pattern recognition -vs- pattern hunting by Shane Snow

Shane Snow shares....Have you ever wondered how small, unknown companies sometimes manage to outgrow rival business leaders?

These upstarts are probably proficient in two related skills: pattern recognition and pattern hunting.

Pattern recognition is about understanding underlying principles and repetitive developments based on experience and practice. For example, when a surfer who’s surfing his favourite spot recognizes a promising surfing wave, he’s practising pattern recognition, as he’s seen the waveform many times before.

On the other hand, pattern hunting is about deliberately analyzing and searching for new patterns. So if another surfer comes along who doesn’t know the waves at that spot, he can still observe the waves and try to find patterns in them.

Although both skills are valuable, pattern hunting can outperform pattern recognition. That’s because if we only rely on our past experience, we are less sensitive to changes in patterns.

Consider the surfer: if he knows the ocean well, then he probably expects it to behave a certain way all the time. Therefore, he might not notice changes from day to day, which the new arrival can leverage to catch better waves.

So from a business standpoint, pattern hunting is essential for a company that wants to find promising new opportunities. Unfortunately, experimenting with new patterns and venturing into the unknown aren’t standard practices at most established companies.

These large corporations are often so focused on the traditional way of doing business that they fail to notice major new trends.

This can have disastrous results. In the 1990s, for example, Kodak lost almost $30 billion of its market capitalization when it ignored the emerging digital photography trend.

To combat this conservative streak, Google has implemented the 20% Doctrine which instructs its employees to spend 20 per cent of their work time developing new ideas. The hope is that this system will ensure that Google stays a leader in innovation.