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156 HBR Leader’s Handbook

to-dos that I keep, but I always categorize them across different time hori-
zons, aligned with the people I’m holding accountable for different tasks.”
We often see leaders struggling to have the humility to admit that they
can’t do it all, as if that is a black mark on their leadership. Instead, we urge
leaders that we work with to see that this is the very hallmark of strong
leadership: recognizing how to apportion tasks, roles, and areas of owner-
ship to others to create the highest levels of performance for the organiza-
tion overall.

Taking a portfolio approach to innovation
When you move your unit or team toward a dual focus on current business
results and future innovation, tensions and trade-offs are inevitable. As
innovative opportunities emerge, when and how much do you start favor-
ing them over existing operations? If certain core business initiatives are
flattening out, when do you cut back on investment? If certain experiments
don’t work out, do you discard them or double-down with even greater
commitment? And how do you prevent the new future from cannibaliz- ing
what you need to keep going today? These questions are the essence of the
“innovator’s dilemma” that Harvard Business School professor Clay
Christensen highlighted in his book of the same name—where the success
of innovation threatens the existing business and may result in trade-offs
that stifle the innovation.
To manage this tension, consider the model of financial portfolio man-
agement: instead of putting all of your money in one place, you spread it
around and create a diverse portfolio of different types of investments—
stocks, bonds, small cap, large cap, domestic, international, and so on. You
then manage the risk and return in the portfolio by adjusting the mix and
amount of investments dynamically, since it is unlikely that all of them will
rise or fall to the same degree simultaneously. We can apply this concept
to innovation as well. Tuck School of Business professors Vijay Govindara-
jan and Chris Trimble, in their HBR article “The CEO’s Role in Business
Model Reinvention,” describe their “three box” approach. They argue that
leaders need to balance and then continue to rebalance their investments
between what should be “preserved and improved” in their current busi-