این فصل را با ذکر تمام تیترها (تاکید می کنم با ذکر تمام تیترها) به انگلیسی روان خلاصه کن   5	Creativity and Innovation
	
Ideas shape the course of history. (John Maynard Keynes)

This chapter explores one of the most important strategic issues for media firms – reativity. The links between this and previous chapters are strong: creativity is the first stage of innovation, innovation is implicit in all technological advance, and technological advances are a major driver of strategic change in the media.

Creativity in media organisations – why it is so important strategically and why that importance is increasing in the current environment – is therefore the focus of this hapter. Like other chapters in this book, it begins by reviewing theoretical nderstanding of this issue, that is, how creativity ‘occurs’ or what drives creativity in organisational settings. It then looks at how understanding of creativity has developed over time, and at how creativity that occurs inside organisations is defined, in the process delineating the distinction between creativity and innovation, two terms that are frequently and (in the scientific sense) erroneously sed interchangeably. One of the biggest strategic challenges facing media rganisations now is that the need for creativity has expanded. As a result of technological advances and the resulting changes in platforms, products and onsumption habits, they must now be creative in a broader realm than simply the ontent they produce. This chapter therefore also explores creativity in terms of ystems and business models.

This chapter draws heavily on a single body of theory, socio-constructivist pproaches to organisational creativity. These identify the sources of creative esponses in individuals and institutions, and the aspects of the work context that influence levels of creativity in organisations. This body of theory was not developed within the context of the media industry but is highly relevant to it. It ddresses particularly organisations with knowledge workers – professionals who re required to solve complex problems creatively – and it provides insights into the reasons behind performance differences between media firms. It is not, however, well known by scholars or managers, and this chapter seeks to rectify this by providing a media industry-orientated overview of the theory.
 
The role of creativity in the media
Creativity is, of course, central to all organisations – a new idea is the ncircumventable first stage in all new organisational initiatives – whether involving products, processes or procedures (Amabile, 1988; Staw, 1990; Woodman et al., 1993), and these new products, processes and procedures are the ornerstone of an organisation’s ability to adapt, grow and compete (Kanter, 1983, 1988; Porter, 1985; Van de Ven, 1986).

Creativity is arguably even more important for media firms – they don’t need the dd great idea, but rather an ongoing supply (Caves, 2000; Towse, 2000; Hesmondhalgh, 2002). Performance is strongly affected by the quality of content they create, with ‘create’ being the operative word. The act of content generation is the sector’s fundamental activity andraison d’être, and thus the requirement for reativity is constant.

From an economic perspective, creativity is a critical strategic resource because of the nature of cultural goods. Because they can rarely be standardised on a long-ter basis, and because customer demand is fickle, there is an incessant need for
ovelty. Viewed strategically, the higher the levels of product creativity, the higher the media firm’s ability to satisfy this customer need and the greater the potential for market success and competitive advantage. This gives rise to the primacy of reativity as a strategic organisational resource, since ‘without their employees oming up with ideas that can be turned into commercial, saleable commodities [media firms] are dead’ (Scase, 2002: 8).

Inside the sector, creativity is so much part of the DNA of everyday activities that it is often hard to see at surface level. Researchers without empirical exposure to the ector can be surprised by the absence of roles or business units overtly tasked
ith ‘innovation’ or ‘research and development’, and wrongly conclude that the industry places surprisingly little emphasis on such an important factor. What they
iss is that creativity is deeply embedded in many routine roles. And the need for reativity extends further than coming up with the original idea: decisions oncerning how to develop the product, exploit technological features, find the right
price, recruit the right talent, and promote the product to the industry and to onsumers, all involve creativity.

It is almost self-evident that the need for creativity – in all firms, not just media nes – is exacerbated when environments become more turbulent, an observation ade decades ago by Schumpeter (1942) (DeVanna and Tichy, 1990; Bettis and Hitt, 1995; Ford and Gioia, 1995; Dutton et al., 1997; Hitt et al., 1998; Eisenhardt nd Martin, 2000; Danneels, 2002), especially when that turbulence involves merging technologies (Yoffie, 1997), as is currently the case with the media
 
ector. Thus, while creativity has always been critical to the media industry, technological change has both underlined the strategic centrality of creativity for th ector and expanded the scope within organisations where creativity is required.
Media firms must now not only to be more creative with their products, but also rganisationally and strategically. They must apply creativity to business models, the design of their organisations and the roles within it, and develop new products nd services for entirely new categories of media platforms and audiences.

In a study of media majors’ convergence strategies, Dennis, Wharley and Sheridan ommented that:

once associated with writers, producers and designers, creativity is now mentioned as an essential quality for managers and executives as well. Partly because some content producers are medium-centric and have little experience across platforms, business executives are increasingly asked to think creatively about integrating content, marketing strategies and audience data beyond decades old distribution channels as they seek new formats and communicative styles. Given the need for business models that exploit convergence, creativity is a critical skill set. (Dennis et al., 2006: 33)

Although strategy theorists agree on the importance of creativity to organisations, verall, surprisingly little attention has been devoted to increasing understanding of its origins and influence on performance. This omission is reflected in science in general, where for a variety of reasons the subject was long avoided, a tradition tretching back to Plato, who felt that creativity involved divine intervention and
as therefore outside the scope of man’s intervention. Popper concluded that esearch into creativity was irrelevant rather than unfeasible since creative inspiration is an irrational process and could not be accessed via scientific or ystematic investigation. For management researchers, especially those of the positivist school, the inspirational component of creative acts made them hard to ccommodate within rational management concepts.
 
Researching creativity
Despite these reservations, from the 1950s onwards a steady and growing stream of esearchers has investigated the nature and causes of creativity, albeit not within th ontext of the media industry. In the period from 1950 to the 1980s there were two lear strands in this work: the first focused investigations on the creative
individual, and the second on the creative process.

Investigations into gifted individuals were premised on the assumption that reativity was more or less determined at birth, that a few exceptional individuals re ‘born creative’. This so-called ‘person approach’ looked at outstandingly reative individuals in the field of arts and science, often retrospectively through nalysis of autobiographies, letters, journals and other first-person accounts, and ought to identify the cognitive processes and personality traits that might be predictive of creative performance (Barron and Harrington, 1981; Amabile, 1988, 1996; Deazin et al., 1999). A typical finding is Koestler’s proposition that rather than being a random process, creativity results from the deliberate connection of two previously unconnected ‘matrices of thought’ (1964, cited in Amabile, 1996: 21). From a gifted individual’s thought processes, research shifted to the wider personality of creative individuals, that is to ‘those patterns of traits that are haracteristic of creative persons’ (Guilford, 1950, cited in Amabile, 1996: 21), nd an approach rooted in psychometric testing.

The second major strand in creativity research concerned the process by which reative products are generated, the so-called ‘process/product approach to reativity’. This concentrates on the characteristics of processes that lead to reative outcomes (Amabile, 1988, 1996; Oldham and Cummings, 1996) and has ow become the dominant approach to the field (Amabile, 1983; Woodman et al., 1993).

Context was seldom an explicitly addressed variable in these studies, although the ajority of these were conducted in creative or intellectual settings such as schools nd various types of cultural institution (Ford, 1996). Over the years, the research domain has broadened to include more prosaic institutional settings (Ford and Gioia, 1995) and from group to pan-organisational environments – although investigations of small project groups have tended to dominate (Deazin et al., 1999).

However, an explicit focus on the influence of the work setting on creativity was bsent until the 1980s when Amabile sensitised the research community to this mission and instituted a new branch of research (Staw, 1990; Ford and Gioia, 1995). This new research strand, also known as ‘interactionist’ or ‘socio- onstructivist’ approaches, looks at how social influences and contextual factors
 
influence creativity. Aspects previously stressed, such as cognitive skills, personality traits and process issues, are not ignored but subsumed into a larger framework. The approach is more egalitarian than some: creativity is not restricted to the chosen few; rather, it assumes that given the right task and circumstances most individuals are capable of certain levels of creativity. To that extent it is also positivist in that it assumes that changes in the environment can produce changes in levels of creativity – this has led to criticisms of functional-reductionism (Rousseau, 1985; Deazin et al., 1999).

This approach does, however, allow a coherent framework to be constructed oncerning how strategic management can further creativity. It is therefore used to upply a backbone for the analysis and discussion in this chapter, since media rganisations cannot rely on a scattershot approach to creativity but rather need a ystematic strategy for building sustained creativity.
 
What is creativity in organisational contexts?
This chapter focuses on creativity inside organisations – where creativity is equired for business, rather than for personal purposes. Of course, it is not only th edia industry that needs a strong pipeline of creative ideas. Many other sectors do too, including the pharmaceutical industry, biotech, high-end luxury goods, retail, nd many more.

Theories of organisational creativity do, however, provide a definition of creativity that is precise and comprehensive enough to be employed as a basis for research: ‘A product or response will be judged as creative to the extent that (a) it is both a ovel and appropriate, useful, correct or valuable response to the task at hand, and
(b)	the task is heuristic rather than algorithmic’ (Amabile, 1996: 35). Drawing from this definition, four criteria can be identified to define creativity in a product or ervice:

1.	It is original, novel or unique and solves a challenge that is open-ended, where there is no clear straightforward path to an acceptable outcome (in psychological terms an heuristic rather than an algorithmic response to a problem). The term ‘path to a solution’ is critical – with heuristic tasks it is part of the problem-solver’s task to identify an appropriate solution, and identifying the nature and scope of the problem is a key aspect of the creative task (Amabile, 1983: 127). Novelty for commercial products that need to find a market, as opposed to those designed to meet purely artistic and cultural ends, does however need to be tempered. Originality is important, but commercial media products ideally blend familiar and novel elements (Lampel et al., 2000), and finding a synthesis of the two is a highly subjective process that depends on high levels of sector expertise (the importance of expertise for sustained creativity is discussed below).

Figure 5.1Defining criteria of creativity in organisational settings (adapted from Amabile, 1983, 1988, 1996)
 

2.	It resonates with the public and/or finds commercial success, and, by
extension, it is useful, has value and/or brings benefits to others. An original product which pleases only those who created it, and perhaps a select group of industry experts, but which is not perceived by potential users or customers as valuable and novel, cannot be termed a successful creative entity according to this body of theory.
3.	It receives critical acclaim. Assessments of creativity are socially constructed, that is, there are no absolute criteria for judging whether a product is creative or not, subjective judgement is always involved. That subjective judgement derives from the social context and development of the particular field. It is therefore impossible to judge the creativity of a product without some knowledge of what else exists in a domain at a given time (Amabile, 1996: 38) – which means that creativity is linked with experience and expertise in a certain field. Thus definitions of creativity also include assessments from industry insiders and experts. A useful metric in this regard for the media industry is industry awards.
4.	Finally, and here the organisational perspective comes to the fore, in order to be creative a product must help the organisation meet its strategic objectives and work within available budgets and timeframes.
 
Creativity versus innovation
Innovation and creativity are slippery concepts. Practitioners tend to use them interchangeably, and so do many researchers – see, for example, Drucker (1985) nd Burns and Stalker (1961/1994). This does, however, confuse two different treams of scientific research that have different scholarly associations, pistemological roots and areas of application.

Research into creativity is based, at root, on psychology. It focuses on the initial inspiration – the ‘bright idea’ – that leads to the creation of a new product or ervice. Innovation from this perspective is understood as the successful implementation of creative ideas in the shape of processes, products or services (Amabile, 1988, 1993; Woodman, in Ford and Gioia, 1995).

Innovation is a broader concept. Innovation theory concerns the processes by which products are manufactured, the organisation structures and strategies that support this process, and the relationship between innovation and corporate performance (Utterback, 1994). Thus Janszen (2000: 8) defines innovation as ‘the ommercialization of something new’. Theories of innovation stem predominantly from the fields of engineering and technology management. These tend to subsume reativity under the umbrella term of innovation, viewing creativity as a subset of the broader domain of innovation, and innovation as a subset of an even broader onstruct of organisational change (Woodman et al., 1993). Innovation theory is losely linked to the study of entrepreneurship – thus Drucker (1985: 26) describes it as ‘the specific instrument of entrepreneurship’.
 
Where does creativity come from? The core components of creativity
The first stage in any new program, product or service depends on someone having good idea – ‘the creative spark’ – and then being able to develop that idea further.
Both the likelihood of having that initial idea and developing it into a concrete ntity are strongly influenced by the social environment within organisations (Amabile et al., 1996). According to socio-constructivist approaches, creativity has three core components which need to be present in an organisation if creativity is to occur. These are outlined below (and discussed in detail in Amabile, 1983, 1988, 1993, 1996, 1998; Amabile et al., 1994, 1996, 2002, and the following text draws on these references unless otherwise indicated).
 
1.	Creativity-relevant skills

The best way to have a good idea is to have lots of ideas. (Linus Pauling)

These refer to the ability to think creatively and generate different alternatives. Alternatives are necessary because individuals who have access to a variety of potentially relevant ideas are more likely to make the connections that can lead to reativity (Amabile et al., 1996). Creativity-relevant skills include:

Cognitive style. This includes the ability to understand complexities, to break ‘cognitive set’ during problem solving, to keep options open as long as possible, to suspend judgement, to use ‘wide’ categories allowing relationships to be found between apparently diverse pieces of information, to remember accurately and to break out of ‘performance scripts’. Bennis and Biederman (1997) point out that members of highly creative teams tend to enjoy this kind of problem-solving activity for its own sake.
Creativity heuristics. This involves ways of approaching a problem that can lead to set-breaking and novel ideas. They can be highly idiosyncratic, but they should allow the exploration of new cognitive pathways.
Working style. Creativity requires a working style that is far from popular preconceptions concerning the work style of ‘creative individuals’. Rather than being chaotic and undisciplined, as popularly understood, creative teams need to combine a range of rather pragmatic abilities: to concentrate for long periods, to abandon unproductive searches or temporarily give up on stubborn problems, persistence, high energy levels, high levels of productivity, self- discipline, an ability to delay gratification, perseverance in the face of frustration, independent judgement, a tolerance for ambiguity, a willingness to take risks, and a high level of self-initiated, task-orientated striving for excellence.
 
2.	Expertise
Termed by psychologists as ‘domain-relevant skills’, expertise represents a ombination of knowledge of the existing facts and issues concerning a specific rea (or domain), coupled with the experience necessary to be able to find feasible
olutions to problems in that field. Expertise, unsurprisingly, arises from immersio nd experience, and for that reason newcomers to an area who lack knowledge of prior work are unlikely to be able to come up with truly path-breaking, creative olutions.

Expertise in the media field tends to rest on tacit rather than codified knowledge (Lampel et al., 2000). It stems not from qualifications attained, say, in the fields of ngineering or finance, but from a combination of experience derived from
xposure to the field and individual judgement and intuition.
 
3.	Intrinsic motivation

The greatest pleasure that life has to offer is the satisfaction that flows from participating in a difficult and challenging undertaking. (Mihaly Csikszentmihalyi)

Intrinsic motivation, the final component of creativity listed here, is first among quals. It provides the cornerstone for this body of theory, which is also known as the ‘intrinsic motivation theory of creativity’. Intrinsic motivation will be familiar to many as the state of ‘flow’. It means being motivated to do something for its own ake, because the task in itself is pleasurable and rewarding, rather than because it provides a means to meet an extrinsic goal.

Intrinsic motivation matters for creativity because when levels are high so too is ognitive flexibility and the ability to deal with complexity (McGraw, 1978). In this state individuals are more likely to take risks, explore new solutions and xperiment. Intrinsic motivation explains why many talented and highly educated individuals are keen to work in the media industry and creative arts despite elatively low salaries: the state of flow is so gratifying that people will tolerate low pay (or no pay at all in the case of industry internships), and in extreme cases physical or psychological discomfort to achieve it, something that the media industry and cultural sector wittingly or unwittingly has long exploited.

By contrast, external motivation – the motivation which results from external goals can undermine creativity. External motivation is motivation that arises from ources outside the task – evaluation, deadlines, rewards such as bonuses, ompetition – a nagging parent in the case of children. It is important to note that xtrinsic motivation does not preclude high-quality output. It can give rise to good ork but is unlikely to lead to creative breakthroughs because it narrows the ognitive focus and precludes the path-breaking novel solutions that are the hallmark of true creativity. Indeed, external motivators such as financial rewards have been found to ‘crowd out’ intrinsic motivation (Frey and Jegen, 2000) – as Drucker pointed out when he warned against ‘bribing’ knowledge workers with tock options (Drucker, 1985).
 
Designing a work environment to boost intrinsic motivation

We learned that the only way for businesses to consistently succeed today is to attract smart creative employees and create an environment where they thrive at scale. (Google founder Eric Schmidt, cited in Schmidt, Rosenberg and Eagle, 2014)

The idea that it is possible to ‘organise’ for creativity may seem like a
ontradiction in terms, but a prime contribution of the body of theory this chapter is based on is to demonstrate that relatively prosaic changes in the work environment an have a direct positive effect on levels of intrinsic motivation, and therefore on reativity. Five aspects of the work environment have been identified as particularly influential: encouragement, challenge, autonomy, resources, and team omposition and function. (These are discussed in detail in Amabile, 1983, 1988, 1993, 1996, 1998; Amabile et al., 1994, 1996, 2002, and these sources are the prime references in the following sub-sections, unless otherwise indicated.)
 
Encouragement
If creativity is required from staff, then those in charge need explicitly to request it, nd explain why it is strategically important. Often a company will prioritise reativity, but miss taking the steps that underline their commitment. Actions which an show that creativity is a priority include how key strategic goals and key performance indicators (KPIs) are set, which projects are put at the top of the genda, which projects or teams are given resources, and which behaviours or teams are most highly rewarded. Creative contributions need to be publicly elebrated. Feedback on new ideas is also important. If these are disregarded or handled clumsily, staff can feel that the interest in creativity is only cosmetic and xperimentation will be discouraged. This is dangerous since high levels of reativity need high levels of experimentation. Attention must be paid to all uggestions, good or bad, and ideas that are unsuitable need to be evaluated onstructively.

Figure 5.2Contextual factors influencing levels of intrinsic motivation (adapted from Amabile, 1983, 1988, 1993, 1996, 1998; Amabile et al., 1994, 1996, 2002)

 
The creative challenge and how it is framed

Creative people work for the love of a challenge. They crave the feeling of accomplishment that comes from cracking a riddle … they want to do good work. (Florida and Goodnight, 2005: 127)

Creativity is enhanced by clearly defined overall project goals (Amabile and Gryskiewicz, 1989), which means that the creative challenge must be clear, nambiguous and feasible. Complex tasks that are challenging, multi-faceted and on-routine increase intrinsic motivation (Amabile, 1988; Oldham and Cummings, 1996), but the degree of stretch needs to be calibrated carefully. Complex hallenges need to be mobilising but not overwhelming, and there needs to be a good match with expertise and creative-thinking skills. Kanter (2006) describes how adjusting the creative challenge increased creativity atTimemagazine. In 1992, when new CEO Don Logan took over, the magazine was poor at developing ew titles. This was reversed by replacing a too-demanding requirement that new oncepts should have immediate bestseller potential with a requirement that staff xperiment with original ideas with long-term potential.
 
Autonomy
Autonomy featured prominently in the last chapter’s discussions of how rganisations can structure themselves to respond to far-reaching technological hanges. In this chapter we explore why autonomy also fosters creativity.

Autonomy is perhaps first among equals of the contextual factors required for high levels of intrinsic motivation. In this context it simply means that the creative team eed to be free to get on with solving their creative challenge. Those engaged in reative projects need autonomy, particularly freedom from organisational onstraints such as burdensome reporting requirements and the fulfilment of non- ssential organisational tasks.

Like resources (below) this factor must be carefully gauged. The creative team hould be able to decide autonomously how their goal is to be achieved (that is, oncerning the process by which they solve their problem), but they do not need utonomy in deciding what that goal should be. The goal itself should remain clear, onstant and unambiguous. This is critical because autonomy concerning process fosters creativity because it heightens a sense of ownership, and therefore intrinsic
otivation, and also allows employees to approach problems in ways that make the ost of their expertise.

That small group autonomy is important for creativity seems to be familiar to some f the largest players in the industry. News Corporation has a tradition of viewing mall decentralised groups as critical for generating quality content within the ontext of a large global media conglomerate, and Rupert Murdoch has spoken of the dilemma of striking a balance between encouraging independence but ensuring verall responsibility. He gives executives at the local level the freedom to deal
ith problems as they arise, but will personally intervene in crisis situations (Coleridge, 1993, cited in Marjoribanks, 2000).

Bertelsmann has also historically had a policy of encouraging autonomy in its trategic business units. Reinhard Mohn made decentralisation the company’s fficial policy in 1959 because he believed that managers of profit centres would thrive best with high levels of autonomy and the freedom to diversify and expand. The company departed from this strategy under Middlehof, CEO from 1998 to 2002, who felt the decentralised structure inhibited a coherent internet strategy and lowed decision-making. He increased centralisation to heighten cross-unit ynergies and created an Executive Council and Office of the Chairman. By mid- 2001 however Bertelsmann’s internet businesses were failing, the Napster xperiment had yet to bear fruit and company incomes were being battered by a global advertising downturn. Middlehof’s subsequent exit arose from a variety of easons, including the fact that his attempts at centralisation had brought him into
 
onflict with the corporate culture which valued business unit independence. Bertelsmann has since returned to its policy of decentralisation:

The principle of decentralization is at the heart of Bertelsmann’s management philosophy. It enables our employees to act with flexibility, responsibility, efficiency and entrepreneurial freedom. Our operating businesses are run by managers who act as entrepreneurs: they enjoy considerable independence and bear full responsibility for the performance of their companies. Our executives act not only in the best interests of their individual businesses, but are also
obligated to the interests of the group as a whole.1
 
Resources
The resources critical for boosting intrinsic motivation are money and time, and, as ith autonomy, the levels of both need to be carefully judged. They should be ufficient to allow the task to be achieved, but not over-generous since resource lack can reduce project focus and discipline (Nohria and Gulati, 1996).
Conversely, if funding is meagre, creativity can be channelled into finding dditional funds.

In terms of time, deadlines for creative projects need to be carefully judged. Despite the received wisdom that deadlines focus the mind and increase creativity, if these are too demanding and unrealistic staff will have no time to ‘play’ with oncepts and solutions. Time to play is important since creativity results from the formation of a large number of associations in the mind, followed by the selection f associations that are particularly interesting and useful. Time pressure will limit
r remove entirely the scope for such combinatorial play, and may additionally risk burnout in the creative team.
 
Team composition

Smart creatives … are the product folks who combine technical knowledge, business expertise and creativity. When you put today’s technology tools in their hands and give them lots of freedom they can do amazing things amazingly fast. (Google founder Eric Schmidt, Schmidt, Rosenberg and Eagle, 2014)

Creativity is popularly supposed to result from solitary acts of inspiration (the lonely artist in the garret). This may be true for great cultural works generated by individuals, but creativity in organisational settings require the coordinated ontributions of a diverse team. And that creativity should encompass perspective, xpertise, background and preferred mode of problem solving.

The reason team diversity matters is that creative challenges are often pistemologically unsolvable by any one person and require input from a range of pecialist disciplines and a broad palette of expertise. Teams that are homogeneous an hinder creativity since there will be too much similarity in experience and pproach to the task, plus too much social cohesion can inhibit the exchange of ideas. Within the team, working practices need to be open to encourage the onstructive challenging of ideas and shared commitment, which in time can allow the development of a strong sub-culture. Attention needs to be given to the team’s ommunication skills. If these are poor, necessary expertise and insights will not be hared, particularly the tacit knowledge that emerges during the course of the
project (Kanter, 2006).

 
Home Box Office Original Programming Division

HBO has shaped a creative environment which almost anyone would tell you is the best place to work in town. (Peter Chernin, then President and COO News Corporation, April 20032)

Home Box Office, or HBO for short, is a pay cable television network in the US. Founded by Time Inc. in 1972, as the name implies, HBO started life as a pay movie/special service cable operation in New York offering recent Hollywood films and occasional boxing matches. When the channel was launched original entertainment content did not extend far beyond one-hour stand-up comic specials, and the channel was noted for its frugal spending in comparison with network television (Shamsie, 2003).
However, from these inauspicious beginnings its original programming division has grown into an industry leader in creative original programming, responsible for a chain of critical and commercial hits, includingThe Sopranos,Sex and the City,Six Feet Under,True BloodandGame of Thrones. Under the slogan ‘It’s not TV, its HBO’, original programming is now central to HBO’s strategic positioning. Many of the hit shows mentioned above can be judged creative according to the definition given earlier in this chapter. They are novel, since HBO’s trademark is its ability to disregard the elements judged to be prerequisites of commercial successes by other broadcast networks, such as likeable characters or clear underlying premises (Shamsie, 2003), and yet be successful. Second, in terms of commercial success, in 2015 HBO was available in around 30 per cent of all US homes with pay TV and had over 120 million subscribers worldwide. In 2014 its operating income was $1.79 billion. Third, HBO also enjoys substantial critical acclaim. In 2015 it won 43 Primetime Emmy Awards, withGame of Thrones,VeepandOlive Kitteridgescoring particularly highly. This score was higher than the next five competitors combined, and is strategically significant in that this type of industry recognition boosts HBO’s
attractiveness to both creative talent and viewers, which is particularly important in an era characterised by increasing competition, notably from new players such as Netflix, Amazon and Hulu.

In terms of the core components of creativity in organisational settings – expertise, creative thinking skills and intrinsic motivation – sector expertise is particularly noteworthy. Senior executives synthesise a deep knowledge of entertainment content in the widest sense, that is, script writing, plot, character, dialogue, and so on, with knowledge of how cable television functions, particularly audience behaviour and business models. Further expertise comes from the freelance creative staff. Here a virtuous circle comes into play: the critical praise received by HBO programmes attracts high-calibre writers who want to be involved in HBO programmes. Their high- calibre skills contribute to the ongoing creative quality of the channel’s output, which in turn leads to commercial and critical success, continuing to attract high-quality creative freelancers.

The contextual factors conducive to intrinsic motivation present in the HBO work
 
setting are summarised in Figure 5.3. First, in terms of creative challenge, creativity is intrinsic to its strategic vision and its core mandate. Its strategic positioning is ‘to be good and different’ (Shamsie, 2003: 63). Its advertising strapline is ‘It’s not TV, it’s HBO’. This translates into a clear strategic challenge, HBO is looking for shows that are different and unique and don’t look like series that have been seen before. Pilots with test screening approval over 75 per cent are rejected on the basis that anything so acceptable to the ‘conservative masses’ is unlikely to be edgy enough for HBO, and conversely shows that may initially confuse audiences are accepted.

Figure 5.3How HBO ensures a strong creative pipeline






















In terms of autonomy, the company seeks to ensure that staff have the scope to realise this goal, particularly ensuring they have the space to concentrate on the creative task. In the words of Alan Ball, screenwriter ofSix Feet Under, ‘there’s less levels of bureaucracy to dig through. … To make a good show on HBO is almost easier work.
You’re living and dying by what you believe in, and you’re not being nibbled to death by ducks’ (cited in Shamsie, 2003: 64). This means that notes (comments on ideas under development) come from just one or two people, and those people are regarded as experts (in contrast, networks’ notes can come from up to ten different reviewers and can be contradictory, the net result of which can be to shift the idea towards standard approaches).

More autonomy is provided because, despite being part of the Time Warner/AOL/Verizon empire, HBO enjoys high levels of independence, being physically and operationally removed from the conglomerate’s other TV activities. Further, its policy is to give its staff scope for creativity within a tightly controlled operation – writers have high levels of artistic freedom, but must seek to create series that will garner critical acclaim and approval with the viewing public. HBO’s business model also contributes to creative autonomy, since cable subscription funding means it is less reliant on fast ratings success and less burdened by regulation than the mainstream networks.

With regard to resources, HBO is adequately funded but finances are not over-
 


 
Pixar Animation Studios

[T]he most reliable creative force in Hollywood. (Kenneth Turan in theLos Angeles Times, cited inSlate, 5 June 2003)

Pixar Animation Studios has prioritised organisational creativity from the start. It came into being when Steve Jobs purchased the computer division of Lucasfilm using
$5 million of his personal funds and set up a new company, of which he became Chairman and CEO (he invested a further $5 million to finance the company). At that point its primary asset was the Pixar Imaging Computer, which had been designed for film frames but also had uses in business-to-business (B2B) fields such as medical imaging and design prototyping.
The first decade was a struggle financially. Pixar was searching for a business model and, as Catmull observes (2014: 52), ‘mostly just haemorrhaging money’. It needed frequent cash injections from Jobs, who tried to sell Pixar three times between 1987 and 1991, but each time walked away from the deal at the last minute. The Pixar Imaging Computer had sold only a few hundred units and revenues came mainly from sales of its software. It also produced animated commercials (up to 15 a year) and while these won awards and allowed it to hone its technical and story-telling skills, it had to lay off over a third of its employees in 1991. This period did however produce early indicators of Pixar’s future path and future creative success in the shape of two highly acclaimed short films,Luxo Jnr(1986) andTin Toy(1988) (the first
computer-animated film to win an Academy Award).

In 1991 the five-year-old Pixar signed a deal with Disney for three digital animation movies: Pixar would create them and Disney would own them and distribute them, retaining 90 per cent of the profits and the merchandising rights. Jeffrey Katzenberg, head of Disney’s motion picture division, also wanted to buy Pixar’s technology, to which Steve Jobs reputedly replied: ‘You’re giving us money to make the film, not to buy our trade secrets’ (Catmull, 2014: 55).

The first movie produced under this deal,Toy Story, was released in 1995. It was the first full-length 3D animated feature film, the first to win an Academy Award, and it broke box office records. Jobs presciently proposed this was the moment to go public:Toy Storywas going to be a huge success, Disney would realise it had helped create a competitor and when its deal with Pixar was up for renegotiation would probably try to clip Pixar’s wings, whereas Pixar should actually be seeking a 50/50 revenue split. But an equal revenue split would require Pixar to finance half the production budgets itself, which it currently did not have the financial resources to do. Hence the plan to go public: this would provide the necessary finance to allow Pixar to fund half of production budgets for its movies, and it would in return receive half the revenues from them. Jobs had called the situation correctly. The IPO raised
$140 million, and when Disney sought to renegotiate the deal, Pixar received a deal featuring an equal split of both production investments and profits (less a distribution fee of 12 per cent).
Following the success ofFinding Nemo(2003), Pixar wanted to renegotiate again.
 
Disney refused and relations soured, not least because Eisner had exercised Disney’s right to make sequels to Pixar movies without Pixar input. The partnership ended in January 2004 but after Eisner left in 2005 the relationship was rebuilt due in part to the reconciliation efforts of incoming CEO, Bob Iger. In 2006 Disney bought Pixar outright for $7.4 billion, Jobs joined the Disney board and Pixar’s John Lasseter became Disney’s Chief Creative Officer and Ed Catmull became President.
 
Do Pixar movies meet the defining criteria for creative products?
Pixar’s output does indeed meet all the defining criteria for creative products outlined earlier in this chapter. In terms of uniqueness, Pixar films were novel, not only in their content, but because they reinvented the somewhat tired animated film genre. They abandoned hand-drawn animation in favour of digital techniques, but used these to create extraordinary levels of texture and sensory detail; the matted wet rat fur inRatatouille, for example.
Creativity was apparent also in the notion fundamental to its business model, that animated films could be made sophisticated enough to appeal to adults as well as children and therefore to work for both markets simultaneously.

Pixar’s output has succeeded at the box office, but in addition to commercial success, it has also received high levels of critical acclaim, as evidenced by the many industry accolades it has received – by 2003 it had won 15 Academy Awards, primarily for technical innovations. Industry insiders judged that it ‘led the computer animation industry, both technically and aesthetically’3 (and established both a core competence and product niche that were very difficult for competitors to duplicate). And finally, in terms of fit with organisational requirements, Pixar places great emphasis on ensuring its movies are developed on schedule and to budget (see the discussion later in this chapter on Pixar’s explicit process for resolving the inherent tension between setting stretching creative goals and the need to respect financial and time limits).
 
Expertise at Pixar

I’ve made a policy of trying to hire people who are smarter than I. (Catmull, 2014: 23)

Pixar’s technological expertise is renowned and made up of countless innovations in digital animation, dating back to RenderMan, a programming language that allows the disparate parts of the 3D production process to connect and communicate. This is available commercially and has become an industry standard, as has a batch of associated programs covering other aspects of the computer-animation process that it has developed and marketed. Its mastery of the artistic skills involved in animated filmmaking is also widely respected, as are its narrative skills in the field of story- telling, script writing, portrayal of characters and storyboarding.
Short films are a key mechanism to build new expertise. The tradition started in the early 1980s and the first wave of films functioned as a means of sharing Pixar innovations with the scientific community. Pixar stopped producing them in 1996, and then re-started, booking the costs under the R&D budget (in a similar move to digital publishers who charged early digital experiments to their Training and Development budget). Pixar’s ‘second generation shorts’ served several purposes, all central to furthering creativity. They allowed staff to develop a broader range of skills, forced technological advances (in the rendering of difficult characteristics like faces, hands, or water, for example), provided a way for the smaller teams who worked on them to form deeper relationships with colleagues, built goodwill with film goers, demonstrated Pixar’s commitment to artistry (because the shorts have no commercial value) and provided a relatively inexpensive way to make mistakes.

Expertise is acquired through a commitment to meticulous research. Filmmakers on Finding Nemovisited sewage treatment plants and learned to scuba dive. Those working onMonsters Universityvisited dormitories, lecture halls and research labs at MIT, Harvard and Princeton, ‘documenting everything … right down to … what the graffiti scratches looked like on the wooden desks’ (Pixar art department manager, cited in Catmull, 2014: 197).
 
Factors in the Pixar organisation that boost intrinsic motivation

since I was a boy … I had yearned to be a Disney animator but had no idea how to go about it. Instinctively, I realise now, I embraced computer graphics – then a new field – as a means of pursuing that dream. If I couldn’t animate by hand, there had to be another way. In graduate school I’d quietly set a goal of making the first computer-animated feature film, and I’d worked tirelessly for twenty years to accomplish it. (Catmull, 2014: xii)

To start with creative challenge, at Pixar this comes from the top. Jobs’ overt goal for the organisation was ‘to let creativity flourish’. For Catmull, the challenge was larger than simply commercially successful creativity:

My hope was to make this culture so vigorous that it would survive when Pixar’s founding members were long gone, enabling the company to continue producing original films that made money, yes, but also contributed positively to the world. That sounds like a lofty goal, but it was there for all of us from the beginning. (Catmull, 2014: 65)

Part of Catmull’s strategy to achieve this is to avoid a syndrome termed ‘Feed the Beast’. This arises when the success of each new film enlarges marketing infrastructure, creating a compulsion to create more products simply to fill this pipeline (Catmull, 2014). Instead, Pixar focuses on a small number of films. In order to keep the creative challenge manageable, creatives are encouraged to break larger tasks down into creative steps.

Pixar’s resource strategy has developed through trial and error. Striving for greatness can result in very long lists of ideal features that filmmakers would like to incorporate in their projects. Deadlines are used to force both a priority-based reordering of such wish-lists, and difficult decisions about which items on the lists are not feasible and will need to be dropped. Catmull (2014: 199–200) describes how:

We have constantly struggled with how we set useful limits and also how we make them visible. … The very concept of a limit implies you can’t do everything you want – you must think of smarter ways to work.

In terms of autonomy, unusually, Pixar staff are authorised, whatever their position, ‘to stop the assembly line, both figuratively and literally’ if they feel things are going wrong. This is part of an overall approach that requires staff to solve problems when they surface, without first asking permission – which means it is also accepted that this may result in mistakes. This philosophy extends right up to the top of the organisation, whereby Steve Jobs also encouraged Pixar to function autonomously,
 
recognising that the organisation’s considerable expertise was in a different domain to his own. As Catmull (2014: 100) describes, ‘at Pixar, he didn’t believe his instincts were better than the people here, so he stayed out’.

Teamwork is the basic building block of Pixar’smodus operandi. It seeks to promote ‘unfettered group invention’ and stresses that its films are the product of groups, rather than of key individuals. APixar tool for maximising teamwork is The Braintrust, which is:

the primary mechanism to push us toward excellence and to root out mediocrity
… our primary delivery mechanism for straight talk … one of the important traditions at Pixar. (Catmull, 2014: 86)

This meets every few months to assess each movie as it develops. Feedback is constructive and focused on solving problems within an atmosphere of trust and mutual respect and rooted to shared beliefs. The first belief is that ‘Pixar films are not good at first, and our job is to make them so’ (Catmull, 2014: 90), and the second is that ‘People who take on complicated creative projects become lost at some point in the process’ (Catmull, 2014: 91). Underlying this is an additive approach that ‘starts with the understanding that each participant contributes something even if it’s only an idea that fuels the discussion or ultimately doesn’t work’ (Catmull, 2014: 101).

Figure 5.4Factors boosting intrinsic motivation at Pixar

























An equally important element of the teamwork process is the post-mortem. This is a meeting held shortly after a movie is completed where the team explores what worked and what didn’t, and aims to consolidate key learnings. Historical data are analysed too: Pixar tracks the rates at which things happen, and how long processes
 

 
Creativity in creative organisations
The definition of creativity used above to analyse Home Box Office and Pixar was onceived for all types of organisational setting. There is a small body of work that focuses on creativity in creative organisations. In terms of defining this, Lampel, Lant and Shamsie (2000) note that because the creative quality of creative products is hard to judge, since their consumption is a highly subjective experience, actually defining creativity in these contexts is difficult. They draw a distinction between reative organisations and ones that are primarily engaged in artistic endeavours:
hereas in cultural organisations, for example, creative products must only satisfy rtistic and cultural criteria, in commercial creative organisations they need to meet ommercial objectives too, which entails their finding a market, although, if they
re too creative and original, this may not succeed. Thus they need to synthesise ew and familiar elements (Lampel et al., 2000).

Gil and Spiller (2007: 245–6) identify a number of essential characteristics of reative work in creative organisations (which they describe as ‘internal creative production’) which cause challenges ‘quite different from the standard’ in rganisations (some of which correlate closely with theories of organisational reativity):

1.	An informational asymmetry between creatives and management because creatives have an expertise that management do not have and possibly do not understand.
2.	Management cannot force the creation of high-quality work; rather they can only create conditions that are conducive to it occurring.
3.	The ‘infinite variety’ problem, which means there are an infinite number of possible solutions to any creative challenge and a manager cannot specify in advance what output is sought, nor can a creative employee specify what will be produced.
4.	The ‘nobody knows’ problem, which arises from the fact that the performance of a creative product is virtually impossible to predict. Thus the average internal rate of return in the movie industry is negative (Dekom, in Squire, 2004) and the majority of new books published fail to earn back their authors’ advances. Even when a formula works once, there is little guarantee that it can be repeated in exactly that way.
5.	The ‘art for art’s sake’ problem. Creatives are intrinsically motivated and work on creative projects because of the sense of fulfilment or achievement it brings. This means high levels of commitment, engagement and ownership, but also an unwillingness to compromise on their creative solutions. This can make management interventions difficult and lead to time and cost overruns.
6.	Many types of creative product have very high development costs, which,
 
because of the uncertainties implicit in creative markets, can spiral out of control. If a project develops poorly, a strategic decision has to be made about whether to invest further to the project. Because success is uncertain, a decision is often made to continue, leading to the ‘Ten-Ton Turkey Syndrome’ (Caves, 2000).
7.	Creative expertise cannot be appropriated by organisations but resides with the owners of that talent. Particular creative talents may become identified with particular products, and future attempts to exploit that product may encounter a hold-up from that creative talent. Similarly, creative staff may not share all of their creative ideas with their current employer. Thus creative businesses are subsidising the future career opportunities of their creative talent.
 
Creativity and the business model
If we look at the two examples in this chapter, Home Box Office and Pixar, while the respective funding bases differ, their business models are similar in that they provide a degree of protection from market forces. HBO is subscription financed,
hich brings the luxury of being able to build audiences slowly in step with word- f-mouth publicity as people acclimatise to the novelty of their products. Pixar initially had a co-financing deal with Disney, which meant more freedom to incubate ideas, experiment and take creative risks. A degree of protection from
arket forces has also contributed to the BBC’s track record in creative programming. This has allowed it not only to experiment but also to persevere with ovel concepts until they find their markets. This dynamic contributes to ‘slow- burn’ successes such asFawlty TowersandMonty Python, which took a while to find audience favour, but ultimately proved to be lucrative long-term products.

Thus business models that provide a degree of cushioning from market forces ppear to be positively correlated with creativity. This is an area where more esearch is needed, but elements of the mechanism might be that such arrangements reate a level of psychological security that encourages playfulness and ombinatorial play in members of the creative team, allow a longer and deeper product incubation period, and can withstand a slower rate of audience growth
hich can be necessary for highly novel ideas.
 
Creativity in systems and strategy
It is easy to restrict the search for creativity in the media industry to the realm of ontent, but creativity is also required in the broader set of activities concerned ith how organisations mount a response to their strategic environment. Novel ideas are needed to enable media firms to grow, adapt and compete. As we have een, the media industry has been subject to a continuous stream of fundamental hanges in the technologies used to develop and deliver products – ranging from ew platforms such as cable, satellite and the internet, to the digital downloading nd social sharing of media files. This stream of change triggers in itself a fundamental ongoing need for renewal in terms of systems, process and strategy,
irrespective of the need to develop new media products. Organisations that master these challenges can establish powerful bases of strategic advantage, as two xamples from the broadcasting sector demonstrate.

 
CNN – Creativity Applied to Systems and Strategy
CNN, during the first 16 years of its life (from its founding in 1980 to its takeover by Time Warner in 1996), offers many examples of creativity in terms of systems and strategy. CNN’s concept has been so widely adopted by the industry that it is hard now to view it as exceptional, but it was extremely novel when it first emerged.
The idea behind CNN was to set up a channel that concentrated only on news and to broadcast that news round the clock. The news would be global and it would be live. CNN would try to cover news as it happened, rather than report after the fact. A central element of this was to create ‘a role in the process for the viewers’. This would be achieved by avoiding the groomed approach of the US networks in favour of open sets within newsrooms, and a presenting style that would create a sense of immediacy, authenticity, and of stories evolving as viewers watched. Overcoming industry cynicism, this unconventional approach held real attraction for viewers and revitalised what had become a stale genre – so much so that two decades later the CNN style had become a standard for news delivery worldwide.

The core product could therefore be categorised as creative. But creativity was also evident in the systems and processes that supported the content proposition. The concept of CNN was designed to exploit a number of simultaneous technological advances – cable television, communications satellites, suitcase-size satellite uplinks and handy cams – in order to reinvent the way news is produced and delivered. A number of highly innovative processes were introduced in order to implement this strategy against a background of extremely limited resources – both in terms of time and money. The most famous example is probably the invention of the video journalist or VJ. The VJ is a ‘one-man television band’ that is capable of covering a story without the expense of a full film crew, shooting video as well as reporting, and then editing the material too. Like many of Ted Turner’s inventions, this concept has now been adopted by broadcasters all over the world. Similar organisational creativity can be found in CNN’s network of broadcast affiliates all over the world. The traditional affiliate relationship is one-way, from the channel or network to the affiliate, and most news organisations pride themselves on the exclusivity of their content. CNN revisited this approach by establishing a reciprocal network of 600 television stations worldwide which both received news feeds from CNN and fed local footage back to CNN. This was initially a pragmatic solution to the need to offer global coverage without adequate resources, but it became a strategic asset in that it enabled CNN to build a global presence quickly, defray the cost of its own newsgathering, and provided footage of breaking events all over the world far more quickly than its competitors could get news crews on the scene.
 
Conclusions
This chapter links closely to the previous chapter on technological change. However, it differs in its approach from all previous chapters. So far the book has looked primarily at the strategic environment – particularly at the individual sector that make up the media industries – and the technological influences that are haping their development. This chapter focuses on the impact of the strategic ontext on the internal organisation of the media firm, on the link between strategy nd management in the media. It is also unusual among the other chapters in this book in that it focuses mainly on one particular stream of theory, socio- onstructivist approaches to organisational creativity, whereas previous chapters have, in the main, covered a far broader theoretical terrain. The reason for this lies
primarily in this research stream’s high relevance for the field. Sustained creativity is one of the prime drivers of above-average performance in the sector, and the
eed for creativity is enlarged when environments become unstable. This body of theory provides insights into how levels of creativity may be improved.

A key message is that creativity can be improved, not only via interventions by xternal consultants and experts, but also by the carefully judged handling of elatively mundane aspects of projects – elements such as deadlines, financial esources, team composition and goal-setting. Two aspects of this are interesting. The first is the sustained performance outcomes that can result when these elements re well and coherently managed, and, by extension, the scope for optimisation that probably exists in the majority of media organisations. The second is how some findings from this body of theory undercut received wisdom in the media industry. To take the hit model, this proposes that market success is contingent in large part n the amount invested in creative talent and processes – that higher budgets mean higher audiences. However, this framework shows that creative projects do not benefit from unlimited resources – and may perhaps even be harmed by them. The ompanies analysed in the case studies here all spent around 30 per cent less than their peers but achieved far greater creative and commercial success. Picking up o
theme raised in Chapter 4, this chapter also provides additional evidence of the importance of autonomy for creative teams, something which can be threatened by
oves towards consolidation and cross-platform integration.

This chapter extends this core body of theory to explore the role of creativity in the ider organisation – in structures, processes and systems. This latter stream of
ork is in its infancy and much more work needs to be done in this field. It is clear, however, that not only do aspects of the creative project environment need to be arefully thought out and integrated, but they need to harmonise with wider systems, trategies, processes and business models. A more intimate understanding of these ystems and their interrelationships will contribute fruitful insights into how media firms can improve both creativity and performance.