LinkedIn Cofounder Reid Hoffman on Innovating for an Uncertain Future

0:01This episode is brought to you by Google Chrome. You think you know a browser, but Gemini and Chrome? That's new. It can help you with practically anything on the web, like restoring a vintage motorcycle from a 50-page restoration block, or finally break down that long article you've had open for weeks. Gemini and Chrome is here for it. Ready to make anything online make sense? There's no place like Chrome. Check responses set up required, compatibility and availability varies 18+. hey Chicago class it up with Crocs you know back to school is coming in fast so why wait to find your new fave footwear step into a local Crocs store and step into your new look try it style it make it yours because the right pair doesn't just show up it shows off first day fits handled Walk out ready for whatever's next.

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1:09Welcome to Harvard Business Review's The New World of Work. I'm Adi Ignatius, Editor-in-Chief of HBR. And each week in the show, we talk to a top-tier CEO about this new world of work that we are defining. And we really talk about all aspects of it. We have a great guest this week, but before I introduce him, I just want to give a quick shout-out to our sponsor. And that's Unisys. Unisys is an IT company that builds critical solutions trusted by demanding businesses and governments around the world. They partner with clients to enable cloud transformation, protect critical operations, and empower the modern workforce.

1:45Visit unisys.com to learn more. All right, so our guest this week is Reid Hoffman. Reid is an entrepreneur, an author, a venture capitalist, a podcaster. He's probably best known as the co-founder in 2002 of LinkedIn and was its first CEO. Full disclosure, we are on LinkedIn right now if you are watching us live. He's served on the boards of many companies, including currently Microsoft. He's now partner at the venture capital firm Greylock Partners, and he hosts the popular podcast Masters of Scale. So, Reid, welcome to the show. Awesome to be here. Great to see you. So, how does it feel appearing on the platform that you yourself created?

2:26I mean, this is probably the definition of a metaverse. Well, it is a definition of a metaverse insofar as people are like, oh, this metaverse is a new thing. but we've already experienced it. We've already been in it. The internet's a fortune of the metaverse. You know, Steamyard and Teams and Zoom are part of the metaverse. And so we're actually in the metaverse. And, you know, obviously, because the entire idea with kind of LinkedIn is how do you empower people to be, to take as much, you know, direction and intentionality and iteration and opportunity in their professional careers, obviously doing this on LinkedIn is awesome from my perspective.

3:01So I'm always delighted to, and actually, you know, we should do more of this. You and I have talked over the years, and there's a bunch of stuff that you think about, and you're the super thoughtful person. So whether it's LinkedIn or others, that'd be awesome. Yeah. Well, that's great. I'd love to do more. And just for people who are wrestling with the definition of metaverse, this is actually not the metaverse. This is meta, but it's not metaverse. But maybe we'll talk more specifically about the metaverse and possibilities, because I know we've already gotten some audience questions about that.

3:33And by the way, if you want to raise a question that I can ask, read, type it into the comment box. We'll try to get to a bunch of these along the way. But a lot of the questions that I have and that people who are watching have are about innovation. And you've been involved in a number of companies that have been super creative, super innovative, and have scaled, which is you've written the book about how to scale. I guess my question is, you know, tell us something about innovation that we don't know that might be of use to our audience. Always a great question. That's kind of where is the unique thing.

4:08Let me start with something that probably a number of people know, but then move to maybe things that are a little bit more esoteric or more, you know, side, you know, kind of subtle. The first one is there is no innovation without risk. And so you can't have, you know, frequently what happens in these kind of things is, oh, I'll take an innovation and it'll just work. And obviously there's ways you try to be innovative in risk intelligent ways. You try to maximize the chance that it will work. You try to minimize the cost of it not working. You try to have some things where if it didn't work, it still works in some kind of viable way of making it work.

4:46But literally if you don't think – if you're doing – you're trying to be innovative and you don't see the risk in what you're doing, either you're not being innovative. This episode is brought to you by Google Chrome. You think you know a browser, but Gemini and Chrome, that's new. It can help you with practically anything on the web, like restoring a vintage motorcycle from a 50-page restoration block, or finally break down that long article you've had open for weeks. Gemini and Chrome is here for it. Ready to make anything online make sense? There's no place like Chrome. Check responses set up required, compatibility and availability varies 18+.

5:22hey Chicago class it up with Crocs you know back to school is coming in fast so why wait to find your new fave footwear step into a local Crocs store and step into your new look try it style it make it yours because the right pair doesn't just show up it shows off first day fits handled Walk out ready for whatever's next. Visit your nearest Crock store today. You're being blind to the risk or maybe it's just not that interesting. And so that's one. Now, the more subtle ways of thinking about kind of innovation are kind of like, okay, so which innovations may have an interesting chance to work?

6:09And this is actually one of the things where you have to intersect a number of different things. So typically, of course, again, people will think, hey, what are the platform changes? Is the metaverse change? Is it an AI change? Is it a cloud change? Is it the ongoing mobile change, et cetera? And how does that lead to what the changes are in the thing that I'm working in? And how does that play to our product or service? How does it play to our supply chain? Or how does that play to how do we work? And then asking a whole set of questions around these things are generally how you can lead to innovations.

6:36But then you want to begin to say, okay, it's this combination of, yes, I've got a good idea. I might be kind of adjusting to a meme that people are talking about. But I'm also thinking about in concrete terms about like how does our product or service work? How does our company work? because you could say, well, there's like a classic one and it's kind of like metaverse is a very common one, which is part of the reason I actually answered in a kind of a direct way of saying, actually, in fact, we're already in part of the metaverse because people being clear about what is that metaverse. So like, is it, oh, we're all gonna be in body suits with a head camera on and that's how everything is gonna work now.

7:18And it's gonna be all like ready player one, but everything else. And I think there's, once you begin to really think about that, you realize that that future is not near term to us. And that actually, in fact, the more interesting thing when you're looking at patterns of innovation are what's happening in the next three, five, ten years. And this is actually, I think, probably the last point I'll make on the innovation is thinking about timeframes is actually really important. Timeframes for when is a platform change happening, timeframes and how can you execute on things and what is that intersection?

7:49And not every time you have a good idea, if you're not throwing out some of your good ideas, then you're probably also not being discerning enough to say, OK, yeah, I had this really good idea about how to use video, but it doesn't really fit within the timeframes. And so I'm going to do something else. And so those are some I'm happy to go in depth in any of these, but those are some kind of, you know, Jackson Pollock throwing paint on a canvas on innovation. Yeah, no, those are all great points. And actually, I'm going to there's an audience question that really built on this. I'm going to go to that right away.

8:19And this is from Alex in London, which is, you know, How do you scale innovation where the profitability of your legacy products can get in the way of kind of innovation and R &D? Well, it's a classic problem. You know, obviously, the innovator's dilemma is usually the way this is historically described, you know, Clay Christensen. And the short answer is, is it takes some leadership and it takes some grits in order to do it. And usually what you want to be able to do is you want to say, hey, if we're going to be innovatively disruptive, we want to do it to ourselves. And so you start you start doing that process.

9:02You'll get organizational tension because your whole organization will be around your legacy product. You'll be still in a place where you say, you know, businesses are about tuning efficiency. And so this part of the reason why you have like HBR and you have, you know, business schools. It's like, how do you reliably put in a dollar and get out two dollars or five dollars or, you know, and it's like. The legacy business will clearly do that. Whereas the new thing is like, well, wait a minute. Are we taking that away? Are we destroying ourselves? Would someone else do it if we didn't do it, et cetera?

9:29And the answer is you have to start trying to do it. It's one of the reasons why I think one of the things that is a practice that the disruptive part of the management of companies in Silicon Valley is you always do some red teaming. You always say, how would an innovator come after us? Okay, can we experiment with that? Can we own that channel? Can we be?

10:18Hey Chicago, class it up with Crocs. You know back to school is coming in fast. So why wait to find your new fave footwear? Step into a local Crocs store and step into your new look. Try it, style it, make it yours. Because the right pair doesn't just show up, it shows off. First day fits, handled. Walk out ready for whatever's next. Visit your nearest Crocs store today. Doing whatever the disruption is, the platform, the lower cost of product or service, because the innovators, Clay Christensen, was classically studied very much on hard drives and kind of cost of that. And we'd be doing that and making that happen.

11:02But without leadership, that can't happen. And the leadership ultimately comes from the CEO and the executives who say, we need to be doing this. And a lot of times, unfortunately, this is when leaders are acting like owners are not, and owners of the future in decades or so forth. It's like, well, if I don't have to do this innovation and then I can hand it off to the next generation, that's frequently where companies can get into trouble because they haven't been taking the risks and making the efforts on the new products. So I'm going to do one more innovation question. You're kind of an innovation guy.

11:37So I'm going to pepper you with one more innovation question. And this is actually from Steve Koepp in Brooklyn. So it's really about innovation opportunities that have maybe been created by the pandemic. I mean, as he puts it, as startups aim to solve problems for employers adapting to long-term distributed work, in what areas do you see promising opportunities in HR and tech and whatever? So there's a couple of places where restructurally you should look at the opportunities. So one is, you know, the kind of the classic aphorism, never waste a good crisis. You know, in this kind of thing, it's like, look, everything's volatile, it's been shaken up some, trying to predict where it's going in this volatility and skating to where the puck is going, not where it is, but where it's going.

12:24Some of that is to say, look, we're accelerating our digital transformation. It was one of the things that, you know, kind of Satya Nadella said very early in the pandemic is, you know, each month we're seeing a year of acceleration of the digital transformation. And I think that's continuing to be the case and say, okay, well, given that, how is the, how are, how are, how's the market condition, customers, individuals, et cetera, to this digital transformation? Where is that going to be heading? How do I get there in that, in the kind of the timeframe of what am I doing? And I think that that, you know, and obviously, you know, some areas that are obvious is, you know, things where we're now all conditioned a lot more to doing work through, you know, kind of Teams and Zoom for this kind of thing.

13:06How do we make that work? What's the iteration of that? When you think about HR and kind of things like, okay, how do we build, you know, company building, team building, trust building, culture building? How does all that happen now that you've got some, wherever it actually ends up, you have some more distributed, some video work and workforce and some more distributed team and some more distributed work processes. You know, how does that all work out? And those, I think we've seen, obviously, some great innovations and some great acceleration. But, you know, it's usually in this tech stuff is people tend to call it to the new thing too early.

13:42Like, oh, OK, we're still in the mobile revolution. We're still in the cloud revolution. We're still in the pandemic and shared collaboration of the fact that we are in this collaborative environment from distributed locations. And so you say, well, Zoom's obvious. But then what else might make a difference? Well, like, you know, products like Coda, where you say, well, okay, you're redesigning your workflow for how you would want to work. And it's a platform for internet, you know, kind of collaborative workflow in terms of how you do it. That would be an example. And things like that are the things where you start thinking, okay, I'm looking out for how does this digital transformation accelerate in terms of what's going.

14:22So part of what you just said is that we don't quite know where we are and where we're going. On the other hand, we have to decide how we're organizing ourselves for work. And, you know, this question is probably it's more about it's more biased than science. But, you know, what's your sense? Do people do we need to be, you know, is the default to try to get as many people back into the office together to collaborate, to create and sustain? This episode is brought to you by Google Chrome. You think you know a browser, but Gemini and Chrome, that's new. It can help you with practically anything on the web, like restoring a vintage motorcycle from a 50-page restoration block, or finally break down that long article you've had open for weeks.

15:03Gemini and Chrome is here for it. Ready to make anything online make sense? There's no place like Chrome. Check responses set up required, compatibility and availability varies 18+. Hey, Chicago. Class it up with Crocs. You know back to school is coming in fast. So why wait to find your new fave footwear? Step into a local croc store and step into your new look. Try it. Style it. Make it yours. Because the right pair doesn't just show up. It shows off. First day fits, handled. Walk out ready for whatever's next. Visit your nearest croc store today. Culture or is that, do you think, an outdated notion at this point?

15:47So I think all of the reasons why we have gathered in cities, in companies, in other kinds of collaborative work environments, those reasons still persist. And it isn't 100%. There's some percentage of people who are like, oh, my God, I'm undistracted by meetings, and I'm allowed to sit in my home office and do some stuff, and I'm so much more productive. And there are some people who are much more productive that way. And by the way, part of it is recognizing who those people are and how you work with them. And now we've got this exposure. How do we make this blended environment work? And so I think that there will be persistence and learnings from this kind of distributed work.

16:27On the other hand, I think there's a higher percentage of people who get energy from being in the room with each other who, like I can tell my level of creative problem solving is better when I'm in the room, you know, with a whiteboard or something else and kind of working on it and kind of riffing than I am on Zoom or on Teams. It's just I'm not terrible and I can make it work. And obviously the last two years, that's what we've been doing. But I've already kind of, you know, now, you know, vaccinated and tested, you know, done some of this stuff where you're in the room and it's in it and the pace and the on targetness and everything else because time always matters in these coefficients is good.

17:06And I think all of that kind of thing will, generally speaking, lead people back in the room. And I think part of it is they say, well, but wait a minute, it's working well now. And you're like, well, it's working well now when it's been everyone distributed. But then once you begin to re-aggregate, you know, the Hamiltonian phrase of being in the room where it happens is like, well, actually, in fact, a key discussion was had at the water cooler or at the cafeteria where you were having a coffee together or a key thing was, you know, kind of in a walking out of that meeting was like, you know, oh, I thought about this during the meeting.

17:38And that's part of the reason why then people say, well, we need to aggregate. And that's a natural way that we tend to operate. And I think that that will generally happen across all the things. Now, my advice to leaders is not to overly force it because obviously people want to see in their leaders that they care about my work style, my productivity, my happiness, my health. And so they don't wanna be like, you're saying you're fine being at home, get your ass back in the office. And it's like, no, no, no. Look, what we care about is how we work really well together and how you and the team both really work well together.

18:12And that's the thing we're focusing on. And I think that will naturally end up with people broadly back in collaborative circumstances, even though you'll see lots of innovations. Maybe it'll be like Tuesday or each group chooses its work at home day or the no meeting day, kind of off the Toby Lutka, kind of Shopify. some of how they operate, which you can hear on the Masters of Scale podcast. And so those kinds of things, I think, will persist and continue. Excellent plug for the Masters of Scale podcast, by the way. Thank you. So a couple weeks ago, we had Sandy Spiker, the CEO of IDEO, on the show.

18:52We were talking about some of the same stuff, and she was saying, what they're trying to figure out is being physically present shouldn't feel like a punishment or a mere requirement, that there has to be a pull factor beyond. I mean, everything you may say about collaboration, about the whiteboard, about the water cooler may be true, but not everyone's going to buy it, and it's hard to actually prove it. So they're trying to think really, so what's the pull factor, whether it's food, whether it's hackathons, whether it's dance parties, I mean, just something where you need to be physically there, and there's a pull.

19:23There's something fun and attractive or valuable to being in the same room. So I think the pull factor is a great idea. And I think it's important to do. And it's part of showing that, like, we care about it. We're not mandating. It isn't like, you know, you're a cog in our machine and your cog needs to be here. It's like, no, we're organic. We're a team. We... This episode is brought to you by Google Chrome. You think you know a browser, but Gemini and Chrome, that's new. It can help you with practically anything on the web, like restoring a vintage motorcycle from a 50-page restoration block, or finally break down that long article you've had open for weeks.

19:59Gemini and Chrome is here for it. Ready to make anything online make sense? There's no place like Chrome. Check responses set up required. Compatibility and availability varies 18+. Hey, Chicago. Class it up with Crocs. You know back to school is coming in fast. So why wait to find your new fave footwear? Step into a local Crocs store and step into your new look. Try it. Style it. Make it yours. Because the right pair doesn't just show up. It shows off. First day fits, handled. Walk out ready for whatever's next. Visit your nearest Crock store today. We play together and so forth and we work together.

20:42And I think food and kind of coffee and other kinds of things are a really excellent way of doing that. I think that my general nudge for folks is to do things that align to the work and to the intersection. so it it might be it isn't just like oh the entertainment's here or the or the or the or the exercise class or the gym is here um i think it might be um you know things like um you know kind of um you know like okay so when we're working together we have all of these things that make the our work and collaboration more easy and together like for example if your meeting room has a bunch of things that make all of that meeting much more, you know, kind of easy and fun.

21:32Like you could say, well, blending them together is like, say, for example, you put Nespresso machines in every meeting room, and then you had, you know, kind of post-it whiteboards and things, and you had some like, you know, here, like we were asking about innovation, like here are some good meeting prompts and questions and things to do. And obviously, you can put those up in your, you know, collaborative working environments online too, but things that kind of align more to the intersection between the work and the projects you're doing and the way that you're being effective there and making it more fun and being more present with each other.

22:02And I think those are the kinds of places to hunt for the pull factors and then look for the ones that are also unique to your culture. So I want to shift gears and talk a little bit about the role of business in society. You know, I know that you, you know, you're a fairly activist business person yourself. So I guess my question is, more and more people are asking businesses to weigh in and even help solve seemingly intractable social problems. I guess the question is, is that, in fact, the role of business? And if it is, how can business play that role effectively and not spread themselves thinly and not really make a difference?

22:47It's a great question. I think the short answer is employees, customers, even investors, although investors tend to be more like just, hey, what's the equity value, et cetera, care more and more about kind of what your impact in society is. And it's helpful to your business across a number of frames to be leaders in this. And then you say, well, how do you not just say, well, okay, everyone's climate change. We're all going to need climate change. We're all going to be sustainable. And by the way, climate change, obviously a big one. And saying something about what you're doing to important current zeitgeists and massive important phenomena like climate change is really important.

23:35But what you do is you think, well, what's the mission of my business? And what is the thing that my business is really trying to do? and how do I invest in that in order to make a very big difference? And that's where you put your real dollars. And part of how to look at it is you're, to some degree, that efficiency we talked about businesses earlier is businesses are platforms. So, like, if you took LinkedIn and you say, like, what kinds of things can LinkedIn do with a dollar that is differentially applied to things that make a big difference in society? If you said, well, you know, what we should do is we should be investing in carbon capture in the oceans, not radio centers and so on that we could do, but like there's something like, you know, something like that.

24:14It's like, well, we don't have the platform for that. Similarly, like if we were launching a business and we were saying, hey, LinkedIn should launch an apparel business. Like, well, we don't have a platform for that. We will be terrible. We'll be really inefficient. On the other hand, what LinkedIn is really good at is how do you help like reskilling? How do you elevate talent? How do you do things like that? And you say, well, okay, so what are the ways that LinkedIn should be philanthropic? And you say, well, actually, in fact, we say, look, well, you have this big thing where part of the thing that's really important to society is, you know, kind of diversity inclusion with new skill sets and so on.

24:47So we should have, you know, kind of projects for that, for the kind of skill platform we have. We should take things like, and, you know, LinkedIn's been doing this for, you know, 15 plus years, you know, veterans and kind of applying their skill sets into the workforce and society. We should be working with cities. We have this LinkedIn Cities project, which is what are the industries and the skills of the future that are relevant to the kind of city regions? And how do we help cities invest intelligently in that to help their citizens and help their industries kind of navigate that? Because we have kind of data and perspective and other kinds of things that can help with that.