Companies & Industries

Wanted: A Few Disruptive Leaders


To get growth back on track, the U.S. needs a new generation of innovative, pioneering executives to shake up technologies and transform industries

The gloom emanating from Wall Street these days is almost palpable. After over a decade of profligate consumer spending, egged on by tax cuts and massive deficits, U.S. consumers find themselves sinking deeper into debt as layoffs are accelerating.

For the past eight years our economy has focused primarily on getting consumers to spend more through tax cuts, low interest rates, subprime mortgages, and multiple credit cards. With the national savings rate approaching zero and the economy plunging into a recession, consumers are at their breaking point. Meanwhile we continue to lose manufacturing jobs to globalization. And financial institutions, long the U.S.'s symbol of global dominance, are retrenching and turning to sovereign wealth funds after losing $150 billion in the subprime crisis.

We must face reality. Those low-tech manufacturing jobs migrating overseas will never return to U.S. shores. Nor can we continue to build our economy on tax cuts, deficit financing, and overstretched consumers. Having lost the manufacturing competition to China, India, and other Asian countries, we must build on our unique strengths in innovation and entrepreneurship to restore our competitive stature in the world. These are the best tools we have to create new jobs paying substantial salaries.

Disrupting With Innovation

To put the U.S. back on the growth track we need a new generation of leaders to transform existing industries and create new ones with breakthrough solutions. In his book, The Innovator's Dilemma, my Harvard colleague Clayton Christensen describes "disruptive technologies" that transform businesses. What U.S. business needs today is disruptive leaders who transform industries in the same manner.

To be clear, I am not suggesting we need leaders who disrupt their organizations by shaking them up and slashing people and expenses. Quite the contrary. What I'm proposing is something very different: We need leaders who disrupt entire industries with their creativity and innovation. Look at what Sergei Brin and Larry Page of Google (GOOG) have done to the Internet. Or what Mark Zuckerberg did in connecting people through Facebook. Or the impact Steve Chen, Chad Hurley, and Jawed Karim had in creating You Tube. Innovators like these can help rebuild the U.S. economy and enable us to compete on a global scale.

Thinking back to the dynamic growth of the 1990s, the big job gains didn't come from industrial companies. They resulted from high-tech innovators such as Microsoft (MSFT), Intel (ITC), and Apple (AAPL); retail innovators such as Amazon (AMZN), Starbucks (SBUX), and Target (TGT); and biomedical and medical technology pioneers such as Genentech (DNA) and my former company, Medtronic.

Seeking to Change the Status Quo

What all these companies have in common is they were led by disruptive leaders: Bill Gates, Andy Grove, Steve Jobs, Jeff Bezos, Howard Schultz, Bob Ulrich, Arthur Levinson, and Earl Bakken. These innovators created great global enterprises employing millions of people at good incomes. They did so by disrupting their industries through innovation and then exporting their ideas around the world.

Pioneers like these spend almost every waking hour thinking of transformational ideas. They refuse merely to improve on the status quo, but seek to change it. They are driven by a passion to change the world with ingenuity, creativity, and technological breakthroughs.

Starting with the new President in 2009, we must shift our national focus to ingenuity and entrepreneurship. Consider the potential of a new generation of disruptive leaders applying themselves to problem areas such as energy and the environment, health care, poverty, and education. This will require greater federal funding of research initiatives in renewable sources of energy, medical research and health-care innovation, creative approaches to reduce poverty, and original ideas to improve education. In addition, the federal government should expand scholarships for science and math, and the number of visas and work permits for legal immigrants.

Advanced Technology Solutions

Technological breakthroughs focused on creating new sources of renewable energy as well as of oil and gas could double automobile mileage while cutting emissions in half, replace dirty coal plants with clean coal solutions, and reduce our dependence on foreign oil and gas by extracting more resources in North America.

In health care, we must use information technology to transform our inefficient health-care delivery systems. To address growth in chronic disease, breakthroughs in genomics can create the new field of predictive health.

Microfinance pioneers like Mohammed Yunus have had stunning successes in enabling poor people outside the U.S. to reach economic self-sufficiency. Why not do the same in the U.S.? Our K-12 education system is in desperate need of reform and could benefit greatly from advanced information innovations to increase levels of science, math, and English-language fluency.

A New Generation of Leaders

All these things are quite possible if we shift our national focus away from war, spending, pork barrel budgets, and consumer indebtedness to encouraging disruptive leaders to focus on the real problems the U.S. faces—and make our country economically vital once again. That will require a national focus—starting with the next President.

A new generation of disruptive leaders with the vision, passion, and courage to tackle these most difficult problems is the very best way to get the U.S. economy back on a growth track.

George, professor of management practice at Harvard Business School, is the author of two best-selling books, True North and Authentic Leadership. He writes his "True North" column every other week at businessweek.com/managing/.

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