July 24, 2012

A Quick Business Lesson from Einstein and Henry Ford

By Patrick Mahan

Einstein said, "The secret to creativity is knowing how to hide your sources." He wasn't advocating stealing other people's ideas, he was just saying that there's no reason to reinvent the wheel.

Ideas are everywhere. And creativity is about observing the world around you, building upon the ideas of others and then making them your own.

In business, we can implement this idea by studying "parallel industries".

One of the best examples of borrowing an idea from a parallel industry is Henry Ford and the assembly line. Contrary to popular belief, Ford did not invent the assembly line. He borrowed the idea from the slaughterhouses in Chicago's meatpacking district. He saw how a line of butchers disassembled various parts of the product as it moved along a conveyor belt, took that idea and then revolutionized automobile manufacturing.

Did he steal the idea? Of course not. He just observed what others were already doing and adapted the concept to fit his own business.

Another example: In 1981, American Airlines launched the first wide-scale frequent flyer program. Since then, restaurants, credit card providers, retailers, and many other businesses, have followed suit by implementing their own versions of loyalty rewards programs with much success.

What do radio stations, movie theaters and airlines have in common? They all sell a time-sensitive commodity. Unsold seats remain unsold forever once the movie starts or once the plane takes off. And once a radio program starts, any unsold commercial slots remain unsold forever. These are different industries with similar problems. What can they learn from each other? How can they borrow ideas from each other and use similar strategies to sell unsold slots at the last minute? Or find other creative ways to recover lost profits after the fact?

If you're a realtor who sells homes, what could you learn from Hollywood movie directors about staging and lighting and setting a mood and crafting a powerful emotional experience?

Can you think of any ideas you and your business could borrow from parallel industries?

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