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Newton Lecture Series: Vineet Nayar trains students to “think impossible”
December 9, 2015

The A. Richard Newton Lecture Series is an initiative of the Sutardja Center for Entrepreneurship & TechnologyWhat defines a high-performance individual?According to author, executive, and philanthropist Vineet Nayar — high performance individuals ‘are those who do stuff which others consider impossible’.  Nayar believes that the most important exercise that entrepreneurs, innovators, and managers can do is train their brain to ‘think outside the boundaries of logic and reason’.“When a magician performs a trick you call it impossible, unbelievable. When they slice someone in half or someone starts flying in the air — impossible. So, the definition of impossible or the definition of a magical moment is what is outside your boundaries of logic and reason,” explained Nayar. “That is not outside the boundaries of logic and reason of the magician, but outside your boundaries of logic and reason.“So, therefore, if you want to be a high performance individual — you want to do the impossible stuff — you have to spend a significant amount of time thinking outside of the boundaries of logic and reason.  It is very important to establish that fact in your mind that if every day you are not thinking about it — you are not going to be able to do it.”It was this logic that Nayar applied to HCL Technologies (HCLT), a global IT services company that when he joined in 2005 was losing what he called “mind share, market share, and talent share”.“When I came to HCL Technologies in 2005, the probability of a successful turnaround was 1%.  So, the way we thought about it was — should we innovate on the product axis? The answer was that there was so much innovation on the product axis that everyone had done, that the whole industry had become commodity, and there was very limited work we could do on that axis,” said Nayar,”Therefore, we asked — is there another axis of innovation?”Nayar used the example of Steve Jobs as one who knew how to think impossible. Jobs was innovative because he focused on a whole new dimension of Apple products — the dimension of user experience.  The products Apple created during Jobs’ tenure ultimately used similar parts as its competitors, but by focusing on creating positive interactions with it users, Apple built trust with its customers and now is one of the most iconic brands in history.So, how did Nayar innovate at HCLT?  He did so by investing in his employees.  He turned the management pyramid upside-down and ushered in an era of transparency and honesty to give his employees the power to innovate.  Nayar theorized that by investing in employees, he could create value where it mattered most in a saturated market — at the frontlines where employees interacted with actual customers.  Nayar chronicled his vision and the transformation of HCLT in his book Employees First, Customers Second: Turning Conventional Management Upside Down (Harvard Business Press).“So, we said actually it’s not about what you do in a company but how you do in a company.  Therefore, if you can energize the employees and motivate them and if management can be accountable to employees rather than just employees accountable to management, you can unleash the kind of energy in the organization which no one else has seen before,” said Nayar.Innovating in this way paid off for Nayar — during his stay as CEO, HCL Technologies did manage to be one of the 1% of companies that regained and exceeded market share after losing it —in fact, they achieved a seven-fold increase in market capitalization from 2007–2013.  Nayar was also named to Fortune Magazine’s only ever “Executive Dream Team” in 2013.Nayar went on to discuss what he believed was a relatively new area for innovation — innovation in the social sector.  He believes that many enterprises that focus on helping society are great at leveraging the power of the heart but do not always apply innovative techniques of the mind which business focuses almost exclusively on.  After leaving HCLT to focus on philanthropic pursuits, Nayar had the idea of ‘the one dollar experiment’.  That is — if you had $1 per student per year to teach English to children in rural India, how would you do it?  (Additional challenges included very limited access to electricity, teachers that also could not speak English, and unengaged students and parents).With these constraints, Nayar challenged the class to discover the solution to the ‘one-dollar experiment’ — a solution which Nayar had already discovered for himself.  Nayar’s NGO, the Sampark Foundation, has already successfully taught English and Math to three million children through 200,000 teachers in 50,000 schools in rural India — meeting the criteria of $1 per child per year.So, how does one teach English to children in a rural area without electricity and anyone who speaks English?  Nayar masterfully engaged the class by asking questions and challenging each idea against the constraints of the experiment.  Through this dialetic, the class did eventually come upon the solution which worked for Nayar and the Sampark Foundation: 1) use an audio device to teach English – one that relies on a long-lasting battery, 2) have the audio device be a character (e.g. a Bollywood star) to be more engaging, 3) teach by translating local folklores and songs to be relevant, and 4) have the children perform a play in English and invite the local politicians to win the political will to carry out the program.But how does innovation work in the real-world?  A student wanted to know.  Surely, elegant solutions to large problems are not discovered through 20 minutes of brainstorming and intuitive reasoning (as had just happened in the class while discovering the solution to the ‘one-dollar experiment’).Nayar did not have an exact answer to how innovation occurs, but he did share his personal three-step process to innovation with the class:

  1. State of unhappiness“Step 1 is to be extremely unhappy with your status quo. Firebrand the constraint and say that you will not move on.  I am not just going to change the constraint just because I can’t find a solution.  Normally, what really happens is that you because you struggle to find a solution — because all solutions outside the boundaries of logic and reason are very difficult — so what you do is you come back and change parameters… so first is fix it — that is what I call the state of unhappiness — that I am not happy until I find something completely uniquely different.”
  2. Energizing vision“Step 2 is to create a vision for tomorrow that is so compelling, so big, that it is worth attempting to go from there to there…. If you were saying ‘how do we innovate in teaching 100 students?’ I will not apply the energy which is required. Most people will not. But the moment you define this vision as ‘if we can innovate we can reach 186 million children in India’ — suddenly the vision is so big that it energizes a lot of people to apply their mind to it.”
  3. Relentless experimentation“The step from here to there is a series of hypothesis formation and experimentation which happens day in and day out.  It’s not something that you will sit and in 15 minutes come up with the solution. You think of the first step, then you think of the second step, then you experiment, then you fail, then you succeed, then you think of another hypothesis — it’s a series of experiments where you are constantly executing, constantly pursuing, and constantly wanting to innovate — you fail 70% of the time, you succeed 30% of the time, and then try more, and try more, and try more…”

Nayar closed the day by discussing which problems he pursues as an entrepreneur.  With so many worthy issues out there, how can an entrepreneur decide to solve only one?“I go after problems I can solve, not problems that interest me,” said Nayar, “Yes, you should be excited about all the problems around you — but you should be more excited about the way you solve it.”