Building the Creative Company

When my wife, Kim Jordan, and I founded New Belgium Brewing Company in 1991, money was tight, so we created a business plan that fit within the budget and a custom equipment plan that fit within the 211 square feet of basement space allotted to the venture. We were told that it wouldn’t work. Creativity, supported with confidence and buffered with a bit of ignorance, was our greatest asset.

by Jeff Lebesch
New Belgium Brewing Company in Entreworld

Sixteen months later, we were selling all the beer we could make. So when it came time to open a second brewing facility, instead of buying all new parts, I scrounged old dairies for tanks and other stainless steel parts, allowing us to rapidly increase production volume without compromising product quality.

Three years later, when we opened an all-new brewery, I again stretched my creativity. In one project, three engineers, including myself, did the work of 12 to custom fashion the control system and piping for our state-of-the-art brewing equipment from Germany.

In 1999, we were searching for ways to reduce brewery carbon dioxide emissions, a natural byproduct of beer fermentation. A brewery co-worker found that we could buy wind power from our local utility rather than invest in new CO2 recovery equipment, resulting in a six times greater net CO2 emission reduction, without any capital expenditures.

Now that the company is established – we’re the fifth largest craft brewery in the United States, with annual revenue of $42 million and 175 employees – I still tinker to find solutions for our equipment needs.

So That’s Creativity

In my mind, building a creative company comes down to examples like these. It’s the ability to bring innovative solutions to difficult problems. A reflection perhaps of my background in engineering, it’s a concept that nonetheless works well for our company.

It’s also a concept that, I believe, would be helpful to other entrepreneurs, especially those whose image is, much like our own, that of being "hip" and "funky."

Indeed, we were founded after a decade of beer-related soul searching on my part. I had the classic beer experience in college. Then I "graduated" to more flavorful imported brews. I dabbled – disastrously at times – in home brewing. In the mid 1980s, when I toured Belgium on a bicycle, I learned about Belgian beer "styles" and the role of major ingredients such as yeast.

By the end of the decade, I was scribbling back-of-the-envelope notes about how to turn what was a passion into the business that became New Belgium Brewing. It’s a business that reflects my ideals as well as my beer-making fervor: a pair of founders as dedicated to preserving the environment as building a company; "hippie"-type employees who want to work for great companies and make great products; and a participatory management style.

All of which is somewhat ironic given that it has been my prosaic definition of creativity – and not only when applied to manufacturing – that has enabled us to prosper.

Beyond Engineering

In the management arena, where my wife presides as chief executive officer and president, the difficult problem that demanded an innovative solution occurred in during a period of particularly fast growth in the 1990s.

The long hairs who embrace great companies and products wouldn’t be willing to remain with a company whose culture was in danger of growing out of that mold, we were advised. Our solution was to enable them to become owners of more than 30 percent of our stock through an ESOP program and to allow access to all of our financial records, except salary information. We even sponsored courses in how to read a balance sheet. The intent, and result, was to create the mind-set of an owner.

These "open-book management" concepts aren’t unique to us, but they have gone a long way toward enabling us to preserve our culture, and even to tweak it in a way that makes sense for a maturing enterprise. These days, employees who are also stockholders don’t think twice about foregoing a quarterly bonus that could be detrimental to the long-term value of their holdings.

Product Savvy

A difficult problem once facing our product line occurred a decade ago when it was clear that one of our products, "Fat TireTM," was accounting for fully 80 percent of sales. A consultant we retained advised that we jettison our other products and even rename the company Fat Tire.

The innovative solution to that problem came right from the gut, and that was to say no. We wanted to continue with the strategy that we had embraced from the beginning, which was to innovate continually when it came to our specialty beers.

In our line of about a dozen offerings, we recently turned to creativity to envision how ale from the Brussels of five centuries ago might have tasted. Although we found a recipe dating from 1554, we couldn’t discern the brewing instructions. So the new brew, which we’ve named "1554," arose from our attempts to improvise while figuring it out.

Similarly, innovation has led us to work around the brewing mantra that holds that high alcohol content enhances flavor. Wanting to design a flavorful beer with little alcohol, which we would call "Loft," we turned to the creative solution of using spices.

Our Creative Future

On the drawing board for the future is a plan to turn our company into one that goes beyond green – that becomes a model of environmental adaptation for other companies. A current project, for example, is to assure that our new warehouse and bottling facility is a net producer rather than consumer of energy.

Already the first problem has surfaced, that such a "living building," as we call it, will be more expensive to build. Already, we are turning our creativity toward the task of solving that problem.

Our definition of creativity has forged a company. Adapt it in the course of building yours, and you will be richly rewarded.

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Using Creativity to Stand Out in a Competitive Marketplace

by Lillian Vernon
Lillian Vernon Corporation

The past few years have been difficult for most retailers. Consumer confidence plummeted following September 11, 2001 followed by anthrax in the mail, Americans worrying about the economy and job security, and the war in Iraq. The marketplace became overcrowded with tens of thousands of traditional and e-retailers competing for shrinking consumer dollars.

These challenging times require creative solutions to survive and thrive. In the direct marketing industry alone, there is a glut of over 10,000 catalog titles. Creative marketing plays an instrumental role in helping Lillian Vernon stand out in this competitive retail environment.

Most major gift and house wares retailers buy their merchandise from the same manufacturers and attend the same trade shows both domestically and overseas. Many products they sell are variations of the same themes. These days, consumers want and expect more variety because they have so many choices. They’ll buy from many different companies without staying loyal to a particular brand. This presents a challenge for retailers who want to maintain and grow their customer base. They must be innovative and develop new and different ways of doing business to attract new customers.

Creative Marketing

When I launched my mail order business in 1951 on my kitchen table, I knew that offering personalization would be a creative way to make my products stand out. I designed a basic commodity – a leather handbag and belt – that I knew young women would want to buy. What made these products unique and attractive to my customers was I offered to include their initials at no cost. I felt they would enjoy wearing something that expressed their individuality, and my hunch proved right. My first ad in Seventeen magazine brought in $32,000 in orders and I was on to a winning concept.

Today, many retailers have followed my lead by offering mass customization but few offer it for free, a service that has become our company trademark. Over half of the products we sell can be personalized.

Creative marketing means customizing your products and services so they are different than your competitors. This is not an easy task, but if you carefully research the marketplace, scout out the unusual and develop your own exclusives, you can develop a trademark that will stand out. The key is staying one step ahead of the competition.

From the beginning, I knew that mail order was a challenging business because it involves consumers buying on blind faith. This required a creative marketing solution, and I met this challenge by introducing one of the most liberal return policies in the retail industry. For 52 years, our company has offered a 100 percent satisfaction guarantee where we offer a replacement or refund on all our products, including personalized ones, with no questions asked – even 10 years later.

Creative Solutions

Problems that could prove costly or even fatal to a business can be turned into profitable solutions using creative marketing. For example, when Lillian Vernon was growing rapidly in the early 1980s, we had huge inventory of overstocked and discontinued products. This was tying up our warehouse space and capital and suffocating our business. My creative solution was to launch our first Sale catalog that became an ongoing catalog title and a profitable way to dispose of excess inventory, the bane of all retailers. The success of our Sale catalog prompted us to open outlet stores along the East Coast where we have a large customer base and widespread brand recognition.

Taking a chance on a new business venture can present an opportunity for creative marketing. At the earliest stages of the e-commerce industry in 1995, Lillian Vernon became one of the first direct marketers to launch a Web site. Our early exposure and experience online helped us attract a broader demographic of customers and gave us the opportunity to introduce our products to a different market segment. Our Web site, http://www.lillianvernon.com, is now the fastest growing and most exciting part of our multi-channel business.

Entrepreneurs and business leaders who "think outside the box" will benefit most by their vision and creativity. Successful companies must continually reinvent themselves through creative marketing to remain competitive and grow. The ones who are afraid of change will eventually fall by the wayside while their industry leaders surpass them.

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Maintain Altitude: Five Steps Toward Entrepreneurial Creativity

by Harry Vardis
Creative Focus, Inc.

An entrepreneur’s job is all about feeling lost and finding a way back. It’s about, as I’ve discovered in my six years since starting a qualitative research firm, Creative Focus, Inc., maintaining altitude. It’s about correcting, as does a pilot, for the inevitable ups and downs in order to stay airborne.

A lot about what enables company builders to confront logic-defying problems – and solve them in order to move their ventures forward – has long been ascribed to hard work and a passionate belief in one’s goals, to say nothing of unbridled optimism.

However, there is another quality that bears acknowledging: a willingness to meet change with creativity.

It is in creativity, in short, that the solutions are found to the incessant issues that arise in the course of building a company. And, as I have discovered, creativity is all about attitude. To maintain the altitude that keeps a company going, you must work on attitude. What follows are five steps for forging an attitude that invites creativity into your entrepreneurial pursuits.

1. Find the Opportunities, Don’t Wallow in the Problems

Problem solvers though they may be, even entrepreneurs get the blues. Especially when it comes to the heavies, such as, "We have no budget," and, "We ran out of money."

Now the above statements appear to suggest an obstacle, whereas, if presented differently, the matter at hand might well appear to be an opportunity, like so: "How might we obtain a budget for this project?" And "In what ways might we find money for this project?"

Transforming problems into opportunities leads to solutions. Having restated the questions above, for example, you might then look for the right person to take as much ownership in the issue as you have. Together, you both might explore further questions that nudge you closer to a solution, such as: "In what ways can we convince a bank to lend us money? Or, "In what ways can we cut costs?" Solutions are apt to arise more frequently when the right questions are posed.

2. Separate Idea Generation From Idea Evaluation

At the heart of creativity is the notion that the more ideas you have the better. When ideas are initially thrown out on the table, however, they are often discounted as being unworkable or unreasonable.

When I worked for a large advertising agency, for example, a friend suggested that I teach the techniques I practiced. Instinctively, I said that wasn’t a good idea because others were doing it and because my time was better spent with clients.

The suggestion might not have been right for me at the time, but the idea itself was good, and my resistance was judging it before I had a chance to let it germinate in my mind. (What I am doing now, in fact, is the very teaching my friend suggested years ago.) The moral for the entrepreneur is to set aside a time to generate ideas, and a completely different time to evaluate each. Don’t mix the two, or you may be killing the babies before you know what they might grow up to be.

3. Change Lenses

Now let’s get to that evaluating. You must, like the photographer who takes 1,000 shots for the one ideal image for the book jacket or advertisement, compile a broad array of ideas. The more you have, the better your chances for finding just the right one for your company.

However, numbers aren’t the whole story. Creativity also involves a practice called "forced association." If you’re in the business of, say, remodeling bathtubs, you might think of several ideas for doing so, such as making tubs deeper or wider. Next, though, forget about the tub and consider a completely different object – let’s say, a banana. It’s yellow, slippery, has a jacket, and contains potassium, which makes it nutritional. Now apply the characteristics of the banana to your tub business. You might then think about introducing a line of colored tubs, for example, or enabling your faucets to release nutrients into the water for a healthier soaking.

When evaluating ideas, in other words, a simple technique is to listen to all of them, clear your mind, and then open a dictionary and pick a random word. Think about how that word or its attributes relate to your company’s issue, and, just as banana to bathtub, you will find yourself with a new perspective. Be assured that you needn’t confine yourself to a dictionary; anything unrelated to the issue at hand, such as an article in a magazine, could produce the same result.

4. Avoid the Trap of Entrenched Thinking
Are you having fun yet? Well, now I’d like you to try an exercise. First, repeat the word, JOKE, six times (Don’t read further until you do that!) Second, what do you call the white part of an egg? Quickly! Third, did you say, yolk? Go ahead, you can admit it. You know that the yolk is the yellow part, not the white part, but you were led astray by the entrenched pattern – joke, joke, joke – and you couldn’t think freely.

That’s what often happens when it comes to being open to new ideas. Humans operate 92 percent on autopilot, and only 8 percent consciously, even, sadly, those entrepreneurs among us. The challenge is to break from those entrenched patterns so that you don’t, subconsciously (or even consciously), eliminate new options. You need to be aware that new patterns exist and that you must make an effort to embrace them.

OK, try this exercise to get yourself going: fold your arms and note which arm is on top. Now re-fold them so that the other arm is on top. Does the new way feel comfortable or strange? Ideas are analogous – new ones do seem strange. The lesson is to give them a chance!

5. Risk Something Big

Write a poem about your work. Or paint a picture. Or tell a story. Once, when I was faced with one of my biggest challenges, I went into a children’s toy store, bought hand paints, and created a mural. The task released my negative energy and focused my thinking. Now, when I look at the mural, I am reminded of how I solved the problem.

The point is that what might be considered silliness when juxtaposed against the serious job of company building – humor, physical activity, or the creative arts – might actually work to loosen you up in times of stress. There is a similarity, after all: it takes a lot of passion to act silly – and to create a company.

These days, top business schools are teaching the liberal arts, as well as painting, poetry, and improvisation, so that students can better express themselves and experience the differing perspectives that lead to creative thinking. Entrepreneurs would do well to do the same.

At the very least, silliness reminds the focused entrepreneur that every undertaking has a human side and that rewards don’t always have to be monetary. In fact, as the old saw goes, if the rewards are coming at the personal level, the financial might just follow.

Are you soaring yet, entrepreneurs? Surely, from these five techniques, you’re beginning to understand that creativity can be unleashed – and that once you embrace it, you will be better able to release the change-producing energy that builds companies. You are, in sum, at least maintaining altitude!

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