11 Rules for Creating Value in the Social Era - Merchant (2012)

Nilofer Merchant has served as a CEO and then a board member of a NASDAQ-traded company.  She has also consulted with numerous Fortune 500 companies including HP, Nokia, Adobe, Symantec and Yahoo!  She is a frequent contributor to the Harvard Business Review and has written a previous book entitled, The New How: Creating Business Solutions Through Collaborative Strategy.  She lectures on innovation and marketing at Stanford University.

11 Rules begins with an obituary for "Traditional Strategy."  This clever personification of the business model taught in business schools throughout the nation prizes marketing data, stability, control and scale.  The Traditional Strategy decides what it wants to produce and then sets about convincing the consumer that they want or need it.

Merchant contends that we have moved into a new "Social Era" where consumers expect to be co-creators of products. They require businesses to be agile and responsive to their wants and needs.  Businesses run using the Traditional Strategy are ill-equipped to meet these new demands.

Merchant states that "the Social Era is about connecting things, people and ideas." Hierarchical controls, large inventories and huge payrolls, typical of successful companies using the Traditional Strategy, serve as barriers to success in this new era.

As in much of the literature on motivation and innovation today, Merchant stresses the need to establish shared purpose among workers.   She states that purpose is a much more powerful motivator than money.  When shared purpose is coupled with shared power, people will self-organize to reach a goal.

The Rules

1. Connections create value.
2. Power in community.
3. Collaboration > controle.
4. Celebrate Onlyness.
5. Allow all talent.
6. Consumers become co-creators.
7. Mistakes can build trust.
8. Learn. Unlearn. (Repeat).
9. Bank on openess.
10. Social purpose unleashes ownership.
11. There are no answers.

How Will You Measure Your Life - Christensen (2012)

Clayton Christensen co-authored this book with James Allworth, an Australian student attending the Harvard Business School and Karen Dillon, the former editor of the Harvard Business Review.

Christensen, widely recognized as a leader in the study of innovative business practices, has published numerous books on disruptive innovation in the marketplace.  "How Will You Measure Your Life?" grew out of a commencement speech that Christensen gave at Harvard in 2010.  Christensen delivered the address after suffering a heart attack and being diagnosed with the same cancer that had killed his father.   As Christensen embarked on writing "How Will You Measure Your Life?" he experienced a stroke that effected his expressive language.  With the help of his family and co-authors, he persisted and the book was published in May 2012.

In "How Will You Measure Your Life?" Christensen goes beyond the world of business and demonstrates how the same systems that one uses to make good decisions in business can be applied to even more important decisions in life.  The author describes how many of his fellow Harvard Business School graduates went on to highly successful lives.  Yet, many saw their personal lives crumble around them.  In some cases such as Jeffrey Skilling, CEO of Enron, they even ended up in jail.  As the name implies, "How Will You Measure Your Life?" focuses on how to live an ethical, as well as a successful, life.

Christensen reviews his theory of disruptive innovation.  He provides several interesting anecdotes including one where he was invited to address the secretary of defense and the Joint Chiefs of Staff as they struggled to learn how to deal with an entirely different type of enemy.  As "market leader," the US Armed Forces understood how to fight large successful military establishments such as the Soviet Union.  Today, however, they must deal with a completely different type of foe that has mastered new military tactics "down market."

Christensen cautioned against the common misinterpretation by business leaders who confuse incentives with motivators.  He described the work of Frederick Hertzberg who developed the "Two-factor Theory" of motivation consisting of "Hygiene Factors" and "Motivators."  Hygiene Factors are things, such as compensation, supervisory practices and company policies that can cause dissatisfaction.  They do not, however, motivate.  Motivators are intrinsic factors that relate to the work itself.  Christensen highlights the paradox that it is possible to love your job and hate it at the same time.

Christensen also discusses the need for empathy in determining what customers truly need.  He observes that many companies "improve" products with no particular effect on sales.  This is because they guess at what the customer needs.  Careful observation, however, often reveals a completely different need that manufacturers never even considered.

Rather than focus on the product, Christensen recommends trying to determine what "job" the customer is is actually "hiring" the product to accomplish.  At this point, the author turns his attention to schools.  To educators and other adults, schools are a job that students must get done.  From the student's perspective, however, school is not the job, but rather the tool to get the job done.  Students want schools to make them feel successful and to help them make friends.  Christensen contends that most schools fail miserably at these tasks.  He further laments that school reformers generally focus on dimensions that are totally irrelevant to the student.

Why is it so difficult for large, successful corporations to innovate?  Christensen contends that it is due to the well accepted business theory of marginal vs. full costs.  As companies look at doing something completely new, they see the full costs, which lowers margins.  If they attempt to simply leverage what they already have, they do not include the full cost into their calculations, which makes incremental change more attractive.  Unfortunately, the resources that they are leveraging are generally ill-equipped or even unwilling to make the necessary changes that true innovation requires.

Christensen warns, "Thinking on a marginal basis can be very very dangerous."

Creating Innovators - Tony Wagner (2012)

Tony Wagner is the innovation education fellow at the Technology and Entrepreneurship Center at Harvard.  He is also the former co-director of the Change Leadership Group at the Harvard Graduate School of Education.  Wagner collaborated with Robert A. Compton, a video producer, who has produced numerous full length documentaries on global education.  Compton produced video clips with several of the people interviewed for the book.  The videos were embedded in the eBook edition.  They are also available at: www.creatinginnovators.com

Creating Innovators presents an interesting compliment to "Creativity" by Mihaly Csikszentmihalyi.  Csikszentmihalyi studied the characteristics of people who had distinguished themselves in their respective fields for their creativity and innovation.  His subjects, for the most part, were over 60 years of age and had already accrued a portfolio of accomplishments.

Wagner's study was similar to that of Csikszentmihalyi although his subjects were very different.  Wagner interviewed young entrepreneurs and innovators between the ages of 21 and 31.  While they had all demonstrated innovative and entrepreneurial skills, for the most part they had not yet achieved wide spread recognition for their accomplishments.

Almost all of Wagner's subjects had supportive parents who encouraged their children to take risks, explore their interests and solve their own problems.  They provided time for creative play and eschewed "helicopter parents" who hover over their children and structure their every moment.

The subjects in Csikszentmihalyi's study reported a different relationship with their parents, although the effect may have been the same.  Csikszentmihalyi noted that a significant number of the people in his study grew up in homes where the father had died while the subject was just a child.  The author suggested that this might have given more latitude to the child to develop skills and assume responsibility early.

One consistent finding of both studies was the perception that school had played no productive role in the subjects' lives.  In both studies, however, the subjects described some adult that had served as a mentor and inspiration.

Both Csikszentmihalyi and Wagner conclude that creativity and innovation emerge through a process.  Wagner describes the process as evolving through three developmental stages: Play (early childhood), Passion (adolescence) and Purpose (adulthood).  He suggests that each stage is simply a refinement of the previous one.

Wagner also describes specific skills that the innovator develops as they pass through these stages: 1) Critical thinking and problem solving, 2) Collaboration, 3) Agility and adaptability, 4) Initiative and entrepreneurship, 5) Acessing and analyzing information, 6) Effective written and oral communication, and 7) Curiosity and imagination.

Wagner is very critical of education in America.  He notes that the one size fits all model of education stifles creativity and innovation.  He provides examples of how subjects in his study were undervalued and sometimes punished for being different in school  He, along with several business leaders from companies such as Apple and Google, observe that schools prize individual accomplishments and "right" answers, yet these are not what innovative companies need or value.

Wagner is equally critical of even the most prestigious of American Universities.  His interviews reveal that the college professors who had the greatest impact on the innovators in the study are often on the fringes of the universities.  They tend to work with students in applied, rather than theoretical classes and they often are paid less because they are ineligible for tenure track positions.  Wagner questions the focus on research over instruction in many of the nation's top universities and calls for educational leaders at every level to re-examine current educational practices.