Fast Talk: The Innovation Conversation

Tim Brown: At Ideo, innovation is our lifeblood. For us, it's as fundamental as accounting. You need to know how much money you've made. You also need to have new ideas. One of the challenges that a lot of companies face is creating a culture that sustains innovation. At the same time, we're seeing a lot less frivolous innovation going on. These days, we don't have conversations with people who walk in the door saying, "I have this really cool idea" -- which often isn't so cool -- "and a lot of money to spend on it."

Beth Sawi: In large organizations, everyone says, "I want ideas." Then a lot of the managers add, "But I only want ideas that are going to be successful." If you really want to encourage innovation, you have to accept failures. You have to expect things to blow up on you. We used to have a thing where we would make an L shape with our fingers and put it on our heads. The "L" was for "learning" -- not for "loser." That's the point. Since the only way you ever learn is by making mistakes, you have to let that happen in your organization and not punish it.

Rusty Rueff: I want to talk about the idea of culture and safety. During the past couple of years, working inside a creative organization, I've learned that there still has to be tension. For most of us, our most productive days come when we feel like our backs are up against the wall -- because that's when creativity comes out. That's one reason I think that the best ideas are yet to come: We're in a cycle where we feel that tension, and if we combine tension with an environment that encourages us to take risks, we'll see big ideas emerge.

Linda Yates: Historically, people have looked for "the big idea." Now they are trying to learn how to build a continuous capacity for innovation inside their organizations. The ecosystem for innovation is changing. It's no longer just a big company and what it can do internally or a brand-new startup and what it can get from Silicon Valley or Austin, Texas. Now you see people banding together to support innovation -- internal, cross border, or cross culture. It even changes how you raise capital for innovation. The question now is, How do you create an open market for capital inside the organization?

The Organization of Innovation

Alan Webber: It's conventional to think of innovation as stemming from a certain set of circumstances or occurring in a certain place, whether it's a protected R&D lab, a quiet think tank, or a creative shop. But in tough times, you may have to be more innovative about where you find innovation. Are there any new rules of thumb or new places to look?

Arno Penzias: The one thing about Bell Labs that made it great was that it was not protected. To the outside world, it always looked like an ivory tower, but what made it work was the fact that it had no research buildings. Every research group in the company was colocated with development people. If it hadn't been, invention is all that you would have gotten. "Invent" is a very important word: It's the creative product of the human mind. You have to start with invention. But innovation means changing somebody's world. Pressure is really important. The pressure that we're feeling now is a great thing. I think that it will serve as an engine for changing the world.

Peter Moore: To really be innovative, you have to live and breathe it. We put our development teams for the games all around the world. You may have heard of Sonic the Hedgehog. The Sonic team is all Japanese, but everyone on it lives in San Francisco, because for that genre of game, the creativity flows more from Japanese culture than from American culture. That's absolutely critical -- particularly if you're dealing with a youth culture that changes every 15 seconds.

Chip Conley: The hospitality business used to be all about predictability. What we've learned over time is that people choose their hotels based on the brand as a mirror. So every time we create a new hotel, spa, or resort, we imagine a magazine that defines the hotel. We choose five words that define the magazine, and by doing that, we get the psychographic fit. We've learned that those five words are the identity-refreshment words that describe our most loyal customers for that product. The words that a person might use to describe that hotel are the words that he would use to describe himself. Then not only do you get inside the customer's head, you get inside his heart.