Defining the creative business of the 21st century
As a financial advisory firm specializing in creative businesses, we are often asked what defines a “creative business.” For many, the first thought that comes to mind are arts-based businesses, encompassing such industries as visual arts, advertising, architecture, design, media, music, and publishing, as well as cultural organizations such as museums, galleries, and libraries.
However, new technologies are forcing us to rethink this definition. The lines are blurring between traditional industries in extremely innovative ways. Take for example, Diamond Foundry, which uses solar technology to forge man-made diamonds—without the human and environmental cost of mining—and transforms them into beautiful gems and jewelry. Or bio-bean, which produces “Coffee Logs” and other biofuels made from recycled coffee grounds. Or Stitch Fix, which uses data science and advanced algorithms to reinvent the business of personal styling and change the way millions buy clothes online.
We can hardly say such businesses are not “creative.” In fact, it’s precisely their creativity that is helping these companies not only set themselves apart from their competitors, but also revolutionizing their respective industries of manufacturing, energy, and retail.
The boundaries of what defines a creative business have broadened so widely that scholars have abandoned strictly defined creative industries for a more loosely defined “creative economy,” which encompasses all economic activities resulting from the creation and circulation of intellectual capital. Employing 30 million people worldwide and generating $2.25 trillion in global revenue, the creative economy has become not only an important component of a country’s GDP, but also a way for it to gain a competitive edge in the overall market.
It’s no wonder governments and non-profits have pushed for policy developments to help foster the creative economy. In Britain, for example, innovation foundation Nesta developed a 10-point policy manifesto to spur creative sector growth in the UK. In China, government officials made a conscious decision in its 11th Five Year Plan to shift its economy from “Made in China” to “Created in China,” which has propelled the nation into becoming a top global innovator in just under a decade. (It’s not a coincidence that the two of the first foldable smartphones to hit the market are from Chinese manufacturers.)
In short, in a world of dynamic globalization, creativity has become one of the world’s most valuable resources, and creative businesses are the businesses that harness it to create commercial value, solve complex problems, and drive cultural and social impact.
What makes for a successful creative business
Since I founded Creative Business Inc. in 2005, our company has been lucky to experience first-hand this creative revolution in the business world. We’ve worked closely with some of the world’s most talented entrepreneurs and innovative companies across diverse sectors, from fine art and design to retail and light manufacturing. Despite creativity being at the core of who they are and what they do, it’s certainly not the only element that makes them successful. Here are the qualities that we see in our most successful clients:
Purpose-driven. Every successful creative business starts with a why. What is your purpose? What is the big question that you’re trying to answer, and how can you and your business solve that problem? Your purpose becomes the guiding star that helps your company stay aligned with its vision and goals. Being purpose-driven not only fosters creativity (genuine innovation needs purpose), but it also helps to attract the best and brightest minds to the business and helps deliver greater economic and social value.
Discipline. If creativity is the fuel that drives innovation, discipline is the engine. Discipline is what allows a business to be methodical, process-driven, and strategic in bringing their ideas to life. Discipline gives us the resilience and patience to stay focused and work through obstacles (and there will be plenty as a business owner!), and it is also what helps business leaders build and manage teams effectively. Businesses cannot sustain themselves on creativity alone—discipline is a key element for profitability and growth.
Adaptability. The ability to adapt and evolve in the face of changing conditions plays a big role in a company’s long-term success and sustainability. It requires the willingness to challenge assumptions and the agility to mobilize quickly to solve unforeseen problems. Creatives are by their nature generally adaptive and flexible, but the most successful creative entrepreneurs are those that can bring that adaptability to an organization as a whole. (Hint: it all goes back to #1—purpose-driven companies are quicker to evolve.)