Rich Karlgaard is an angel investor, board director and Wall Street Journal best-selling author as well as the longtime publisher (since 1998) of Forbes magazine. He also writes the Forbes column, “Innovation Rules,” which is known for its witty assessment of business and technology. He has been a regular panelist on television’s Forbes on FOX show since its inception in 2001. Rich really is a serial entrepreneur and has launched two magazines (Upside and Forbes ASAP), the venture capital firm Garage Technology Ventures (with his friend, Guy Kawasaki), and Silicon Valley’s premier business and technology forum, 7500-member Churchill Club. He is a past Northern California winner of the Ernst & Young “Entrepreneur of the Year” award. Rich speaks 50 to 60 times a year on economic, business and investment themes. He was raised in Bismarck, North Dakota, and graduated from Stanford University. He lives with his family in Silicon Valley. His latest book, The Soft Edge : Where Great Companies Find Lasting Success, was published by Jossey-Bass/A Wiley Brand (April 2014).
Here is an excerpt from my interview of him. To read the complete interview, please click here.
* * *
Morris: Before discussing The Soft Edge, a few general questions. First, who has had the greatest influence on your personal growth? How so?
Karlgaard: That would be my dad, Dick, who died in 2012. Dick was the athletic director of the Bismarck, N.D. public school system. He hired and fired high school coaches. He also ran state tournaments in every sport and had a big deep voice and did the public address at football and basketball games and at track meets. He was a mythic figure around Bismarck. He absolutely loved his job. He did what he wanted to do, and he excelled at it. He was twice named the national high school athletic director of the year. My dad invented his own job and he was happy. That’s what I learned from him.
Morris: Years ago, was there a turning point (if not an epiphany) that set you on the career course you continue to follow? Please explain.
Karlgaard: When I bought my first Apple Macintosh in 1985. I bought a Mac, then a copy of Aldus PageMaker (I had serial number 443), then a laser printer. Suddenly I had the tools to be a publisher. No longer was I limited to being a low-level technical writer. Liberation! Desktop publishing let me create Upside magazine, which let me interview people like Bill Gates, which caught the eye of Steve Forbes. The Mac began a marvelous chain of events.
Morris: To what extent has your formal education been invaluable to what you have accomplished in life thus far?
Karlgaard: Zip. Stanford looks good on anyone’s resume, but I learned nothing of value in classes. College taught me to hate reading. I used to hide in the library and pour through old issues of Sports Illustrated rather than study political science textbooks. I fell in love with reading, beyond sports writing, two years after finishing college. I became interested in business, markets and finance only after I figured out that business was just another kind of sport. As editor of Upside and Forbes ASAP, I tried to inject a sports-writing vigor and wit and human truth to business. That’s what I strive for in my Forbes Innovation Rules columns. That was my goal in writing The Soft Edge.
Morris: What do you know now about the business world that you wish you knew when you when to work full-time for the first time? Why?
Karlgaard: Well, I knew absolutely nothing about business when I graduated from college. I was able to catch up fast once I learned that business was like sports, but, alas, I didn’t figure that out until my late twenties. In Search of Excellence by Tom Peters and Bob Waterman was another eye-opener. They wrote about business as if it could be … fun. Which it can be.
Morris: Of all the films that you have seen, which – in your opinion – best dramatizes important business principles? Please explain.
Karlgaard: Movies about business are almost always boring. They always feel forced. Ashton Kutcher did in fact resemble Steve Jobs – spoke like him, walked like him — and that was amazing for, oh, the first five minutes. But the story was wooden. Great movies, on the other hand, teach us about human truth. Insights about human truth are what matter in business.
Morris: From which non-business book have you learned the most valuable lessons about business? Please explain.
Karlgaard: I am now immensely enjoying Scott Eyman’s biography of John Wayne. This book is not primarily about the movie business, but Eyman in great detail shows how Wayne managed his career and brand and how he worked with different directors and studios. Wayne’s collaboration, in particular, with director John Ford is deeply illuminating.
Morris: Here are several of my favorite quotations to which I ask you to respond. From Howard Aiken: “Don’t worry about people stealing your ideas. If your ideas are any good, you’ll have to ram them down people’s throats.”
Karlgaard: True in science and philosophy. But note that Apple did not have to ram the iPhone down people’s throats.
Morris: From Richard Dawkins: “Yesterday’s dangerous idea is today’s orthodoxy and tomorrow’s cliché.”
Karlgaard: Only true when evolution is at work. Certainly business innovation follows this course. But the Dawkins dictum fails to explain, say, deeper human nature, which is timeless.
Morris: From Isaac Asimov: “The most exciting phrase to hear in science, the one that heralds the most discoveries, is not “Eureka!” (I found it!) but ‘That’s odd….’”
Karlgaard: I love this quote! The analogy in business would be, “Odd that our product generates more buzz when we advertise less.” Or, “Odd that Mary, who is such an introvert, is our best salesperson.”
Morris: Finally, from Peter Drucker: “There is surely nothing quite so useless as doing with great efficiency what should not be done at all.”
Karlgaard: I was lucky to interview Drucker on two occasions at his home in Claremont, Calif. He told me the most difficult thing for any CEO was to figure out what not to do.
Morris: In one of Tom Davenport’s recent books, Judgment Calls, he and co-author Brooke Manville offer “an antidote for the Great Man theory of decision making and organizational performance”: organizational judgment. That is, “the collective capacity to make good calls and wise moves when the need for them exceeds the scope of any single leader’s direct control.” What do you think?
Karlgaard: I know Tom Davenport and consider him brilliant. But I wouldn’t be so quick to toss out the Great Man. Apple lost something vital with the death of Steve Jobs. Amazon needs Jeff Bezos. Tesla needs Elon Musk. Professor Davenport’s idea of a Great Man sounds more like Downton Abbey’s Lord Crawley – a caricature of a pompous know-it-all – than it does of actual great leaders you see in business today. Today’s great leaders are data driven, yes, but they are far, far more than that. You can’t inspire people with data.
Morris: In your opinion, why do so many C-level executives seem to have such a difficult time delegating work to others?
Karlgaard: To my eye, it is below C-level where you see this at work. C-level executives rise to that level because, generally, they are good at delegation. Too many mid-level managers get stuck or burn out because they are not. They don’t know how. Or they are afraid to.
Morris: The greatest leaders throughout history (with rare exception) were great storytellers. What do you make of that?
Karlgaard: The job of a great leader is to put conviction in people’s hearts. Stories do that because they give us meaning and purpose. Which, in turn, leads to conviction.
Morris: In recent years, there has been criticism, sometimes severe criticism of M.B.A. programs, even those offered by the most prestigious business schools. In your opinion, in which area is there the greatest need for immediate improvement? Any suggestions?
Karlgaard: The value of a Harvard MBA is that, (1) it proves you were smart enough, driven enough, to get into Harvard Business School, and (2) you now have great contacts. The actual education is the least of it. Simulation technology will radically transform teaching and learning in business. I’m convinced that all but the very top business schools will decline. The investment in time and money won’t be worth it. What employer is going to pay a premium salary for an MBA that isn’t from a top school? But there will always be Harvard, Stanford and Wharton.
Morris: Looking ahead (let’s say) 3-5 years, what do you think will be the greatest challenge that CEOs will face? Any Advice?
Karlgaard: I honestly can’t figure out why any company would want to be public. The scrutiny is only going to get worse. The happiest CEOs I know run private companies. Jim Goodnight of SAS Institute is a happy man. I recently spent a day with Michael Dell in Austin. He is ten times happier now than when Dell was public.
* * *
To read the complete interview, please click here.
Rich cordially invites you to check out the resources at his website.
Also here’s his Forbes link.
Note: This was among the first books I reviewed for Amazon (in 2000) and I recently re-read it while doing some research on several of the 20 companies it features. Don’t let the publication date deter you. These stories are even more entertaining and informative now than they were then because these are perspectives on them 25 years before many of them and their leaders became almost deities in the vineyards of free enterprise.
Each chapter offers a profile of a major contributor to the evolution of American business history, beginning with one of my ancestors, Robert Morris (America’s “first real businessman”), and concluding with Bill Gates (“Microsoft’s co-founder and guiding spirit”). In between, Gross and his associates also examine other great leaders such as McCormick, Rockefeller, Morgan, Ford, Merrill, Sarnoff, Disney, Johnson, Ogilvy, Kroc, Wilson, Ash, Walton, and McGowan as well as major corporations such as American Express, Intel, Harley-Davidson, and Kohlberg Kravis Roberts & Co. The reader is told, “This book is about heroes” and it really is.
Using the most effective strategies and devices of a storyteller, the authors examine biographical information within an historical context, sustaining interest with anecdotes while providing insights as to the causes and effects of each subject’s accomplishments. For Morris, essentially the economic survival of thirteen colonies during their struggle for independence. For McCormick, the industrialization of agriculture. For Rockefeller, the creation and development of the modern corporation. For Morgan, saving a nation’s financial system. For Ford, mass-producing affordable personal transportation. For Merrill, broadening the base of stock ownership to include those, among others, for whom the Ford Motor Company manufactured automobiles. Each of the other “heroes” discussed made equally important contributions.
A brief review such as this can only suggest (albeit inadequately) the wealth of information to be found in this book. The prose has snap, crackle, and pop. The focus is crystal clear. The lessons to be learned from the careers examined are of incalculable value. Although this book will be of interest to almost anyone, it will have special importance for school, college, and university students who may sometimes wonder if there are any “secrets to success.” The answer is yes. The specifics are to be found in the lives of those who are discussed in Greatest Business Stories of All Time.
Adam Bryant conducts interviews of senior-level executives that appear in his “Corner Office” column each week in the SundayBusiness section of The New York Times. Here are a few insights provided during an interview of Byron Lewis Sr., the chairman and chief executive of the UniWorld Group, who says he values common sense. But uncommon sense, Mr. Lewis says, is “where genius comes from.”
To read the complete interview and Bryant’s interviews of other executives, please click here.
* * *
Got an M.B.A.? Great, but I Prefer Uncommon Sense
Bryant: How do you hire? What qualities are you looking for?
Lewis: I’m looking for entrepreneurial capabilities. I’m looking for integrity.
Bryant How do you tell if somebody has integrity?
Lewis: We ask them for references, but it’s also an intuition you need to have. Many people who come to us don’t have traditional backgrounds. I’m looking for people who have ideas. I’m looking for people who can move the agency forward. I am looking for people who are different but different within the context of a business.
Bryant: Can you elaborate on that last point?
Lewis: I’m looking for people who are not siloed. You have to know how to work with the creative people. You have to know how to bring the best out of them.
Bryant: What’s your advice for getting the most out of creative people?
Lewis: Creative people never know when or where the inspiration will come from, and leaders should understand that. The best way to build a team is to let the creative people feel that you understand them, and if they want to go off strategy, let them have their commercial or two, but make sure you have what the client asks for. The best creative also comes from good strategic planning and staying on point.
Bryant: Let’s say you just hired me, and I ask you, “What’s it like to work for you?”
Lewis: Well, I’m a piece of work. You have to understand that I never worked for an advertising agency or a mainstream marketing company. It might be difficult because I built this company and I’m a nontraditional person. I’m looking for ideas, and I’m looking for people who go beyond. When the thought hits me, I want to share it, and I’ll call a meeting in a moment. Working with me would be challenging, but rewarding.
Bryant: What’s your advice on how to lead and manage?
Lewis: What I’ve learned is that what I value the most is common sense. When you really find a leader, that person has uncommon sense. I do not believe in formulas. I believe in integrity. Integrity is that you feel a loyalty not only to the company but also loyalty to an idea. I’m driven by ideas and I want people to be open and honest with what they believe, because I’ve learned to listen and value ideas. My company depends upon innovation. That’s how we started, and the older we get, the more important innovation becomes. Change can only come from people who feel free and have the courage to stand up for what they believe.
Bryant: How has your leadership style evolved?
Lewis: To be candid, I used to tell people that you have to be able to stand me — I am insistent on doing things a certain way because I knew they worked. But that wasn’t necessarily creating harmony, and now I’m aware that I want to hear from others. I want them to feel free to be honest about what they think.
Bryant: How do you create a culture of honesty?
Lewis: The truth is, people need to see their ideas being used. I used to insist upon doing it my way. Now, I’m much more interested in seeing that they do it their way.
Bryant: And when did that change happen?
Lewis: It’s happened much more recently. I’m pretty clear about who I am. I’m very clear about where I stand. I think my brand is, “Byron is kind of difficult but he’s interesting.” People are aware that I’m difficult, but they also see that it works.
Bryant: And why are you difficult?
Lewis: As a start-up company, I was desperate to make sure that we would be successful. I did a lot of things myself, and it’s difficult to move away from that, partly because I managed to keep the company going during some tough times.
But it is very important that we have mutual respect. It’s particularly important because UniWorld is truly diverse. Our people bring different perspectives and customs that really contribute to our understanding of what we do.
People who work here know the history of the company, and that is our culture. It’s about innovation and change. There’s no formula, but that’s what we’ve created, and there is respect for individual people and where they come from. In another sense — I’m not as interested in M.B.A.’s as I might have been. I respect people for what they bring. I’m looking for people who have common sense, common decency. But I’m primarily looking for people who have uncommon sense because that’s where genius comes from.
Bryant: Talk more about that phrase, if you would.
Lewis: Uncommon sense is what Bill Gates and certain people have. Sure, they went to college, but they didn’t even finish because they created an idea. They had a vision and acted upon it.
I don’t claim to be on that level, but with my history and my company’s history, that’s in our DNA and it works, particularly in these times. I’m open to ideas as long as they’re strategically sound.
People of color — because of their background — they’re used to hard times and hard living. Hard times and hard living create the originality and individuality that you find among black athletes, black musicians, jazz and hip-hop artists. That’s what I’m looking for in my space. Jazz musicians do not think traditionally. They are creative people. That’s what makes this music, makes our culture global. I’m looking for those characteristics.
Uncommon to me is where genius comes from. Uncommon people, in our culture, get the most traction, and we see that today, where Mary J. Blige, P. Diddy and Jay-Z are now considered fashion icons. A person like Queen Latifah — who would ever have imagined that she would be an iconic figure for P.& G.’s CoverGirl brand? She has an uncommon background, an uncommon view of the world. Strangely enough, those views resonate across all spaces.
* * *
To read the complete interview, please click here.
Adam Bryant, deputy national editor of The New York Times, oversees coverage of education issues, military affairs, law, and works with reporters in many of the Times‘ domestic bureaus. He also conducts interviews with CEOs and other leaders for Corner Office, a weekly feature in the SundayBusiness section and on nytimes.com that he started in March 2009. In his new book, The Corner Office: Indispensable and Unexpected Lessons from CEOs on How to Lead and Succeed, (Times Books), he analyzes the broader lessons that emerge from his interviews with more than 70 leaders. To read an excerpt, please click here. To contact him, please click here.
Nancy Duarte has driven the vision and growth of Duarte for 20 years, building an internationally respected design firm, which has created over a quarter of a million presentations. She has helped shape the perceptions of many of the world’s leading brands and thought leaders. Nancy is the author of the best-selling and award winning book Slide:ology: The Art and Science of Creating Great Presentations, where her experience was distilled into best practices for business communicators. She continues to advance new forms of presentation through partnerships with innovative forums like TED and PopTech. Nancy serves as a TED Fellows committee member, is a 2009 Woman of Influence and 2008 Communicator of the Year. Nancy’s latest award-winning book, Resonate: Present Visual Stories that Transform Audiences, was published by Wiley in 2010.
Morris: Before discussing Resonate, a few general questions. First, when and why did you first become interested in design?
Duarte: I’ve always been primarily a visual communicator. When I played as a child I would trace coloring book characters and classify them. It was easier for me to express myself visually than verbally. I received average grades school on my written assignments and top honors on any assignments that were accompanied by visuals.
Morris: Did that interest precede your interest in effective communication? Please explain.
Duarte: Effective communication is fascinating to me yet bad communication is just as fascinating. There are lessons to be learned from both. I can’t say I am a natural communicator, it’s taken a lot of work to be able to develop content relevant to the audience and deliver it with credibility. My initial natural ability tended to be more around the visual display of information. For years I was more comfortable visualizing other people’s great thinking. I preferred to be hidden behind the curtain than a thinker myself. It wasn’t until I wrote Resonate that I’ve gained the confidence to call myself a communicator.
Morris: Briefly, please trace the founding and subsequent development of Duarte Design. For example, what was its original mission and to what extent (if any) has that since changed?
Duarte: My husband, Mark, started the firm and it was called “Duarte Desktop Publishing and Graphic Design.” Wow, what a mouthful. We stumbled into presentations in 1989 and landed a very sophisticated account. When that company had a significant layoff in 1992 and the price of desktop projectors dropped significantly our presentation services spread across the Silicon Valley like wildfire as our clients scattered into new jobs across the valley. The firm has grown from just Mark to almost 100 people writing and visualizing presentations.
Morris: What do you know now that you wish you knew when your firm was founded?
Duarte: So much of what we did in the early days was trial and error. There were many long days and nights trying to figure out how to grow, increase our quality, and keep employees motivated. I wish I’d brought in mature, smart staff earlier in the process. Having many smart people share the load has been the best thing we’ve ever done.
Morris: There has been significant increase of interest in design thinking as the publication of Resonate as well as of other books by Tim Brown (Change by Design), Roger Martin (The Design of Business), Roberto Verganti (Design-Driven Innovation), and Thomas Lockwood (Design Thinking) clearly indicate. How do you explain this? Why has the subject become so “hot”?
Duarte: My hope is that design thinking becomes an innovative discipline and not just the trend of the decade. As a nation and globally, we have some of the biggest problems to solve we have ever faced. We need innovative ways to solve our problems and communicating the solutions will be paramount. Original thinking, complex problem solving, and collaboration are all important skills for our future.
Morris: I view the appointment of John Maeda (author of The Laws of Simplicity and in May 2011, Redesigning Leadership) as president of Rhode Island School of Design as well as the fact that Roger Martin is the dean of the Rotman School of Management at the University of Toronto are indications that the academic community is also becoming much more actively involved with design thinking. Do you agree?
Duarte: I agree! My hope is that the academic world will be open to the innovative approach design thinkers bring. I know John Maeda personally, and I love the way he thinks. He considers perspectives and has insights that would have never entered my mind. We need innovators at the helm of our education institutions, although there may be uncomfortable culture clashes initially, it’s important to move in this direction.
Morris: Look ahead (let’s say) 3-5 years, what do you see as the single most important business opportunity for firms such as yours?
Duarte: Wow Robert, you ask great questions! Right now we’re very focused on the power of story to persuade. Story incites us or unites us. My firm has an awestruck reverence for the power of story. Our short term priority is to uncover a quantitative way to measure the impact of a presentation and innovative ways to take presentations viral. As we’ve been working through the global landscape, we’re starting to see the importance of understanding and communicating stories in the context of a global atmosphere.
Morris: Now please shift your attention to Resonate. Please explain its title and subtitle.
Duarte: When someone says “that resonates with me” what they are saying is “I agree with you” or “I align with you.” Once your ideas resonate with an audience, they will change. But, the only way to have true resonance is to understand the ones with whom you are trying to resonate. You need to spend time thinking about your audience. What unites them, what incites them? What does a walk in their shoes look like? Think about your audience and what’s on their mind before you begin building your presentation. Thinking about them will help you identify beliefs and behavior in your audience that you can connect with. Resonate with.
* * *
To read the complete interview, please click here.
A rigorous and comprehensive analysis of the evolution of a creative idea
Others have their own reasons for praising this book. Here are two of mine. First, David Kord Murray immediately states his core thesis and then develops it with original (rather than borrowed) brilliance throughout the narrative that follows. Here it is, in composite form: “Ideas are constructed out of other ideas, there are no original thoughts, you can’t make something out of nothing, you have to make it out of something else. It’s the law of cerebral physics. Ideas are born of other ideas, built in and out of the ideas that came before. That’s why I say that brilliance is borrowed…An idea is like a house or a building. Your business problem is the foundation of that house. In other words, you build your idea on a foundation of well-defined problems. Once defined, you borrow ideas from places with a comparable problem…Then, you take these borrowed ideas and start combining them to form the overall structure of your house, to form the structure of your new solution.”
I also admire the scope and depth of primary and secondary sources that Murray cites within the framework of the six steps to innovation. For example, Step One involves defining the problem to be solved. Murray advises that the foundation for solving the problem be on “solid ground” and that the problem is viewed in context (e.g. scope) rather than in isolation. His sources include Sergey Brin and Larry Page (“the Google Guys”, Isaac Newton, and James Maxwell. If you have a search problem, as Brin and Page once did, ask “Who else has a search problem?” The answer probably includes librarians, rescue teams, sailors, hunters, archeologists, and explorers.
Step Two involves borrowing ideas from wherever there is or has been a similar problem: “borrowing brilliance is the search for ideas” and what Murray calls “creative combinations” are the result of borrowing from competitors, observations, other people, while traveling away from home, from what Murray calls “the opposite place” (i.e. the opposite of what is popular), a similar place, and/or a distant place (e.g. ancient Rome). His sources include Albert Einstein, Bill Gates, and John Nash. They and others used one or more existing idea as material to construct a new idea, one that would then become a new (for now) “creative combination.” That is what Johannes Gutenberg did in the 1440s when he combined materials that already existed: a wine press, an adjustable undertable, movable typeface of lead-based alloy, a matrix (i.e. hand mould), and oil-based ink.
Murray also provides a convincing reassurance to all who claim they are “not creative” that innovation is a never-ending process that, over extended time, it may involve thousands (millions?) of individuals who “build on the ideas of others,” some of whom – many centuries ago — also built on the ideas of others who preceded them. Almost anyone is capable of making a valuable contribution to this process on continuous improvement. The value of some contributions will be greater than others, obviously, but all are essential.
The best recently published account of this process, at least that I am aware of, is provided by William Rosen in his book about the development of steam-driven power, The Most Powerful Idea in the World: A Story of Steam, Industry, and Invention, published by Random House (2010).