Lessons for Innovation from Hollywood

In preparation for my interview with BIF Research Advisor John Kao later this week, I came across another interview he gave several years ago about how to weave together different disciplines to find a new tool box for business model innovation. One of John's major career accomplishments is Hollywood producer (he produced and financed sex, lies and videotape). John is as close to a contemporary renaissance man as you're likely to find. He says his life always been about making journeys back and forth between different contexts. As it turns out, he found that Hollywood offers some of the best conditions and environment for innovative change.

From John's Dialog on Leadership interview:

"I got involved in the details of producing movies in the ’80s and knew what it felt like to be on a sound stage with a director and a crew of 150 people spending $200,000 a day trying to get certain kinds of shots, dealing with all the uncertainties of production. In a funny kind of way, that was a great precursor to thinking about how to manage an innovation-oriented environment in an innovation-oriented business. I think a lot of the Hollywood model is really relevant for innovation. Hollywood doesn’t make uniformly wonderful movies, but they have a process for making movies that works well enough to get movies made.

Priniciple 1: Every Movie Starts with One Person

Well, for one thing, every movie starts with one person who is the prime mover. It could be the person who has the idea, it could be a producer who gets interested in a subject matter, it could be a director who’s interested in something. But all these projects begin with a person.

Priniciple 2: Project-Centered Staffing

They then staff up so they have a contingency work force for that project, which is custom made for that project. And then they staff down. Everyone in this day and age is an independent contractor, so there’s a huge amount of negotiation involved in putting that team together.

Priniciple 3: Culture of Collaboration

There are also a whole set of behavioral norms around collaboration in Hollywood, which are very functional. People make fun of Hollywood because everybody’s so nice and they never say no. There’s a certain functionality in the positive aspects of collaboration, because people get to bond very quickly. When you go on a set and you have a job to do, you almost immediately can meet the person who has the information that you need and then will make it very easy for you to get what you need to get done accomplished, because their job is to create lubricated relationships that work very well instantly, even though they’ve never met you.

It’s also true in the structure of innovation, in the institutional sense. In the early 20th century you had movie studios that were the so-called "dream factories" with walls around them. There was an economic logic behind that. There were scarce elements of production. There were people who knew how to do things in a certain way, like how to set lights up in a certain way, and you wanted to make sure that people who were spies for other companies could not see how you did things.

Priniciple 4: Weaving of Diverse Disciplines

Value always migrates to what is scarce, and in this early stage in Hollywood what was scarce was production knowledge. Actors were cheap. Anybody who looked good could be in front of the camera because you didn’t have to talk in the silent movie era.

The history of Hollywood is a fascinating history of innovation, because the organizational models and business models evolved to keep pace with different and evolving power dynamics among the different players.

It seemed to me that having elements of an experience design-oriented business that borrowed from theater, from Hollywood, and from the world of traditional design would begin to accomplish my goal. The question was, what are the new practices around innovation in the New Economy? How does innovation have to work in the New Economy? My conclusion was that the people who had those answers were probably not strategy consultants, business school professors, or heads of product development. People outside of those traditional disciplines had the new ideas. They were probably from the fringes, from places like improv acting and scenario planning and the anthropology of customers and this kind of stuff."

Posted January 2, 2008 11:00 AM by Chris Flanagan | Permalink