Seminal Entrepreneurship and Innovation Skills CAN IN FACT BE LEARNED

New Ways to Learn Entrepreneurship

Posted by Ikhlaq Sidhu, April 22nd, 2014

You may already be aware that the Berkeley Method of Entrepreneurship (BMofE, see link on our CET website – https://cet.berkeley.edu/curriculum/) is a unique teaching model for developing the entrepreneurial mindset, in addition to teaching tactics and providing infrastructure for the new venture process. One of the big questions in the field of start-up education has always been whether entrepreneurs are simply “born” or whether entrepreneurial skills can be acquired. Our most recent findings give us reason to believe that these critical skills and behaviors can indeed be taught and learned.

We see support for this in the confluence of two major themes:

1) our own co-authored Comfort Zone research showing that entrepreneurs and innovators are comfortable (and continue to be increasingly so) with ambiguity and with experiences outside their comfort zone

2) empirical research studies on motivating success by Carol Dweck, a distinguished Stanford psychology professor. Her findings show that mental growth, learning, and resilience are linked to a specific mindset (growth mindset), which allows students to be comfortable working outside their comfort zones and accepting of new challenges.

Thanks to Rebecca Loeffler, Visiting Scholar with UC Berkeley’s CET and on loan from Germany’s prestigious Ludwig-Maximilians-Universität München (LMU), we are now bringing together concepts from social psychology (part of Rebecca’s academic focus) with our previous work training entrepreneurs.

So, let’s connect the dots. Prof. Carol Dweck’s work on mindsets is exciting for education, with most of the study being conducted originally in K-12 settings. What she discovered is that children typically develop one of two mindsets: a “fixed mindset” or a “growth mindset”. The fixed mindset characterizes students who believe that ability is a fixed trait. Often children become constrained in their learning by allegedly permanent “labels” such as being smart or not smart. People with a fixed mindset try very hard to hold their label of being smart by avoiding challenges or situations that might have others question their badge of credibility. They are mostly afraid to lose the label of “being smart” which they have already attained.

In contrast, individuals with the growth mindset believe that ability is the product of effort and can therefore be learned or trained. They believe that they can overcome challenges and develop new mental capabilities. Those who have a “growth mindset” are not afraid of being wrong. Instead they find reward in the experience of overcoming challenges. They continue to take on challenges outside of their comfort zones and they continue to grow.

As mentioned earlier, the amazing part is that this growth mindset can be learned. It comes down to reward mechanisms. For those who are rewarded by themselves or others for “being” smart or successful, it generally leads to less self-driven challenge, less growth, and a downfall in measured results. But for those who are rewarded for the process of “overcoming challenges or trying new strategies or for even effort” the result is a positive reinforcement for taking on harder tasks and a continued increase in capabilities and results (i.e. to get in to the growth mindset on your own, “don’t tell yourself your are brilliant, instead, be proud of the challenges that you have been able to overcome”)

In our most recent Comfort Zone research work, originally developed by Prof. Paris de l’Etraz at the IE Business School, we observed that among the segments of entrepreneurs/innovators, managers, and engineers, it is the entrepreneur segment that is the most tolerant of ambiguity and the most comfortable to take on challenges outside of his/her own comfort zone. Moreover, it turns out that people in each segment would like to increase their comfort with ambiguity believing that they would actually be happier professionally and personally, however, only entrepreneurs/innovators actually continue to grow in this manner. Every other segment regresses slightly after their high school years, while entrepreneurs and innovators markedly increase their comfort with ambiguity.

There are several major results (or at least hypothesis) that could be concluded from this:

  1. A growth mindset allows a person to be comfortable with ambiguity and therefore creates the seminal condition from which entrepreneurship and innovation skills and mindset can be formed.
  2. Developing a growth mindset is essential to become a successful entrepreneur. Successful entrepreneurs are likely to reflect a growth mindset.
  1. A growth mindset can be fostered through certain kinds of feedback and rewards.
  1. Since reward structure has a direct effect on mindset, it’s likely that corporate environment or social environment plays a significant role in creating and incentivizing entrepreneurs and innovators.
  1. Ultimately, we can teach people in ways that will bring out their intrinsic innovation and entrepreneurial potential.

The Path from Executive Education to Corporate Innovation

dilbert-cartoon_1Posted by Ikhlaq Sidhu, December 23rd, 2013

I’m on my way back from Shanghai after being invited to work with a group of Chinese executives on their product innovation and intrapreneurship strategies, using aspects of my newly developed model for professional/executive education. It’s really an exciting model, that I used with Coca-Cola on their beverage strategy in China, with Tencent, a leading retailer with hundreds of stores, GM, World Health products, and other multi-nationals seeking global innovation.

Simultaneous Translation of Coca-Cola Exec in China

Photo: Coca-Cola and World Health Products executive discussing strategy options for China in Shanghai with simultaneous translation. December 16, 2013.

The Issue:

While many institutions and programs I’ve worked with excel at providing executive education programs with a clear impact, these are more the exception than the rule. For many, I’d say that the time has come for a change. Historically, executive education has focused on succession planning. The formula was that you take experienced, trusted managers and then have them spend some time being polished by academic experts. And that has become a big business: Business Schools today make about 40% of their revenue from Executive Education. That model needs to be refreshed, if it is to effectively solve the problem of innovating in a global environment.

First, most Executive Programs have mixed reviews in terms of quality. It turns out that half of professors actually score below 3.5/5. In other words not all program professors are “best in class”.

Second, case method and other generic materials are often not relevant. They provide very few targeted insights for the executives. Picking useful cases requires significant industry experience-based judgment and they must be supplemented with additional insights. Many of these programs simply do not have ways to address the actual context, strategy, and threats that their firm’s executives are facing.

Third, and this is a pretty important one, these programs are not accountable. There is no mechanism to follow up to see what came from the experience. Sometimes the courses can be “interesting” or “fun”, but in the next week, its business as usual.

And my best reason to believe that it’s time for a change is that most of these programs are focused on research results of the past. Firms live in the present and plan for the future. In fact, the pace of innovation has been accelerating significantly in the last 100 years and its not slowing down. The current issue for most firms, as pointed out by banking innovator Carlos Beldarrain, is that, the minimum pace of innovation to simply survive, is also accelerating. The time is right to find a model that works even better.

The Solution:

Here is the challenge I offer to those interested in evolving what is generally today’s state of the art for executive education:

  1. We need to actually focus on the goals of the firms. This means that successful programs will build in the time and methods for the faculty to actually know the company and its people at a deeper level.
  2. There has to be a mix of academic and industry experts. For year’s at Berkeley, we have been bringing Silicon Valley know how into our teaching program though entrepreneurs, investors, innovators, and executives. Choosing the right faculty is also critical because they need to have the breadth of how to teach executives as well as a relevancy on current industry issues.
  3. The firm’s executive champions have to be directly involved. I’ve always been known as an innovator. But with experience I’ve learned, no matter how capable you are at innovation, you can’t innovate within an organization without “permission” from the organization to actually create the innovation. For this reason, its critical that the executive sponsors participate to “offer the permission” for the participants to innovate, and to let them know that its safe to do so. By the way, “some people” are going to innovate anyway, as Steve Jobs said, you can’t stop them and you can’t ignore them either.
  4. It’s really about the project, not the lecture or the case. Yes, there are essential materials to cover, but the project has to be a real problem of the firm. Barriers such as confidentiality or NDAs cannot be excuses to work on fake projects.
  5. Projects need to be holistic. A company’s project cannot be only about design or only about strategy or only about branding. No, you need complete alignment on the project, because the result has to be financial success and impact or maybe learning and failure. Isolated skill development is not an executive level challenge.
  6. And finally, we need to have accountability of the result. What happened after one quarter, one year, or longer. You can’t teach it if you have not lived it in some way, and you also are not qualified to offer your certification if your institution does not have skin in the game, just like your students.

For institutions and programs who can evolve and incorporate these aspects, I respectfully suggest that it will result in a big step forward for both education and innovation.

Storytelling for Engineering Leaders

As engineers and engineering leaders, we often forget the important role of “storytelling” in our work.  Usually, this takes the form of a myopic focus on our technology capabilities or markets served.  What we forget is that it won’t matter unless the concept is meaningful to people.  And stories are the medium that humans understand best.

Simple example:  every internal company pitch and every venture pitch is actually a story.  As noted by my colleague Ken Singer, Managing Director for Berkeley’s Center for Entrepreneurship and Technology, pitches generally have a protagonist (the user), a villain (the pain they suffer), a setting (competitive landscape) and a resolution (your solution).  Facts are fine, but telling the story communicates your idea better and builds the brand.

In this article, I’d like you to think about stories at two levels:  1) the story that you tell to communicate your project and 2) the story that a company tells to build its brand.

Learning Lesson 1:

Marc Benioff, founder, chairman and CEO of salesforce.com talks about storytelling

Marc Benioff, founder, chairman and CEO of salesforce.com

Read “Storytelling Tips from Salesforce’s Marc Benioff” Story-telling-Benioff-Salesforce by Carmine Gallo.  Salesforce has been famous for building a software company around its “no software” story (since it is a service) and vilifying some giant software companies in the process.  We use this example in our Engineering Leadership Program, as first introduced to our program by Prof. Burghardt Tenderich, Annenberg School for Communication & Journalism at the University of Southern California.  Here is a key excerpt:

“Tell classic stories. Most reporters don’t care about a tiny startup, and that’s why Benioff never positioned himself as such.  He told a classic David-vs.-Goliath story. “We gave the media something different.  We gave them something new. We always positioned ourselves as revolutionaries. We went after the largest competitor in the industry or the industry itself.  We made our story about change.  We were about something new and different that was good for customers, and good for the community.  We talked about the future”  says Benioff.  Although the media landscape is changing, Benioff believes there will always be a need for content.  The delivery model might be changing, but exchanging and sharing stories and information remains as important as ever.”

Learning Lesson 2:

Then watch this clip (above) introduced to me by my colleague Prof. Tom Byers at Stanford.  He presented it in a program we taught (and publicly available at STVP’s E-corner).  The clip shows Jack Dorsey (a founder at Twitter and Square) describing his process for getting ideas out of his head, onto paper, and eventually into public communications of the company.

After reading the Gallo article and watching the clip, consider the following questions:

  1. How could you improve the story of what you would like to develop next?
  2. How should the story evolve once you show others?
  3. How do you achieve consistency in the story across others in the firm?

Posted by:  Ikhlaq Sidhu

What Can Go Wrong Part 1

This introductory clip to Engineering Leadership illustrates of what can go wrong during the process of innovation.  The clip is centered around the famous case of E-Ink which raised $120M over 7 years to commercialize an exciting new display technology.

As you watch the video, think about what the firm did right and wrong.  What could you have done better as an engineering leader?

Key concepts:
Choosing a market, choosing a business model, types of mistakes and miscalculations, technology push timeline, building ecosystems of suppliers, partners, and customers, and early stage innovation.

Posted by Ikhlaq Sidhu

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