Lessons in Innovation and Longevity from Hollywood
Universal Pictures was founded in 1912, Warner Brothers in 1923, Walt Disney Studios in 1923 and Columbia Pictures in 1924. How have they survived and prospered for so long in such a competitive and volatile business? Movie-making is one of the few American industries which has shrugged off competition and dominated the global market over an extended period. US TV and film exports are worth around $16B a year. The big studios must be doing something right so what lessons regarding innovation and survival can we learn from them?
1. Pivot and Restructure
Hollywood has had to see off threats which many saw as potentially fatal â€“ particularly the rise of TV, the internet and digital piracy. They have had to adjust to the vagaries of taste and fashion. They did so by understanding their customers, relentless innovation and by restructuring. The studios were once highly integrated owning cinemas and employing large permanent staffs. Now they have relatively few assets and outsource assignments to flexible talented teams.
2. Experiment, fail often and learn fast
Failure is commonplace in Hollywood. Most directors and producers have experienced a big flop. But they learn lessons and move on. Whatâ€™s more every movie is subject to constant internal criticism and ongoing revision. Pixarâ€™s hit film, Up, was radically reworked as it was being made on the advice of the â€˜Braintrustâ€™ an internal group whose job was to review and improve the product as it was being made. Many corporate CEOs bristle at criticism of their policies and products but in Hollywood everyone is a critic and every take can be replaced by a retake.
3. Empower Talent
A new creative team is formed for each film and it is given enormous freedom to make its own decisions â€“ within a budget and a timescale. There is a minimum of interference from the studio unless things go way off track. The freelancers on the team depend on their reputations to gain future assignments so they are motivated to work hard and produce great results. They take pride in their team achievements and they all get recognition on the movieâ€™s closing credits.
4. Global Ambition and Marketing
Nearly every movie is striving to be a big hit worldwide. They use aggressive well-funded marketing campaigns with heavy use of social media from the outset. They try to create awareness and buzz in their target market. They encourage reviews and word of mouth coverage. Many high-tech startups have similar challenges but fail to get the awareness and market traction that they need. They could learn from Hollywoodâ€™s marketing methods.
Every business that has to manage new product developments, creative talent and uncertain innovations can learn from Tinseltown. The people running the big studios are hard headed business professionals who know how to manage a portfolio of risky new products. They understand the importance of having a mix of safe sequels and daring innovations. They tolerate failure and learn from it. They empower teams of brilliant people. They have survived a turbulent century and stayed on top. As far as innovation is concerned we can all learn from the place that gave us a movie which embodies their success, Back to the Future.
Inspired by an article in The Economist, Creative Capitalism, Nov 1 2014,
image credit: mr.littlehand
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Paul Sloane writes, speaks and leads workshops on creativity, innovation and leadership. He is the author of The Innovative Leader and editor of A Guide to Open Innovation and Crowdsourcing, published both published by Kogan-Page. Follow him @PaulSloane
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