“The Trump Effect” and Impacts on Innovation and Entrepreneurship
Whatever your political orientation or where you are in the world, 2017 in the USA has certainly gotten off to a most interesting start. Since the election of Donald Trump, almost every executive, entrepreneur, official and policy group I’ve met with has asked my view on the business and economic implications of the new administration. Now that we have experienced a month of near-non-stop chaos and activity in Washington since our new President took office, one thing seems clear: 2017 looks to be a year filled with uncertainty, disruption and change (either that, or total gridlock). This bumpiness applies equally to US-focused businesses and to those with international operations, partners and customers.
So – disengaging from the political discussion – what are the broad implications of this Trump Effect for innovation and entrepreneurship?
Two Top Questions
In the work I do at UC Berkeley on innovation and entrepreneurship, and also with leaders and boards around the world, two of the most frequently asked questions I receive are:
- “Where do great opportunities come from?” and
- “What separates the best entrepreneurs and innovators from everyone else?”
One word typically embeds itself at the core of my responses: “change.”
Our New Normal?
Under President Trump we are seeing change and disruption being espoused, legislated and tweeted from the White House on a daily basis. Is this our “new normal” for the next four years?
From an entrepreneur’s perspective, and especially if this really is our new normal, if there was ever an opportune time to embrace change and launch new ventures it would be hard to imagine a more turbulent and uncertain period than right now.
Where Great Opportunities Come From
Returning to my top two questions, when it comes to where great opportunities come from, change is the ultimate driver of new opportunities and creator of new markets. New technologies have transformed our lives and given rise to whole new sectors, including many of our most valuable companies, such as Amazon, Google, Apple and Alibaba. Changes in demographics – e.g. as baby boomers age – create huge opportunities in housing, healthcare, and transportation. The implications of climate change and what to do about it are just beginning to be understood (or perhaps not, at least in a few instances). And the likelihood of significant changes in laws, regulations and trade will create huge opportunities for those who are well-positioned, well-informed, and able to move quickly in response to a changing landscape.
And Threats as Well…
Of course the reciprocal holds equally true. With every set of new opportunities and change there also arrives an entire new set of threats, particularly for those established, slow-moving, less innovative organizations that prefer the status quo. Their days may be numbered.
Even fast moving and flexible organizations may face new threats or impediments. For example, many tech companies have become increasingly concerned over the past month about the longer term legal status of some of their best and brightest team members. Those contributors are in the US legally now, but the rules may change and it may become harder for them to stay. Many of these companies and individuals are already developing Plans B and C.
What the Best Entrepreneurs and Innovators Get Right
A productive relationship with change is also what separates great entrepreneurs and innovators from the rest of us. Not only do they see the opportunities that change creates, but they look to drive even greater change themselves. They attract and mobilize resources and move quickly to take advantage of shifting landscapes.
Great entrepreneurs also embrace a commercially-oriented version of the scientific method, undertaking frequent real-time business experiments, all the while knowing that many of these experiments will fail. But out of these failures will come new insights that will drive new products, new processes, and new relationships with customers. And – bonus – some of these experiments succeed outright as well.
The results of this confluence of rapidly changing environments, proactive and fast-moving entrepreneurs and innovators, and an ethos of experimentation and learning, are all around us. Sector leaders – in many cases sector creators – such as Facebook, Uber, Airbnb and Snapchat are all less than a dozen years old. A new generation of space travel and exploration is being privately developed. The intersection of technology and mobility is leading to new approaches to transportation and logistics, from self-driving cars and trucks to drone delivery of your next Amazon package. The Internet of things is changing the way we interact with our physical environment (I love my Alexa and Nest). And we’ve just scratched the surface of what artificial intelligence such as IBM’s Watson might deliver.
A Front-Row Seat to Great New Ventures and Innovations
I have one of the best front-row seats to this process, with the amazing students and entrepreneurs I teach, mentor and advise at UC Berkeley and around the world, and the ventures they launch. These teams combine the best of business insights, design thinking, and technical know-how to develop new ventures and products that range from headsets to help you sleep better, to printable thin-film rechargeable batteries; from new approaches to fighting cancer, to a smart mattress pad that monitors newborn babies in their cribs; and from emerging fashion trends and channels to brain-controlled augmented and virtual reality experiences. Yes, even a better breast pump – seriously; check it out: http://fortune.com/2016/12/06/naya-smart-breast-pump/
So as we think about our current unpredictable environment and what it means for innovation and entrepreneurship, let’s also remember that great opportunities come out of times of great change. Go out and create, innovate, build, launch.
Is the glass half empty or half full?
When it come to change and opportunity, I say half full. At least. Drink up!