The TIME at Davos Debate: The Rewards of Mastering Risk

Our experts examine the meaning of true leadership in uncertain times

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Flavia Schaub for TIME


We’re heading into the fifth year of the global economic crisis. People are calling it the Great Stagnation, and there’s a great pessimism setting in. There’s a lot of disparagement of current technological innovation — that there were only a handful of things that truly changed the way people live. Do any of you believe this, that innovation is slowing down?

(MORE: What If America’s Best Ideas Were Behind It?)

CHAMBERS: I think it’s the exact opposite. Change will actually accelerate. Just using the example of one thing that we’re interested in, you think about connecting every device in the world, of which 99% are not connected today. We think you can create an industry worth $14 trillion.

SENN: I have second thoughts on not being pessimistic but maybe a bit realistic. To make this happen, it needs a balance with the regulatory environment. A lot of the innovation is not really coming through, because you need to deal with it from a regulatory point of view around the world, and a lot of these regulatory pressures are not as aligned globally as they could be, particularly in the financial-services industry.

MAHINDRA: If you look around — you look at the news of the past four years — there has been a tremendous amount of focus on CEOs, on restricting what they can do. We can look at that as negative, or we can look at it as fences that will set us free. I think we have to spend an equal amount of time and rigor on setting up systems and protocols that encourage free thinking, that encourage innovation.

CHRISTENSEN: So I don’t want to come across as believing that innovation can end, but individual nations and individual companies can actually put themselves in a situation where they cannot innovate. So let me just pick on Apple. They start new markets with their technology, and that’s really the core of who they are and what makes them so good. Manufacturing these products is just a sidelight, and it’s really easy to outsource the manufacturing of that to people in China, who have better costs. We visited a plant in China that manufactures the logic circuit for an iPhone. There isn’t anybody in America who could innovate in that anymore.

CHAMBERS: I was with Martin a year ago. I would have been complaining about regulations. But my position has changed dramatically. You’re beginning to see a group of leaders who are thinking out of the box and saying, “I’m going to compete against other states. In Canada, I’m going to compete against other provinces. In emerging markets, I’m going to compete against other emerging nations, which will get their regulatory act together.”

GADIESH: We haven’t really spent time on education. And I think one of the first things that should be on any government’s agenda is reform in education, all the way from kindergarten to the top. Because what we have now is education that doesn’t actually provide for the jobs that are the most needed. China or Shanghai, for example, got it. Ten years ago they realized that. They were way down on the OECD list of countries and regions, and today Shanghai is No. 1 in science, No. 1 in mathematics and No. 1 in reading comprehension. In the West, I’m afraid, we’re behind. I believe in India we’re behind. It’s a real place where business should interact with governments.

SENN: There are still some countries that have to get the call. There’s competition between nations. Those countries that really set the tone to support innovation will create jobs.


What do you believe are the major barriers to business-model innovation?

GADIESH: One of the things that people don’t talk enough about is, How much of a right brain and left brain you actually have — right brain representing the creative side and left brain representing the commercial side. You need somebody who is a left brain to recognize that right brains are important or they stop them before they get a chance to move ahead. The second thing is that innovation really needs some structure. It’s not just sitting somewhere in a lab and thinking interesting thoughts.

MAHINDRA: To pick up on her comment about right-brain people — my undergraduate degree was in filmmaking. For a long time, it was my deepest, darkest secret [laughter]. I didn’t want anybody to know about it. Today I’m looking for filmmakers, designers, people from the humanities. That’s how I think I’ll create a culture of innovation.

CHAMBERS: As a parting thought, if there is something that could really make a difference in your company, your university, your country, but you’re not doing it because you have fear about innovation or fear of failure, just go for it. That’s what leadership is all about.

See Four Keys to Decoding the World Economic Forum.
See more about Mario Draghi: The Man Who Would Save Europe.

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