Indiana Jones, innovation, numbers, learn, Toby Elwin, blog

What Businesses Can Learn About Innovation … a comment about the numbers

Indiana Jones, Toby Elwin, blog

what are the success odds?

I read Stephen Shapiro’s excellent blog on innovation and wanted to pull over one of his blogs and my comments with a chance to expand them here.

This post brings together two topics that are powerful when coupled, but too often stand apart and at odds:

  1. numbers and
  2. stories

The innumerate, numerical illiteracy, stand in the way of too much innovation.

A secondary, deeper, challenge to decisions comes when we forget the phrase: “lies, damned lies, and statistics”.

Here is Stephen Shapiro’s outstanding blog reposted with my expanded comment below:

What Businesses Can Learn About Innovation from Cultural Anthropology

August 25, 2009 by Stephen Shapiro, Vice President of Strategic Consulting, InnoCentive

My good friend, Jeff Salz, is a fantastic speaker and a Doctor of Cultural Anthropology. Lately we have had some fascinating conversations about what businesses can learn about innovation through the study of cultural anthropology.

To get things rolling, I suggested that there were two areas where the innovation world would benefit from his expertise:

  1. Studying customers through anthropological means.
  2. Learning about organization culture through the study of the history of civilizations.

In this blog entry, I discuss the first point. A future blog entry will address the topic of culture and civilizations.

Anthropological Studies of Your Customers

The traditional way to get customer insight is to do one of the following:

  • Focus groups
  • Surveys
  • Customer analytics

Although these techniques are useful, they have quite a few shortcomings.

In my article on “Why Statistics Kill Innovation,” (.pdf) I suggest that if you are crunching numbers, you are probably gathering information from existing customers. This will give you insight into their buying habits, usability behaviors, and other patterns. But most likely you are only gathering data about YOUR customers. As a result you are missing the input of former customers or people who never were customers.

Another reason that these techniques – especially focus groups and surveys – don’t work, is that they tend to test the conscious mind rather than the unconscious mind. For more on this, don’t miss my article on ‘Are Your Conscious and Unconscious Minds Aligned.’ In it I discuss a testing approach called “Implicit Association Testing” that can help test the unconscious mind. However, you can’t always get access to your customers in a way that they can take such a test.

What can you do?

Become Indiana Jones

You can don your Indiana Jones hat and do some anthropological studies. Where possible, you can observe your customers. By doing this you can find unarticulated needs and wants.

One client of mine decided to do this. They publish text books for students and instruction manuals for teachers and professors. It wasn’t until they started to watch the teachers in the classroom that they developed some interesting product enhancements. For example, during one anthropological study, the publisher found that teachers lugged several extremely heavy books from class to class. This led the publisher to create a version of the instruction manuals that could be segmented. This enabled teachers to carry only the section of the book they needed that week, and not an entire semester’s worth of paper. Teachers never made this suggestion during surveys and focus groups.

Jeff has another interesting suggestion. He believes that the best way to understand a culture  – and the unconscious beliefs – is through the stories people tell. By engaging in storytelling and listening to stories, you can uncover the true culture. These aren’t the typical business-like conversations you have in boardrooms. Rather they are more akin to the stories that you would tell while sitting around a campfire. Jeff said to me…

Whether Neanderthal, Neolithic or New Yorker, our most important decisions are made on an ‘affective/emotional’ rather than ‘cognitive/objective’ basis. To accurately apprehend the subjective elements that drive and inform a culture – and its decision – making – there is no substitution for personal immersion. The only way to understand people is to learn their language – spoken and unspoken. Break bread, swap tales, share coffee, wine, laughter and sorrow. In the process you will discover the ways you and they are the same. From this ‘sameness’ may come not only the understanding you seek but – if your mind is fresh – a new awareness of yourself and your society as well.

Now is the time to don your fedora and see the world – and your customers – with fresh eyes.

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My posted comments, within others:

Toby Elwin on September 3rd, 2009 2:17 pm

I continue to find a research challenge versus research bounce between how much data is enough and how much data is relevant. In “Against the Gods, The Remarkable Story of Risk“, I was reminded there are never enough resources to have 100% of the data or a large enough population for true statistical validity: the reason predictions are never 100% confident.

So, in statistics without an understanding of confidence intervals we generalize. When we paint statistics to others, too many develop innumeracy or rarely drill down for clarification poor data collection or sample size validity. Without simple questions about the data statistics are often still the criteria a decision is made; no longer a just portion of other qualitative or quantitative information, but an unequal weight in our decisions.

Innumeracy in the wrong hands drives political agenda and people begin to quote, misquote, and bend the statistics (most likely a set of statistics that were not gathered scientifically) to prove their point or discredit another’s point. [Example: This year our Massachusetts sales tax was raised 25% – while technically true the point of using the number 25% had an agenda] Numbers without a justification or a story behind them should be thrown in the bin.

The reason we remember Aesop’s fables, Hans Christian Andersen fairy tales, or even the Hewlett Packard garage is that stories, not numbers, are easy to carry and pass along. The act of story telling requires listening and a compelling plot. So much easier than processing facts and figures. Listening to a story that is supported with numbers (even statistics) will not intimidate those innumerics, and before written language, stories were the only way to pass on history, skills, and survival needs.

It is interesting this one post present both data gathering and story telling. To me the simple words “data gathering” conveys an image of a white lab coat; where story telling conveys a gripping scene entirely different from the lab coat.

The last twist with numbers, or statistics, related to the blog is that statistics does have an ability to fuel innovation and story-telling despite statistically your strategy fails:  just frame the numbers as a start of the opportunity or an incomplete part of picture and your foundation is set.

An interesting and powerful tool for generative, change management is Introduction to Appreciative Inquiry the core of which relies on story telling.

“Lies, damned lies, and statistics” is reminds us numbers don’t lie, but people do.

Innumeracy is a curable affliction.

Always remind yourself that perception is a renewable prescription.

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