If someone comes up with a great idea—or even an idea—we should start at yes, and work through every reason why we can't do it. We never start at no.

Creativity is natural and abundant, the natural human state. We are creative beings. Being creative is not the hard part. The hard part is figuring out how to marry creativity to discipline so that the discipline amplifies the creativity, rather than squelching it. Truly great entrepreneurs do not just have a great idea (and often, they copy their ideas from others). The entrepreneurial path to greatness is to go from idea to business, then business to company, then company to great company, then great company into enduring great company. To accomplish this entire journey requires much more than just a creative idea.

Thirty spokes share the wheel’s hub,
It is the center hole that makes it useful.
Shape clay into a vessel,
It is the space within that makes it useful.
Cut doors and windows for a room,
It is the holes which make it useful.
Therefore profit comes from what is there,
Usefulness from what is not there.

Lasting innovation in an information revolution doesn’t come from the elite, or from people who already have access to wealth and authority. It comes from the edges, from people who are just gaining access for the first time.

Companies often want to make decisions based on "the number," or a precise estimate of a project's financial potential. When companies only consider a single scenario, they almost always feel as if they have to be conservative, leading them to prioritize "sure things" in known markets over risky ventures in new markets.

While that approach might be reasonable when a company is launching a modest line extension into a known market, a new-to-the-world solution could unfold in infinite ways. It might be worth investing in a project that appears to have negative NPV, on average, if a modest investment can highlight whether outsize returns are possible. Further, if you don't invest in the long term, you increase the odds that you will fall behind existing and emerging competitors in the next economic cycle. A company that ranks all of the projects in its innovation portfolio by NPV might unintentionally stop working on projects with the greatest long-term growth potential.

Broadly speaking, organic growth can come from natural expansion of the core business, moves into near-in adjacent markets, and the creation of entirely new growth businesses. Companies need to have a rough estimate of their ultimate top-line and bottom-line goals, and how much growth they can reasonably expect to get from each of those three categories.

Companies have to treat different types of innovation opportunities differently. Companies routinely organize differently to solve fundamentally different problems, yet the area of growth is all too often lumped into one managerial process, governed by one set of metrics. An incremental improvement in an existing market has to be measured, monitored, and managed differently than a completely new strategy that might go into a non-existent market. Trying to pursue fundamentally different opportunities in the same way guarantees that one type of opportunity will be sub-optimized.

Generally speaking, new growth approaches must go through a more iterative development process where the focus is on identifying and addressing the key assumptions and risks behind success. The metrics that guide a new growth idea in an early stage should not be the metrics like net present value or return on investment that are favored in the core business; rather, companies need to assess how well a concept fits a more qualitative pattern that typifies success in their target market.

Companies need not throw out their stage-gate processes. Rather, they can follow different paths for different types of innovations at the front end of the innovation process, where they formulate, screen, and shape ideas. As the iterative development process removes key risks from new opportunities, the new business can gradually transition to a company’s core launch capability. This transition marks the formalization of a new business that, if successful, will someday become part of the company’s core.

The exception to this transition occurs when the new venture follows a business model that the core business would view to be unattractive. The weight of historical evidence suggests that a great deal of organizational autonomy is necessary for companies to successfully create businesses that are disruptive to their core business.

If you’re going to do something new, you have to overlap fields. God didn’t make disciplines; man did.

The most creative leaders I’ve met don’t aspire to learn from the “best in class” in their industry—especially when best in class isn’t all that great. Instead, they aspire to learn from innovators far outside their industry as a way to shake things up and leapfrog the competition. Ideas that are routine in one industry can be revolutionary when they migrate to another industry, especially when those ideas challenge the prevailing assumptions that define so many industries.

[how can one tell if an idea is any good?] Here’s the simple litmus test: Does your community care? Everyone has a “community” of constituents—customers, users, readers, clients, etc. Share your ideas liberally. If your community engages with them (either for or against them), then you know you’re onto something. If they don’t look twice you know that you either need to reconsider the idea or rethink how you communicate it.

We have to rely both on analysis and synthesis. Analysis—taking complex things and studying and understanding them—is very useful for knowing how well something is going to work and how you might improve it or make it more efficient. It’s not very good for coming up with major new ideas. There we have to be able to synthesize many competing ideas or competing insights—even if those things are in tension—into something that is somehow a whole. What designers and design thinkers are always searching for is the alternative that’s better than the initial starting points.

In most organizations, there’s an incredible amount of talent everywhere, and often that talent is more connected to the marketplace and the world. There’s a clear and real role for senior leadership, but it’s not to have the ideas—it’s to create the framework for the ideas to exist.

There’s another thing that organizations often miss: They assume that the things you go out and study should be the things that are right in the middle of the market, so they talk to customers who are in the middle of the bell curve about the products that the company already makes. That’s usually the least useful form of observation. The most useful is to go and visit with people who are at the ends of the bell curve. “Extreme users” are doing weird and wonderful things that you’ve never imagined, and that’s where you will get interesting ideas. Plus, you shouldn’t just talk to people who are using your product or competing products—talk to people who aren’t. If you ask somebody who already is, the best you’re going to get is incremental improvements of the thing you’ve already got.

One way to stimulate a creative mindset is to avoid the typical focus of organizations on what is and to ask, instead, what if questions. Doing this regularly tests your ability to see things anew.

The important thing is that over time, scientific progress transforms things that used to have to be dealt with in a problem-solving mode down to the pattern-recognition space; and from pattern recognition into the rules-based mode. This is the mechanism by which less-trained people are enabled to do more sophisticated things. This is always the way disruption happens. It enables a larger population of less-experienced people to do more sophisticated things.

Of course, innovations are exceptions because the system is built for something else; the system is built for perpetuation, control, and efficiency…To encourage innovation, to create a real constituency for What Could Be, companies need to unleash ideas, passion, and commitment across the company. We have to move from innovations as exceptions; move beyond innovation as a specific role or structure, beyond innovation as a once-in-a-while project, to thinking about innovation as a deep capability.

A new sense of direction doesn't come from a few smart people, who have all been in the company for 20 years, getting together and thinking about it. You have to dramatically increase the strategic variety that's there, create thousands of new ideas out of which you can look for new themes and directions. And then the role of top management is to be the editor. That is, top managers move from being the creators of strategy to searching for the patterns in the streams of ideas that -- in the most innovative companies -- constantly emerge in the organization.

We as executives have to resist our natural tendency to avoid or minimize risks. This instinct leads executives to choose to copy successes rather than try to create something brand-new... If you want to be original, you have to accept the uncertainty, even when it’s uncomfortable, and have the capability to recover when your organization takes a big risk and fails.

Most organizations have discrete formal groups and processes that use different lenses for evaluating ideas: Marketing represents the customers, finance evaluates the economics, and engineering determines feasibility for launch. They answer the questions in series, and then “throw the problem over the wall” to the next team. They may not even be aware of one another’s findings.

The principles of focused accountability or clear decision rights provide a purported rationale for this fragmented approach. Breaking up the innovation process often seems like the easiest way to make progress. However, it ignores the fact that truly effective innovation needs to integrate choices about customers, finance, and technology; without buy-in at the outset from all these groups, choices made upstream may be undone downstream. When the final decisions about launching the product must be made, the groups often find themselves at cross-purposes; either one group wins and the others lose, or they reach a rapid but weak compromise for the sake of consensus that satisfies nobody, including the customers.

More often than not, the wisest upstream choices are enabled by a timely combination of formal and informal interactions. Right at the start, convene disparate perspectives for rigorous and synchronized debate — a seemingly messy and difficult process that actually makes things easier in the long run. The answers to three major questions should determine whether an idea should be developed or not: (1) will customers want it? (2) can we produce it? and (3) will we be able to make money from it? If you are organizing this process, set up ways to bring the necessary people into one room — or, at least, on one long conference call — to talk through all these questions together. Bring different perspectives to the surface, have productive fights (substantive and candid debates), and come to the best answer. This is the only way to resolve the natural tensions between formal groups without forcing them to compromise. (As management thinkers dating back to Mary Parker Follett have noted, compromise is more likely to water down the result than get the best from conflicting ideas.) When they arrive at joint decisions, different functions feel mutually accountable for results, which inherently improves the chances for success in any process that requires handoffs and coordination later.

Ideas invite others to respond with imaginative gusto. Big imaginative ideas succeed by building on two principles. They are democratic (shared by everybody) and demotic (like art, they convince by being suggestive, not merely by making rational sense). By being evocative rather than explicit, they invite participation.

Facts do not have control of you; your imagination does, and it need have no limits.

To put ideas into action is the most difficult thing in the world.

The best way to get a good idea is to get a lot of ideas.

As for the genius of innovation, clearly the one percent spark of inspiration is nurtured by a positive culture. But the 99 percent perspiration ingredient comes from employees who love what they do, as well as where they do it, and who invest in that Holy Grail of productivity called “discretionary effort.”

Models and concepts and frameworks are—to use another phrase—mental boxes within which we comprehend the real world. And ever since the 1960s, we have been taught to be creative by “thinking outside the box.”

The trouble is this: once you have mentally stepped outside the box, what happens next? The space outside the box is very expansive—infinitely so—and there can be no guarantee that you will find a solution to your problem. So the answer is that you need to find a new box. And you must consciously build or choose that box yourself; if you do not, an unconscious process will do it for you.

The way we think means that we cannot be creative in a constructive way without inventing models or boxes. Ideally, you need to develop a number of new boxes—new models, new scenarios, new ways of approaching a problem—to structure your thinking. The challenge—and the real art of creativity—is to know how to build those new boxes and, in the process, provide the framework for fresh imaginative effort.