Page 7 - Harvard Business Review (November-December, 2017)

IDEA WATCH WHAT SKILLS SHOULD A FOUNDER PRIORITIZE?

CONTINUED FROM PAGE 20 START-UPS
consumer preference and find
Hofstetter and his colleagues WHAT SKILLS
more-effective ways to evaluate
the ideas that are generated.
cite prior research showing that
product developers who identify SHOULD A FOUNDER
“idea hubs,” or similar ideas
submitted by different people, PRIORITIZE?
may get better results. One
platform replaced simple “likes”
with more-complex evaluative How well do college and MBA programs prepare students
questions, which reduced the to launch technology ventures? Researchers surveyed 141
incidence of reciprocal voting. Harvard Business School alumni who had founded companies,
And the researchers suggest that mostly venture capital–backed tech start-ups. They also
platforms develop algorithms questioned 20 non-MBA founders. Both groups said that M&A
or other mechanisms to control aspiring founders should aim to become jack-of-all-trades WHY EXTRAVERTED CEOs
for social ties. managers, with emphasis on putting together and leading a
Adrian Gerber, the CEO of team and identifying and responding to customer needs. They WIN IN ACQUISITIONS
Atizo 360°, agrees that companies listed specialized skills, including finance and engineering, Companies collectively spend
should pay less attention to as lower priorities. One respondent noted, “Every one of billions of dollars a year on
consumer voting and give more these skills is important. The question is: For which will the mergers and acquisitions—often
weight to their own criteria when CEO build deep personal expertise, and for which will they destroying rather than creating
winnowing hundreds of ideas outsource to other founding team members?” ■ value. New research uses a
down to a handful of viable ones. novel linguistic technique to
As crowdsourcing evolves, he PERCENTAGE OF FOUNDERS WHO SAY THAT “HIGH” explore one factor that may
says, companies are beginning OR “VERY HIGH” PRIORITY SHOULD BE GIVEN TO: influence M&A behavior and
to show a preference for a more outcomes: CEO extraversion.
carefully selected crowd, one that 88 Researchers examined the
brings special expertise to the quarterly earnings calls of 2,381
innovation puzzle. For instance, 82 global CEOs over a period of 10
they are increasingly using open 80 years, using textual analysis
innovation platforms with groups software to assess each person’s
of employees or suppliers rather LEADERSHIP 74 degree of extraversion; they
than consumers. Some firms also FOUNDING TEAM ASSEMBLY 72 71 then looked at the M&A activity
seek out specialized consumers 69 of the leaders’ companies. They
whose views may be especially PRODUCT MANAGEMENT SELLING 65 found that extraverted CEOs
relevant. To brainstorm new TEAM MANAGEMENT MARKETING engaged in more acquisitions,
kinds of avalanche protection targeted larger companies,
gear, Mammoth, the Swiss PRODUCT DESIGN and were more likely to earn
outdoor clothing and equipment above-average returns after
company, recently asked Atizo STRATEGY FORMULATION their deals. Why? They tend to
to convene an online group of 47 serve on more corporate boards
mountaineers who have design 44 than their less-extraverted
or engineering experience. As counterparts, giving them
that example suggests, the right FINANCE broader networks and providing
answer may come from tapping a access to intelligence that
small number of the right people may help them identify and
rather than from polling a crowd pursue promising targets. Their
of random idea generators. ENGINEERING MANAGEMENT personalities may also give
HBR Reprint F1706A them a leg up in persuading
ABOUT THE RESEARCH “Should shareholders of the value of
their acquisitions. ■
You Really Produce What
Consumers Like Online? Empirical
Evidence for Reciprocal Voting in Open ABOUT THE RESEARCH
Innovation Contests,” by Reto Hofstetter, “The Acquisitive Nature of
Suleiman Aryobsei, and Andreas Extraverted CEOs,” by Shavin Malhotra
Herrmann (Journal of Product et al. (Administrative Science
Innovation Management, forthcoming) SOURCE THOMAS R. EISENMANN, ROB HOWE, AND BETH ALTRINGER Quarterly, 2017)

22 HARVARD BUSINESS REVIEW NOVEMBER–DECEMBER 2017