Column : Cerebral energetic officer

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: The recent election of Barack Obama raises the question: can a single individual make a difference to how a large group such as a nation thinks and acts in the long term? Or, in the more modest context of business: can a CEO drive the employees of a firm to become more innovative and perform better over time? Corporate culture plays an important role in making firms more innovative, but does the individual at the head of the firm have a role to play in all this?

Common sense would suggest that the people who lead companies have an important role in driving innovation within them. Anecdotal evidence would support such a view too. CEOs like Andy Grove at Intel and Steve Jobs at Apple have been widely acknowledged for promoting innovation in their firms.

Surprisingly, academic literature presents a mixed view on the subject. Some authors suggest that CEOs might actually be bad for innovation. They may be so steeped in the past, or so swamped by their day-to-day activities, that they fail to recognise how the technological or market situation has changed on them. Here too examples are easy to find.

One need only think of Ken Olson, the CEO of Digital Equipment Corporation who, as late as 1977, decreed that “there is no reason anyone would want a computer in their home” and proceeded to forbid his employees from using the words “home computer” or “personal computer” within the firm.

Other authors have argued that CEOs are simply not very relevant in driving innovation. Or else, this effect is only at the project level, via support for individuals and teams working on individual projects. The legendary Andy Grove seems to hint at something like this at Intel: “Over time, more and more of our production resources were directed to the emerging microprocessor business, not as a result of any specific strategic direction by senior management but as a result of daily decisions by middle managers?”