At its essence, an organization is an idea machine. It will thrive or languish, live or die, according to the quality of its ideas. Is your organization a good idea machine, a bad idea machine, or meandering somewhere below its potential? Is it generating the kinds of ideas that will propel your organization to where you know it can be?

Good ideas will raise the bar. Good ideas find ways for the organization to stand out in distinctive and valuable ways, like Apple’s high-touch customer service via the Genius Bar. Good ideas use resources in the most productive way possible, like enabling airline passengers to use the power of their phone to manage reservations and produce a boarding pass.

Bad ideas lower the bar. Bad ideas diminish the customer experience, like incessant emails asking to fill out a survey after one simple purchase. Bad ideas make things overly complicated, like new corporate software systems that require more work for users than the original process.

See the figure below. It illustrates that every organization has the ability to collect and synthesize information from the environment. Some organizations use those inputs to their advantage, others cannot translate those inputs into value, and some will even degrade the performance of their organizations.

Leaders cannot take responsibility for everything, but they do have significant discretion to affect the quality and quality of ideas. They can, in fact, become expert mechanics and fine tune their idea machine so that it cranks out ideas with serious horsepower.