Are you a Bezos or a Musk? Creating Innovation Capital with Jeff Dyer
Jo Ann Barefoot
Jeff Dyer is a professor of strategy at BYU and the Wharton School. He and two co-authors, Nathan Furr and Curtis Lefrandt, have written the book, Innovation Capital, which explores how to lead innovation work, whether for companies or for projects, in situations where the innovator lacks the formal “power” to cause the needed steps. What do you do, for instance, if your boss doesn’t see the need for innovation? How do you get people to want to join your project?
In our conversation, Jeff says part of the answer is what he calls the human capital skill of forward-thinking -- which he likens to mental time travel, envisioning what people in your industry will want next, and what technology is coming that will enable new things to happen. He talks about spotting opportunities -- being a “scout” and learning to see patterns. He talks about getting other people to want to help so that you can amass the needed resources. And he talks about building an innovation reputation that will continue to attract people to your efforts over time.
A fascinating part of our conversation centers on insights about famous innovators and inventors, like Steve Jobs and Steve Wozniak, or Edison and Tesla. Last year, Jeff and his colleagues conducted research to identify and rank America’s most innovative leaders today. The resulting Forbes Magazine story reports a tie for the number one slot: Elon Musk and Jeff Bezos.
The dual ranking spotlights a key factor that differentiates two basic types of innovation challenges. Some are mainly technological in nature -- like the ones Elon Musk tackles -- while a second type is mainly cultural and organizational, like the ones Jeff Bezos excels at solving. Depending on which challenge they face, innovators will need to follow distinctly different paths to success.
When Musk pursues an initiative, for example, he tends to go where there is high technological uncertainty. He asks, can this even be done? Can we create a reusable rocket, or an electric car that can go 300 miles in one charge, or a hyperloop from San Francisco to Los Angeles? He lays out a lofty and inspiring vision, seeking to get people excited at the outset by being big and bold. He sometimes misses the goal, but he says you have to try to be great to be really good. Bezos, in contrast, innovates around customer demand, on what the coming needs will be. He doesn’t do big and bold. Even with his space company, Blue Origin, he was quiet at the start. He wants to show that something is going to work.
These differences, again, flow from the kinds of problems these innovators choose to take on, and that choice, in turn, fuels big differences in how they manage. Jeff explains how they prioritize which problems to solve first, how they select people, how they work with people, how they sell, and even when they speak at meetings.
Jeff and I talked about the great innovation thinker Clay Christensen, who authored the book, Innovator’s Dilemma (note that we recorded this episode before Professor Christensen passed away in late January). We also talked about the dilemma that the top innovators list has a dearth of women. He shares innovation lessons he learned from former Pepsico CEO Indra Nooyi, about her insights on tying your work to purpose, telling great stories, and leaving the world better than you find it. Let’s hope future lists are more diverse.
For most of the topics we discuss on Barefoot Innovation, the innovation challenge is in the second category -- the Bezos one, that’s cultural and organizational. The technology already exists to do the big things that are needed in finance and financial regulation. It was invented by other people for other purposes, long ago, and is already at work in other sectors, in mature form. All we have to do is figure out how to get it into finance and regulation, which are inherently hard to change, and which will require many adaptations and safeguards. Still, I see many situations where the Musk approach, the big vision, and inspiration, is exactly what’s needed to galvanize action.
Links
The Innovator’s DNA Website: https://www.innovatorsdna.com/
Innovation Capital by Jeff Dyer: Amazon
The Innovator’s Method by Jeff Dyer: Amazon
Clay Christensen’s Website: claytonchristensen.com
The Innovator’s Dilemma by Clay Christensen: Amazon
America's Most Innovative Leaders - Forbes
More on Jeff
Jeff Dyer (Ph.D. UCLA) is professor of strategy at BYU and the Wharton School. He worked previously as a management consultant at Bain & Company and co-founded the Innovator’s DNA consultancy. He is the author of three Harvard Press bestsellers on innovation leadership: The Innovator’s DNA, The Innovator’s Method, and Innovation Capital.
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We have wonderful episodes in the queue. If you haven’t already, check out my recent conversations with the Comptroller of the Currency, Joseph Otting and with Jelena McWilliams, Chairman of the FDIC. We also recently posted a fascinating discussion with Greg Becker, CEO of Silicon Valley Bank.
Coming soon, our conversations with David Reiling, CEO of Sunrise Banks; with Ellison Anne Williams of Enveil; and with Albert Forkner, State Banking Commissioner of Wyoming. We’ll also talk with Sarah Willis of the Metlife Foundation and Allie Burns, CEO of the nonprofit Village Capital. We’ll have a show with Shamir Karkal and Angela Wilson of Sila. And we have a fascinating conversation with Jerry Buckley and Sasha Leonhart of the Buckley law firm, on a study they did for AIR and the Omidyar Network called The Financial Regulators’ Dilemma, on obstacles to innovation by the federal financial regulators.
Upcoming Events
If you would like to book me to speak to your group, contact jay@provokemanagement.com.
Meanwhile I’ll hope to see you at these events:
Innovate Finance Global Summit, April 20-21, London, UK
Shared Assessments Third Party Risk Summit, April 29-30, Arlington, VA
LendIt Fintech USA, May 13-14, New York, NY
And for regulators, I’m looking forward to speaking at an upcoming conference of the FFIEC and will hope to see many of you there.
Until then, keep innovating!