An Evolutionary Approach to Innovation

Can biology teach us anything about innovation? The essence of Darwinism is that progress is created by adaptation to changed conditions. What starts as a random mutation can also spread to become the norm through a process of natural selection.

The same is surely true with innovation. New ideas are mutations created when two or more old ideas combine. For instance, Virgin Atlantic Airways is what happens when you cross an entertainment company with an airline business.

Virgin itself is also a good example of mutation and adaptation. The music retail business was created when a postal strike threatened to shut down the fledgling mail order record company. Virgin Atlantic was the result of an unsolicited approach from outside the company. Virgin Blue (a low-cost airline in Australia) is a similar story.

In my experience, what makes Virgin innovative is a strong sense of self, an ability to experiment, the skill to cross-fertilize ideas, and a willingness to change. The company has largely grown, not through the unfolding of some master plan, but through an accumulation of learning and ideas caused by threats, accidents and luck.

So, if external events and adaptation are the driving forces of biological evolution, is it possible to develop an innovation process that seeks out accidents and mutations?

This is an idea being developed by companies like Brand Genetics in the UK and Dr. Ron Alexander in Australia.

The list of things created by accident is certainly impressive; Aspirin, Band-Aids, Diners Club, DNA finger printing, dynamite, inoculation, Jell-O, Lamborghini, microwave ovens, nylon, penicillin, velcro and Vodafone to name just a few.

However, one of the defining characteristics of business is a preoccupation with orderly process ("If you can't measure it, you can't manage it."). So it's hard to imagine corporate cultures embracing randomness — or agreeing with John Lennon, who said, "Life is what happens to you when you're busy making other plans."

Accidents are born of experimentation, but the automotive and fashion industries are almost the only industries that publicly experiment with radical mutations. What, for example, is the soft drink industry equivalent of a concept car at the Detroit Motor Show?

Zara, the Spanish clothing retailer, is a classic example of experimentation and adaptation. Store managers send customer feedback and observations to in-house design teams via PDAs. This helps the company to spot fashion trends and adapt merchandise to local tastes.

Just-in-time production (an idea transferred from the automotive industry), then gives the company an edge in terms of speed and flexibility. The result is a three-week turnaround time for new products (the industry average is nine months), and 10,000 new designs every year — none of which stay in store for more than four weeks.

The analogy of biology also leads to an interesting idea about whether companies are best thought of in mechanical or biological terms. Traditionally, we have likened companies to machines. Organisations are mechanical devices (engines if you like) that can be tuned by experts to deliver optimum performance.

For companies that are looking to fine tune what they already do, this is probably correct. A product like the Porsche 911 evolves due to a process of continuous improvement and slowly changing environmental factors. The focus is on repetition. Development is logical and linear.

However, if you're seeking to revolutionize a product or market, the biological model is an interesting thinking tool. In this context, biology reminds us that random events and non-linear thinking cause developmental jumps. Unlike machines, living things have the ability to identify and translate opportunities and threats into strategies for survival. A good example is Mercedes-Benz working with Swatch watches to create the Smart car.

Creative leaps are usually the result of accidental cross-fertilization (variation) or rapid adaptation caused by the threat of change. Hence the importance of identifying an enemy, setting unrealistic deadlines and using diverse teams to create paradigm shifts.

The latter is a route employed by MIT who mix different disciplines together. As Nicholas Negroponte puts it, "New ideas do not necessarily live within the borders of existing intellectual domains. In fact they are most often at the edges and in curious intersections."

This is a thought echoed by Edward de Bono, who talks about the need for provocation and discontinuity. In order to come up with a new solution you must first jump laterally to a different start or end point.

For example, if you want to revolutionise the hotel industry you need to identify the assumptions upon which the industry operates and then create a divergent strategy. This could lead you to invent Formule 1 Hotels (keep prices low by focusing on beds, hygiene, and privacy), or another value innovator, easyHotel (keep rooms cheap by making guests hire their own bed linen and clean their own rooms).

What else can you do to create these jumps? A good place to start is to look at the edge (fringe) of existing markets. Here you'll find the misfits and the rebels. Companies that see things differently. People young enough not to realise that new ideas are impossible, or old enough not to care.

How else can you use a Darwinian approach to innovation? Here are five ideas:

  • Look at the big evolutionary picture — what are the driving forces?
  • Create mutations — unusual combinations of people and ideas.
  • Look for new ideas and conditions that could disrupt your market.
  • Treat accidents as opportunities for divergence and adaptation.
  • Cooperate with other companies (create mutually beneficial eco-systems)

Finally, remember the words of Charles Darwin, "It is not the strongest of the species that survives, nor the most intelligent, but the one most responsive to change."

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