Johansson: Diversity Drives Innovation

By Rebecca R. Hastings, SPHR Oct 29, 2008

ATLANTA—Attendees at the 2008 SHRM Diversity Conference & Exposition shouted out a resounding “yes!” when Frans Johansson, author of The Medici Effect and managing director of Medici Capital Management, asked if innovation is critical to their organizations’ success.

They also understand what he meant when he said during his Oct. 28 keynote session here that “diversity drives innovation.”

The Medici Effect is named for a banking family that lived in Florence, Italy during the fifteenth century and who provided funding for sculptors, scientists, poets, philosophers, financiers, painters and architects. The city became known for the Renaissance—one of the most innovative eras in history.

Johansson said all new ideas are combinations of existing things. For example, a light bulb screws into a light socket the same way a bottle screws into its top.

Yet two very different things, when combined, are more likely to lead to real innovation, he said, than two similar things. He described how an architect in Zimbabwe built an office building that requires no air conditioning system by drawing inspiration from the mounds that termites build.

Johansson said that innovative individuals and teams generate and execute far more ideas than others. But because ideas can fail for many reasons, Johansson said, it’s important to generate lots of ideas. Diverse teams generate better ideas once barriers are broken down because members have different experiences.

One reason barriers exist, according to Johansson, is that human beings tend to spend more time with people who are like themselves as they age. He says individuals can break down barriers and increase their ability to innovate if they:

  • Find inspiration from fields or cultures other than their own—and dare to explore the connections.
  • Staff for innovation. Though some organizations, such as HP, might hire those from different industries and backgrounds intentionally to foster innovation, he said some companies just need to encourage employees to consider who they work with and provide opportunities to connect with those from other areas.
  • Leverage existing diversity. “You have—right now—all kinds of diversity in your teams and you are not leveraging it,” he said. Johansson used the example of Frito Lay’s cool guacamole chips, which generated $100 million in sales the first year, as an example of one company that tapped into its resources to create something completely new—and profitable.
  • Intersect ideas from around the world. Johansson said that companies might generate ideas locally but fail to tap into insights and expertise from other geographic areas that might impact the success or failure of a particular idea.
  • Diverse teams outperform quickly. Though homogeneous teams might outperform diverse ones at first, their productivity levels off quickly, Johansson said. “The ability to get a diverse team up and running quickly is going to be critical,” he said. The leader of such a team needs to be open and tolerant, therefore, but must also be action-focused so the team doesn’t get bogged down in the plethora of ideas they are likely to generate.
  • Plan to make mistakes and to experiment. More ideas mean more opportunity but also more mistakes. Innovation requires experimentation, Johansson said.

Johansson emphasized that everyone has the ability—and the time—to be creative. To demonstrate this point, audience members were asked to work with a partner for just three minutes to generate ideas for their organizations inspired by the fashion industry. The few ideas shared by participants made it clear to those present that true innovation does not require a major investment of time.

Johansson encouraged attendees to find ways to make connections and create opportunities for innovation. “Pull together people that are different, and just let it rip,” he said.

Rebecca R. Hastings, SPHR, is an online editor/manager for SHRM.


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