Published in the San Diego Union-Tribune, May 2, 2016
“I have an idea.” Great, you don’t say, “Wow, how cool.”
Now the problem – is it a good idea? This of course is the critical piece of thinking. Determining if an idea is good is not easy. And, who should determine the idea’s true value – the creator or the manager? The answer, according to Justin Berg, a professor at Stanford Business School, is neither.
Berg studies “creative forecasting” – aka the skill of predicting the success of new ideas. Think of technology of course, but then think of books, entertainment and real estate development. Think of every little guy who starts a business and believes he has a good idea.
What Berg finds is that the best judges of an idea are “the peers of the creator.” He reached this conclusion by studying circus acts. He interviewed 338 circus professionals and had them watch videos of new circus acts to determine which ones they thought would be loved by the audience. Then he tested that against 13,000 audience members.
Managers tended to undervalue the most novel ideas. They opted for the more conventional acts. But the other performers – not the actual creator of the act but other “circus people” – were more attuned to what would actually work for the audience. The best judges were their peers.
“Creators focus on idea generation, while managers focus on idea evaluation,” says Berg. He explains the difference between “divergent thinking,” which is how creators search for new connections, and “convergent thinking,” where managers use previous knowledge as the baseline of what will work.
So, obviously, the takeaway here is that you need to build a company in which there is significant cross-pollination among the various skill sets. While the computer geek may not have an MBA, there is a very good chance that he or she will recognize a breakthrough and its significance before the business development guy.
I experienced this in a biotech in which I am involved. The significance of one of their tests was not apparent to the team until another scientist in a different field in a different city pointed out to us what we had. It changed our direction in launching a diagnostic product. The “peer” was a physician who was better able to see the novel aspect of a technology that the creator team had not fully appreciated. We had something, but we were looking at it from the wrong direction.
(Note: Don’t worry about someone stealing something – especially if you don’t even know what you have is worth stealing.)
Of course, one of the most famous ways to test an idea is to go talk to your customer. Spend some shoe leather and leave the office and find out what the customer wants.
The only problem with this is sometimes you don’t know what to ask. And that is because the new idea may not have gotten out of its incubation in your company – potentially squashed by the manager who did not give it enough air so that you could even show it or discuss it with the potential customer.
The other puzzle here is how much time and money do you spend on exploring a new idea before you kill it or feed it. The limiting factor is time. You can’t chase every idea so you need a process to better pick the winners. To that end, Berg has one last thought: Talk to the “hybrid” – the guy who was a creator and moved to manager and so knows something about idea generation.
Think about baseball managers and football coaches – almost universally they were former players. Venture capitalists are often former chief executives of successful companies. So the “been there, done that” service stripe has some credibility in moving up the managerial ranks.
On the other hand, the fact that you can write brilliant code does not translate that you can manage 100 engineers or sell software services. Beware of letting employees rise to their own level of incompetence and find themselves in a cave of their own making with no way out.
Ideas are a dime a dozen. Now if I only had to spend a dime to find out which ones are really good, I would be very rich.
Rule No. 461
If it’s such a good idea, why are you showing it to me?