Here is a brief excerpt from an article written by Donald Sull for the McKinsey Quarterly, published by McKinsey & Company. He believes — and agree — that constraints aren’t the enemy of creativity—they make it more effective. To read the complete article, check out other resources, learn more about the firm, obtain subscription information, and register to receive email alerts, please click here.

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When it comes to innovation, the single most common piece of advice may be to “think outside the box.” Constraints, according to this view, are the enemy of creativity because they sap intrinsic motivation and limit possibilities.

Sophisticated innovators, however, have long recognized that constraints spur and guide innovation. Attempting to innovate without boundaries overwhelms people with options and ignores established practices, such as agile programming, that have been shown to enhance innovation. Without guidelines to structure the interactions, members of a complex organization or ecosystem struggle to coordinate their innovative activities.

How, then, can organizations embrace a more disciplined approach to innovation? One productive approach is to apply a few simple rules to key steps in the innovation process. Simple rules add just enough structure to help organizations avoid the stifling bureaucracy of too many rules and the chaos of none at all. By imposing constraints on themselves, individuals, teams, and organizations can spark creativity and channel it along the desired trajectory. Instead of trying to think outside the wrong box, you can use simple rules to draw the right box and innovate within it.

Simple rules cannot, of course, guarantee successful innovation—no tool can. Innovation creates novel products, processes, or business models that generate economic value. Trying anything new inevitably entails experimentation and failure. Simple rules, however, add discipline to the process to boost efficiency and increase the odds that the resulting innovations will create value.

Simple rules are most commonly applied to the sustaining kind of innovation, often viewed as less important than major breakthroughs. The current fascination with disruption obscures an important reality. For many established companies, incremental product improvements, advances in existing business models, and moves into adjacent markets remain critical sources of value-creating innovation. The turnaround of Danish toymaker LEGO over the past decade, for example, has depended at least as much on rejuvenating the core business through the injection of discipline into the company’s new-product development engine as it has on radical innovation.

Simple rules can also be used to guide a company’s major innovations. In the early 2000s, for example, Corning set out to double the number of major new businesses it launched each decade. A team evaluated the company’s historical breakthrough products, including the television tube, optical fiber, and substrates for catalytic converters. By identifying the commonalities across these past advances, the team articulated a set of simple rules to evaluate major innovations: they should address new markets with more than $500 million in potential revenue, leverage the company’s expertise in materials science, represent a critical component in a complex system, and be protected from competition by patents and proprietary process expertise.

What simple rules are (and aren’t)

Simple rules embody a handful of guidelines tailored to the user and task at hand, balancing concrete guidance with the freedom to exercise creativity. To illustrate how simple rules can foster innovation, consider the case of Zumba Fitness.1 That company’s fitness routine was developed when Alberto Perez, a Colombian aerobics instructor, forgot to take his exercise tape to class and used what he had at hand—a tape of salsa music. Today, Zumba is a global business that offers classes at 200,000 locations in 180 countries to over 15 million customers drawn by the ethos “Ditch the workout. Join the party.”

Zumba’s executives actively seek out suggestions for new products and services from its army of over 100,000 licensed instructors. Other companies routinely approach Zumba with possible partnership and licensing agreements. In fact, it is deluged by ideas for new classes (Zumba Gold for baby boomers), music (the first Zumba Fitness Dance Party CD went platinum in France), clothing, fitness concerts, and video games, such as Zumba Fitness for Nintendo Wii. Zumba’s founders rely on two simple rules that help them quickly identify the most promising innovations from the flood of proposals they receive. First, any new product or service must help the instructors—who not only lead the classes but carry Zumba’s brand, and drive sales of products—to attract clients and keep them engaged. Second, the proposal must deliver FEJ (pronounced “fedge”), which stands for “freeing, electrifying joy” and distinguishes Zumba from the “no pain, no gain” philosophy of many fitness classes.

These two principles for screening innovation proposals illustrate the four characteristics of effective simple rules. First, Zumba’s rules are few in number, which makes them straightforward to remember, communicate, and use. They also make it easy for the founders to describe the kinds of innovations most likely to be chosen and to explain why specific ones weren’t. Capping the number of rules forces a relentless focus on what matters most, as well. Zumba’s success depends on the passion of its instructors and the differentiation of its offering from less playful exercise options. The rules encapsulate the essence of the company’s strategy.

Second, effective simple rules apply to a well-defined activity or decision (in Zumba’s case, selecting new products and services). To promote innovation, many executives embrace broad principles—like “encourage flexibility and innovation” or “be collaborative”—meant to cover every process. To cover multiple activities, rules must be extremely general, and often end up bordering on platitudes. These aspirational statements, while well intentioned, provide little concrete guidance for specific activities. As a result, they are often ignored.

Third, simple rules should be tailored to the unique culture and strategy of the organization using them. Many managers want to transplant rules from successful companies without modification—a big mistake (see sidebar, “Pitfalls to avoid when making rules”). Finally, simple rules supply guidance while leaving ample scope for discretion and creativity. Zumba’s simple rules provide a framework for discussing and identifying which innovations are attractive but are not mathematical formulas where you enter the inputs and the answer pops out. The best simple rules are guidelines, not algorithms.

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Here is a direct link to the complete article.

To learn more about Donald Sull and his work, please click here.