The Art of Innovation

Tom Kelley, general manager of IDEO, a product design and innovation consultancy based in Palo Alto, California, draws on the firm's experience with more than 3,000 projects to lay out a practical guide to building a culture of innovation. Cofounded by his brother David Kelley, IDEO grew from a small team working above a dress shop into what Fast Company called "the world's most celebrated design firm," topping the Industrial Design Excellence Awards list for 10 consecutive years. Kelley argues that innovation has risen from the least important reason companies seek outside help to the most important, particularly among senior executives, and he frames the book as a distillation of lessons learned on IDEO's front lines.

Kelley opens by describing IDEO's five-step methodology: understand the market and constraints, observe real people, visualize new concepts, evaluate and refine prototypes through quick iterations, and implement the concept for commercialization. He emphasizes that methodology alone is insufficient; it must be paired with the right culture, work practices, and infrastructure. To illustrate, he recounts the ABC Nightline episode in which IDEO redesigned the American shopping cart in five days before nearly 10 million viewers. The team observed shoppers on day one, brainstormed hundreds of ideas on day two, split into prototype groups, and by Friday unveiled a sleek cart with removable handbaskets, a child seat inspired by roller coasters, a price scanner, and sideways-tracking rear wheels. The public response focused not on shopping carts but on the creative process itself.

The book traces IDEO's origins to 1978, when David Kelley launched his firm after earning a master's degree from Stanford's Product Design program. His first hires were Stanford friends, and the early culture was improvisational, with the team spray-painting chairs, making desks from discount doors, and waging rubber band wars. A neighbor connected them with Apple, leading to work on the Lisa computer and the first commercial mouse. The company later merged with firms in London, San Francisco, and Palo Alto to form IDEO Product Development in 1991, never posting an unprofitable quarter.

Kelley devotes significant attention to observation as the foundation of innovation. He argues that focus groups are unreliable because people give polite, expected answers and cannot articulate what is missing. Instead, IDEO sends teams to watch real people in real environments. Direct operating-room observation of technicians using a balloon angioplasty inflation device revealed they used both hands despite the product's one-handed design claim, leading to ergonomic improvements. Kelley introduces the principle of "being left-handed," meaning developing empathy for users who differ from the designer. When Oral-B asked IDEO to redesign children's toothbrushes, observation revealed that kids grip with their whole fist, leading to a fatter, squishier handle. Jane Fulton Suri, IDEO's head of human-factors investigations, shadowed NEC salespeople in Tokyo, producing insights that led to the award-winning Versa laptop, which doubled NEC's U.S. market share in six months. Kelley encourages keeping "bug lists" of everyday frustrations, citing Perry Klebahn, who noticed how awkward existing snowshoes were while recovering from an ankle fracture and went on to found Atlas Snowshoe Company. He also advocates thinking of products as "verbs" rather than "nouns": watching bikers struggle with water bottles led to a tapered design with a self-sealing valve inspired by the heart's tricuspid valve.

Brainstorming, Kelley argues, is a skill to be continuously improved. He outlines seven principles: sharpen the focus with a customer-centered problem statement, post playful rules on walls, number ideas to track fluency, build on promising threads, use spatial memory by writing on visible surfaces, stretch mental muscles with warm-ups, and get physical by building crude models. He identifies six ways to kill a brainstormer, including letting the boss speak first, forcing turn-taking, and banning silly ideas.

Kelley challenges the myth of the lone genius, noting that even Thomas Edison relied on a 14-man team. He identifies key traits of "hot groups," or small teams that achieve outsized results: total dedication, tight deadlines, irreverence, disciplinary diversity, open workspace, and empowerment to seek outside resources. In IDEO's studio system, studio leaders pitched their visions and employees chose which teams to join via secret ballot, with everyone receiving their first choice. The Eyemodule project exemplifies a hot group: Dennis Boyle, one of IDEO's founding engineers, led a team that set a 60-day goal to create a digital camera add-on for the Handspring Visor, overcame manufacturing obstacles by personally focusing thousands of lenses, and shipped the best-selling Visor accessory in six and a half months.

Prototyping receives extended treatment as both a practical tool and a philosophy, encapsulated in Boyle's maxim, "Never go to a meeting without a prototype." Kelley recounts how Jeff Bezos founded Amazon by instructing his moving van to head west before choosing a city, writing his business plan on a laptop while his wife drove, and gaining precious days by making decisions in parallel. He describes how accidental discoveries emerge from prototyping: a Logitech steering wheel molded in red rubber because no other color was available delighted the client, and a failed self-teeing football led to the Aerobie when curved wings accidentally created perfect spirals. The Apple Duo Dock illustrates iterative refinement: a VCR-inspired docking mechanism powered by a toy motor went through more than a dozen prototypes and cost less than seven dollars in parts.

The book devotes a chapter to workspace as a critical innovation tool. IDEO's Palo Alto campus of seven buildings along tree-lined High Street functions like a college where the street itself sparks spontaneous encounters. The Boston office built a nine-foot-high, 42-foot-long Amtrak train car inside the building, which served as both a design space and a social hub that informed the Acela express service. Kelley warns against hierarchical space allocation, contrasting a company where employees counted ceiling tiles to gauge office size with Alcoa's headquarters, where Chairman Paul O'Neill gave executives and staff identical workstations. He also describes the Tech Box, a curated collection of eclectic technologies that serves as a lending library of innovation elements across all IDEO offices.

Kelley argues that companies must harness unpredictability through cross-pollination, the practice of applying ideas from one field to another. He addresses barriers to innovation using the Palm Pilot as a central case: after half a dozen personal digital assistants (PDAs) failed by pursuing perfect handwriting recognition, Jeff Hawkins, Palm's creator, sidestepped the assumption by developing Graffiti, a simplified alphabet requiring users to learn new letter forms, and stripped the device until it fit in a shirt pocket. Kelley discusses rituals as barriers, noting that the wine industry's centuries-old cork tradition resists objectively superior metal caps. He examines how companies should create experiences rather than just products, deconstructing the airport journey into granular steps and presenting the Steelcase Work/Life Center in New York, where eliminating wait times and integrating salespeople's workplaces into the buyer's tour increased sales dramatically.

On risk taking, Kelley articulates IDEO's philosophy of failing often to succeed sooner. He presents snowboarding and mountain biking as cautionary tales of incumbents failing to act: major ski manufacturers dismissed snowboarding while Jake Burton Carpenter built boards in his Vermont garage and dominated the sport, and Schwinn missed mountain biking despite early riders using its own bikes. Regarding refinement, Kelley advocates fighting "feature creep" and pursuing simplicity. The Palm V case study illustrates extreme refinement: engineer Amy Han led a brainstorm that reshaped the device's profile, the team machined dozens of button shapes, replaced plastic with anodized aluminum, and substituted screws with industrial adhesive. Looking ahead, Kelley describes IDEO's Project 2010 collaboration with BusinessWeek, which envisioned future products including a PDA-wallet hybrid with thumbprint access, a cylinder that rolls out flexible displays, and paired devices for lovers that transmit signals through breath and glow when squeezed.

Kelley closes by comparing innovation to a golf swing: each element is simple, but combining them consistently is the challenge. He advocates producing several crude prototypes early and getting fast feedback rather than polishing a single deliverable. His practice tips include watching customers and noncustomers, shaping workspace to encourage collaboration, thinking in verbs to create experiences, breaking rules and failing forward, staying human to let hot groups emerge, and building bridges between departments and the future. Innovation, he concludes, is not about perfection but about observing, brainstorming, prototyping, and maintaining a spirit of serious fun.