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New problems? Maybe it’s time for a new type of manager

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Nathan Furr is an assistant professor at Brigham Young University and co-author of The Innovator's Method: Bringing the Lean Start-up into Your Organization. He also has acted as the founder or adviser to start-ups across several industries, including retail and clean technology. He spoke about his principles of innovation with Tom Fox, a guest writer for On Leadership and vice president for leadership and innovation at the nonprofit Partnership for Public Service. Fox also heads up their Center for Government Leadership.

Q. How do great innovators approach leadership?

A. If you asked a group of managers five years ago “What’s your job?” they would say that it’s to make decisions. It was rooted in a classic military metaphor of strategy. It’s this idea that the commander’s job is to see the field and put the troops in the right position to win the war. The challenge with that model is that it’s rooted in some element of relative certainty, but innovation is all about uncertainty.

I define innovation as solving problems. And in today’s uncertain world, if you are solving really innovative problems, you can’t really see the field or where your troops are, so you need a different approach to management. Instead of it being your job to make the decisions and tell your “troops” what to do, your job as a manager is to stand by their side as the chief experimenter and guide them in asking the right questions and then designing the experiments that will help them learn about the uncertainties they face.

Q. What are some of the roadblocks to innovating in government?

A. There are many similarities to a private organization. You have a fair amount of hierarchy and bureaucracy, and you have a fair amount of command and control. Government and social entrepreneurs always make a mistake where they get an idea about something they’re really excited about — they make all these big assumptions that they later discover were untrue. They usually discover it after they’ve spent all their money.

So the lesson is to start by identifying and testing your assumptions about what problem you are solving before you spend all your time and money on what ultimately proved to be an incorrect guess.

Q. What is the next step once you fully grasp the problem you are trying to solve?

A. Use rapid experiments and prototypes to match the solution to the problem and then scale it up. Ask yourself how you could conduct a low-cost and even low-visibility rapid experiment that would allow you to learn about your assumptions with real customers. You have to launch a small-scale experiment and then iterate on that so that when it comes time to roll it out, to scale it, you haven’t scaled on a bunch of broken assumptions.

It is so much more expensive, politically costly and dangerous to try to fix something big than to fix something small. I see that in the launch. Whatever your feelings about Obamacare, from an innovation perspective, you could just see that the whole enrollment process was going to be broken. They said, “Let’s create an enrollment system and then let’s roll it out to the whole nation at the same time.” It’s a classic example of scaling it before you nail it.

Q. What drew you to write the book about innovation?

A. I was at Stanford and involved in the early founding of the lean start-up movement. I was stunned by how immensely popular it became and how unpopular traditional management became among entrepreneurs. I asked myself why. And I came down to this answer: Management thinking was developed in the late industrial revolution for a very specific purpose — technology had transformed the economy from what was essentially a set of cottage industries into a group of very large companies that were producing things at an incredible scale.

These huge companies needed a whole new group of professionals to operate — “managers.” Management was developed to literally make the trains run on time. It was developed in a context where people knew what the problems and solutions were, they just needed to organize production. And at the same time, innovation and entrepreneurship were not topics at all in the business world. A century later when we started bringing on more entrepreneurship, we just borrowed our existing management theories into the entrepreneurship context. But it didn’t work.

Management is about relative certainty, but innovation is about radical uncertainty. So we need a new set of tools for the uncertainty. My goal is to develop a management science of uncertainty. How do we manage uncertainty? That’s my personal dream.

Q. How can a leader make that transition from chief decision-maker to chief experimenter?

A. I’m not saying that management thinking is wrong. I actually think it’s incredibly useful when it’s applied to the right context. So if we’re facing problems of relative certainty, then traditional management thinking is absolutely the right tool. By contrast, when you face uncertainty, learning fast is the source of your advantage, not scaling up and getting big fast. So as a leader or manager, I want you to be able to switch to the right tools when you face uncertainty. The world is full of problems and each of those problems is an opportunity. If we have the right tools — the right management tools, the right process, the right leadership perspective — we can solve these problems a lot more effectively and for less money.

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