developers to office workers, to post complex technical questions or obtain simple operational assistance.  A Sustainability Idea Contest was run online for 8 weeks. The community employed a star-rating principle to filter out the best ideas from the 850 proposals submitted for sustainable products and energy- saving concepts.  The contest led to “smart levees,” now being built in the Netherlands.44 © 3M 2011 All Rights Reserved.
    • 45. Fertile soil for creativity  Employee autonomy and trust  Bottom-up innovation  Collaboration without boundaries …This sounds familiar45 © 3M 2011 All Rights Reserved.
    • 46. “Encourage experimental doodling… “If you put fences around people, you get sheep. Give people the room they need” (the 15% principle) William McKnight, 3M CEO46 © 3M 2011 All Rights Reserved.
    • 47. “Encourage experimental doodling… “If you put fences around people, you get sheep. Give people the room they need” (the 15% principle) “Hire good people and leave them alone.” William McKnight, 3M CEO47 © 3M 2011 All Rights Reserved.
    • 48. “As our business grows, it becomes increasingly necessary to delegate responsibility and to encourage men and women to exercise their initiative. William McKnight, 3M CEO48 © 3M 2011 All Rights Reserved.
    • 49. “As our business grows, it becomes increasingly necessary to delegate responsibility and to encourage men and women to exercise their initiative. Those men and women, to whom we delegate authority and responsibility… are going to want to do their jobs in their own way.” William McKnight, 3M CEO49 © 3M 2011 All Rights Reserved.
    • 50. • McKnight‟s principles are still regarded as “visionary” by popular business theorists today • And they can be amplified and expanded using the collaboration platform afforded by a 21st century digital infrastructure50 © 3M 2011 All Rights Reserved.
    • 51. Quality is essential Define Measure Analyze Improve Control51 © 3M 2011 All Rights Reserved.
    • 52. Quality is essential, but it should be balanced Define Search Measure Connect Analyze Share Improve Discover Control Invent Foster efficiency and creativity across all of the enterprise52 © 3M 2011 All Rights Reserved.
    • 53. Employees, a renewable, sustainable source of energy. They want to make a difference, and they know they can53 © 3M 2011 All Rights Reserved.

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