Creative Thinking & Problem Solving

Session 1
Creativity & Its Importance in Business

Prof. Runa Maitra

June – July 2018
 Session 1: Creativity & Its Importance
in Business
• Introduction
• Changing Time
• Some definition of creativity
• Invention & Creativity
• The importance given to creativity in business
• How creative thinking may be used in management
• Conditions in which creative thinking is needed most
• Paradigm shift
 CHANGING TIMES
• The first few years of the present century saw
technology advancing in line with that experienced
during the last years of the twentieth century.
• The trend has continued but alongside the
prominence of technology in creating change
economic, political and social pressures have come to
dominate the scene.
• In the past few years the latter have begun to produce
problems that are difficult to solve.
• In business there is need to obtain insights into such
problems.
 CHANGING TIMES
• Questions such as ‘How does one stimulate
growth in sales and profits when there is no
growth to be had?’ may be at the back of
managers’ minds.
• Or even, ‘How can we ensure that the business
will survive?’
• They cannot, however, assume, like Dickens’
Wilkins Micawber that ‘something will turn up’.
• Challenging assumptions is at the heart of
creative problem solving.
 Why do we need creativity?

https://www.youtube.com/watch?v=RwGlaCTnNys
 SOME DEFINITIONS OF CREATIVITY:
What is creative thinking?
• Creativity is a concept that we often come
across in our everyday conversation. We hear
of creative people, admire creative objects of
art or read creative books. Yet, despite our
almost innate understanding of what it means
to be creative, there is much confusion about
the nature of creativity.
 SOME DEFINITIONS OF CREATIVITY:
What is creative thinking?
• Wertheimer ([1945] 1959) suggested that creative thinking
involved breaking down and restructuring our knowledge about
something in order to gain new insights into its nature.
Understanding our own cognitive model of reality may therefore
be an important determinant of our ability to think creatively.

• Kelly (1955) and Rogers (1954) both supported this argument by

maintaining that we can be creative by gaining an understanding
of how we think about a subject. Creativity is something that
occurs when we are able to organize our thoughts in such a way
that readily leads to a different and even better understanding of
the subject or situation we are considering.
 SOME DEFINITIONS OF CREATIVITY:
What is creative thinking?
• Maslow (1954) thought of creativity as having two levels. He envisaged
primary creativity as the source of new discovery, real novelty, or ideas that
depart from what exists at a given point in time.
• He saw secondary creativity as a characteristic possessed by many scientists
in their collective search for discovery achieved by working alongside other
people, extending the work of previous researchers, and exercising
prudence and caution in their claims about new insights or ideas.
• He envisaged creativity as an aspect of human nature that was to be found
universally in all human beings. In children he felt it to be an easily
observable phenomenon but suggested that it seemed to become lost in
adults, surfacing mainly in dreams with the relaxation of repressions and
defences.
• It was a view that was echoed subsequently by Stein (1974), who argued
that without such an assumption the techniques for stimulating creativity
would have no application.
 SOME DEFINITIONS OF CREATIVITY: What is
creative thinking?
• Torrance (1965) defined creativity as:
– The process of becoming sensitive to problems, deficiencies,
gaps in know ledge, missing elements, disharmonies, and so on;
identifying the difficulty; searching for solutions, making guesses
or formulating hypotheses about the deficiencies; testing and
retesting them; and finally communicating the results.
• This contrasts with that of Newell et al. (1962). They
adopted a criterion-based approach, which suggests that
any problem solving may be creative.
• Indeed, Haefele (1962) argues that every one of us must
be creative to some degree because we have to find new
solutions to newly presented problems.
 SOME DEFINITIONS OF CREATIVITY: What is
creative thinking?
• Rickards (1985: 5) defines creativity as ‘the personal
discovery process, partially unconscious, which leads
to new and relevant insights’.
• Rickards (1988: 225) also advocates a view of creativity
as a universal human process resulting in the escape
from assumptions and the discovery of new and
meaningful perspectives, or as an ‘escape from mental
stuckness’.

In broad terms he believes that creativity is to do with

personal, internal restructuring.
 INVENTION AND CREATIVITY
• Invention is an act of creativity that results in a device,
process or technique that is novel enough to produce a
significant change in the application of technology.
• The application of creativity is fundamental to invention.
The element of novelty has various forms; it may be a new
device or process, or even material, but it may also consist
of a combination of existing knowledge in a manner not
previously considered.

For example, James Watt added a separate condensing

chamber – a new device – to Thomas Newcomen’s
atmospheric engine and created the steam engine.
 INVENTION AND CREATIVITY
We need to differentiate between
invention and innovation
• One may look on invention as the formulation
of new ideas for products or processes

• whereas innovation concerns the practical

application of new inventions into marketable
products or services.
 Differentiate between two types
of innovation:
• Product innovation: this comprises changes to
attributes of product, resulting in a change in the way
the product is perceived by consumers – for example,
wireless connectivity to the Internet as opposed to
access by cable

• Process innovation: this relates to changes to a service

or product production process. It usually produces
benefits in the production process, i.e. increase in
productivity and cost reduction – for example, emails
compared to mail delivered through the postbox.
 Theories of invention: The
deterministic & The individualistic
• The deterministic theory holds that when economic, technical
and cultural conditions are ripe, an invention will be made by
one inventor or another; who does it is just historical accident.
• This theory has some support in the numerous instances of
simultaneous and independent invention.
It also helps to explain the competing claims that emerged over
the invention of the steamboat, the electric telegraph, the
incandescent lamp and the aeroplane.
• The theory is also plausible because timing is unquestionably
important in invention.
• Also, inventors are likely to focus on projects that are reasonably
attainable and for which there is a recognizable need or
demand.
Let’s Understand the difference

https://www.youtube.com/watch?
v=FXJUDyqobbM
 THE IMPORTANCE GIVEN TO CREATIVITY IN
BUSINESS
• In management, problems arise as different or new
situations present themselves and they often require
novel solutions.
• Frequently, it is difficult to see solutions to problems
by thinking in a conventional fashion.
• Logical thinking takes our existing knowledge and uses
rules of inference to produce new knowledge.
• However, because logical thinking progresses in a
series of steps, each one dependent on the last, this
new knowledge is merely an extension of what we
know already, rather than being truly new.
THE IMPORTANCE GIVEN TO CREATIVITY IN
BUSINESS
• It would seem, therefore, that logical thinking
has only a limited role to play in helping
managers to be creative.
• The need for creative problem solving has
arisen as a result of the inadequacies of logical
thinking.
• It is a method of using imagination along with
techniques that use analogies, associations and
other mechanisms to help produce insights into
problems.
 HOW CREATIVE THINKING MAY BE
USED IN MANAGEMENT
• Creative thinking benefits all areas and activities
of management.
• It is required to dream up better ways of
marketing goods, to devise new production
methods, to find new ways to motivate people,
and so on.
• Creativity turns up in every business situation
where there is a chance that things can be done
in a more businesslike, more profitable or more
satisfying way.
ILLUSTRATIONS OF HOW CREATIVITY MAY BE
USED IN MANAGEMENT
• To make more effective use of a manager’s
time
• To improve a product’s appeal to customers
• To improve motivation among staff
• To appeal to customers’ wants and needs
• To cut costs through more efficient/effective
production
 The typical of the kinds of problem
that require creative thinking
• How to identify new and profitable product-
market opportunities.
• How to get skilled and experienced staff to stay
with the company without paying them
excessively high salaries.
 Problems that require creative
thinking are ‘open-ended’ problems
• Problems for which there is more than one
solution.
• Executives have to make decisions that require
creative problem solving in their organizations
– planning,
– organizing,
– leading and
– controlling
 Planning
• Determining the mission of the organization.
• Determining the organizational objectives.
• Identifying strengths, weaknesses,
opportunities and threats.
• Adjusting the organization behavior and
strategies to competitors’ strategies.
• Deciding how to implement competitive
strategies
 Organizing
• Deciding what jobs need to be done within an
organizational unit.
• Deciding how various jobs within an
organizational unit can be grouped together, etc.
• Deciding how much authority should be
delegated to various organizational positions.
• Determining how best to train people for their
jobs.
 Leading & Controlling
• Finding ways of increasing productivity in the
workplace.
• Deciding what systems of control are needed.
• Setting standards.
• Identifying why standards/objectives have not
been achieved.
 Formulating strategy that can benefit from
creative thinking
• Mintzberg (1987) identified five activities that
describe the strategy process:
– goal/objective setting;
– analysis (internal and/or external);
– development of strategic alternatives and
selection;
– implementation and evaluation.
 Conditions In Which Creative Thinking Is
Needed Most
• It is argued that in an organizational sense
creative thinking is required most when there
is a lack of consensus regarding goals and also
a lack of understanding about cause–effect
relationships (Thompson, 1967).
• Disagreement often occurs when problems
arise that have not been previously
encountered, and when outcomes and goals
are uncertain.
 Managers need to scan information quickly
and make rapid judgments
• Palus and Horth (2002) suggest several approaches for
breaking free of our habitual ways of seeing in order to
become innovators:
– Alter perspective radically by changing one’s point of view.
– Ask for the opinions of others and collaborate with others who
have the skills and perspectives one lacks.
– Use questions to take aim at the root of the issues faced.
– Spend time among customers, constituencies and competitors
to gain new perspectives.
– Keep track of ideas.
– Change the pace of attention to information and knowledge
acquired.
 PARADIGM SHIFT
• Kuhn (1970) defined and popularized the
concept of ‘paradigm shift’ (p.10).
• Kuhn argued that science does not evolve, but
rather it follows a ‘series of peaceful
interludes punctuated by intellectually violent
revolutions’, and in those revolutions ‘one
conceptual world view is replaced by another’.
 Paradigm shifts are different from
continuous improvement
• A paradigm is a set of rules and regulations that
define boundaries and help us to be successful
within those boundaries, where success is
measured by the problems solved using these
rules and regulations. Paradigm shifts are different
from continuous improvement.

Examples include going from donkey cart or horse-

drawn carriage to car, or travelling long distances by
aeroplane instead of by bus or ocean liner.
 The 71 Most AMAZING Innovations of All
Time

https://www.youtube.com/watch?v=I16TJUp4SVA
 The process of paradigm shift encouraged
& effected through creative thinking
• Creative thinking brings into place notions and
ideas that would not normally be contemplated in
problem solving.
• Creative problem-solving methods make extensive
use of techniques and approaches that help to find
solutions to recalcitrant open-ended problems.
• The ability to tolerate ambivalence between
opposites or two incompatible subjects is thought
to characterize highly productive creative thinking.
 QUESTIONS
• Why should the modern-day manager need to
know about creative problem solving?
• Why is creative problem-solving expertise an
important asset for any business executive?
• How might executives improve their creative
problem-solving skills?
• What is paradigm shift? How does it relate to
creative problem solving?