Chapter 4
Co-Creation: Inviting Your Audience Into the Process
At The Second City, shows are created through constant dialogue with audiences. Rather than treating audiences as passive consumers or focus groups, performers listen to their reactions-laughter, groans, and silences-to edit and refine material.
This co-creation process was exemplified when a controversial scene featuring Superman in a wheelchair (referencing Christopher Reeve's accident) initially received hostile audience reactions. Instead of abandoning the scene, director Mick Napier transformed it by adding a poignant song that acknowledged the audience's discomfort while making a deeper satirical point. This approach turned a potentially offensive sketch into one of the show's most memorable pieces.
For businesses, co-creation provides remarkable insight whether developing products, marketing, or production processes. It ensures you're giving customers what they want even when they can't articulate it themselves. The effectiveness of co-creation relates to the neuroscientific "closure principle"-humans are hardwired to complete incomplete pictures by filling in missing information. People respond positively when invited to contribute to partially formed ideas.
However, successful co-creation requires overcoming three major barriers. First, individuals must surrender ownership of their ideas to the group-allowing others to modify and build upon them rather than controlling outcomes for personal credit. Second, leaders must cede control, which becomes harder the higher one rises in an organization. The most effective creatives at Second City possess both idea generation skills and the ability to listen to ensemble members, allowing concepts to evolve from simple to complex.
Finally, fear-of failure, looking foolish, or the unknown-blocks effective co-creation. While useful for basic safety, fear produces knee-jerk, path-of-least-resistance ideas rather than elegant creative thinking. Fear-based cultures like those at Enron (fear of speaking up) or Kodak (fear of killing their film business) led to catastrophic outcomes.
Fear manifests in various ways during co-creation: excessive questioning that shifts creative responsibility onto others, aggression that stops creative momentum, leadership by volume that damages collaboration, and waffling that stems from fear of the unknown and lack of confidence. The antidote is preparation-just as improvisers warm up before performances, business professionals must gather sufficient data and rehearse scenarios with team members to build decisive leadership skills.
Chapter 5
Comedy as Change Agent: Making Transformation Easier
E.B. White famously compared analyzing comedy to dissecting a frog-few are interested and the frog dies in the process. Nevertheless, understanding how comedy works can help organizations navigate change more effectively.
Comedy expert Anne Libera identifies three essential elements: recognition, pain, and distance. Recognition occurs when audiences identify familiar patterns or references. Pain is necessary because comedy requires discomfort-even simple jokes create momentary cognitive dissonance. Distance provides the safety that allows audiences to laugh at painful truths, whether through time ("too soon?"), physical separation, or established trust.
Change is hard in any organization, but comedy and improvisation form a powerful combination to make transformation easier. Comedy enables honest conversations about problems without being threatening, while improv builds the skills needed to navigate change. This approach has proven effective across education, politics, startups, and Fortune 500 companies.
Our partnership with Norwegian Cruise Line demonstrates this principle perfectly. What began as an unlikely business development opportunity became a creative revelation-we discovered the power of satirizing the cruise experience itself. Norwegian encouraged us to make fun of everything from tiny cabins to powerful toilet flushes, and audiences loved it. During bad weather, when passengers were grumpy, we deliberately addressed the "elephant in the room" through weather jokes, diffusing tension through laughter.
Even the most conservative organizations can benefit from comedy when conveying important messages. In fact, the higher the stakes, the more comedy helps cut through clutter and create safe spaces for honest conversation. Our RealBiz Shorts program revolutionized corporate ethics and compliance training-traditionally the most humorless, mind-numbing corporate experience. By creating engaging, funny videos about serious compliance topics, we've attracted nearly 300 blue-chip clients in three years.
When companies lack humor, it often stems from confusing reverence with respect. Respect acknowledges worth while enabling dialogue between different perspectives. Reverence, however, places ideas or institutions beyond questioning-making them untouchable and perfect. When respect transforms into reverence, those with lower status cannot speak truth to power, making necessary change impossible. Comedy has historically served to level these playing fields, giving voice to those who need to call out failings in leadership or institutions.
Chapter 6
Embracing Failure: The Essential Ingredient for Innovation
At Second City, failure is not only accepted but expected-it's why their late-night Improv Sets following scripted shows are free. The company fails regularly, on stage, in conference rooms, and in business decisions, understanding that challenging and reinventing oneself requires embracing failure as part of the process.
Second City proudly shares their spectacular failures: the "Royster Oyster" hamburger that sent dozens of food-poisoned customers to the hospital; the disastrous Cleveland theatre opening where audiences booed their political satire; an overbudgeted sales training video series that barely broke even; three failed attempts to open a Montreal theatre; a pretentious dramatic improv show called "Invisible Rails" that drove even improv legend Del Close from the audience; and an avant-garde set design featuring unrelated cow and spider murals created by artists who endangered their baby with spray paint fumes.
Despite these failures, Second City remains hugely successful. They recognize that failure isn't something to fear but to embrace. The fear of failure-not failure itself-paralyzes innovation, causing people to disengage, hold back, and avoid risks. Organizations that accept failure as natural see tremendous increases in productivity and creativity.
Improvisation means creating something from nothing in real time, in front of an audience. At Second City, performers are essentially paid to present rough drafts to hundreds of people, evolving those drafts into brilliant, unexpected comedy. During the creation of a Second City revue, they experiment with characters, dialogue, scene order, and music over a 10-12 week process. This tinkering may cause short-term pain for preview audiences but leads to long-term gain with successful shows that run for months.
Second City fails in six specific ways that contribute to their success. First, they fail in public, recognizing that where there's potential for public failure, there's also opportunity for public acclaim. Second, they fail together-ensembles provide the creative safety net that allows individuals to risk and flourish. Before every performance, cast members hug and say "I got your back"-a reminder that the group empowers the individual.
Third, they fail fast-when failures happen, they quickly move to the next idea without dwelling on what went wrong. Fourth, they fail free of judgment-no one feels free to take risks if they think they're being judged. At Second City, once actors and directors begin rehearsal, no one enters that room without invitation-even producers must ask permission to see previews.
Fifth, they fail with confidence-when they fail, they rebound quickly because they bring unshakable confidence that their approach, talent, and experience will carry them through. Finally, they fail incrementally-in improv, the axiom "bring a brick, not a cathedral" means performers contribute small ideas that build scenes collectively rather than trying to control everything.
Chapter 7
Follow the Follower: Reimagining Leadership
Improv comedy principles align remarkably with Peter Drucker's theories on modern leadership. Drucker championed flatter corporate structures focusing on knowledge workers as assets rather than liabilities, customer-centricity, and autonomous teams-all paralleling improv's ensemble approach. Second City embodies these principles by valuing talent as their greatest asset, giving performers creative control, and connecting their work directly to audience participation. This approach has proven particularly effective in rapidly changing business environments where adaptability and collective intelligence are crucial for success.
One of the most valuable leadership lessons at Second City comes from Andrew Alexander: "Build the right sandbox, hire the right people, and get the hell out of the way." Producers don't intrude on rehearsals uninvited-directors determine when outside feedback is appropriate. This approach prevents premature judgment that can derail creativity and allows teams to take necessary risks. The method has resulted in breakthrough performances and innovative sketches that might never have emerged under more controlling management styles. For example, many of Second City's most successful shows evolved from seemingly chaotic rehearsal processes where performers were given the freedom to experiment extensively.
Reading the room is fundamental to effective leadership, requiring a sophisticated blend of emotional intelligence and situational awareness. When you truly engage in the moment using all your senses, you dramatically increase the chances of meaningful exchanges. Effective leaders notice subtle body language cues like someone sinking in their chair, checking their phone, or displaying micro-expressions of disagreement, and quickly re-engage them in the conversation. The improv principle "Leave the action onstage" applies perfectly here-don't focus on what's not present, but instead concentrate fully on the people and space before you. This skill becomes particularly crucial in virtual environments, where leaders must work harder to detect and respond to engagement levels.
Modern leadership has evolved beyond the "cigar-chomping, throne-sitting" boss of old, embracing a more nuanced and inclusive approach. Today's effective leaders adapt fluidly, allowing knowledgeable team members to take center stage when appropriate, creating what some call "situational leadership." Studies show women often excel at modern leadership, with research by Dr. Jack Zenger finding women rated more positively in twelve of fifteen leadership effectiveness functions, including taking initiative, driving results, and building relationships. This reflects a shift from command-and-control to collaborative leadership that leverages traditionally feminine strengths like listening, relationship-building, and fostering psychological safety in teams.
The "String of Pearls" exercise demonstrates this principle beautifully and has become a cornerstone of leadership development programs. Participants line up facing forward, with the first person receiving an opening line of dialogue and the last person receiving a closing line. Each person in between must improvise a line that logically connects the narrative from beginning to end, requiring careful attention to both previous contributions and the ultimate goal. This exercise teaches participants to consider not just their individual contribution but how it fits within the larger context-exactly what effective leadership requires. The exercise also highlights the importance of active listening, adaptability, and collaborative storytelling in modern leadership contexts.
Successful organizations increasingly recognize that leadership is not about maintaining rigid control but about creating environments where creativity, innovation, and collective intelligence can flourish. This approach requires leaders to sometimes step back, allowing others to shine while maintaining the overall direction and purpose of the team's efforts.
Chapter 8
Listening: The Most Underrated Business Skill
In 2004, British satirist Tony Hendra published "Father Joe," chronicling his decades-long friendship with a Benedictine monk who offered him wisdom paralleling the core principles of improvisation. The monk emphasized listening as the essential way to truly know others-reaching beyond our walls to connect with another's reality.
Despite listening being how we learn 85% of what we know and comprising 45% of our workdays, humans only listen at a 25% comprehension rate, with a mere 2% of professionals having formal listening training. This deficiency creates problems everywhere-in business, communities, and homes-because we're never properly taught this fundamental skill.
Great listening forms the foundation of great improvisation. Before actors can affirm and build on each other's ideas through Yes, And, they must first genuinely hear them. Beginning improvisers often fail because fear overrides their listening skills-they resort to monologues or disconnected responses rather than building on their scene partners' offers.
At Second City, listening is treated as receiving gifts; each statement from another actor presents an opportunity to build something meaningful together. Students learn through exercises like "Thank You," where they must acknowledge their partner's contribution before responding, and "Repetition," where they must repeat or paraphrase what they've heard before adding new dialogue.
While improvisers face immediate consequences for poor listening-public failure and reputation damage-the business world often allows people to mask their inattention with nods and murmurs. However, the cost remains significant: organizations build products no one asked for or wanted. The business world is littered with examples: Ben-Gay aspirin, Cosmopolitan yogurt, McDonald's Arch Deluxe, Harley Davidson perfume, the XFL, and New Coke. These failures occur when companies don't listen to their own client base.
Listening skills have become more crucial than ever as business grows more global and generational shifts occur in the workplace. Like a muscle, listening needs consistent exercise to improve. Second City has developed exercises that make this improvement both possible and enjoyable.
One example is "Last Word Response," where participants must begin each statement with the last word spoken by their partner. This forces people to listen completely through to the end of each thought-something most businesspeople rarely do. Stephen Covey described this as the difference between "listening to understand and listening to respond." Without full listening, we miss content, contradict unnecessarily, and create false disagreements.
Improvisation also requires listening beyond words to discern a speaker's true intent through tone, manner, and physical cues. Paul Ekman's work on micro expressions-fleeting facial expressions revealing concealed emotions-demonstrates the gap between what people say and how they really feel. For businesses, this empathetic listening provides a clearer path to truth and what Dan Goleman calls "cognitive empathy"-understanding how others feel and what they might be thinking.
Chapter 9
The Improviser's Mindset: A Toolkit for Uncertain Times
Improvisation is about discovery-creating something from nothing through brain and heart. At Second City, we've tested our principles in millions of scenarios across six decades and learned there's no single path to creativity, but we can provide tools for any journey. Whether in a comedy sketch or a boardroom presentation, the fundamental skills remain consistent: staying present, responding authentically, and building on what exists.
Leadership in an improvisational context means building strong ensembles where individuals contribute their unique strengths while being supported in their weaknesses. This might mean having a technical expert partner with a skilled communicator, or allowing a creative visionary to collaborate with a detail-oriented executor. To thrive in innovation, we must destigmatize failure and reframe it as valuable data. Even at Second City, we often forget improvisation's tenets ourselves, but the key is consistent reflection, sincere apology when needed, and continuous improvement.
In our accelerating world of technological disruption and market shifts, improvisation offers the perfect toolkit for navigating the unknown. The principles we've explored-Yes, And; ensemble building; co-creation; embracing failure; flexible leadership; and deep listening-aren't just techniques for creating comedy. They're essential skills for thriving in a business environment characterized by constant change and uncertainty. Companies that embrace these principles consistently outperform those stuck in rigid, traditional approaches.
The wall in our office displays a simple but powerful list that reminds us of the improviser's mindset: look people in the eye to establish genuine connection, be endlessly curious about possibilities, eliminate "no" from your default responses, forgive yourself and others quickly, make your partner look good rather than seeking personal glory, listen to the whole person including their non-verbal cues, say "we" instead of "I" to build collective ownership, and above all-be an improviser in every situation.
These principles have transformed The Second City from a small cabaret theater challenging institutions in the late '50s to a global entertainment and education organization that has trained generations of performers and business professionals alike. We've seen these tools successfully deployed across industries - they've helped companies like Google improve their product development process, enabled Nike to enhance their creative collaborations, and assisted Motorola in solving complex organizational challenges. The applications range from improving daily team interactions to facilitating major corporate transformations.
As you face your next challenge-whether it's a difficult conversation with a team member, a high-stakes product launch, or a major organizational change-remember that you have the innate capacity to improvise. You can create something from nothing by starting with what's available. You can build on others' ideas rather than tearing them down, turning initial concepts into breakthrough innovations. You can embrace failure as a stepping stone to success, learning from each setback. You can lead by following and follow by leading, adapting your role to what the situation demands. And most importantly, you can truly listen-to your colleagues, your customers, and yourself-hearing not just words but underlying needs and aspirations.
The world doesn't need more rigid scripts or predetermined solutions. It needs more improvisers who can adapt, create, and thrive in the face of uncertainty.
