Towards the Big Idea - Review - Brief Article

Today's marketplace is a war of ideas. Unless you stand for something, you won't stand out.

When marketers speak in reverent tones about a "brand experience" or "brand promise," clearly they're talking about something more than a company's product or service. These terms suggest a relationship with consumers built on emotional ties--on positive feelings such as comfort and trust. Indeed, in order to explain the market dominance of a Nike or Starbucks, one must put economic considerations into the context of the emotional bonds that consumers have forged with those brands.

Which is exactly Robert Jones' tack in The Big Idea (HarperBusiness/Harper-Collins). Jones analyzes 50 of the world's biggest ideas, and deduces how entrepreneurs can find and communicate their own big ideas. "People don't just buy Ikea," the author writes. "They buy into it--into an idea that mingles style, thrift, self-help, plainness, Scandinavia, classlessness and all sorts of other things."

Jones believes that today's economy recognizes the power of emotion--to challenge complacent corporations, destroy old categories and bring customers and employees together in completely new kinds of community. The book's premise is that "emotional logic" plays a crucial role in today's consumer buying trends. "The things people buy--products and services--are becoming more and more similar as it becomes increasingly easy for one company to copy another's technological advantage," Jones writes. "This has a simple buy devastating consequence: In the absence of economic differences, emotional logic will become the single most important business driver."

In the chapter excerpted here, it is argued that formulating and managing a compelling big idea is the most fundamental of all business objectives: more emotional than a business model; more sensuous than ideology; more solid than vision; and deeper than brand. A really good big idea, according to Jones, does several things at once: It meets people's needs both internally and externally; makes the organization valuable and unique; celebrates people's differences; and creates unity but never uniformity. "Big ideas create a special kind of engagement with the organization: they lead people to identify with it," he writes. "That is to say, people recognize an aspect of themselves in the organization, and so make the organization part of themselves."

A consultant with the Wolff Olins firm in New York and London, Jones advises chief executives of national and global corporations on how to create and manage their big ideas. He lives in Highbury, North London.

Today more than ever, the business world is full of ideas. Good and bad, fresh and stale, worthwhile and merely modish. Ideas for new business models, ideas for new products, ideas like "focus" and other management catch phrases. And ideas that are, in effect, corporate ideologies-- the "company way."

Many of them are valuable in their own way but organizations are discovering that they don't do enough. They don't help differentiate organizations--they don't make them stand out in a noisy marketplace. They don't engage people. They don't nourish life.

Organizations are searching for something bigger.

More Emotional Than A Business Model

People often talk in excited tones about new "business models." What they normally mean is new ways of conducting a business, usually at considerably lower cost than before. A new business model may involve, for instance, a slicker manufacturing process, or a streamlined distribution channel.

Electronic commerce is currently creating dozens of new business models in this vein: the bookshop that has no shelves; the virtual travel agency; the electronic auctioneer; the flight-booker where you name the fare you're prepared to pay.

Business models like these can be impressive generators of revenue (and, over time, profit). And they certainly count as ideas. But they're not the kind of big idea that this book is about. They are simply ideas about a way of doing business, not about what that business stands for, for its employees and its customers.

Because business models are simply a way of doing business, they are eminently imitable. In the PC business, for instance, Dell has been admired for years for its business model: making PCs to customers' specifications, so that stock is kept to the barest minimum. But by 1998, Compaq and IBM, its two main rivals, were catching up. Since then, both Dell and Compaq have moved on again. Dell is now trying to move on from a business model to a bigger idea, through advertising in which Michael Dell himself asserts that Dell believes in 'being direct.'

And most traditional bookshops around the world are emulating the business model of Amazon. What they can't so easily copy is the experience of dealing with the company What will make or break Amazon is its big idea--the idea of "completeness"--not its business model.

The truth is that any good organization needs both:a clever business model, and a richly compelling big idea. The business model may well change completely over time: the big idea is much more stable. The business model guarantees some way of making money (even if it's in the distant future).

The big idea engages people. Without a sturdy business model, the organization will run out of funding. And without a big idea, it will--sooner or later--run out of people. Consumers-with-attitude will spurn it. The best employees will go elsewhere. Investors will put their money into something more exciting.

There are other kinds of ideas as well as business models. Product ideas, for example. It's claimed that the U.S. manufacturer Rubbermaid produces a new product every day And behind every new product, and every new service, is an idea. But product ideas don't create long-term advantage. Competitors are quick to exploit good ideas. Procter & Gamble invented a new spray to eliminate smells in fabrics, and called it Febreze. Within a few months, Johnson & Johnson, Clorox and others had launched their own versions.

A product idea is not the same as a big idea. The two are, of course, intimately connected. Good product ideas flow readily from a strong, underlying organizational idea. Pret a Manger, the British sandwich shop chain, has an organizational idea that a lunchtime food can be as stylish and enticing as fashionable. But the Pret a Manger idea is larger than any of its products: indeed, it could change its complete range of products (and probably has), but till be Pret a Manger.

Organizations capable of long-lasting success do not depend on a particular product idea. Their organizational idea generates their product ideas, and not vice versa; and it is big enough to generate an almost inexhaustible range of product ideas. For example, the organizational idea of "making people happy" drove the creation of Disney as a company; and Disney became the kind of company that could make Fantasia and Disneyland and the city of Celebration and whatever new products it announces in the new century.

Alongside product ideas, the business world is full of ideas on how to manage better. For instance, almost every strategy expert over the last 20 years has preached focus. Peters and Waterman, back in the early 1980s, showed how what they called excellent companies stick to the knitting": they concentrate on what they're best at. Meanwhile, conglomerates went out of fashion as investors found direct use of the stock market a more efficient way of spreading an investment over a range of industries. As a result, businesses worldwide have defined their core businesses, and divested everything that is not core. Hanson, once the world's most admired conglomerate, is now a building products company.

But focusing on a particular product segment, or a particular market sector, or a particular core competency is not the same thing as having a big idea. This kind of focus is about what you choose to do, not how you do it. So, once again, ifs imitable. And it's perfectly possible to be relatively unfocused in the traditional sense, but nevertheless to run a purposeful business driven by a simple big idea.

More Sensuous Than Ideology

All the ideas we've looked at so far--business models, product ideas, points of focus and gurus' catch phrases--are predominantly rational. Big ideas are much more emotional. They are much more about the spirit of an organization. And they are much more powerful at driving behavior.

One way of describing an idea that influences behavior is an ideology. The bestselling book Built to Last looks at 18 of America's most admired companies--those seen as "visionary"--and shows how important ideology has been for these visionary businesses, The book's conclusion is that "the existence of a core ideology [is] a primary element in the historical development of visionary companies."

The book goes onto define ideology as a combination of two things--core values and purpose. It argues that, in all these visionary companies, this core ideology is a constant, which is not allowed to change over time. Conversely everything else--products, markets, organization structures, and so on--is allowed to change. Indeed, change is strongly and systematically encouraged. So a company is nothing other than its core values and purpose.

Ideologies served American companies well in the 20th century Hewlett-Packard, with its strong ethical principles, was one of the most admired companies. The department store Nordstrom, whose culture is said to be almost cult-like in its intensity and where so-called "Nordies" chant "We're No. 1" at 7 a.m. meetings, has been hugely successful (though, interestingly it hasn't expanded outside America). And Andersen Consulting, whose recruits go through a compulsory induction process at their Chicago training center, and who are often known outside the company as "androids," has grown by 20% or more very year of its existence.

But, at least in their barest form, these ideologies will not be enough in the wider world, nor in this century. Ideology will not convince employees who feel increasingly free to move between companies, and who are increasingly skeptical about corporatism. Ideology will not convince employees in the rest of the world who never have been open to the myths American corporations tell themselves. Ideology belongs to the old century to the era of company man. Although people still want to belong, they're increasingly reluctant to sign up to an ideology. And ideology will be irrelevant to consumers, who will be interested in a company's purpose and values only if they generate something special for customers.

In other words, both employees and consumers will demand something richer, something more experiential, more emotional, more sensuous than ideology.

Towards a Big Idea

The last three decades have seen organizations travel in search of that "something more sensuous." Their first calling point was corporate identity It originated in the U.S. in the 1940s, but it wasn't until the '70s that it joined the management lexicon. Gurus like Wally Olins preached the value of making your strategy visible through symbols, logotypes, colors and typefaces. At the very least, these devices helped to make clear the relationships between component divisions in complex businesses: the rise of corporate identity coincided with the rise of the diversified corporation. But the best corporate identity work went far beyond that, and brought a new quality of evocation, sometimes even of beauty to corporate symbolism.

Most organizations, however, commissioned dreary and repetitive logos that said nothing about them and made little difference to their success. Travel through France and, as you pass from region to region and from department to department, you're greeted by a gallery of welcome signs, each with a logo more banal than the last. Travel by train in Britain, and you're bewildered and disoriented by train company logos, almost all of them woefully unimaginative. Corporate identities like these, instead of raising their owners above the visual noise in their marketplace, simply add to it.

And the weakness they share is that they represent nothing: they are mere devices, with no idea behind them, with nothing to stand for. Indeed, some organizations who've undertaken corporate identity projects find that they've ended up with little more than a smart letterhead and need to start another exercise to find a personality to underlie the new logo.

More Solid Than Vision

In the 1980s many organizations became less concerned about their outwards symbolism, and more concerned about their inward purpose. Senior management believed that, in a world where technology was creating increasingly rapid change, their employees needed to share a view of what the business was there to do. Writers like Tom Peters created a great deal of excitement about releasing the potential of employees, turning every company into an "excellence" organization.

By the end of the decade, almost every organization, and every division within every organization, had a mission statement. But all these mission statements looked pretty much the same. In fact, you can now get software that generates random mission statements by stringing together standard phrases from the impoverished vocabulary of "mission."

As well as being dishearteningly unoriginal, these statements were also largely ineffectual. They were displayed, nicely framed, in canteens and reception areas, but, as Eileen Shapiro suggested in her book Fad Surfing in the Boardroom, most were little more than "a talisman, hung in public places to ward off evil spirits."

Gradually the mood changed. In business, and in politics too, a demand grew for what was called "the vision thing." Instead of mission statements, organizations created visions. The military analogy of "mission" turned into the more spiritual analogy of "vision." But the content changed less. Missions and visions both tended to be about one or more of three things. First, a statement of purpose: why the organization exists. Second, a statement of ambition: where the organization wants to get to. Third, a statement of values: what the organization believes in.

Some missions and visions were relatively precise. General Electric set out to "become No. 1 or No. 2 in every market we serve and revolutionize this company to have the speed and agility of a small enterprise." Compare this with Westinghouse's vaguer statement: "Total quality, Market leadership, Technology driven, Global, Focused growth, Diversified Both of these statements are like a million others around the world. They once made sense--indeed, they probably resonated deeply--on a flipchart at the end of a senior management retreat. But they're too bare, too generic, too abstract, to drive experience.

Most of the time, these statements are nothing but words. They're often highly abstract, and fail to guide people in their day-to-day behavior. And they're rarely truthful: they do not correspond with the messy reality that employees see around them every day.

Most of these statements are a product of compromise. In the interests of involving people in their creation, they end up being designed by a committee. From the often heated debates that result, what emerge are the coldest of lowest-common-denominators. Vision, which should be an act of leadership, becomes an act of fudge.

Mission and vision have another weakness. They appeal only to an internal audience: the organization's employees, in particular its managers. The simple ambition that drives Microsoft--Windows everywhere--is like this. It may excite insiders, but offers customers nothing to buy into.

Deeper Than Brand

Through the 1990s, the pendulum swung from the introspective missions and visions to something much more outward-directed, and much less abstract: brand.

A concept that had been applied for a century to consumer products began to be applied to whole organizations, even to complex ones like professional service firms which don't sell products and don't sell to consumers. By the end of the decade, a typical edition of The Economist might have included expensive brand-building advertising for Andersen Consulting, Ernst & Young, KPMG and PricewaterhouseCoopers.

Manufacturers created consumer product brands to differentiate their products from goods sold in plain paper bags in groceries. The brand label said, in effect, "You can see who made this product and therefore trust it to be reliable." The brand was much more than a label or a logo: it was a promise. The brand promised consumers that, every time they bought the product, they would get the same experience.

In return for this level of confidence, consumers would pay more: brands could command premium pricing. Consumers would also repeat-buy: brands could increase sales. And consumers would experiment with new products that carried the same brand--brand extensions. So brands could enable their owners to diversify. These three prizes started to look very attractive to companies that sold not products, but services. But service companies depend on their people. And people aren't consistent. It's very hard for a service business like British Airways or Holiday Inn or Club Med to deliver complete consistency

Some work towards it by making their service as much like a product as possible: for McDonald's, for instance, the food itself, and the design of the restaurants, is easily reproducible, and is made to form a much more important part of the consumer experience than the behavior of its staff, which isn't so easily reproducible.

The whole idea of brand hits its limits with businesses like professional services firms, where there's little scope to make the service more like a product. Indeed, some clients buy the very individuality of the partner they deal with. Total consistency is not what they want.

By the end of the decade, the idea of brand, in its original form, started to look inadequate. It over-promised to consumers, and in some cases suggested a kind of uniformity that they didn't want. Worse, by speaking directly to consumers, it didn't speak to the needs and concerns of employees, the very people who were meant to keep the brand promise.

Many organizations felt themselves to be in a different world from consumer goods--professional firms, public agencies and charities for example--and their employees were deeply mistrustful of the idea of brand, thinking of it as a mere sugar coating. What organizations started to look for was something deeper than brand. Something that, unlike product idea or business model, would be rich and sensuous. And something that, unlike vision or brand, would appeal to people inside and outside the organization equally: something they could share.

Big Ideas

We've found that vision is too inward-looking, and brand too outward-looking. What kind of idea can appeal to every stakeholder? The idea must, in a sense, come before brand. It must drive the kind of promise that the organization makes.

Howard Schultz was once asked by USA Today how he created Starbucks as a huge brand. His response was that he didn't set out to create a brand; he set out to create a really good company, and the brand developed in other words, get the big idea right, and its external manifestation, the brand, will to a large extent take care of itself.

A big idea that can create or nourish a really good company must probably do four things, for both outsiders and insiders. First, it must make the organization valuable. The organization must meet people's real needs--tomorrow's as well as today's, and emotional as well as practical. Second, it must make the organization different--the organization must offer something unique. This is essential if customers are going to buy from it--and if employees are going to work for it. Third, it must bind people together, creating a sense of belonging for employees and customers. Fourth, it must celebrate people's differences. A big idea creates unity but never uniformity.

As well as going wide--inside and outside the organization--big ideas reach deeply within people. Big ideas create a special kind of engagement with the organization: they lead people to identify with it. That's to say people recognize an aspect of themselves in the organization, and so make the organization part of themselves.

How does it happen? You encounter an organization for the first time, and see something you like: something valuable, something different. The approval of friends often helps here: this is very much a social, rather than an individual, process. You start to interact with it, maybe buy something, maybe even take a job there. You start to feel a sense of belonging, but also a stronger sense of your own individually. Your link with that organization then becomes part of your definition of yourself. Indeed, it expands and enriches your sense of yourself. Criticism of the organization feels like criticism of you. If the organization fails in some way, you feel wounded.

That's what an organization like Starbucks can do. At Starbucks, people don't just buy coffee, they engage in the whole Starbucks idea. At Mandarin Oriental hotels, people don't just stay the night, they feel part of a club. Customers and employees of Orange are "Orange People."

Creating depth of engagement means appealing to people at many levels other than the purely rational. This intimacy is far more effective for organizations than vision or brand. People become much more than customers or employees: they become participators, creators and advocates.

A New Way of Business

What's emerging from all this isn't just big ideas: it's a new kind of corporation. "There's a new way of running a business," says Orange's Hans Snook, "It's based on integrity on believing what you say and on attempting to deliver on it."

So how is this new way of running a business different? Old organizations claim to be "customer-driven." The new organization stands for something. It proposes something which customers then engage with. It doesn't wait for customers to tell it what to do. Big idea companies gain stature by refusing to pander to customer demands, where those demands would undermine the big idea.

Old organizations aimed to win the loyalty of their customers and employees. The new organization goes beyond loyalty. Someone once said, sadly," Loyalty is what remains when belief has gone." Companies with a big idea inspire belief: something more intelligent, more deeply motivating, more dynamic, something that can make them want to change the way they behave.

Old organizations aim for profit, or maybe long-term shareholder value. The new organization aims for a goal beyond profit, which can inspire all its stakeholders. Old organizations use "vision" and "brand" as tools. New organizations see their big idea not as a tool but as their core. They exist to make their big idea a reality and so, in one way or another, to nourish life.

And that's just what we're now starting to see in the world's marketplace. A simple example is Nike, which makes sports shoes, but which stands for the bigger idea of "winning." Another is Amazon, which on the surface sells books, but is actually about "com0 pleteness"--the idea that anybody can get anything. Or Ikea, which makes furnishings, but stands for the bigger idea of "a better everyday life for the many." Or the BBC, a broadcaster, which stands for the bigger idea of "authoritativeness." It provides authoritative news and information, and sets an authoritative standard in entertainment.

Or Starbucks, which is about "sociability" more than it's about coffee--providing a place where people can feel at home as they drink coffee, chat or read the papers. Or Cisco, a manufacturer of equipment for electronic networks, which believes in an "outside-in" way of running a business, where customers have an unusual degree of power over the organization's strategy.

Or Southwest, the airline that lives and breathes a spirit of "irreverence"--where flying is fun. Or Muji, the retailer of homewares and clothing, which believes in simple designs and natural materials, rather than the flashiness of many branded goods.

This phenomenon isn't restricted to fashionable, highly brand-conscious companies. It applies to workaday businesses like insurance, air cargo, distribution, building products, water utilities, outsourcing companies, paper manufacturers and law firms. Though there may be only one or two companies with a big idea in these areas now, in a few years there will be dozens.

And like all ideas, these organizational big ideas are most potent when they resonate with larger social changes. As the American magazine The Nation famously wrote in 1943, "There is one thing stronger than all the armies in the world, and that is an idea whose time has come." Muji's idea of plainness resonates with a wider desire for the authentic. Ikea's democratization of design coincides with a wider drive to remove barriers of class and wealth.

Idea Versus Idea

This is an extraordinary and relatively new development. It means that the landscape is changing. Instead of an array of organizations, large and small, doing a million different things, the world of work is changing into a world of ideas. Ideas are starting to matter more than the organizations that embody them. Instead of Apple versus Microsoft, British Airways versus Virgin, Sony versus Bang & Olufsen, we're moving to a new set of values. Apple stands for difference, Microsoft for ubiquity: which do you identify with? British Airways offers a kind of reassurance, Virgin a more youthful iconoclasm: which idea can capture more passengers? Sony is about perfectionism, Bang & Olufsen about poetry: which is the bigger idea in the new century? People are responding to, and engaging with, the ideas that seem right to them, or right for them.

In a way, the emergence of idea-led organizations isn't so surprising. Not when consumers are crying out for organizations to stand for something. Not when investors want organizations to own a magic well-spring of future value. Not when people want to work for organizations that share their own values and priorities.

And when all these groups of people overlap, it's not so surprising that organizations are looking for one thing to say to all of them. In a world of over-communication--in a marketplace that's far too noisy--a few organizations are finding bigger, simpler ideas that enable them to rise above the din.

COPYRIGHT 2000 BPI Communications, Inc.
COPYRIGHT 2000 Gale Group