That’s an interesting point about innovation. A lot of people would argue that innovation within organizations often comes from younger people. Do you see qualities in the next generation of business leaders that could help to drive that push for innovation? And if so, how can organizations start to effectively use those next-generation leaders to drive innovation?
This is a whole generation of people who have grown up very resourceful at getting ideas from any place, because they’ve grown up on the Internet and they’ve grown up with a view that whatever problem I want to solve, I have access to solving that problem in all kinds of ways. Social networking makes you resourceful in a combination of ways. It’s not that you can just get data, you can also actually connect to other interesting people from anywhere in the world.
If you think about the core of all innovation, it’s actually a creative recombination of ideas and people. So most innovation is not actually inventing something new; instead it’s putting together existing things in new ways. This was Schumpeter’s great insight. And if you actually study the history of science or you study the history of innovation, it is a very rare thing that is genuinely novel. Most things are creative recombinations. I think that there’s a generation of people growing up whose capacity to do that is much greater than it ever used to be before—just because that’s the way they inherently think of organizing themselves.
There’s a series of very significant challenges that business and society face, that will require this kind of imagination to address. How do you balance energy security with environmental sustainability? How do you leverage the amazing innovations in health care that allow us to all live longer, with the cost that these imply? How will we get three billion people on the planet the stuff that one billion already have? If we imagine that the resource intensity of producing a car which these people will one day have is the same as the resource intensity of producing it for the first one billion, we’re dead. We’re not going to be able to make it happen.
There have to be fundamentally different innovative ideas for how we even produce existing stuff for the next three billion people who all want it. So you have to make the Tata Nano at $2,000, but we’ll have to ask the question, what’s the next price point at which a car is going to get made? Or what’s the next value proposition for how one thinks about each of these things? Because if we just think that all we’re going to do is to recreate the existing value chain of the one billion for the other three billion, the planet can’t sustain it. There are not enough resources in the world to do that. But I’m of the view that this generation of people who are now growing up in schools and colleges will be resourceful enough to do it because they’ve been educated with a different kind of mind.
What’s your word of hope and word of caution for this generation?
The word of hope is that there’s so much to do right now. The biggest example is those three billion people in the world who haven’t yet benefited from the prosperity that business can create. That is an extraordinary opportunity for business leaders. Just think about that: three-quarters of this planet still haven’t benefited from what business can help provide. And one-quarter that have benefited also have their challenges. I think that almost nothing that is of any significance in the world today—environmental sustainability, digital revolution, health care—I can’t think of a single problem of any significance that’s going to be solved without business playing not just a role, but a leadership role. So to me, that’s the amazing hope that exists for anybody who’s entertaining a career in business today.
The caution that I would have is his: don’t get too impatient with yourself. There’s something about the Facebook generation that because things start and end in three minutes, you might believe that all the answers to all of these questions also have to start and end in three minutes, and that they will all get done in some super-rapid cycle in which everything is getting done. The speeding up of the world doesn’t mean that everything in your life can be sped up the same way. Have the capacity to be patient, to be committed to the long term, to be able to devote years of energy into something, as opposed to just minutes. That’s going to be an important part of what people need to be prepared for. But if they’re prepared for this, the opportunities are endless.