The NYT interviewed Steve Case, founder of AOL, in a provocative article “When Attackers Become Defenders, Innovation Is Lost.” Last week I talked about innovation and great ideas coming from a quiet mind. I was intrigued that Mr. Case added another layer to that. He believes thatinnovation rarely happens when a company is in a “defensive” posture – protecting what they have. From this stance, all executives see is what they might lose, and fear that their stock will be worth less when they leave.This defense of what they have and the status quo kills innovation.
These are mostly large organizations and government entities that defend.The flip side is the entrepreneur that attacks the status quo, innovates, wants to change and will take significant risks to do so. The flexibility and nimbleness that smaller entrepreneurial companies inherently have as an advantage goes away as they grow, unless it’s absolutely incorporated into their core values – the fiber of the companies’ personality. Case makes the point that listening to the employees, executives and different points-of-view keeps the company fresh and open to new ideas. This is culture, not the size of business. It’s harder as the company grows larger, but not impossible.
Larger companies are run by boards and shareholders whose job it is to “defend” the value of the company, not necessarily to innovate. What if the job of the board were to be an attacker, an innovator and a risk taker? What if that was the role of government organizations – constant reinvention and innovation? My guess is that a lot of people would have heartburn. Most people’s risk tolerance is not as high as that of an entrepreneur.
Entrepreneurs are the cowboys. They take the hills that everyone says are impossible. After they’ve taken so many hills, they get a little beat up, they get tired and want a rest, and they start to defend. It’s a natural evolution of an organization. As individuals we become more conservative as we grow older, less risk tolerant and so do businesses, unless you continue to instill innovation, reinvention and offensive strategy into the fiber of the organizations gene pool – meaning the talent and culture.
Case makes the point that had he fired the top 50 executives at the start of the merger of AOL and Time Warner and brought in 50 new minds to see things from a different perspective, it might have worked. It certainly would have been a game changer, and it would have been a great offensive or attack strategy. However, two defensive giants looking to marry up for security and more real estate rarely stake out the new hill to take.
Bottom line, both types of approaches need to exist in the realm of business. One is not necessarily superior to the other. Just be sure to know which one is at the core of your enterprise, (and why), and if you believe that to be one of your competitive advantages, embed that value throughout the organization for success.