The Power of Storytelling

In the last several decades, we have become much better at doing things right. Well-understood project management tools help companies manage schedule, cost, and require- ments; program management tools help companies leverage value across projects; and portfolio management techniques help spread risk across projects and across time.But innovators face a conundrum: we're doing things right, but are we doing the right things? That's a harder ques- tion to answer, because it requires seeing into the future, and our tools for peering into the future are far less developed than our tools for managing the present. For example, we can use mathematical technology-forecasting techniques to estimate the likely growth of an industry or market or the adoption rates of technologies, or to compare the anticipated performance of a new technology with an existing one. We can also develop scenarios of alternative future states by ex- trapolating from a few key forces or trends. Yet these tech- niques really don't paint a complete picture of the future-they don't help us understand the challenges that the customer of the future will face. For that, we need a different tool, one not usually associated with technological innovation: storytelling. Storytelling links potential future states to the actors within them. Once this link is made, problems that will exist, and potential solutions, become much clearer.One of the main reasons companies fail to see the future coming is i nnovation blindness-the inability to see how the future might unfold in a manner different from the way the past has evolved. The more successful an established com- pany is, the more likely it is to suffer from innovation blind- ness. Established business computer companies nodded as personal computers displaced mainframes for business use, and many of these same companies later failed to recognize that tablet usage would outpace PC use, not over decades but in just a couple of years. Large steel companies never thought that mini-mills would successfully compete with them, let alone disrupt the entire industry. And who would have pre- dicted that Chrysler's minivan would displace the station wagon and revolutionize the auto industry-or that this rev- olution would blend into the political landscape with the rise of the soccer mom a decade later?While Stage-Gate and lean manufacturing techniques have helped many companies better manage resources and reduce waste, their focus on efficient linear handoffs within the innovation cycle or the reduction of variation with the production environment has contributed to innovation blindness by reinforcing existing beliefs about how things work. This seriously constricts innovation-not the incre- mental innovation that expands novel ideas into powerful brands or product families, but the breakthrough innova- tions that seed new industries or disrupt established products or services. Applying existing beliefs to future states rarely leads to nonobvious conclusions.We can escape the trap of innovation blindness, but that requires looking past what we know to what we can imag- ine. Storytelling is a powerful imaginative tool. Stories can allow us to see the world through the eyes of characters very different from ourselves. They free us from the constraints of our own experience and help us to envision other lives. In doing so, stories weave together alternative cause-and-effect relationships, offering vivid windows into different versions of the future. I'm not the first to note this. John Kotter, a Harvard Business School professor claimed that we learn best from hearing stories that strike a chord within us, arguing that leaders who fail to grasp the power of stories risk failure.Beyond the emotional appeal of stories, narrative structure can help guide thinking about breakthrough innovation. Stories typically unfold in three acts. Act one begins with the set-up, laying out the players, their relationships to one an- other, and their situation. …