The 2013 World Economic Forum Annual Meeting was in full swing yesterday in Davos, Switzerland.
Why do you care? In a session titled Leading Through Adversity, some of the world's biggest names in corporate leadership offered insights on how business leaders can take on risk to spur innovation. Here were their biggest talking points.
Don't confuse uncertainty with unfamiliarity. "There's an old Arab saying that says: 'anyone who's ever been bit by a snake is going to be afraid of a rope.' That is actually where we are: there are many ropes out there that we treat as snakes. In general, people are risk averse. But there's a difference between being risk averse and being averse to unfamiliarity," said Orit Gadiesh, Chairman of Bain & Company.
She said what often feels risky is actually just the unfamiliar--something that "can be learned--it can be researched, and people can learn attitudes and skills to manage in a time like that."
She continued: "Not moving because of things are unfamiliar--and you haven't bothered to learn how to operate on them--I think is really a crime. The uncertain is the unknown and the unknown is the future, and you cannot predict the future. But the unfamiliar? You can learn how to operate in that."
Now is the time to go against the grain. "When you get the majority of the economy predictable, you're gonna get faster job growth, and companies investing more. But actually, the best return for companies is when things are really going the wrong way, and you're willing to go against the tide," said John Chambers, CEO of Cisco.
He added: "I would argue that your chance to break away is now as opposed to twelve months from now when hopefully governments get more predictable with their policies. In many of our industries, if you're risk averse, you get left behind."
Face uncertainty head on and innovate. "We have to deal with uncertainty," Anand Mahrindra, Chairman of Mahindra & Madindra in India, said. "That is our profession. Please--look for uncertainty. It's regulated autocratic governments that look for certainty and I want no part of it. I think we are on the cusp of a major uptrend in innovation." He added that the world has lacked a true innovator for some time now.
"There are companies like Apple that are still going cutting edge innovation, but they're facing companies like Samsung that are doing more for less," he said. "Now, what I think is going to happen is that you're going to see cutting edge innovation is required. I think there's a boom in cutting-edge philosophy, and I think the winners in the next decade--either from the West or from the East--will look around their organizations, find out where competence lies in both of these areas--pioneering and in more for less--and finding a way to synthesize them and create a whole new cycle of innovation."