A Quantum Theory of Networks

 Waveforms

This week I've had a tremendous series of conversations based around the power and pitfall of innovation networks. Everyone I spoke to recognise their importance but few people – myself included – understand them or know how to harness them. Let me tell three quick, and mostly personal stories, to illustrate what I mean.

Story 1 – Square Pegs/Round Holes

The first story comes from my first job out of University, where I worked for a medium sized research and development company with an impressive history of innovation. It had (and still has) about 300 very smart people scattered across lots of small labs and offices in 6 separate buildings on a large industrial site. People generally had little idea what research was happening elsewhere in the company to any significant degree. This was in the mid-90s so the web was a mere baby compared to what it enables now.

One guy – let's call him Tony – was in his mid to late 50's and spent the majority of his time walking between the different buildings and labs chatting to people, having a coffee, enquiring about their research, and inevitably giving some useful suggestions as to what they might try next and who else within the company they should talk to. Now Tony had quite an impact on me personally and I was in no doubt whatsoever that he added tremendous value to the business in linking up disparate bits of research or science happening within the same organisation.

Now at the same time the new incoming senior management in the organisation were trying to move to a more consultancy based business model where our time was allocated to specific projects and therefore your utilisation became a key metric. Now Tony's 'utilisation' was low, partly, I suspect because he wouldn’t 'play the game' and was partially contrary by nature. Anyway I'm sorry to say that Tony was 'removed' from the organisation fairly rapidly as he couldn't immediately demonstrate his immediate value to the organisation. There may well have been other factors at play that I wasn’t aware of but I felt strongly then, as I do now, that this was a short-sighted decision made by measuring the wrong thing.

Story 2 – The Buzz of Brokerage

Secondly, I learned this week about two new innovations that are coming to market that we in the Connect team at Nesta had a direct hand in creating as we hosted the initial programmes where the collaborators got together and developed the initial proposition. One is a major collaboration between two multinational companies, and the other is a small licensing deal between an inventor and a bigger company. We got a tremendous buzz from hearing about both of these collaborations knowing that we had helped to make them happen.

Now the (literally) million dollar question is, what is the mechanism by which we could find efficient way take 0.1% of the value created? Interestingly – and I'm not that surprised or too bitter about this – in both cases the people involved had either partially or entirely forgotten that we had brought them together in the first place, and therefore securing that 0.1% from them is unlikely ever to work.

Anyway, like a pub landlord, I get a real kick out of knowing that people have made a connection in ‘our establishment’ and I think most 'brokers' do too because they are almost hard wired to make (often lateral) connections. A friend of mine who is a great broker can't help bring people together and doesn't particularly stick around or care what happens. I think he has, at an unconscious level a heightened perspective of influence, knowledge and power and how it flows.

Story 3 – Cash-mobs and Collective Action

My final story comes from Rory Sutherland, VP at Ogilvy who wrote a great blog post about collective action. In speaking to him about it afterwards he told me about the train station at Haywards Heath where the car park is right next to the train platform, but on the other side of the tracks. Instead of it being a short hop over to the platform from the car park, one has to walk a quarter of a mile to a bridge to get over to the station.

Now Rory’s solution was as follows. What if some or all of the 500 or so people who park regularly in Haywards Heath station each contributed a small amount of money, say £10 a year, so you could quite rapidly get the (say) £50,000 it would cost to put a bridge between the car park and the station, thereby saving commuters lots of valuable sleep and work time.

This makes almost too much sense to me but there is limited way for people to coordinate themselves to get such an initiative underway. He goes on to argue that brands may play a coordinating and underwriting role in getting such ‘public goods’ commissioned. I’m not sure about the role brands can play here but surely the tools exist right now for these ‘cashmobs’ (as opposed to flash mobs’) to come together.

A Quantum Theory of Networks?

Finally some of my Research and Policy colleagues at Nesta have recently done some, as yet, unpublished research into innovation networks and have developed a really useful framework for understanding them, which I’m convinced will be extremely useful.

However I’m also reminded of my quantum physics classes at University that taught me that particles exist in a sort of ‘wave of potential positions’ until observed at which point the wave collapses into a specific location. I think business or innovation networks work in a similar way. There are multiple potential collaborations, connections, marriages, divorces that exist at any one time, but they don’t stand up to too much scrutiny or measurement either. Most organisational or government attempts to support or develop networks fall flat in my experience as they are almost certainly too formal.

In a similar way pubs and clubs are places that spawn numerous relationships but you don’t measure their success based on the number of marriages, or divorces, they have initiated. Nor would the landlord expect to be invited to the big day. Rather we have a handy proxy namely income from behind the bar minus costs, which is all you really need to know about how successful the establishment is. Therefore I think we need a much more simple and/or subtle way to support, measure and understand networks.

I challenged my research colleagues asking them ‘What’s their big idea?’ (which I recognise is quite possibly not terribly helpful). All I can offer is that, when it comes to innovation I think we are looking and spending money in the wrong places. Rather than mostly investing in ideas or individuals which always distort markets, we should be investing intelligently in connecting people which create new markets. Invest in challenges not ideas and processes not events as Steve Shapiro has recently written here. The people with the power, money, or ideas, aren’t the same, so if we can spot the gaps and the connections between them then we are definitely on to something big.

So What?

I offer these stories as a starting point for a conversation and I don’t claim to have any tangible conclusions – sorry about that. In many ways I've become rather like Tony (from Story 1) myself through my work at Nesta, where we bring diverse groups of people and organisations together to see what they might create together. And ironically, I've worked with and for, lots of organisations who try to deliberately create the role of 'Network Manager/Director' with often dismal results.

I am convinced that networks are increasing in importance. Our competition or our next big opportunity can increasingly come from anywhere, so as I’ve said before we need to get much better as individuals and as organisations at building our big ideas networks as Linda Gratton from LBS calls them, and spotting what’s popping up in our peripheral vision. And, whilst the web is a tremendous tool, I still think there is no substitute for face-to-face interactions. In open innovation it’s about your perception as partner of choice and this is simply about being straight forward, decent and pleasant to work with.

Anyway, as ever I would value any feedback, conversations or suggestions. Thanks for reading to the end!

Comments

  1. Interesting post Roland!
    Static analysis of innovation networks does indeed miss the big question: which nodes (constrained or enabled as they may be by their current network position) are actually good at making the connections they need to make in order to innovate? Skill at the pub: dress, chat-up lines, displaying sincerity, knowing the landlord so he points out useful/attractive partners, are hard to capture in a static network analysis. So is which players are stuck in a groove when it comes to innovation partner selection and which ones are reflecting on and optimising their partner selection strategy. And, as with Rory’s nice example, access to the pub noticeboard to let everyone know about the latest community initiative is also a nice asset to have.
    What I think is also interesting is the question of how to reach those who never come into the pub, and those who sit in the pub behind their newspapers, minding their business and waiting for “something” to happen.

  2. Great post, and really nice storytelling. Was not hard to hang on till the end. Storytelling is a really powerful tool in connecting nodes (what else are they exchanging then narrative fragments?) I wrote a post that makes a point not dissimilar from yours: Connections create more value than Transactions in a Complex World: http://bit.ly/8qh8DY
    wonder what your take on this is?

  3. Very interesting post Roland. I agree that gaining a better understanding of innovation networks is essential, and that these networks are central to successful innovation these days.
    One idea that I think is useful here is using more network analysis to look at how these networks function, what structures are best, and so on. I am in the process of editing a special issue for my journal (Innovation: Management, Policy & Practice) right now on this topic, and I know that Industry & Innovation has a special issue coming out soon on the same topic.
    The sense I get from looking at the articles that have been submitted is that at an academic level a lot of feel that this is important, but we are only just now starting to make progress on figuring out how to measure & understand what’s going on. I think that’s the first step in then figuring out how to manage it better.
    In any case, overall, I think it is a fascinating and critical topic!

  4. Roland, this is a great post, and something that we have been discussing in terms of where the real value is.
    Like you, we see the huge importance of innovation networks, and in particular how new types of people need to be valued in new types of contexts.
    Networks can side step the standard operating frameworks of established companies and organisations and reach a new kind of collectivism, promising new tools and new ways of working.
    We see this as being in part about the role of a host, fitting in with your analogy to a pub landlord and who he brings together – and the importance of network roles and the articulation of the value of the people who act in this way.
    I love this sentence: However I’m also reminded of my quantum physics classes at University that taught me that particles exist in a sort of ‘wave of potential positions’ until observed at which point the wave collapses into a specific location.
    Linked to this is the undetermined nature of the connections and their results. The open question around measuring output is important .. It is a difficult question, as it reflects the fact that the mechanisms and people that really make things happen are often hidden, but the urgency is in discovering how we surface this and ‘measure’ it in a meaningful way without simplifying or disrupting the emerging power, agility and potential of the network.
    Your comment regarding process rather than events also resonated: seeing the design of events and the ways in which we can bring people together not as one-off occasions but building blocks of a bigger process. It’s all about creating the right conditions for an emergence of systems of influence.
    Cassie, Ellie, Simone

  5. I really enjoyed the three stories, and the different perspectives they bring, and the resulting responses too. I take your invitation to have a conversation seriously, and so offer unformed reflections back, in the spirit of conversation over coffee…
    I’ve thought for many years now about the role of the connector, and seen it as something that at times appears to be one thing I can offer; the ability to see potential fits – to show people, businesses how they connect. I recognise that at times, and perhaps particularly, when working with the public’s money, perhaps there is a need to “measure” the impact of that role, or to find a way of having that acknowledged (financially or in other ways).
    Your second story, where the people (as someone much more wise than I said) those people that are now working in new partnerships or new ways feel that “we did it ourselves”. It seems to me that this skill as a leader is differently, perhaps more, necessary now. It certainly seems as though it is being valued more – if the numbers of attempts to quantify, map and replicate that skill is a sign of value.
    I love that you point out that there needs to be an ability to create not only conditions for successful idea-generation, but doing so with an eye on the landscape, with thought of how those new ideas will be connected to the different elements of a system – to people who can realise and fund and distribute are being recognised.
    What I see as being true is that the people who are able to make those connections need not only to be able to inspire trust, but imagination. If there does need to be, or if the connector wants a trail back to them then there are, of course, lots of ways for that to be established; and they can either be overt, in a contract (although that may feel like it would make a light process heavier) or through the relationship being maintained in some way. I’ve gratifyingly had good experiences of people acknowledging the connections that I made for them some years back. I also recognise that this requires confidence and generosity from all parties. I have also smiled and enjoyed it when people have stood having forgotten the initial connections I made.
    A little bit of me wants to say, wasn’t it ever thus, and another part of me recognises that we have different tools available to us, we have, perhaps, new ways of analysing networks; a larger part of me is just excited and pleased at something quite simple. It is that you – and those commenting and the wider debate – through the work you do are providing recognition that we need to support new ways of doing things, and new ways of bringing different skills and groups together in order to affect change; and this process may value the role of the connector differently.

  6. Thanks all for your great comments so far. Really appreciate all of your responses.
    Chris – ah yes those lurkers who complain that it’s a rubbish party but won’t actually speak to anyone and help get it started.
    Berend – thanks for your kind words and the link too. Had a quick look at your post. I love abstract/conceptual art too and suspect it is a brain wiring thing. I am a firm believer in Conversations first, then relationships, then transactions
    Thanks Tim – agree it’s an important area and look forward to hearing the outcome of the research. My take for what it’s worth is network analysis is very worthwhile but i’ve seldom seen it done well to be honest.
    Cassie, Ellie, Simone – in 3 part harmony 😉 – yes the conditions for emergence are fascinating and fragile. perhaps, as you say the mechanisms and people that really make things happen are hidden, but intuitively I feel there must be a way to surface these mechanisms without destroying them.
    Sian – wow what a comment. That’s a blog post in it’s own right! And yes how could I forget Dr Karen who massively influenced me here and I shamefully neglected to credit. loved your way of expressing yourself here and great that your role as a connector has been recognised, as it should. We could all do with a tad more confidence and generosity I guess.
    Anyway, thanks again all 🙂

  7. Couldn’t agree more Roland.
    I think we’re on the same page here, but I’m fortunate that here in Manchester the value of ‘Tony’s work’ is recognised.
    Manchester: Knowledge Capital has been running for a few years now, but about 12 months ago they recognised the need for an ‘Innovation Activist’ and I joined the team (the job title alone was worth an application!).
    When I explain what I do, I shamelessly use the Technology Strategy Board line “Connect and Catalyse” – but you’re right, this input is not always remembered or rewarded. I know that Rolls met Royce in the Midland Hotel, Manchester – but whether they were introduced or just started chatting at the bar, I don’t recall.
    So yes, the challenge is in the metrics. I’ve tried creating spreadsheets with meetings and outcomes, but if you’re like me, you run between all these connections and don’t really have time for lengthy write-ups (you can see that from the lack of entries on my blog).
    What I, and maybe you?, need is an app that works on the move that logs the connection and endorses likely outcome – if anyone wants to work with me developing an app for that, please get in touch!

  8. Chris write: “What I think is also interesting is the question of how to reach those who never come into the pub, and those who sit in the pub behind their newspapers, minding their business and waiting for “something” to happen.”
    Certainly, it’s a given in social and community regeneration, that these groups can and are reached if initiative is trestled on the backs or or motivated by a core group who act as ambassadors, role models and enthusiasts who spread the message. Slowly but surely, there’s a gravitational pull where people who are negative turn positive. It’s a difficult alchemy but not particularly difficult to pull off, so long as the process and its objectives are organic, flexible and the agents/ambassadors feel that they control it all.
    And a great post Roland! 🙂

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