Todd Zenger

Todd Zenger Q&A: Entrepreneurship is Value Creation

Todd Zenger is an accomplished academic, currently serving as the chair of the Department of Entrepreneurship and Strategy at the David Eccles School of Business at the University of Utah and presidential professor of strategy and strategic leadership. With degrees from Stanford University and UCLA, Zenger is an expert in the field of strategy, entrepreneurship and organizational design. He is widely published in leading academic journals and has consulted many high-profile clients, including Boeing and Hewlett Packard. Zenger’s research interests include the process of value creation, organizational design, and the role of strategic leaders in both identifying and solving problems.

How did you arrive in Utah?

Zenger:  After 24 years at Washington University in St. Louis, I decided to move west and join the challenge of building a top entrepreneurship and strategy group at the University of Utah.

What interested you about entrepreneurship and strategy? When did you discover your passion?

Zenger: I began exploring how small, entrepreneurial firms out-innovate large, established firms as a graduate student at UCLA, and have continued this as one line of my research ever since.

More recent work explores how entrepreneurs create breakthrough value, suggesting that successful entrepreneurs are analogous to scientists. They identify unsolved problems. They compose theories about how the world operates and then using these theories, they generate hypotheses and experiments about how to test them.

My academic colleagues across campus engage in a very similar process: they develop a theory about how the world works — one that solves a problem they have identified, and then they perhaps run experiments to test the theory. Much of the narrative in the entrepreneurship literature is about running ten thousand experiments, and simply: do do do. That seems a bit foolish for all of the reasons that it would be foolish for me to tell my colleagues in the biology, chemistry or engineering departments to just run a bunch of experiments and see what happens. You need to think about your role as someone who sees a problem, develops a unique hypothesis about solving it, and then runs the experiments to test that hypothesis.

That’s the path to introducing value. Entrepreneurship certainly has randomness associated with it, but that’s true across campus as well — there’s all kind of serendipitous outcomes. My advice is not to maximize serendipity, but to get really good at framing problems and composing theories.

I’ve heard that entrepreneurship is best learned practically, through that “do, do, do process,” so why get a degree in entrepreneurship?

Zenger: In my mind, it’s a little bit like asking, “Why is it useful to understand the theory behind art, why not just go and start fingerpainting?” The answer is, you do need to just do it, but there are some things that you can teach and learn that are useful. There are a lot of schools that I think buy into that idea completely: entrepreneurship is all about doing, so we’re just going to create an environment in which you can do stuff. One of the unique perspectives that we take here, is that entrepreneurship is also a way of thinking. You can teach people to find problems and to be more effective in solving those problems, and being able to help them understand the world in a much broader sense. And then there are other practical kinds of skills, like how do you test an idea? Analytical skills, how do you market a product or service, how do you manage finances, and all kind of practical skills. There’s some theory behind navigating those practical skills that you can develop.

And that’s the benefit of academic entrepreneurship, that you learn those skills?

Zenger: That’s what we try to push in the class. Ideally, we are trying to couple some of this theoretical approach with tools about how to run experiments, including marketing tools and finance tools. Then there is the Foundry course that is really about execution: how can you be a really good testing your idea, how do you structure your life, get peer feedback? This is a very  hands-on, how you actually do this stuff type of course. These are vital skills that are actually applicable to not just entrepreneurship, but everywhere.

So, what definition do you attach to the ambiguous term of “entrepreneur”? Is it always in flux?

Zenger: Many define it as somebody who starts their own business, and manages it, but I think the skills of being an effective entrepreneur involve all of what we’ve talked about. It means being a value creator in whatever setting you find yourself. Such skills have universal application, and everywhere from large corporations to art studios are looking for people who are really good at framing problems, at solving problems, who can manage their lives effectively, who can understand and apply analytics, who can test their hypotheses. What organizations want are entrepreneurs, or at least individuals with this kind of entrepreneurial flair. In many business school classes, you’re dealing with cases, simulated worlds that you can process and think about how to manipulate, which is partly doing, but is a far cry from what you could do at Lassonde.

What do you want to see out of the Department of Entrepreneurship and Strategy?

Zenger: I would love for much of the campus to engage around our introductory entrepreneurship courses that are really focused on what it means to be a value creator in whatever setting you find yourself. For those who want to develop skills that will help them move an idea forward toward testing, marketing, and financing, we aim to provide these skills, as well.

Our market for entrepreneurship courses is not merely our business students. What’s true here like most universities is that entrepreneurship is a campus-wide initiative.  Here it happens to be staffed and supported through the business school.  But our aim is to make entrepreneurship classes accessible and applicable across campus.

Whatever you do, it’d be great to take an entrepreneurship class so that you understand what value creation is about; it’s a universal principle, whether you’re trying to run a political campaign or a dance studio or create art or you’re building video games or you’re writing a novel, I suppose.  In all cases, you have think about the problem you’re trying to solve, the opportunity you see, and how you create something out of it. Having people think about value creation in an entrepreneurial language is useful. That’s one of the things we’re trying to do, create courses that are accessible and interesting and that can appeal to anyone across campus.

Anything else you want to mention?

Zenger: We are committed to a real partnership with the Lassonde Institute and Lassonde Studios, and we’re trying to have these courses be tightly integrated with what goes on at Lassonde, so those who really do have an idea about what entrepreneurial venture they want to pursue that they could certainly step through courses and see how that idea can become real, how they can use and apply their skills, but also use a bunch of complementary resources that emerge through Lassonde, whether it be financial resources or equipment or it could be seminars and coaching.

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