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Creative decision making - how it's changing
This document discusses new models for decision making in a changing business environment. It outlines four big shifts: 1) externalization, 2) radical adjacency, 3) narrow innovation, and 4) options management replacing ROI. Social, creative, and iterative decision processes are suggested as better models. Creative decisions involve abundance of information and choices. Decision contexts are constantly changing, requiring new criteria like risk reduction, learning, and talent. Trust is also reshaping as emotions evolve. The key is for companies to change how they see, feel, and relate to capture available options.
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Creative decision making - how it's changing
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- 2. “Rational” Decision Models Actionmodels : An action is of the form "IF <this> is true, THEN do <that>" Stage Gate: If innovation x still promises Return Y, at Gate Z, let it pass
- 3. MOST DECISION MODELSREST ON THE ASSUMPTION OF OLIGOPOLY POWER – THAT WE CAN BUY MARKETS MY LAB MY INVENTION, MY START- UP, MY PRODUCT MY MARKETING BUDGET MY CUSTOMERS THIS IS THE ECONOMY WE INHABITED FOR 200 YEARS
- 4. Two Decision Models.Rational and Social, VC v Crowdfunding Crowd model – emotive capitalism 1.Project based, no growth requirement 2.No assumption about failure 3.Self-imposed outcome burden, supports entrepreneurism 4.Culture-friendly and ideal for building emotional outcomes 5.Peer and social network based, potentially with a positive loop for resources 6.Emotional connections VC Model – Surplus Capital 1.Company based, must scale 2.Assumption of high failure rate 3.High stress for proposers, barrier to entrepreneurs 4.Antagonistic to cultural production or lifestyle 5.Extractive, the money is taken out 6.ROI
- 5. THREE BIG DRIVERSOF CHANGE 1. The loss of oligopoly power THROUGH, global competition and convergence, reconstructing trust 2. Throw in technological disruption too – mobile, cloud, social, data, also impacts trust 3. And globally diverse markets with differing needs and dynamics FOUR BIG SHIFTS
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- 8. THE BIG SHIFT2 RADICAL ADJACENCY THE REQUIREMENT TO GO OUT INTO OTHER MARKETS WITH NEW PRODUCTS, OR TO GO WHERE YOU HAVE NO TRACK RECORD OR CORE COMPETENCY. How come Apple is the world’s top retailer?
- 9. RADICAL ADJACENCY EXAMPLES Apple intosmartphones, and into retail Microsoft into telephony and devices Google into Mobile, Lending and Autos Walmart trying to open a bank Train makers into services
- 10. THE BIG SHIFT3 – NARROW INNOVATION MULTIPLE SIMULTANEOUS INNOVATIONS TO SERVE NEW, NARROWER MARKETS FOR THE GLOBAL MIDDLE CLASS. Google Glass will launch with 2,000 apps
- 11. Narrow Innovation Example: Samsung Over150 different types of phone in the US alone Makes every type of display – OLED, LCD, PLASMA Make computers, phones, tablets, TVs, white goods etc
- 12. In most corporations decisionsare being pushed to the edge, old decision hierarchies can’t cope More decisions, faster cycles, nearer the edge
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- 14. OPTIONS MANAGEMENT –WHAT DO WE MEAN? Companies are faced by options that they can recognize and embrace But in so doing they need to devise new-ROI CRITERIA. ROI is EXAGGERATiON and at best impossible at the early stage CRITERIA tend to be applied restrospecitively once ROI has failed Proposed criteria: •Does it provide risk reduction/anticipate competitor moves? •Does it accelerate other processes or learning capabilities? •Does it bring in or bring on key talent? •Does it contribute to image/brand/marketing?
- 15. Companies need astrategic options portfolio built from a variety of criteria and capable of being managed. OPTION PORTFOLIOS SHOULD CONSIST OF OPTIONS THAT ARE OUT THERE, NOT JUST THOSE YOU GENERATE DESIRED INNOVATION PROJECTS DECIDED WITH SOCIAL, CREATIVE AND ITERATIVE DECISION MODELS EXISTING INNOVATION PROJECTS (SHORT AND LONG TERM) KNOWN COMPETITOR PROJECTS THE COMMON GO TO MARKET MODEL A DECISION TOOL AND A MANAGEMENT TOOL
- 16. SO WHAT ARETHE NEW DECISION PROCESSES? WHAT ARE THE NEW MODELS FOR AN OPTIONS MANAGER? SOCIAL CREATIVE ITERATIVE
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- 18. WHO HAS DECIDED YOURIT DEVICE POLICY? YOUR DOCUMENT SHARING STRATEGY? YOUR EMPLOYEES AND THEIR FRIENDS THAT’S WHY AUTODESK HAS BOUGHT UP COMMUNITIES TOTALLING 120 MILLION MEMBERS OF THE PUBLIC
- 20. “Normally when peoplethink of making music they think write, record, mix. We don’t do that at all. It is confusing and terrifying to some artists but we do all three at the same time. Write, mix, open audio files, throw things onto the phone….” Mike Shinoda Linkin Park Eclectic, knowledgeable, good decisions A Creative Decision Process
- 21. “He (producer SalaamRemi) started going through his sample library and all these different crazy drums. And there were these loud, obnoxious, just destructive drums, and I was like, Yeah! A girl on fire is loud and obnoxious and destructive and just, like, totally unrelenting and she’s free….” Alicia Keyes on writing Girl on Fire And another
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- 23. ITERATIVE - Creativityis about taking what’s out there and making something of it.
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- 25. WE MAKE DECISIONSIN CONSTANTLY CHANGING CONTEXTS
- 26. William Henry PerkinsWallace Carothers
- 27. The Connection Between19th Century Chemist Perkins and Samsung?
- 28. The Colourless BuiltEnvironment
- 29. Monet 1900 and VanGogh late 1880s
- 30. PERKINS STARTED USOFF BY SYNETHESIZING PURPLE (AS MAUVE) IN THE 1850S
- 31. HUMANS HAVE GRADUALLYCOLOURED THEIR WORLD AND ENHANCED THEIR ABILITY TO ENJOY COLOUR THEY HAVE GROWN A SENSE OF COLOUR
- 32. Nanosys/3M Quantum DotTechnology 2013 – Enhances LCD Colour Reproduction by 50%
- 33. OLED – a$26 billion market in the making, is all about color reproduction
- 34. HUMANS MAKE USEOF ONLY ABOUT 30% OF THEIR COLOUR CAPABILITY
- 35. 1. WE CHANGEHOW WE SEE
- 36. CAROTHERS – INVENTED NYLON AND BEGANTHE LONG PROCESS OF FREEING THE HUMAN SEXUAL FORM IN THE PUBLIC ARENA
- 38. PUBLIC SEXUALITY SPARKEDTHE RESURGENCE OF ROMANTIC LOVE AND THE SONGS THAT MAKE UP THE SOUNDTRACKS OF OUR LIVES Music is a major driver of the web, auto innovation, domestic entertainment etc.
- 39. 1. WE CHANGEHOW WE SEE 2. WE CHANGE HOW WE FEEL
- 40. RESHAPING TRUST Like allemotions, trust evolves
- 41. I trust: Paypal Google Facebook About 60%of my LinkedIn Connections People who work for me whom I have never met People I work with where my only connection is an Electronically Signed contract People who sell me apps About 1,000 people on Twitter
- 42. IN SHORT – WEARE REFRAMING THE WORLD AROUND US THAT’S WHAT WE WANT YOU TO DO NOW 1. WE CHANGE HOW WE SEE 2. WE CHANGE HOW WE FEEL 3. WE CHANGE HOW WE RELATE
- 43. Go with you’reyour emotions – your gut. Don’t play safe Allow yourself options that you might normally cut. Build don’t burn Look around you for decision criteria. Ask for support
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