The Innovation Secret

What is it about 'secrecy' that encourages innovative ideas? Rosanna Beart, junior consultant, delves deeper.

The sign "Restricted Area: We hear you knocking, we can't let you in." can be found on the door of Nike’s Digital Sport Division lab. It is just one of the indicators of the culture of secrecy fostered at Nike’s HQ in Oregon.

Nike, and other innovation giants such as Google and Apple, deliberately cultivate a culture of secrecy. But surely, promoting secrecy, elitism and exclusivity - actively building those organisational siloes that act as barriers to knowledge sharing and collaboration - can’t create an environment where innovation can thrive? So how come these companies not only continue to operate at the forefront of innovation, but also have some of the highest employee satisfaction rates in the world with employees that are unusually invested in their brand.

Maybe the answer lies behind that closed door, so let’s take a closer look at innovation at Nike. At HQ, Nike has various ‘labs’ to house its innovation projects. Divisions such as the Innovation Kitchen, the Digital Sport Division and SPARQ Performance Center are all located in small, futuristic spaces that are hard to find - by design. Teams are issued with special passes to grant access and the windows are tinted black.

Although somewhat counter-intuitive to the traditional view of engagement,  designing your environment in this way has many potential benefits for employees:

  • When a team is entrusted to keep a secret, trust between teammates isn’t just encouraged, it is vital. It becomes their bond, their common goal and is the foundation of the mutual trust needed to collaborate openly with each other, harnessing the best ideas and developing them together.
  • The work that the team is undertaking is automatically valued as something that is worth keeping a secret. As such, the work is imbued with real importance and a higher sense of worth.
  • When R&D activities are kept secret, emphasis is suddenly placed on the need for innovating at speed. There is an implicit urgency in the work, urgency to beat competitors to the best new ideas. This heightens competitiveness against competitors, a rivalry which heightens a sense of belonging to your own team, and increases your investment in your own team’s success.

A key component of engagement is encouraging employees to connect with their customers. Secrecy plays a large role here too with the clear PR and marketing benefits of withholding new product information. The more secretive the work, the more anticipated it is by customers, and therefore the more desired –people cared so much they built dedicated iPhone rumours sites or hid in bushes to snap the new BMW. Innovation companies are very capable at building huge hype around product launches. As we all aware, Apple and Nike launches are major events on the world stage.

The level of secrecy is very carefully managed at Nike. Journalists are regularly given ‘exclusive access’ to these labs, visitors have reported the doors being left wide open, and it is clear that in practice they are not as exclusive as they are made out to be. Customers usually know the broad parameters of what Nike is working on at any given time, be it trainers with self-tying shoe laces or the latest FuelBand. The R&D details are understandably covert and exact features are kept back for the launch, but in both culture and marketing, secrecy at Nike is more symbolic than anything else. The secrecy is more about cultivating a special environment than it is for genuine privacy.

At Apple however, secrecy is the cornerstone of Steve Jobs’ legacy. And, despite Apple’s success, when the culture is taken to the extreme, it can be more restrictive than conductive to successful innovation. At Apple, the secrets are kept not just between them and the outside world, but also between employees inside Apple. Rather than work on a project in its entirety, employees are brought into work on a specific component without even knowing what product it will ultimately end up in.

Many of the advantages laid out previously are negated when the secrecy is taken this far. With no sense of the bigger picture, there is far less understanding of the value of their work, and as no one knows who works on what, there is suspicion and less pride of ownership.

But most importantly, as we tackle more complex ideas, it becomes less and less likely that any one person – or even one team - will be able to figure out every piece of the puzzle. So for the really complex problems, not only do you have to attract smart people, but those people have to work with a wide and diverse group inside – and even outside the company - in order for them to be really smart.

It is a fine balance to keep a level of secrecy that is helpful to employees, that enhances brand identification rather than distances it, that is conducive and not restrictive in culture. But it seems that when this balance is obtained, it can be a really exciting time for innovation.