Idea practitioners: Key to every organization's success

Idea practitioners: Key to every organization's success

Hermawan Kertajaya, Contributor, Jakarta

What's the Big Idea?: Creating and Capitalizing on the Best
Management Thinking Thomas H. Davenport and Laurence Prusak with
H. James Wilson Harvard Business School Press, Boston.
Massachusetts (April 2003) 256 pp

As a consultant, I am well aware of the importance of creative
ideas in the consulting business. Every consultation project with
a client has its own uniqueness, and is naturally always
different from previous ones.

Because these projects cannot be approached using the same
methods and generic tools, creative people with new and fresh
ideas are always needed to solve problems and simultaneously to
develop an organization's competitive advantages.

Davenport and Prusak, veterans in the consulting business,
apparently also hold to similar ideas. In their latest book, they
describe a group of executives who, to date, have stayed "hidden"
but are behind businesses' success. The writers refer to this
group as "the idea practitioners". They are the people who study
the thinking of business gurus, adjust them to suit real problems
they face, then put the modified ideas into practice within their
own organizations.

As their first example, the writers compare Westinghouse and
GE, both diversified, innovative conglomerates. The businesses of
both, too, have some similarities, for instance in broadcasting,
power generation, industrial equipment and financing.
Nevertheless, why was GE able to become one of the most
successful businesses within the last 100 years, while
Westinghouse became bankrupt?

Davenport and Prusak consider that the difference in the fates
of the two lies in their differing embrace of ideas for business
improvement. GE has a reputation primarily for its innovative
business and management ideas, rather than any breakthrough
products or services. In contrast, although Westinghouse did have
innovative products, the only business notions it pursued
involved financial analysis, acquisition and divestiture, and a
late-in-the-game approach to quality.

GE, especially under Jack Welch, did not just talk about
ideas; it applied them in the practice of its day-to day
business. Welch was assisted by a group of his advisers, who
included academics, consultants and GE's own employees. The group
came to be known as idea practitioners.

They were a link between ideas and action. Without them, ideas
would have just stayed that way and would never have been put
into practice. These idea practitioners possess key skills of
"translation, harmonization and timing". They can tell whether an
idea needs modification to work inside the firm. They also have
the capacity to harmonize key themes which exist externally as
well as internally, as well as knowing the right timing to adopt
an idea in an organization.

Furthermore, Davenport and Prusak have also identified the
personalities of idea practitioners. Idea practitioners are able
to filter and then synthesize from multiple ideas, modifying them
to suit their organization's needs. They are thoughtful and
reflective managers capable of distinguishing good ideas from
bad. But, even though they are passionate about their ideas, they
are neither fervent or militant proponents, nor unquestioning
backers of ill-conceived ideas of others. Most seem quite mild-
mannered at first meeting.

On the characteristics of good ideas themselves, the writers
explain that almost all share one or more of three business
objectives: improved efficiency (doing things right), greater
effectiveness (doing the right thing), and innovation in products
or processes (doing something new). These three underlie a great
many of the business-oriented goals of most management notions.

So, how good are business gurus as sources of sound business
ideas? These people -- apart from CEOs or Company Chairmen -- are
those the media has put in the spotlight and publicized; they are
not idea practitioners. The latter mainly work quietly behind the
scenes. Davenport and Prusak argue that these gurus do not really
create business ideas. They tend to just assemble, package, and
broadcast business ideas; they will rarely create the whole thing
from scratch.

One example is the idea of core competence popularized by Gary
Hamel and C.K. Prahalad at the beginning of the 1990's. The idea
itself was then not actually new. The concept of a "resource-
based view of the firm" had been discussed for decades by
academics, including by Edith Penrose in 1956.

The backgrounds of business gurus are also looked at in depth
and completely explained. Hence the reader can learn about the
line of thought underlying the "birth" of their ideas. Davenport
and Prusak divide up the backgrounds of these business gurus into
four groups: Business academics (for example, Michael Porter,
C.K. Prahalad), consultants (Adrian Slywotzky), practising
managers (Jack Welch, Andy Grove) and journalists (Tom Stewart,
John Byrne).

Based on analyses of the Harvard Business Review and MIT Sloan
Management Review in 1998-1999, Davenport and Prusak found that
the majority of writers in these two business journals came from
academic backgrounds, only then becoming consultants and
managers, and finally journalists.

The writers also did not forget to put forward the interaction
between ideas and the market. It must be remembered that ideas
must also be "sold", not just stored in the minds of idea
practitioners. The relationships between idea buyers (managers),
idea sellers (the advice industry of consulting, investment
banks, business schools, law firms, rating agencies and so on),
idea market channels (publishing, conferences, and education),
and idea brokers (research groups within investment banks,
consulting and IT industry analyst firms) are set out in detail
so we can follow this interplay between markets and ideas.

All the authors' arguments concerning the importance of idea
practitioners are put forward descriptively and completely,
reflecting a high degree of insightful analysis, but still
staying reader-friendly all the way. Many examples are put
forward. Apart from GE, as mentioned earlier, other examples
given in the book include Taco Bell, BP, Dell, Xerox, Johnson &
Johnson, and the World Bank.

As a rather interesting addition, the writers also provide an
appendix with a list of business and management ideas, a list of
the idea practitioners they have been able to identify, together
with the rankings of the top 200 business gurus, with Michael
Porter occupying top place.

Overall, Davenport and Prusak have succeeded in presenting
both a complete and systematic framework and guide for business
ideas. This book is also not just head-in-the-clouds concepts,
because it is based on the writers' experience as consultants to
various businesses over many years.

Inevitably, this will be one of those works which will be a
future classic among business and management books.