First Friday Book Synopsis

"…like CliffNotes on steroids…"

A Q&A with “The Father of the Lean Startup Movement”

BlankHere is an excerpt from an article by John A. Byrne for LinkedIn Pulse during which Steve Blank responds to Qs posed by Lauren Everitt. To read the complete Q&A and check out other articles, please click here.

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Steve Blank is a legend in Silicon Valley circles. Bearded and bespectacled, the serial entrepreneur speaks in anecdotes and questions–which he then answers, his voice rising with incredulity as though he’s continually uncovering new epiphanies.

In other words, he’s a damn good interview. So when Poets&Quants‘ Lauren Everitt recently sat down with him to ask some challenging questions about the role of business schools and MBAs in entrepreneurship, he didn’t pull any punches. As part of Global Entrepreneurship Week, we’re sharing with LinkedIn readers a story a day from the more than 40 articles in our new digital iPad magazine devoted to MBA startups. Listen in to Lauren’s interview with the outspoken and always provocative Blank:

Is an MBA a worthwhile investment for an aspiring entrepreneur?

This is a conversation I have with all my students who want to go to business school. If the question is should I ever go to business school? Of course. But the next question is: Should I go to business school first? My advice is if you haven’t worked in a startup, don’t go to business school to work in one. I want you to get your hands dirty doing scut work. Try to be a founder or be a spear carrier. After a year, you’re going to decide whether this is the career for you, or whether you’d really be more happy as an investment banker.

Business schools are still treating startups as small versions of large companies. Most of these principles are not only wrong, they’re toxic. They’re destructive to early stage ventures. So the value of business school is no longer what I’m learning in my classes, but the value of networking and some of the other things that I might need to know when my startup gets big. The value diminishes, but that doesn’t mean it’s zero. It just means that it will be awhile before business schools catch up to this idea that there’s a separate stack of skills and knowledge for founders than for people who execute existing companies.

Why do you think business schools are missing the mark?

The problem is the content of what we’ve been teaching. And here’s why it ended up like that from my point of view. If you ask business school professors, do you consult? I’d say you’d get an extraordinarily high percentage who do. Great. Where do you consult? They consult with people who pay them. Great. Where are those people? They’re at large companies.

The better the faculty are, the larger the company they’re consulting. They treat a 100,000-person company the same as two people in a garage. That was the mistake–not understanding we needed an entirely different language, architecture, and management stack. It was unfair to expect professors who’ve never had to take out the trash and unstop the toilet at three in the morning as part of their consulting jobs to figure this out. It wasn’t an intelligence problem. It’s not that business school professors are dumb. It’s just they haven’t been exposed to the profession.

Which are the best business schools for entrepreneurship?

Berkeley got it in a second. Columbia got it in a second. Harvard gets it, but they have to rename everything. The good news is they teach students the concepts. The bad news is those students have no idea what language everybody else is speaking. Then there’s the third group: Screw-you-you’re-wrong that says, “No, we’re not changing our curriculum.” I respect that, too, because we can have an interesting conversation. The worst version, and I’ve seen this in another East Coast school, adds the new methodology on top of the old one. They’re checking all the possible boxes but not really understanding that they have to make an intellectual break. I think that does damage.

The faculty that get it are the ones who started companies. Why am I teaching at Stanford? The president of Stanford was an engineer and entrepreneur. Why am I teaching in the engineering school and not the business school? The guy who heads up the entrepreneurship program in the engineering school was an entrepreneur.

The joke is that the last people on earth to get it will be business school professors. But if you’ve ever been a practitioner, the minute you sit through a demo day, you go, “Boy, this is what we’ve been missing!”

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To read the complete article, please click here.

John A. Byrne is Chairman & Editor-in-Chief at C-Change Media Inc.

Wednesday, December 4, 2013 Posted by | Bob's blog entries | , , , , , , , | Leave a comment

World Changers: A book review by Bob Morris

World ChangersWorld Changers: 25 Entrepreneurs Who Changed Business as We Knew It
John A. Byrne
Portfolio/Penguin Group (2011)

Exemplars of an opportunistic mindset and acceptance of risk and potential failure, as well as independence and control

John A. Byrne is chairman and editor-in-chief of C-Change Media Inc., a digital media startup that is launching a network of websites for the global business community. C-Change currently has two highly successful sites, Poets&Quants.com and Poets&QuantsforExecs.com. Little more than two years old, P&Q generates more than one million monthly page views and boasts a book imprint division which published its first title in 2012. World Changers is his first book in ten years since the publication of his collaboration with General Electric Chairman Jack Welch. Straight from the Gut (2003). His other books include the recently published It’s All About Who You Hire, How They Lead…and Other Essential Advice from a Self-Made Leader (2013), co-authored with Mort Mandel, a self-made billionaire and highly successful entrepreneur in both the for-profit and non-profit worlds. Also, Informed Consent (1995), The Whiz Kids (1993), Chainsaw (1999), Odyssey (1987), and The Headhunters (1986).

Years ago during an annual meeting, GE’s then chairman and CEO, Jack Welch, explained his reasons for admiring entrepreneurial companies: “”For one, they communicate better. Without the din and prattle of bureaucracy, people listen as well as talk; and since there are fewer of them they generally know and understand each other. Second, small companies move faster. They know the penalties for hesitation in the marketplace. Third, in small companies, with fewer layers and less camouflage, the leaders show up very clearly on the screen. Their performance and its impact are clear to everyone. And, finally, smaller companies waste less. They spend less time in endless reviews and approvals and politics and paper drills. They have fewer people; therefore they can only do the important things. Their people are free to direct their energy and attention toward the marketplace rather than fighting bureaucracy.”

Byrne observes, “I’ve been flattered to have had General Electric CEO Jack Welch, an intrapreneur of there ever was one, ask me to work closely with him on his memoir – a collaboration that resulted in my spending more than a thousand hours with him. I envy that unique opportunity as well as Byrne’s conversations with 27 entrepreneurs whose 25 companies did indeed “change business as we knew it.”

Two of them co-founded Home Depot (Arthur Blank and Bernie Marcus) and another pair (Larry Page and Sergey Brin) co-founded Google. During the conversation with Blank and Marcus, Marcus recalls when they “threw GE out” and purchased their light bulbs from Philips. Welch responded, “Why would you do that to us? We’re friends.” Marcus’ reaction? “He was full of crap. His thing was bottom-line oriented and ours was customer oriented and it just didn’t match. It didn’t work. We bought a few things from him, including refrigerators. But he never got the bulb business back. He didn’t deserve to get it back.”

Byrne provides a brief but remarkably informative introduction to each conversation. However different the entrepreneurs may be in most other respects, all of them “share a set of common behaviors and attitudes. Ernst & Young’s own research identified what it calls the essence of an entrepreneur. It is, if you will, the shared DNA of people who are using their life’s work as an expression of self.” There are three core attributes that every entrepreneur shares: An Opportunity Mind-set, Acceptance of Risk and Potential Failure, and Independence and Control.

“To these three core strands, entrepreneurs bring drive, tenacity, and persistence. They live what they believe, building success on the basis of a strong culture and values. They seek out niches and market gaps. They are the architects of their own passionate and focused vision. While being non-conformist, they also are team players. And they are voracious networkers, building an ecosystem of finance, people, and know-how.”

Here in Dallas near the downtown area, we have a Farmer’s Market at which several merchants offer slices of fresh fruit as samples of their wares. In that spirit, I now share a few brief quotations from Byrne’s abundant orchard.

John Mackey, Whole Foods Market: “I do think we have a disruptive business model. But we don’t think about it in those ways. We are not a bunch of business school graduates who are trying to come up with a disruptive business model. We are a purpose-driven business, which is attempting to fulfill its mission. (Page 13)

Howard Schultz, Starbucks: “There was no efficiency at Starbucks. We were flying high without instruments. I say that with a smile but we shouldn’t be proud of that. But growth and success cover up a lot of mistakes. It’s hard to look in the rear-view mirror when you’re looking forward all the time.” (59)

Jess Bezos, Amazon: “The balance of power online moves away from the merchant toward the consumer. This is because customers have been information online. Comparison shopping is just a click away.” (67)

Herb Kelleher, Southwest Airlines: “The business of business is people. In a lot of companies you have to surrender your personality when you show up for work…We never felt that way. We always felt that if you allow people to be themselves at work, they will enjoy what they are doing. They’ll be more productive as a consequence of enjoying it.” (75)

Steve Jobs, Apple: “Picasso had a saying: `Good artists copy, great artists steal.’ We have always been shameless about stealing great ideas. Part of what made the Mackintosh great was the people who were working on it were musicians, poets, artists, historians, zoologists, who also happened to be the best computer scientists in the world.” (88)

Reid Hoffman, LinkedIn: “The old paradigm of climbing up a stable career ladder is dead and gone. No career is a sure thing anymore. The un certain, rapidly changing conditions in which h entrepreneurs start companies are what it’s no like for all of us fashioning a career. Therefore you should approach career strategy the same way an entrepreneur approaches starting a business.”

Oprah Winfrey, Harpo, Inc.: “How do you know when you’re doing something right? How do you know that? If feels so. What I know now is that feelings are really your GPS system for life. When you’re supposed to do something or not to do something, your emotional guidance system lets you know. The trick is to learn to check your ego at the door and start checking your gut instead.” (159)

Larry Page, Google: “We didn’t start out with a search engine at all. In late 19945, I started collecting the links on the Web, because my adviser [at Stanford's Graduate School] and I decided that would be a good thing to do. We didn’t know exactly what I was going to do with it, but it seemed like no one was really looking at the links on the Web – which pages link to which pages. So it is a huge graph. I figured I could get a dissertation and do something fun and perhaps practical at the same time, which is really what motivates me.” (199)

Phil Knight, Nike: “In the early days, when we were just a running shoe company and almost all our employees were runners, we understood the consumer very well. There is no shoe school, so where do you recruit people for a company that develops and markets running shoes? The running track. It made sense, and it worked. We and the consumer were one in the same.” (240)

Great stuff can be found within all of the 25 conversations. I feel obliged to point out that Byrne is an active participant, indeed an erudite contributor rather than someone who merely tees up questions to which others respond. I hope this brief commentary of mine makes crystal clear that John Byrne was uniquely well-qualified to conduct interviews of 27 entrepreneurs “who changed business as we knew it.” What they reveal and Byrne’s brilliant analysis of their revelations provide a wealth of information, insights, and wisdom in this single volume, published by Portfolio/Penguin Group (December 2011). These exemplars of entrepreneurism do indeed possess an opportunistic mindset and acceptance of risk and potential failure, as well as independence and control.

Tuesday, April 16, 2013 Posted by | Bob's blog entries | , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , | Leave a comment

The 12 greatest entrepreneurs of our time

Here is an excerpt from John A. Byrne’s cover article by FORTUNE magazine. Great ideas are hard to come by. Putting them to work is even harder. Byrne invites you to meet the founders who turned concepts into companies and changed the face of business.

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When Jeff Bezos came up with the idea for what would become Amazon.com, he went on a stroll in Central Park with his boss at the time to share his epiphany.

Bezos, in 1992, was a senior vice president for the New York hedge fund D.E. Shaw. He described his dream to create a company that would sell books on the Internet. His boss listened intently before offering a bit of advice: “That sounds like a really good idea, but it would be an even better idea for someone who didn’t already have a good job.”

Big ideas of the ground-shifting variety are rare — and hard to pull off. But that’s the difference between the dreamer and the doer. It took Bezos all of 48 hours to decide to quit his job and get started. Some 18 years later, he’s still at the helm of Amazon.com, which has redefined the way people buy almost everything, employs 56,200 people, and is valued at more than $80 billion.

Having spent years studying Bezos and others like him as an author, senior writer, and editor at both Business Week and Fast Company, I can tell you that Bezos is one of those rare birds who have made a meaningful mark on our economy and our world. He would certainly be on anyone’s list of the 12 greatest entrepreneurs of my generation. Who else should make that cut? After spending the better part of the past year pondering that question for a new book, World Changers: 25 Entrepreneurs Who Changed Business as We Knew It (Portfolio Penguin), I was asked by FORTUNE who deserves to be on that list — and what we can learn from each of them.

Many are obvious — from the late Steve Jobs, who helped make Apple the hottest and most valuable company on the planet, to Mark Zuckerberg, who will take Facebook public in what is anticipated to be the biggest IPO of all time (at a value of more than $80 billion). But there will be a few surprises too, such as N.R. Narayana Murthy, the visionary founder of Infosys who has built one of the largest companies in India, helping to transform that economy and put it on the world stage.

Another surprise: Not a single woman makes the list of the top 12 — at a time when women have gathered more influence and power in business than ever before. Oprah Winfrey has leveraged her celebrity into a formidable media empire, and the late Body Shop founder Anita Roddick proved that you could market products by being socially and environmentally responsible. They clearly warrant honorable mention but have not, in my view, transformed the face of business or society in as profound a way as those singled out here.

Admittedly this list of the world’s greatest entrepreneurs is subjective. I based it largely on social and economic impact; the world-changing vision of a founder who has inspired employees and other entrepreneurs alike; a record of innovation; and the actual performance of their companies over time. These founders created and then nurtured healthy, sustainable organizations that now have a combined market value of more than $1.7 trillion. They directly employ more than 3 million people, ranging from a high of 2.1 million at Wal-Mart to just over 3,000 at Facebook.

Yet those numbers only touch the surface. Each of their companies sits at the nucleus of a thriving ecosystem that has cultivated and nurtured dozens if not hundreds of other enterprises. Small companies have thrived as suppliers, for example, to Whole Foods, which, among other things, buys produce from more than 2,000 local farms. So the power of each of these organizations extends far beyond its own walls.

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To read the complete article, please click here.

John A. Byrne is Chairman & Editor-in-Chief at C-Change Media Inc. John A. Byrne is the chairman and CEO of C-Change Media Inc. Until recently, Byrne was editor-in-chief of BusinessWeek.com and executive editor of BusinessWeek. He holds the distinction of authoring a record 58 cover stories in BusinessWeek magazine and is also the author or co-author of eight business books, including two New York Times‘ bestsellers. Byrne had also been editor-in-chief of Fast Company magazine. He founded C-Change Media, a digital media company, to take advantage of the sea change that is roiling the traditional media business. C stands for content, curation and community, the three common attributes of each C-Change web venture.

Monday, April 9, 2012 Posted by | Bob's blog entries | , , , , , , , , , , , , , , , , , , | Leave a comment

   

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