Try a quick exercise in innovation:
Challenge 1) In sixty seconds, think of as many new solutions to existing problems as you can. Go.
Challenge 2) In sixty seconds, think of as many new solutions to the problem of sorting paperwork on a desk using a wallet, a rock, and a book of matches. Go.
For which challenge did you generate more solutions? For which challenge did you generate higher quality solutions? If you are using a human brain to come up with solutions, the likely answer to both questions is the second challenge. How can that be? That challenge allowed for only one problem and a very limited range of solution tools, while the first challenge was open to infinite possibilities. Shouldn’t we be able to pull out more from an infinite set of options than from a limited one?
The short answer is no. That is not how the human brain works.
The old saying, “necessity is the mother of invention,” proves to be true in psychological studies. One such recent study done by Janina Marguc and her colleagues at the University of Amsterdam concluded “that obstacles trigger an ‘if obstacle, then start global processing’ response” in our brains. Apparently, we all have a bit of MacGyver in us. Give us unlimited resources, and we don’t know what to do. Throw some hurdles in our path, and we’ll expand our thinking to find ways over, under, around, or through them.
Recent studies specific to new product development and innovation management have found this to be true with teams and organizations, just as much as with individuals in psychology experiments. Decades of research have consistently demonstrated that organizations with formalized innovation management processes produce more consistent innovation successes than unstructured organizations. Financial constraints were once thought to have only negative impact on innovation, but research done by Irene Scopelliti, Paola Cillo, Bruno Busacca, David Mazursky concluded “financial constraints lead to the ideation of more creative products. Yet these products are generated using fewer inputs and a lower budget than products generated in an unconstrained condition.”
Organizations should neither be afraid to impose constraints on teams developing new products, nor be tempted to solve all challenges by simply throwing more resources at them. Doing so will not necessarily yield valuable solutions to problems.
At the same time, innovation managers must recognize that this is a balancing act. Too much constraint is just as detrimental, if not more so, than too little. For example, let’s try one more exercise:
Challenge 3) In sixty seconds, think of as many new solutions as you can to the problem of sorting paperwork on a desk using nothing. Not even your hands. Go.
Clearly, you can’t do anything with nothing. That seems almost too obvious to say, but which of us has not had the experience of watching someone demand more water from a dry well?
Creativity will be optimized somewhere between zero resources and infinite resources. The trick is to find that sweet spot for your team, your organization, and your culture. Some tips to find that sweet spot:
1) Imposed constraints must create a sense of challenge, but not one of futility. Some of the seminal work in the psychology of creativity by Mihaly Cziksentmihalyi (it’s pronounced just like it’s spelled), demonstrated that if you make a problem too easy, boredom will inhibit creative approaches, and if you make a problem too difficult, resignation will ensue. The secret is to have the problem solvers feel stretched beyond their comfort zone, but not broken. Moreover, much like anatomical muscles, the mental muscles exercised in this manner will become stronger over time, allowing for (and even demanding) bigger challenges in the future.
2) Understand the type of problem you are solving. The brain has evolved for survival. It thinks differently when it feels safe than when it feels threatened. When safe, the brain feels free to romp through creative fields of the imagination, discovering all sorts of new knowledge and forging innumerable connections between bits of information. When threatened, the brain goes into highly focused survival mode, eliminating the distractions and narrowing in on an immediate solution that will allow it to live for another day. If you need creative, divergent, imaginative thinking, you must create a safe, tranquil, happy environment for the thinkers. If you need focused, convergent, practical thinking, you need to create a sense of urgency, maybe even bordering on fear. Expecting one type of thinking in the other type of environment is like expecting fish and mammals to be able to breathe in each other’s environments.
3) Store and consider solutions that violate the constraints. There are two reasons for this. First, there will be times when superior solutions will violate the imposed constraints. For example, a new product may exceed the budgeted development funds, but even more greatly exceed the expected return on investment. Second, the constraints themselves may prove to be wrong. A constraint to use an existing technology may be erased by the development of a new technology, for example. The important thing is to define and communicate the constraints first, and then situationally consider when it is okay to violate the constraints. You would never hand the keys to your new car over to someone who had never driven before and tell them to drive as fast as they want wherever they want. Yet an experienced driver, familiar with the rules of the road, may choose to exceed speed limits and pass over a double-yellow lane marker if rushing an expectant mother in the throes of labor to a hospital. You must know and understand the rules before you can break them with positive outcomes.
 For those who don’t know, MacGyver was a late-eighties TV series in which the hero, Angus MacGyver, was able to battle the forces of evil and escape the most dangerous and challenging situations armed with nothing but some toothpaste, an old paint can, and a Hello Kitty Pez dispenser (or the like).
 Excerpted from “How Do Financial Constraints Affect Creativity?” published in the Journal of Product Innovation Management, 2013