Tuesday, November 19, 2013

Keeping Us In the Ocean

By Andrew Yenchik

Perhaps the real life version of Tony Stark, Elon Musk can’t help but keep his name and ideas in the news.  Detailed blog posts regarding Tesla car fires, PayPal’s newest strategic partner, SpaceX’s newest venture with NASA, and innovative ideas surrounding the Hyperloop, continually fill my RSS feeds.  It seems that Musk is doing what we all dream of doing and what many companies strive to do – continually invent something new and cool that will catch attention and rake in profits.

But in reality, Musk may not be as brilliant an entrepreneur and businessman that many in media give him credit for.  The strategies and ideas he puts forth don’t appear to be that new or that inventive.  Tesla’s cars follow a long line of electric and hybrid vehicles from Toyota, Honda, and dozens of other manufacturers.  SpaceX isn’t doing things that different than NASA has done since the space races of the 60’s and 70’s.  And the Hyperloop is an enhanced and high-speed version version of a transit system – something most cities have had for decades.

So how does Musk think up these ideas?  And how has he been so successful in areas that already seemed saturated with ideas, products, and companies?  It may seem contrite to say that he is an expert Blue Ocean strategist – but that is my argument.  Musk is the new Jobs:  giving people what they want before they really know they want it.  Just as Jobs capitalized on Toshiba’s foray into the 2.5” hard drive market, so Musk is capitalizing on many technologies to further his designs and ideas.  Musk rarely invents something new – rather he combines technologies into products and companies that solve problems.

Kim and Mauborgne, in Blue Ocean Strategy, explain that a Blue Ocean strategist puts the clock forward 20 years.  They ask themselves: how many industries that are unknown today will exist then? [1] Further, those strategists who bring science to the art of strategy are those that ask: “What might we do?” and not “What should we do?” [2] Musk, and his ventures and partners, appear to be asking these types of questions and pondering the answers.

But just brainstorming and thinking haven’t led to Tesla, SpaceX, SolarCity, and PayPal.  Musk knows how to take the next steps, shifting away from the “What do I believe?” types of questions to the “What would I have to believe?” types of questions.  As Lafley, et al explain, such questions help a strategist design the right types of rigorous tests for an idea, to flush it out, and assure it passes the scientific tests.

Such was the case for Tesla motors.  In fact, Tesla Motors almost never came to fruition.  The electric car company was raising a round of funding in the summer of 2008 when the financial crisis hit. After car companies like Chrysler and GM went bankrupt, Musk had a hard time approaching investors about Tesla.  “People were angry that you brought it up,” Musk said.  Musk said he put everything he had left into the company, even borrowing money from friends. Tesla went on to close the investment round on the last hour of the last possible day. If the fundraise hadn’t come through, the company would have gone bankrupt a few days later. [3] Musk, like others, faced risks with optimism, because he had implemented the scientific method to fully vet, test, retest, and claim victory for Tesla. [2]

It appears that the greatest minds of our generation (Lucas, Jobs, Gates, Musk, et al) find ways to leave the red oceans and pull us to blue oceans.  How?  They don’t search for the right answer or the right idea.  They push past the barriers of traditional thinking and start asking themselves what the right questions to ask will be.  In my opinion, asking the right questions may prove to be more valuable than finding the answers to any question asked.

Do you think Musk is that brilliant on his own?  Or has he just studied and applied the HBR literature better than anyone else?  Is the literature written about him and because of him?  Or is it written for him?

And who are the next generation of thinkers and strategists?  Who will accompany Elon Musk as a brilliant Blue Ocean mind and push our culture and living into new oceans?  Is it Richard Branson?  Oprah?  Larry and Sergey?  Zuckerburg?  Bezos?

[1] Kim and Mauborgne, “Blue Ocean Strategy,” HBR October 2004
[2] Lafley, Martin, Rivkin, and Siggelkow, “Bringing Science to The Art of Strategy,” HBR September 2012
[3]  http://thenextweb.com/entrepreneur/2013/10/31/elon-musk-failure-fear/

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