Art or Science?

Business is not an either/or proposition -- a cycle of innovation and analytical operation is needed to succeed.

Is it an art or a science? I don't even have to tell you what "it" is for you to identify with the perennial debate. Leadership: art or science? Innovation: art or science? Effective time management? Compose a symphony? Write a book?

In their 2007 best seller Competing on Analytics: The New Science of Winning, Thomas Davenport and Jeanne Harris argue and explain the value of science through the analysis of data. On the flip side, Malcolm Gladwell argues in Blink that intuition, built on years of experience, can often be the best decision making tool. Which is it? The answer, of course, is both. But no one likes that answer, because it seems like a cop-out.

There is, of course, a better answer than "both." And that answer is, "it depends." It's not so much that it depends on "the situation," but rather it depends on where something is in its evolutionary process.

Let me illustrate with an example used in Competing on Analytics. In chapter one, a fairly lengthy history of the movie-rental business, Netflix is cited as a great example of a "come from nowhere" competitor that shook Blockbuster to its core by offering movie rentals through an on-line portal and delivering them via the US Postal Service. The book goes on to explain how analytics -- a deep understanding of customer wants and how to deliver on them -- led to great competitive advantage. Pure science, you might say. But looking beneath the surface, you'd find that the decision to get into the movie rental business was based on much more of an intuitive sense of how movies could be supplied better -- in other words, more art than science. So the founders of Netflix quickly moved from art to science as they implemented their new business.

Well, here's the thing about science. Science is clear. There's little ambiguity in science. In some cases there are physical laws, or mathematical equations, or strict methodologies that define the very best way of doing things. In some cases it takes years to master a science. In other cases, it simply takes buying a new piece of software into which someone else has programmed the scientific rules. But in all cases, the more anything becomes a science, the faster the next competitor can adopt it. Ultimately, science levels the playing field, and computers or automation commoditize it.

The result is this: to differentiate ourselves, we need to begin the cycle all over again by returning to art.

This cycle of art evolving into science, only needing to return to art once again, is at the heart of today's innovation craze. Yet few really understand that it is, in fact, a cycle. For example, a recent headline in CIO Magazine read: "You've Nailed Operational Excellence. What's Next?" But the headline misses the point. You don't move beyond operational excellence; you just have to balance it with the need for innovation. You have to generate new, differentiating and, in most cases, less perfect or immature ideas. Then you need the techniques of operational excellence to master them and make them work.

Companies that are preparing to leave their operational excellence days in the past to pursue a generation of innovation are going to find themselves right back where they started ten years ago -- with defects, inefficiencies and unhappy customers.

There's an old saying, "history is destined to repeat itself." I, for one, don't believe this has to be true. I believe companies, like people, can change for good without repeating cycles. I believe corporations can embrace the reality that they always need both sides of their selves to succeed.