How to Cultivate Leadership That Is Honed to Solve Problems – Deborah Ancona and Hal Gregersen

MIT Sloan Prof. Deborah Ancona

Hal Gregersen, Executive Director of the MIT Leadership Center

Hal Gregersen, Executive Director of the MIT Leadership Center

From strategy+business

In the aftermath of the Boston Marathon bombing in 2013, the terrorists responsible for that act took the life of a police officer, Sean Collier, who worked at the Massachusetts Institute of Technology (MIT). Those who knew and loved him at MIT resolved to commemorate his memory. J. Meejin Yoon, head of MIT’s department of architecture, designed a memorial to honor Collier’s love of the outdoors and spirit of service, while reflecting the university community he served. The memorial is composed of massive interlocking granite blocks. Making them stand up required a feat of engineering that pushed the technical limits of the material. A multidisciplinary group assembled to figure out how to complete the project. The group included faculty, students, and staff with expertise in architecture, construction, engineering, and masonry, as well as consulting experts in structural and civil engineering, landscape architecture, and lighting design. No one person directed the project from start to finish; instead, teams stepped up and stepped out, forming for just as long as their expertise was needed. The Collier Memorial was unveiled on April 29, 2015, just a few days after the second anniversary of the officer’s death. It stands today on MIT’s campus as a tribute to a life given in service to a community that rises to meet challenges.

When a collaborative project like the Collier Memorial comes to fruition, it might seem to happen without leaders. But in reality, the many leaders involved were following a model of leadership that is hard to spot until you know how to look for it. We call this approach challenge-driven leadership. These leaders are propelled by the intrinsic desire to solve problems and meet challenges creatively. They are not motivated by the trappings of authority, status, or showmanship. They don’t particularly want to lead, and they certainly don’t want to be led. But they excel at choreographing and directing the work of others, because their expert knowledge enables them to spot opportunities to innovate in a way that cannot be done by working alone.

Challenge-driven leadership is not right for every situation. But where innovation and entrepreneurship are required — and in particular where developing a solution requires drawing together diverse talents and perspectives to discover novel approaches — it tends to work well. No wonder we find it in many places where people are dealing with “wicked problems,” a term coined in 1967 by design theorist Horst Rittel that refers to broad challenges with no obvious solutions. This is the kind of leadership that many companies, government agencies, and nonprofits would do well to recognize and cultivate.

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The surprising way to come up with your next business idea — Hal Gregersen

Hal Gregersen, Executive Director of the MIT Leadership Center

Hal Gregersen, Executive Director of the MIT Leadership Center

From Fortune

Scott Cook, founder and CEO of Intuit INTU -0.43% , didn’t come up with his concept for the popular Quicken money management software sitting behind the desk or spit-balling ideas in a brainstorming session. He first conceived of it while watching his wife grow increasingly frustrated preparing the family’s finances. From a single observation, combined with Cook’s understanding of computers, one of the world’s most successful financial software companies was born.

Consider all of the times you’ve asked yourself: “Why didn’t I think of that?” Indeed, the world’s next pioneering innovation could be sitting in plain view for anyone to discover. But what is it that inspires some people to take the next step on something overlooked by others?

Our research of high-impact leaders shows about one-third of them fall into the camp of observers –carefully observing the world around them with all of their senses, and identifying common threads across often unconnected data to provoke unique business ideas. Observation has transformative power. Yet, in today’s 24/7 culture, many of us operate on autopilot, starving our brain’s creative capacity. Here are three ways to tune this critical discovery skill and increase the odds that your next observation adds up to great innovation.

Schedule It

The most obvious way to become a great observer is to actively observe. Take a page from Cook’s book and watch your spouse or child perform a task. Schedule observation excursions; pick a company to follow, or set aside 10 minutes to observe something intensely. Following observation periods, think about how that might lead to a new strategy, product service or production process.

Read the full post at Fortune.

Hal Gregersen is Executive Director of the MIT Leadership Center and a Senior Lecturer in Leadership and Innovation at the MIT Sloan School of Management.

How We Rank The Most Innovative Companies 2017 – Jeff Dyer and Hal Gregersen

Jeff Dyer, Horace Beesley Professor of Strategy at the Marriott School of Management at Brigham Young University

Hal Gregersen, Executive Director of the MIT Leadership Center

Hal Gregersen, Executive Director of the MIT Leadership Center

From Forbes

Most innovation rankings are popularity contests based on past performance or editorial whims. We set out to create something very different with the World’s Most Innovative Companies list, using the wisdom of the crowd. Our method relies on investors’ ability to identify firms they expect to be innovative now and in the future. You can learn more about our research on innovation at The Innovator’s DNA website.

Companies are ranked by their innovation premium: the difference between their market capitalization and the net present value of cash flows from existing businesses (based on a proprietary algorithm from Credit Suisse HOLT). The difference between them is the bonus given by equity investors on the educated hunch that the company will continue to come up with profitable new growth.

To be included, firms need seven years of public financial data and $10 billion in market cap. (Facebook, for example, would rank high on the list if we used only the data since they went public.) We include only industries that are known to invest in innovation, excluding industries that have no measurable investment in R&D, so banks and other financial services don’t make the list. Nor do energy and mining firms, whose market value is tied more to commodity prices than innovation. Big caveat: Our picks do not correlate with subsequent investor returns. To the extent that today’s share price embeds high-growth expectations, one might even anticipate low returns to investors, as these expectations may be difficult to meet.

We use something called the Innovation Premium to compile our list. It is calculated first by projecting the cash flows a company produces from its existing businesses without any growth and look at the net present value (NPV) of those cash flows. We compare this base value of the existing business with the company’s current total Enterprise Value (EV): Companies with an EV above their base value have an innovation premium built into their stock price. You can read a more detailed explanation of our work around innovative companies and leaders in our book The Innovator’s DNA (Harvard Business Press, 2011), written with Harvard Business School professor Clayton Christensen. The following steps outline this approach in greater detail:

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How asking tough questions could save your career — Hal Gregersen

Hal Gregersen, Executive Director of the MIT Leadership Center

Hal Gregersen, Executive Director of the MIT Leadership Center

From Fortune

At age four, we’re fueled with curiosity, asking thousands of questions to better grasp what’s going on around us. Already we are aware, at a very fundamental level, that questioning helps us feel our way around a situation and develop entirely new ways of engaging with the world.

It isn’t long, however, before we enter an educational system that rewards answers more than questions. Consider that the average child between six- to 18-years old asks only one question per one-hour class per month. Contrast that with the average teacher, who peppers kids with 300 to 600 questions a day and waits an average of one second for each reply, and you have a recipe for what I call the “Global Questioning Crisis.”

As adults, many leaders perpetuate this answer-centric culture, playing it safe as they get things done. But, based on my research and firsthand conversations with the most renowned leaders of our time, high-impact innovators know that they must question to disrupt, or risk being disrupted. As such, they sustain this critical skillset, not just by asking more questions, but by identifying the “hot” questions – ones that are provocative, emotional and downright uncomfortable – while also encouraging those around them to be passionate about the same. Finally, they actively pursue answers to these hot questions by leveraging several key discovery skills – observing, networking, experimenting, and associational thinking.

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What VW can learn from Gen. Stanley McChrystal about imperfect leaders — Hal Gregersen

Hal Gregersen, Executive Director of the MIT Leadership Center

Hal Gregersen, Executive Director of the MIT Leadership Center

From Fortune

The title of Chief Executive Officer commonly conjures up images of a sharply dressed, smooth-talking individual who paints an inspiring, mesmerizing picture of their company in images and words. But it is underneath this veiled exterior that an organization’s real story lives.

When the Volkswagen scandal broke, my first thought went to the leaders of the company. Of course, there is the obvious question: Did former CEO Martin Winterkorn and Volkswagen America CEO Michael Horn know about the cheating (both have denied this)? But for me, a leadership scholar, the fiasco raises much more interesting questions about Winterkorn and Horn’s leadership styles: Did the CEO image or illusion they projected blind them from the realities of their own business? Did they perpetuate a culture where employees were fearful of sharing problems with those at the top? Though we may never know how much knowledge these leaders had prior to the public exposé, it is a compelling case of what can happen when leaders become too focused on an image of perfection. Rather than trying to conform to a pre-cast mold, I believe leaders should abandon their bogus two-dimensional views of leadership.

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