Efosa Ojomo is a senior research fellow at the Clayton Christensen Institute for Disruptive Innovation. He works alongside Harvard Business School professor Clay Christensen in figuring out the best ways to help entrepreneurs, policy makers, and development practitioners spur economic prosperity. He is a co-author of The Prosperity Paradox: How Innovation Can Lift Nations out of Poverty. He will speak in the 2019 program track Defining Economic Progress.
To say that Harvard Business School professor Clayton Christensen has had a profound impact on innovation, business, and management is an understatement.
In 1997, when he published his first book The Innovator’s Dilemma, he coined and popularized the term Disruptive Innovation which explains how industry leaders get upended by smaller and less resourced market entrants. Soon after publication, the book became a must-read for many managers in Silicon Valley and beyond. Today Christensen is highly sought after by executives, policymakers, and investors thanks to his distinct ability to reframe problems in a way that fundamentally changes how you see the world.
I first got to know Professor Christensen in 2015 while pursuing an MBA from Harvard Business School. With the ambitious goal of figuring out how businesses could improve the lives of people living in poverty, I enrolled in his course Building and Sustaining Successful Enterprises and later had the opportunity to work with him on several projects that aimed to understand innovation’s impact on economic development. Most recently, our years of research culminated in our just-released book with Karen Dillon The Prosperity Paradox: How Innovation Can Lift Nations Out of Poverty.
Thanks to our work together, I have come to know Professor Christensen as a colleague, a mentor, and, perhaps most importantly, a friend. Here are just a few things he has taught me about innovation, economic prosperity, and life.
Innovation is such a buzzword these days. Many companies, NGOs, and governments are investing in innovation or “innovative” programs. But what does the word really mean? Surprisingly, it’s one of Professor Christensen’s least favorite words because innovation now means different things to different people. And so, the first thing he taught me was how he defines innovation: a change in the process by which an organization transforms labor, capital, materials, or information into products and services of greater value.
Innovation does not need to be high-tech or feature-rich. Innovation is also different from invention, which is the creation of something entirely new. This is important, because as investments in innovation become more ubiquitous, managers need a common language and definition for what they mean.
Professor Christensen also drove home the message that there are different types of innovations with distinct impacts on economic development. Disruptive innovations transform industries by replacing complicated and expensive products and services with simple and affordable ones. Efficiency innovations increase the efficiency in a given industry. Market-creating innovations create new markets that often serve as the foundation upon which prosperous economies are built. And sustaining innovations make existing products even better.
When managers have a common language and understanding of innovation, they are better able to predict the impact of their investments.
On economic prosperity
The distinction between economically prosperous countries and poor countries is often stark. Travel to poor countries and instantly you see the lack of infrastructure and institutions. As a result, conventional wisdom promulgated in mainstream economic development discourse — which is highlighted by expenditures in the industry — is that poor countries should first fix their infrastructure and institution problems. Only then will innovations be able to flourish.
But as Professor Christensen and I poured through historical examples of countries that have risen from poverty to prosperity, we discovered that we have the equation backwards.
Innovation isn’t a thing that happens on the fringes of society after society “fixes” itself — that is, after society builds its infrastructures and develops its courts, legislatures, financial markets, etc. Instead, innovation is the process by which society develops itself. It is precisely through innovations that create, or connect to, new markets that societies can create jobs, pay taxes, and build their infrastructure and institutions.
In the United States, for instance, there was a time when infrastructure and institutions were grossly underdeveloped. Large and complicated projects like the development of roadways often failed because they were too costly. But when entrepreneurs created new markets for cars, agricultural products, and other goods, the value from these innovations funded the construction of many successful roads and other infrastructure projects. In the US, as in other wealthy countries, innovation preceded development.
Interestingly, the biggest lesson Professor Christensen has taught me has little to do with innovation, business, or management of corporations. It’s about how I can develop and pursue a deliberate strategy to spend a life filled with contentment, joy, and purpose.
We all have limited resources — time, energy, talent, money, relationships, and so on — and the way we spend our resources ultimately shapes our life’s strategy. Many things compete for these resources and it is all too easy to spend the best years of our lives working, at the expense of developing rich relationships with friends and family.
These allocation choices can make our lives turn out to be very different from what we intended. When people who have a high need for achievement have an extra half hour of time or an extra ounce of energy, they often unconsciously allocate it towards activities that yield the most tangible evidence of progress. It’s tempting to focus our extra energy on work, for instance, where we complete projects and if we’re lucky get raises and promotions. Those are concrete things that make us feel good, whereas investing in relationships sometimes takes longer to pay off. But intimate and loving relationships with family and friends are arguably the most powerful and enduring source of happiness.
My life so far has taken unexpected turns that have led me to work with the one of the world’s greatest management thinkers. I could not have scripted it better. My hope is that some of the lessons the professor has taught me are helpful to you.
The views and opinions of the author are his own and do not necessarily reflect those of the Aspen Institute.