S+B: Now that you mention it, it seems like each one of your ideas is about the fundamental viability of human beings: as consumers making a life for themselves, employees offering their skills as part of a bigger competency, or innovators rising to an impossible challenge. It’s as if you’re putting the benefit of the doubt on the human being.
PRAHALAD: Yes. If I had to characterize my deepest belief, I would say it’s the centrality of the individual.
Institutions are not central. Institutions are different ways of combining skills and capabilities of the moment. That, of course, is the opposite of the traditional way of thinking, starting from Max Weber and Frederick Taylor in the early 20th century. They posited that institutions were central to society, not individuals. I believe the contrary is true.
Maybe this comes from my philosophical training in India, with Hinduism, in which there is no central authority. The religion is highly distributed and decentralized, held together by its beliefs. Hindus are taught that individuals must improve their situation by what they do. You may have no choice in how you are born, but you have tremendous choice in what you do.
For example, in the Kartikeya story [from Hindu mythology], there is a conversation between Arjuna the warrior and Krishna the god. Arjuna asks questions and Krishna answers, and then finally Krishna says, “I’ve shown you the truth. Now, you choose.” He never says, “You must do this.”
S+B: How does this affect the way you think about strategy?
PRAHALAD: Conventional strategy didn’t even consider individuals. When a company looked at its resources, it considered its financial situation: could it afford another employee or not, for example, rather than what kind of new employee must it bring aboard.
But when you look at an organization’s core competencies as its most valuable resources, you can begin to think of learning, creating strategy, and innovation as parts of a single long journey. The journey is iterative, interactive, and full of small steps. Nobody gets a big aha one day. Instead, there is searching; there are missteps, experiments, and doubt.
For all of these reasons, it takes time to develop a new idea. If you are a writer, like me, then what you write on any given day may be only a fragment of what you know or what you believe, because you may not be ready to write down everything you have to say. There are breakthroughs, but they happen over a long period of time.
- Art Kleiner is the editor-in-chief of strategy+business and the author of The Age of Heretics (2nd ed., Jossey-Bass, 2008).