In his book Where Good Ideas Come From - The Natural History of Innovation Steven Johnson presents seven patterns that recur again and again in unusually fertile environments for idea generation.

The Adjacent Possible

“In our work lives, in our creative pursuits, in the organizations that employ us, in the communities we inhabit — in all these different environments we are surrounded by potential new configurations, new ways of breaking out of our standard routines. The trick is to figure out ways to explore the edges of possibility that surround you.”

What if a hearing aid could be replaced with a pair of wireless earbuds and a smartphone app? A Swiss startup is trying to make this reality with an app called Fennex, recently released for the iPhone, which works with Apple’s $159 AirPods wireless earbuds. Alex Mari, CEO of the startup of the same name says today’s version functions like a “cheap hearing aid—: it merely tests your hearing in each ear and uses those results to act as a personalized, adjustable amplifier. If you have trouble hearing in a class, for instance, you could place your phone near the podium while you’re sitting a few rows back and listening in on a pair of AirPods. A new use of the iPhone and the AirPods made possible by Apple's wireless earbuds, the iPhone, and the app store.

After discussing WhatsApp’s present and future with the co-founder of WhatsApp Jan Koum, Harry McCracken the technology editor for Fast Company wrapped up by asking him about its early days. “In Hollywood films, they always make it look like there’s that epiphany you have, that you come up with an idea and you run to the patent office with music playing in the background” he laughs. But he believes that he and co-founder Acton found a winning formula over time because they experimented, leveraged the technologies available to them (such as iOS notifications, which Apple introduced in 2009), and watched how people used their app. “Not only is this approach repeatable, but he also adds, it’s become even more doable as smartphones have reached even more people and matured as a platform.” retrieved from Fast Company

In the 1800's, a new innovation was introduced that had the potential to radically change transportation. At the time, most people traveled via horse and buggy. This was fine for shorter distances, but as cities grew, the method proved restrictive. It was slow, expensive, and even dangerous. The engine (horse) had a mind of its own, and fatality rates in large metropolises like Chicago were seven times what they are for cars today.

Gasoline powered vehicles promised a solution. These early automobiles could go farther, faster, and even cut down on manure, which at the time was threatening to suffocate many major cities. But getting people to adopt what we now think of as cars required a massive mind shift. Horses (and donkeys) had been the primary transportation method for thousands of years. While there were many drawbacks to this method, people were comfortable with it. They knew what to expect. Automobiles were completely new. They required different fuel to run, different skills to drive, and different know-how to fix.

Some of the same issues are driving changes to today's automobile and the designs of future cities. For a forward look at the future read this article published on Medium. “How driverless vehicles can enable on-demand accommodation for one night or 1000, and at rates 10x cheaper than your rent bill.”

The efforts to land on the moon produced the following tech.

The first micro computer

Virtual reality technology

Anti-icing formulas

Air purifier technology

Mylar

CAT Scan and MRI Tech

Ostoporosis drugs

Tech to keep tranplant patients alive while waiting for and organ

Liquid Networks

“To make your mind more innovative, you have to place it inside environments that share that same network signature: networks of ideas or people that mimic the neural networks of a mind exploring the boundaries of the adjacent possible. They create an environment where partial ideas can connect and help complete ideas.”

Recently towns, communities, businesses, and individuals have created ecosystems or campuses to encouraging cooperation and collaboration with the hope that their place will spur the growth on innovation. The world's biggest startup campus is opening this summer in Paris's 13th arrondissement. Based on a former railway depot known as la Halle Freyssinet, the 34,000 meter/squared space will accommodate more than 1,000 startups and counts as founding partners companies such as Facebook and Microsoft.

The Slow Hunch

“Hunches start with a vague, hard-to-describe sense that there's an interesting solution to a problem that hasn't yet been proposed, and they linger in the shadows of the mind, sometimes for decades, assembling new connections and gaining strength. ” To help facilitate the process of turning hunches into problem solutions, keep a diary of your discoveries and thoughts.

Kripa Varanasi and his wife, Manasa, were at home, and she was trying to make a snack for their young son. She was struggling to spoon out some honey, frustrated by how hard it was to get the last bits of sticky sweetness from the bottom of the container. Finally, she turned to her husband. “You work on slippery things,” she said. “Why can’t you make a slippery bottle?” Varanasi says he knew instantly that was just the idea he had been looking for: “I was like, that’s brilliant!” Kripa and one of his students had developed an invention to make slippery surfaces and were seeking a real-world application. Five years later, that company, called LiquiGlide, closed its second round of venture capital—for a total of more than $24 million in funding. And already LiquiGlide has contracts with more than 70 companies to bring various versions of its slippery coatings, some of them food-grade, into the marketplace by way of ketchup and glue bottles, cosmetics jars, paint cans, mixing vats for agrochemicals, and more. The concept behind that initial slippery invention, which led up to that “Aha!” moment, had been years in the making. retrieved from MIT Technology Review

Serendipity

Serendipity needs unlikely collisions and discoveries, but it also needs something to anchor those discoveries. The challenge is how to create environments that foster these serendipitous connections. On the web Product Hunt, Indiegogo, Kickstarter, Tech Crunch, and FastCompany provide opportunities to collide with innovative ideas. One of the great examples of a serendipitous encounter that led to a new business opportunity involves Dietrich Mateschitz and a routine business trip to Thailand. Mateschitz arrived in Thailand suffering from terrible jet lag. Some locals took pity on him and directed him to a store where he was told to ask for an exotic-sounding tonic called Krating Daeng. Mateschitz learned that in addition to being an excellent remedy for jet lag, Krating Daeng was also prized by locals for its ability to increase physical endurance and mental concentration. You and I know Krating Daeng as Red Bull

Error

Error is not merely a phase you have to suffer through on the way to genius. Errors often create a path that leads you out of your comfortable assumptions. Being wrong forces one to persistent in exploring. In Silicon Valley, the mantra is 'fail fast, fail often' which hopefully leads to a successful business plan. They have coined the term 'pivot' which means, when the first business model isn’t working (and this happens more often than not), the CEO and team pivot to plan B.

Exaptation

Exaptation is the idea that the function of a trait might shift during its evolutionary history. Morphing the feature found in one product into another product creating a new function. Chrysler under Lee Iacocca formed platform teams to develop new vehicles. The first platform developed and launched the LH model. All the disciplines Engineering, Manufacturing, Marketing, Purchasing were brought together at one location on Featherstone Road in Auburn Hills. Weekly meetings of all the disciplines presented their issues. As future vehicle platforms formed their teams to develop new vehicles, they joined the 'things gone right' sessions to learn and to apply the lessons to their team's job to be done.

 

First principles thinking helps you to cobble together information from different disciplines to create new ideas and innovations. You start by getting to the facts. Once you have a foundation of facts, you can make a plan to improve each little piece. This process naturally leads to exploring widely for better substitutes. Johannes Gutenberg combined the technology of a screw press — a device used for making wine — with movable type, paper, and ink to create the printing press. Movable type had been used for centuries, but Gutenberg was the first person to consider the constituent parts of the process and adapt technology from an entirely different field to make printing far more efficient.

Platforms

Beaver by felling poplars and willows to build dams, single-handedly transform tempered forests into wetlands. Which then attract and support a remarkable array of neighbors: pileated woodpeckers are drilling nesting cavities into dead trees; wood ducks and Canada geese setting in abandoned beaver lodges; heron and kingfishers and swallows enjoy the benefits of the 'artificial' pond, along with frogs, lizards, and other slow-water species. The beaver creates a platform that sustains an amazingly diverse assemblage of life.   Similarly, so does Apple, Facebook, Amazon, and GitHub.

The hyperloop industry—if you can call a handful of VC-backed outfits an industry—got going in 2013, after Elon Musk published a white paper on his idea of tubular travel and said he was too busy to work on it. The hyperloop platform has a number of large and expensive hurdles to conquer before becoming a commercial success. But, hyperloop has the potential to spur significant transportation innovation if research continues at its current pace. In fact, that crossover has already begun. A student-run hyperloop team out of the University of Wisconsin–Madison maglev design uses Halbach arrays in a novel fashion, says technical director Justin Williams, allowing for passive movement, as opposed to superconducting magnets that require a flow of electricity to work. It could significantly reduce the amount of energy required to propel a levitating train. Hyperloop Transportation Technologies is developing a sensor-embedded carbon fiber structure for its pods, which it calls “Vibranium.” Named for the material found in Black Panther’s suit and Captain America’s shield, this stuff can provide real-time data about the pod’s temperature, structural integrity, and other metrics.

A new study by the University of Pennsylvania provides the first comprehensive look at how the Kickstarter community impacts the creative economy. The study finds that Kickstarter projects have employed 283,000 part-time collaborators in bringing creative projects to life. Created 8,800 new companies and nonprofits, and 29,600 full-time jobs. Generated more than $5.3 billion in direct economic impact for those creators and their communities.

Creators reported that Kickstarter afforded them the creative independence they would not have been able to achieve through other funding avenues, and allowed them to bring their project to life without compromising their vision. These are conditions that empower creators to aim high and take the creative risks needed to fuel innovation.

Backers reported more than 50% of Kickstarter projects to be innovative. An estimated 4,200 patents tied to projects have been filed. More than 10% of creators reported winning significant awards for their work, including a MacArthur Genius grant, National Design Awards from the Cooper Hewitt Smithsonian Design Museum, a James Dyson Award, IDSA’s International Design Excellence Award, CES Innovation Awards, the Sikorsky Prize, Independent Games Festival Awards, Grammys, an Oscar, and many more.

Probably the best explanation for why companies decline is that they fall prey to organizational rigidities. Processes are optimized for managing a proven business model and value proposition rather than innovation. Companies must balance exploiting profitable markets with exploring new markets. Exploiting known markets requires optimizing processes and executing effectively, and leads to reliable, near-term successes. Exploring unknown markets requires search and experimentation and offers none of the immediate benefits of exploitation. Creators need to aim high and take the creative risks needed to fuel innovation and take several ideas, make many small bets, and test where they’ll go. They need to adjust these ideas based on evidence until they find a value proposition that customers want embedded in a scalable business model.

Finding the best balance between exploration and exploitation depends on the rate of change in the environment. When change comes slowly, the balance can tilt toward exploitation. When it happens quickly, an organization must dedicate more resources to exploration, since profits are rapidly exhausted . In general, companies tend to lean more on exploitation, which increases efficiency and profits in the short run but makes the company rigid, a state of affairs that only grows worse with age. Similar to aging individuals, companies rely on methods and rules of thumb that worked well in the past rather than embrace novelty. Companies, too, follow an arc of skill. Michael Mauboussin quoted in the Farnam Street Blog Untangling Skill and Luck in Business, Sports, and Investing published 1/2/2013.

Innovation is the implementation of new ideas that add value

In his classic article, “The Capitalist’s Dilemma” (HBR, June 2014) Clayton Christensen distinguished three kinds of innovation: Performance-improving innovations that replace old products with new and better models. Efficiency innovations that help companies make and sell mature, established products or services to the same customers at lower prices. Market-creating innovations that “transform complicated or costly products so radically that they create a new class of consumers or a new market.” Company leadership can be focused on the short-term, tangible results that come from sustainable and efficiency innovation like cost-cutting programs or the replacement of old products and services with new ones. They also tend to be ideas that can be implemented quickly and are judged by the time to pay back the investment.

Contrast this with the results from the Bell Labs. For a long stretch of the 20th century, it was the most innovative scientific organization in the world. On any list of its inventions, the most notable is probably the transistor, invented in 1947, which is now the building block of all digital products and contemporary life. What can we learn from the Bell Labs?

The central figure in that tale is Mervin Kelly, who envisioned an “institute of creative technology,” where, thanks in part to long corridors and a mandatory open-door policy, research scientists would inevitably interact with engineers, physicists with chemists, materials scientists with mathematicians. He fostered an open, cooperative, and interdisciplinary environment. He took the long view, recognizing that the breakthroughs necessary to keep Ma Bell viable would not come from any single individual. He also never presumed to know the shape of the future, giving his researchers plenty of latitude to pursue whatever they believed might prove beneficial. And he had a broad view of what he considered beneficial, often championing pure science even when the immediate payoff wasn't obvious.

Bell Labs housed thinkers and doers under one roof. Purposefully mixed together on the transistor project were physicists, metallurgists, and electrical engineers; side by side were specialists, in theory, experimentation, and manufacturing. Everyone would interact with one another. Some of the hallways in the building were designed to be so long that to look down their length was to see the end disappear at a vanishing point. Traveling the hall’s length without encountering a number of acquaintances, problems, diversions, and ideas was almost impossible. A physicist on his way to lunch in the cafeteria was like a magnet rolling past iron filings. Bell Labs’ satellite facilities were set in the phone company’s manufacturing plants, to help transfer all these new ideas into things. But the exchange was supposed to go both ways, with the engineers learning from the plant workers, too. Mervin Kelly, Bell labs chairman of the board in sum, trusted people to create. And he trusted them to help one another create. For more read True Innovation published in the NY Times.

Collaboration is a powerful tool for speeding up innovation because innovation is all about ideas. If you have an idea and I have an idea, then if we’re collaborating, we can develop the better idea and ignore the worse idea. But if we’re working alone, then the worse idea doesn’t get discarded, and that slows down innovation. Company organization and culture has a large influence on innovation.

The ingredients for Innovation

Ideo is a global design company committed to creating positive impact. This Ideo study retrieved from Fast CoDesign presents the results of their study on how to measure innovation. Ideo found that the most important element is the organization’s ability to adapt and respond to change.

 

What prevents us from offering up ideas. Steven Pressfield in “Do the Work” suggests; “The enemy is Resistance. The enemy is our chattering brain, which, if we give it so much as a nanosecond, will start producing excuses, alibis, transparent self-justifications, and a million reasons why we can’t/shouldn’t/won’t do what we know we need to do.”

But before trying something new, it’s important to look to see why innovation isn’t already happening. The failure to innovate usually comes down to two prevailing reasons: First, leadership doesn’t embody the change they want to see. Second, the organization is mired in an old way of doing things that stymies new ideas. Or the idea requires betting the farm on an idea that has an unknown payback. Kodak failed to bet the farm on digital photography. They had too many resources engaged in producing and developing film, and they were unable to realize that online photo sharing was the new business model.

In any company, there can be several types of leadership styles. You will find traditional direction-setting leadership that can work well when a solution to a problem is known. This leadership style is good at executing plans and guiding the workforce. Leaders that are needed for creative innovation must be able to create a community that is willing and able to innovate. They need to guide their teams with a sense of purpose and shared values through creative agility. To Steven Johnson's rich environments for creative idea generation, there must be leadership to produce life from the incubator.

“No one yet has made a list of places where the extraordinary may happen and where it may not. Still, there are indications. Among crowds, in drawing rooms, among easements and comforts and pleasures, it is seldom seen. It likes the out-of-doors. It likes the concentrating mind. It likes solitude. It is more likely to stick to the risk-taker than the ticket-taker. It isn’t that it would disparage comforts or the set routines of the world, but that its concern is directed to another place. Its concern is the edge, and the making of a form out of the formlessness that is beyond the edge.” Mary Oliver quoted in Brainpickings

In The Black Swan: The Impact of the Highly Improbable, Nassim Nicholas Taleb suggests “constant tinkering as a way to benefit from Black Swans, or rare events, because they are hard to predict. The strategy for the discoverers and entrepreneurs is to rely less on top-down planning and focus on maximum tinkering and recognising opportunities when they present themselves. So I disagree with the followers of Marx and those of Adam Smith: the reason free markets work is because they allow people to be lucky, thanks to aggressive trial and error, not by giving rewards or 'incentives' for skill. The strategy is, then, to tinker as much as possible and try to collect as many Black Swan opportunities as you can.”