S Eriously Silly

Freedom to play breeds innovation--and productivity. Just ask the founder and CEO of IDEO

At fabled product-design company IDEO, acting goofy is all in a day's work. Employees play miniature golf and toss Nerf balls in the hallways and race desk chairs in the street outside the company's Palo Alto (Calif.) headquarters.

Isn't "fun workplace" a bit of an oxymoron? Not to David M. Kelley, CEO and founder of the now-350-employee business. He thinks play ignites the innovative spirit. With more than 3,000 products under IDEO's belt over two decades--including Apple Computer Inc.'s first mouse and a stand-up toothpaste tube for Crest--Kelley is clearly on to something.

These days, Kelley, who teaches at Stanford University's Product Design Program and consults on innovation to companies large and small, wants to invent thinkers, not just products. Kelley talked to reporter Charles Butler about creative culture and how small fry can exploit their freer, less rule-driven environment to foster innovation.

Q: When do you know if a company has an innovative culture?

A: In a creative culture, everybody feels comfortable speaking up, even in front of the president. In a hierarchical, noncreative company, everybody feels afraid and waits to see what side the president or senior management comes down on. Big ideas happen when people build on each other's ideas.

Q: Why is having fun so important?

A: It's all in the breakdown of barriers of who's important in the company. You can be playful when everybody feels they're just as important as the next person. The reason you're not throwing a Nerf ball around at IBM is not that you're not playful; it's fear of retribution from somebody higher up. So if you can break down that barrier, everybody not only feels comfortable throwing the Nerf ball but coming up with ideas.

Q: But how can you funnel playfulness into productivity?

A: For us, a good day is when we have what we call "brainstormers," and in our culture, the highest form of status is being invited to a lot of brainstormers. That means people value you. The fun part is that you've been invited to give ideas even if it's not your client or project.

Q: How can office design help create a team atmosphere?

A: Most companies put people in individual offices, and if there's any space left, they build a conference room. Totally wrong. First, build group space. Every project is important, so why not have a group room where you put the collective stuff the group owns--the material, the information, the prototypes? Then you build offices around it.

Q: Are small businesses more apt to be innovative?

A: For sure. The reason is the rules. They're the biggest deterrent to innovation or creativity. In a small company, you know who's making the rules or you know it's O.K. to break them if you have a good idea. But as small companies get bigger and start making more rules, I recommend that they still let their people feel empowered to break them--or at least question them if they have a special job to do.

Q: These days, everybody seems crazed at work. How can we find the time to be innovative?

A: We call it "busy-itis." It's just a macho thing. Right now, no one can go home and do anything but say: "I'm so busy, I can't keep up." It's a fad. I don't think it's related to creativity. It's a question of who in the company is dedicated as the strategic people. We'll reorganize companies to have an advance-concept group, which is like R&D, and this is the reason: Everybody who is grinding it out and getting the present product out feels better knowing the company has a vision of the next product.

Q: You recommend making innovations very rapidly. Doesn't that lead to mistakes?

A: The best path to innovation is through what we call enlightened trial-and-error. The day a project starts, make a bunch of crummy prototypes and the next day show them to customers, users and manufacturing. They'll tell you what's wrong. Take copious notes and fix it. Just keep speeding along to finalize what the idea is.

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