Wild Cards, Boiling Frogs, and Elephants in the Room
Interview with Alan Iny, Co-author with Luc De Brabandere of Thinking in New Boxes, Part 2
'Sometimes when everything superficially appears to be moving along just perfectly, the truth is that you are a “sitting duck.”’ Thinking in New Boxes
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Vern Burkhardt (VB):
Do senior executives of companies have more difficulty with prospective thinking than predictive thinking and, if so, is this a problem for long term success?
[Vern’s note: Predictive thinking attempts to forecast the future by extrapolating from present and past quantitative and known data. Prospective thinking attempts to prepare us for possible alternative futures by being open and imaginative about known or unknown qualitative information.]
I would say human beings in general have more difficulty with prospective thinking than predictive thinking. If indeed this is the case, then, yes, it would probably hold true for senior executives, including some of the ones I work with. We’re all human and there are a lot of stories of CEO’s who have had difficulty with predictive thinking.
A pre-condition for long-term success is that we need to be willing to re-invent things. One of the fun examples from our book is Reuters, which was founded by Julius Reuter 163 years ago. In order to stay in the same business of providing information – news and stock prices – they’ve had to fundamentally re-invent themselves from top to bottom six times, going from carrier pigeons to telegraph and telex to radio, satellites and the Internet. But they are still essentially in the same business.
The key is to be willing to explore multiple possible futures and to think about what might happen, rather than being bound to the predictive, the deductive, and the analytical. These three traits are often more valued in standardized testing in the education system, by the way, and can be a very valuable skill but we need to go beyond them.
This sounds like an important message to be delivered to the education system including business schools.
It’s a big challenge, but it’s an exciting one to think about. Imagine if we valued inductive and prospective thinking and creativity in the same way deductive, logical, and analytical thought is valued. To be clear, it’s not a question of one over the other. It’s a question of one and the other.
Would you talk about what you refer to as ‘wild cards’, ‘boiling frogs’, and ‘elephants in the room’?
Absolutely. These are fun terms.
A synonym for ‘wild cards’ in many ways is the Black Swan. We’re talking about unexpected, high impact things. We have to recognize that no matter how much data we have about trends and predictions of what’s going to happen in the future there will still be wild cards. This could take the form of volcanic ash impacting air travel, Toyota’s brakes failing despite its reputation for reliability, or Bill Gates giving all his money to charity. Whatever it is, they will be high impact events which are hard to foresee in advance but obvious in retrospect.
The idea of ‘boiling frogs’ relates to the anecdotal frog that, in theory, doesn’t jump out of the pot if you raise the temperature very gradually and ends up being boiled alive. Apparently the latest biological research is that the frog actually would jump out, which is perhaps encouraging for him and for people trying to be creative. An example of boiling frogs is climate change, which seems to be happening so gradually that people are willing to completely ignore it, and one day this may end up being to their peril.
The ‘elephant in the room’ is something that everyone is well aware of, but they deliberately or subconsciously choose to ignore it. Sometimes we encounter clients who refuse to face the fact that their industry is declining or that something hugely impactful is about to happen.
Whatever the case may be, our claim is that increasing your awareness of wild cards, boiling frogs, and elephants in the room increases the odds of you being better prepared for whatever might happen in the future.
You mentioned climate change. The tendency now is for people to talk about adapting to the inevitability of climate change rather than reversing it, or taking action to find alternatives to activities that are accelerating climate change. I’m not meaning to move into a political discussion but it’s an interesting phenomenon in terms of the question of thinking in new boxes.
Yes it is. Some scientists advise that adapting is our only choice because it’s too late to fundamentally reverse this phenomenon. This is certainly a fatalistic view.
The more general view, which applies to business, is that we have to be more adaptive, especially given that the world is changing more quickly than ever before. It’s the only way for us to be resilient and to continue to thrive in a world that’s changing. If the change happens to be climactic, then it’s likely more dramatic for the world around us but it’s quite similar to what a typical business in a typical industry may face.
Some businesses take the position of not adapting to change, but rather leading change. Would you agree this is most often a winning strategy?
Some businesses at some moments in time might take the position of leading rather than adapting. There are some companies that have repeatedly done a great job of this, but I don’t think they’ll be able to sustain it forever.
Having a portfolio of strategies in the hopper – sometimes leading and coming up with the next big thing, sometimes being a fast follower, and sometimes being adaptive and resilient – is the best way to achieve long-term success. It’s a good strategy for your strategy.
When working to generate breakthrough brilliant new ideas how do you know when you have identified the most relevant and useful questions?
I don’t think you can ever know with certainty.
The question might more appropriately be how do you know when you have identified a relevant and useful question for a creative exercise or a brainstorm? It will be one that is visual, evocative, clear, and understandable. It will be where you have a specific set of criteria of what would constitute success, and it would identify whether you’re bound by specific restraints.
It’s not a matter of just saying, “We need growth. Think outside the box.” Rather, you should say, “We need ideas for growth that fit with our existing brand proposition, that don’t cannibalize our sales too much, but at the same time would help us appeal to a 26 year old mid-Western mom who’s holding down two jobs." Of course, this description is totally made up, but if that were to be your target segment you can see how you will have developed a visual image and a relatively clear question bound by constraints. You would be much more likely to come up with useful output from your brainstorm.
In your book you list 82 ways to kill a new idea. Why is there so often a tendency for people to try to kill new ideas, and how can one person in a group where this is happening try to change this behavior?
I have a couple of thoughts about why there’s a tendency for people to try to kill new ideas. People probably don’t deliberately set out to do this. Maybe some occasionally do so, but more often it’s done with a reply such as, “Well, we should check with legal.” “Maybe we should set up a task force for this.” It’s a soft killing of the idea. It’s often not an overtly deliberate response such as, “That’s a horrible idea. It’s ridiculous.” It’s rarely the extreme version of trying to kill new ideas, but it still happens as a method of shooting them down.
The best way for one person in a group to try to counter the tendency to kill new ideas is to make it clear that this is the time for divergence. It’s the time when the goal is to identify a lot of ideas on the question or problem, and everyone must withhold their judgment in the spirit of Osborn and brainstorming. It needs to be made clear that convergence will come later. Most organizations know how to select and operationalize a new initiative. Shooting down ideas and prioritizing them can come later after many ideas have been identified.
As you said, it’s frustrating for everyone when some people in the room are in a divergent mode of thinking while others are in a convergent mode. When this is the case some are coming up with a lot of possibilities, and others are methodically shooting them down.
You need to recognize that there’s a time for divergence, there’s a time for convergence, and you can’t do both at the same time. This is the best suggestion I have for the brave person who’s going to try to change these behaviors.
Get everybody thinking in the same vein.
Yes, ensure everyone is in the same mode of thinking at the same time.
“Crushing is a wonderful way to expand your ideas, opening them up with new features, and suggesting other ways in which they can be stretched or consolidated, refined or intensified.” How do you crush ideas?
Crushing is one of the techniques for generating ideas which I like to use towards the end of a creative session or workshop. There’s a long list of ways to crush an idea. For example, stretch it, freeze it, add glamour to it, make it old, make it fly, speed it up, make it bigger, make it round, make it weightless, turn it upside down, electrify it, reverse it, make it hotter, twist it, add a new ingredient, make it collapsible, make it fly, contaminate it, purify it, sharpen it, make it fragile, make it romantic, make it uncomfortable, etc. This would occur once you have a set of ideas and before you get to the convergence step where you select and prioritize.
During convergence you might say, “Yes, but….” During crushing, and divergence in general, you want to say, “Yes and….” It is about building on the ideas that we have generated. Creative activities will have been used to get a lot of ideas, and then you can use crushing to build upon them by having “yes and…” discussions to stretch these ideas in different directions.
The goal is to enhance creativity.
Quite right. It assists us in getting past your existing preconceptions and assumptions that influence the way you look at the world and the way you do things.
“Convergence should not be an impulsive rush to judgment (though that is often our natural instinct). Instead, it is about being thoughtful, methodical – and patient.” Do you have advice for those who have difficulty overcoming this natural instinct?
The point of convergence is not to merely shoot down all the ideas you will have put on lots of flip charts, even if they appear to not make sense. If you do so without having laid out clear criteria and constraints beforehand, you will simply revert back to the status quo. You’ll probably end up close to where you started because you won’t have pushed the boundaries.
If, on the other hand, you lay out in advance the specific criteria for what a good idea would look like you’ll have a much higher chance of overcoming this natural instinct of reverting to the status quo and the impulsive rush to judgment. The criteria could be cost/benefit, risk vs. feasibility, benefit to customers, or others. You will want to identify the criteria in advance and try to adhere to them throughout the process.
There will be times when you come up with an idea that’s so far outside the box – or in such a new box if you will – that it forces you to change your criteria and constraints. You may do this because you want to put all your eggs in that basket because the idea is so fantastic, but I think this is relatively rare.
“Some people say there’s no need to reinvent the wheel, but we should be glad that many individuals did just that. The wheel has come a long way in recent centuries.” What is the lesson from this observation?
Somebody saying, “There’s no need to reinvent the wheel” is a great way of shutting down ideas, because it’s a statement nobody can argue with. It appears to be common wisdom.
But think about where wheels were 100 years ago – wooden wagon wheels, then steel rims around the wooden wheel, later solid rubber, and then inflatable inner tubes. Now we have fancy radials, snow tires, tractor wheels, and more innovative ideas such as Michelin’s tweel. It’s great that people actually did reinvent the wheel. The wheel has come a long way.
This is a reminder that there are seemingly gentle ways of killing good ideas. We have to allow ourselves to diverge when the time is right, converge when the time is right, and be willing to reinvent things when the time is right.
In your experience are most business leaders better at convergent thinking than divergent thinking?
Many human beings are better at convergent thinking than divergent thinking. Most of us are probably a little bit better at one than the other.
Likely many business leaders are better at convergent thinking but some of the best collaborations in history have been between two people who are at different ends of the thinking spectrum. Well known examples were Hewlett and Packard, Rolls and Royce, and Gates and Allen.
Good partnerships often have people who are better in convergent thinking and others who excel in divergent thinking. It could be the CEO and COO, the President and CEO, or some other combination. You should ensure that if you’re not good in both types of thinking, then you have somebody near you who excels at the one you’re not good at. This is an important factor for success.
If you consciously try, can you improve your ability to do divergent thinking?
Some people are inherently more creative than others. Think about Mozart, Einstein, and Shakespeare.
However, I firmly believe that everybody has the opportunity to become more creative, to nurture their divergent, inductive, and prospective ways of thinking. We offer some techniques for this in our book. There are many other fantastic books which also provide useful tips.
When talking about the need to reevaluate relentlessly you say, “Surviving success can be just as challenging as succeeding in the first place.” Why is this?
When we succeed with a beautiful new idea we tend to think it will last forever. One of my favorite examples is Henry Ford who was, by any definition, an amazing innovator starting with the Model A and eventually ending up with Model T. When his team had developed the fantastic Model T he thought he had arrived. And in a sense he had. It sold 15 million units and was a huge financial success for his company. The problem is he had the box in his mind that the Model T was the future of the Ford Motor Company. It has even been said he had in his mind that the Model T was the future of the automotive industry.
But the world kept changing around Henry Ford. General Motors and others created higher end cars, lower end cars, cars with different features, and cars painted in different colors. Henry Ford famously said, “My customers can have any color car they want as long as it’s black.” He refused to adapt to change. He went into denial despite plummeting sales. He was trapped in an outdated mental ‘box’, and was unable to move to the new box of changing customer demands with automobiles becoming a consumer necessity. He was unable to ask the question, What would it take to create a compelling customer experience in the changing circumstances? Ford Motor Company with its Model T, which was once a pacesetter for the industry, had become staid and uncompetitive. The result was it nearly went out of business in 1927, before Henry Ford relented and consented to launch a re-vamped Model A.
The Ford Model T is a fantastic example, which shows that no matter how great an innovator you are and no matter how smart or great a leader you are the world keeps changing. No good idea will last forever, and this applies from the Model T to the iPhone, or any other innovative product we can think of. This is why we say that surviving success can be just as hard as succeeding in the first place. The point is you can’t rest on your laurels.
If you do you end up staying in the same box.
Exactly. This may work for a period of time, but you can’t rest on your laurels forever.
“As Step 5 of our process suggests, continuously examining your old boxes – and allowing your perceptions to evolve – is the best way to sustain your creativity.” Does the pace of change permit one’s perceptions to evolve or do they have to be more forcefully changed?
My answer would depend on the situation or even the industry. You can never tell when somebody is going to have an Eureka moment, which could be a Caramba moment for you.
The best way I know to sustain your creativity is to be proactive about it. It doesn’t mean you need a brand new strategy and new market segmentation every Monday morning. It does mean paying attention to weak signals. It means paying attention to how the world is evolving and what your competitors are doing. It means being as adaptive as you can possibly be about these changes.
If you’re lucky and you have a great idea like the Model T or the iPhone, it will last a while before it gets disrupted. It will last a while before the world changes completely in such a way that your idea is no longer useful.
As I said before, the pace of change is increasing. Something that might have lasted a dozen years a century ago might now only last one year. It’s a constant process of re-evaluation.
You say, “Scenario planning is never a magic way to know the future.” So what is its purpose and value?
Scenario planning is not about predicting what the future will be. It’s about being better prepared for what you cannot predict. It is a way to encourage you to think in new boxes when you are doing strategic planning and preparing for the future. By creating scenarios based on trends that you know something about and uncertainties that span a wide range of possibilities, your organization can make better and more robust decisions. Each scenario is a new box.
The point of scenario planning is to develop a few possible futures, a few visions of what the world will be like in 2020 or 2050, or whatever time frame you agree upon. Most critically, it is about how to prepare.
For each of the scenarios you develop you ask yourself what are the implications for your organization? What are the opportunities and threats that would arise? In what ways would you be better or worse prepared than your competitors? If you think about this for each of the scenarios, then you’ll have broadened your horizons. You’ll have stretched your perspectives, and you’ll be much better prepared for whatever may come to pass.
You won’t be prepared for every possible contingency and Black Swan. There might still be surprises and wild cards, but you’ll be much better prepared than you otherwise would be. You will be better able to think in new boxes.
Are more companies than ever before recognizing the benefits of developing what you call “fanciful, indeterminate scenarios”?
More companies are recognizing the benefits of scenarios, but there’s still a lot of void space. There’s still a lot of room for improvement.
Some leaders of companies may be reticent because they don’t see an immediate payback to the time and expense invested, the marketplace changes so quickly, and it is not always clear how to use scenarios for strategic planning. We believe that many leaders are uncomfortable with the need for them to stretch their perceptions, to explore the provocative nature of scenarios.
There are some companies that think it’s an academic exercise, which is perhaps true if your focus is on the scenarios themselves. It’s not true if you go deep into the implications. It’s never about the scenarios. It’s about what you do with them, and what opportunities and risks arise.
Maybe there are companies not interested because the leaders and CEO’s think, ‘I’m only going to be around for two or three years so who cares about the long term? I’m focused on the quarterly earnings for my year end bonus.’ If we get past those and other possible objections, yes, scenarios are picking up steam. But there’s a lot more room for companies to adopt this way of thinking.
Is it useful for small companies as well as large?
Yes. Small companies often have less time on their hands, let’s put it that way, to engage in this kind of thoughtful exercise, but in some ways this makes it even more important. It doesn’t have to be a complex 6-month exercise with ten people, which is something that a big company might be able to afford. A small company would never be able to dedicate this level of resource to scenario planning.
It can be much quicker and on a smaller scale for a small company. The idea is to stretch the horizons in our thinking.
Is it possible for a leadership group in an organization to create useful scenarios without the help of outsiders who have experience with this tool?
Absolutely. There are several clear approaches to scenarios. Some are the standard axis of uncertainty approaches and others are based more on systems thinking.
The approach we outline in our book is what we’ve called the Black Swan approach. It’s more creative, more out there, and more what you described earlier as developing fanciful indeterminate scenarios. However you describe it, there is a clear, step-by-step approach. If you are willing to challenge your perspectives and some sacred cows, perceived constraints, and assumptions in your organization, then it can be done without the help of outsiders.
What advice do you have for a CEO who has little patience for divergent thinkers?
If you are fortunate then you will still be able to come up with good ideas. More likely you will eventually face a crisis. A CEO doesn’t have to embrace divergent thinkers every moment of every day, or with every person he or she interacts with. But a good CEO should embrace divergent thinking at the right times and in the right measure.
Is the strategy of frequently changing CEOs a sound approach in order to force organizations to think in new boxes to change their strategic vision? Or are there better approaches?
Changing CEOs in order to force the organizations to think in new boxes isn’t typically the stated strategy of boards of directors of companies, but it does end up happening for a variety of reasons. I wouldn’t endorse frequent changing of CEO’s as a sound approach but having a clear, strategic vision is something that is valuable.
I’ll give you one interesting example. There’s a small non-profit I work with called DreamYard
. It does arts education in The Bronx, which is a tough neighborhood. When I first became involved with them seven or eight years ago there were two co-CEO’s trying to run this relatively small non-profit. They had all sorts of dreams, such as opening their own charter school and an after-school center. I advised them, which is probably the same as any consulting firm would, that having co-CEO’s seldom works. But in this case it does. These two guys have opened their much dreamed about charter school and have done a lot of other amazing things. They are still working together!
At the end of the day, there is no one size fits all for finding the right CEO and executive structure. Frequently changing CEO’s isn’t a sound planning strategy, but if it ends up happening and is done for the right reasons, hopefully the organization will be able to move beyond it.
Who should read Thinking in New Boxes
As many people as possible is the simplest answer!
It was designed to be a book that would appeal to a broad, mass market. Anyone who is willing to doubt, who is willing to open up and challenge some of their perspectives, and who is willing to embark on a process to be more creative should find it useful. It’s not only for CEO’s.
It’s for anyone who has a problem and is willing to look at it in fresh ways. It’s for anyone willing to doubt.
Creativity is not exclusively about new products and services. It can help you come up with new products, services, or new business models. It can also help you solve a mid-life crisis, or tackle whatever issue or problem you are facing personally. The goal of the book is to change the way you look at things. It’s about changing perspectives. It’s about changing mental models, which is even more powerful than just coming up with new product ideas.
Thinking in new boxes can be applied to an entire organization. It can be used to assess and reformulate a company’s strategic vision. It can be used by product development teams, customer service groups, manufacturing and procurement departments, and for improving any other aspect of your business.
On the Boston Consulting Group’s website you say, “Always structure the problem, but don’t force-fit any standard frameworks unless they really apply.” Would you elaborate on this?
I am amazed you found that quote. It was put on BCG’s website long before Thinking in New Boxes
was written. It was meant to be my advice to potential recruits who might be joining BCG or might be considering going into the consulting world. But it fits.
What I was trying to convey when I said you have to structure the problem is that you have to prepare for any creative exercise or problem-solving exercise, but don’t force fit any standard frameworks unless they really apply. It means you should take what’s useful. Find a useful box for your particular problem.
In the context of recruiting I was saying don’t force yourself to use Michael Porter’s Five Forces Model, or whatever approach you may have picked up in business school. Ensure you solve the problem thoughtfully based on what’s in front of you.
However, this fits nicely with the whole approach to new boxes and creativity, which came many years later.
Do you have any final advice about how to ensure we think in new boxes?
One of the best pieces of advice I can offer is to remember that creativity does not require new ideas. It only requires changing existing ones.
My favorite example is BIC. For 30 years they were only a pen company, and they had many ideas like four colored pens, erasable pens, and a host of other types of pens. But eventually when they realized they were in the business of inexpensive plastic consumer goods, the door was opened to thinking of lighters and razors. All they had to do was change their box. They had to change their self-concept from ‘We are a pen company’ to “We are a disposable plastic object company’. They didn’t invent anything new to the world. Cheap, disposable plastic lighters and razors already existed. Gillette and many others were already making them. All BIC had to do was change something within themselves, not invent something new to the world.
Creativity is about changing the way you look at things. It’s about changing your existing boxes, your existing mental models. It does not require new ones, which is good because there are already a lot of new ideas out there.
We need to be acutely aware that our existing mental models complete with their invisible biases are most likely holding us back or sending us in the wrong directions. To be creative and come up with a completely new idea you have to look at the world differently, and this requires thinking in ‘new boxes’.
Authors Alan Iny and Luc de Brabandere offer a five-step process to guide our creative process:
- Doubt – Our current ideas are only working hypotheses, and we need to see the world through fresh lenses.
- Probe and explore the possible – Seek to understand and strive to ask the right questions.
- Diverge – Generate lots of ideas, models, concepts, and ways of thinking even if they appear to be unrealistic or impractical.
- Converge – Test your ideas to determine which ones to pursue for breakthrough change.
- Re-evaluate Relentlessly – Be agile and ensure you don’t become imprisoned in what once were your new mental model; learn when it is time to discard old boxes and develop new ones.
This is only a quick summary. It is well worth reading their book to learn more about the “five essential steps to spark the next big idea.”
Alan Iny’s Bio:
Alan Iny (@alan_iny
) is the senior specialist for creativity and scenario planning at The Boston Consulting Group. He has trained thousands of executives and BCG consultants, runs a wide range of workshops across industries, and speaks around the world about coming up with product, service, and other ideas, developing a new strategic vision, and thinking creatively about the future.
Before joining BCG in 2003, he earned an MBA from Columbia Business School and an honors BSc from McGill Univer¬sity in mathematics and management. Alan Iny lives in New York with his wife and daughter.
Alan Iny is the co-author with Luc de Brabandere of Thinking in New Boxes: A New Paradigm for Business Creativity