The Uncertainty Mindset

Becoming and staying innovative as an organization may be less about finding a highly adapted, stable state of optimal innovation performance and more about investing energy and time in ongoing processes of seeking, finding, losing, and then regaining balance and equilibrium. - Vaughn Tan

INTRODUCTION

TAKEAWAYS

GENERAL

• If we are only doing things where we know it will work, then we are not doing anything really new.
• Where the future is uncertain, people and organizations have the freedom to influence what it becomes.
• Good producers [...] are able to infuse a complex, unique cluster of characteristics into what they make, and to keep those characteristics consistent over time.
• The uncertainty mindset makes organizations messy, dissonant, unpredictable. The hidden benefit is that it gives them the continuing ability to innovate and adapt.
• How they're structured makes it nearly impossible for them to innovate their way out of the mess they're in. They need a new way to thinking just to keep up, let alone get ahead.
• Revolutions occur when customary ways of doing things change quickly and dramatically. These changes result from the combination of discovering new ways of working and re-examining how things have always been done.
• The teams featured in this book were effective innovators not only because they saw and could accept that their industry was changing. They were also good at changing themselves to adapt to or drive those changes. This was not because they possessed, some special, ineffable, unreplicable property. In this book, I've argued the opposite, that this ability springs from a simple but unconventional approach to thinking about organization which is rooted in an uncertainty mindset. The uncertainty mindset is a foundation for teams that are more able to innovate and adapt to change.
• When you have limited resources but your organization is not rigid, you can figure it out.
• Regardless of whether or not we recognize it, the world is becoming more uncertain as it becomes more complex and interconnected.
• Chefs developing new recipes loop back and forth repeatedly between experimenting at the component level and the level of the finished dish. This is unavoidable because the components and the finished dish mutually affect each other.
• The creation and refinement of a new dish is best handled by people who are focused on creating new things and the inevitable failure that entails, instead of on replicating existing things and becoming successful at that through repetition. These two different sets of tasks draw on fundamentally different skills and inclinations.
• R&D chefs are also motivated to become as good as possible but at coming up with good problems to solve and then solving those problems. The goals they must pursue are neither as clear nor as well-understood as those that service chefs pursue, and the goals themselves often change over time.
• Desperation by design probably only makes sense for teams that are tasked to innovate and do new and unfamiliar things.
• If a team's goals are clearly specified and understood in advance, and the actions that it must take to achieve those goals are also clearly specified and well understood, the best way to motivate the team is to tie rewards to the output and train them in the actions that are known to be needed - artificially injecting desperation into such a team is counterproductive. Well-understood projects are precisely the ones for which the leader's role is to minimize the amount of uncertainty and disruption the team faces through proper scoping and appropriate resource allocation.
• [...] as the individual or the team becomes better and better at doing any particular type of work, it becomes harder and harder to justify abandoning comfortable and predictably good performance for discomfort and unpredictable performance."
• But it takes a creative and sophisticated individual or team of people to think up something new and then develop it into something that makes sense in the context of existing markets.

ON ORGANIZATIONAL DESIGN (FOR INNOVATION)

• Organizations that fail to push themselves out of the comfort zone enter a plateau that, while comfortable, eventually begins to pall. Their most valuable members, the ones who thrive on and seek learning and challenge, eventually grow bored and leave. Decline and death ensues .
• Effective innovation management involves training people and designing teams to be willing and able to discard what they have become good at and become good at something else.
• Becoming and staying innovative as an organization may be less about finding a highly adapted, stable state of optimal innovation performance and more about investing energy and time in ongoing processes of seeking, finding, losing, and then regaining balance and equilibrium.
• The conventional ways of thinking about organizing big companies are not up to this new challenge they produce organizations that are extremely good at doing predictable things, but terrible at responding well to change.
• They were innovative and adaptable to an uncertain external environment not in spite of but because they made their internal environment uncertain. While uncertainty is hard for organizations to deal with, the benefit of uncertainty is that it creates space for something that doesn't yet exist - and the motivation to fill that space. How can we build continually innovative and adaptable organizations? One facet of the answer is that it can be as simple as starting with a mindset that explicitly acknowledges that the future is uncertain instead of risky.
• What had seemed at the outset like an unprofessional, haphazard way to manage jobs and responsibilities turned out to be one of the keys to understanding why these teams could adapt in the first place. Adaptation was driven by team members motivated by the changeability and modularity of their roles to explore and evolve what they did.
• Roles for members of these R&D teams were modular and provisional, the teams pursued goals that were open-ended and abstract, and they intentionally committed themselves to projects far beyond their current abilities. In these teams, member roles were unstable and changeable, team goals were uncertain and impossible to articulate, and the teams were periodically consumed by desperation. Yet these teams could consistently come up with new ideas that worked. They could innovate so effectively not in spite of but because of these counterintuitive organizational decisions.
• Making something genuinely new and useful requires combining rational problem-solving with messy interpretation.
• [...] organizations that want to be innovative cannot also be neat, predictable, stable, and unchanging.
• They have to be able to change inside as the demands on the outside change, and they are likely to experience ambiguity and dissonance and be untidy as they change.

ON INNOVATION

• Innovation requires the paradoxical ability to be simultaneously creative and nondelusional about the world; to see what's actually there but also to actively imagine how that shapes the range of meaningful, not-yet-existent, possible outcomes. This requires both making sense of things as they are and also being able to break that framework of sensemaking and interpretation to allow room for the new.
• Innovation and creativity depend on the organization achieving a continually moving state of balance between having enough structure to coordinate its members and the looseness and freedom to ensure that they can find new things and bring them into the organization.
• Because innovation work is complex and requires connecting formerly disparate bodies of knowledge or combining existing knowledge in new ways, teams that do it best have a wide range of skills and perspectives.
• Innovation is inherently truly uncertain. With innovation work, you don't know what you're looking for until you find it or create it. Uncertainty is an inescapable part of trying to do something that has not been done or even imagined before.
• It follows that innovation cannot be solely a process of rational analysis and problem-solving if that were true, machines would be able to do it for us.
• What makes innovation work hard is that uncertainty makes it both a rational problem-solving process and an interpretive, open-ended process of finding problems by bringing different perspectives together and negotiating how they interact.
• (R&D) teams said that real innovation- coming up with really ideas rather than something derivative or incremental-was inseparable from doing something they had never done before and weren't sure how to do.
• The discomfort of doing new things balanced against the excitement of learning; the comfort of familiar and easy work balanced against boredom from not learning.
• [...] innovation actually happens at different scales of analysis and in many different contexts.
• Innovations fundamentally change how people, organizations, or industries do things, and they exist on a continuum between being technical or sociocultural.
• True desperation only emerges when these three conditions exist. The sharp focus that productive desperation creates comes from knowing that the stakes are real, the drive to action comes from knowing that inaction has real consequences, and the learning comes from having to do things that are not part of the team's current repertoire.
• They set a regular program for desperation: commit to a desperation project with a determinate end-time, push through to completion, rest and recover, then find and commit to another project. The regularity of this rhythm allowed them to muster their willpower for each push because they knew approximately when the end time would be.
• Innovation teams face changing and emergent demands that make it impossible to know in advance how team members will have to respond.
• Successful desperation projects manage to find that point where the project's demands push the teams beyond their current capacities but not so far that they snap.
• The R&D team members I spoke to knew that they would find their work fundamentally unsatisfying if they didn't learn by putting themselves into the discomfort zone. [...] These teams don't succeed in being innovative unless their members push themselves into discomfort zones."

ON PROBLEM SOLVING, PROTOTYPING & FEEDBACK

• Three principles for prototype feedback helped team members develop precise and detailed style knowledge surprisingly quickly:
• (1) ensuring that feedback was given in group settings,(
• 2) emphasizing feedback on outcomes instead of processes, and
• (3) using concrete examples to anchor feedback on outcomes.
• If people tell you what to do, you're conditioned to do that and you won't really try to define the problem differently in a way that makes it easier to solve.
• Outcome-focused feedback is necessarily vague and ambiguous about what the recipient should do next, whereas process focused feedback tends to be quite clear and specific about this.
• Every test added to or refined the same mass of style knowledge. As a result, learning style knowledge happened both within each and across all projects any person worked on.

SEE MORE POSTS

The Design of Business

The Design of Business

The Uncertainty Mindset

The Uncertainty Mindset

Strategic Intuition

Strategic Intuition

Introducing: Systems-Driven Growth

Introducing: Systems-Driven Growth