The world’s most respected business professor, Clayton Christensen and the co-author of their new book Efosa Ojomo share about the Prosperity Paradox and how innovation can lift nations out of poverty.
Book: The Prosperity Paradox
Show Introduction –
NOTABLE QUOTABLE – “In your life, there are going to be constant demands for your time and attention. How are you going to decide which of those demands gets resources? The trap many people fall into is to allocate their time to whoever screams loudest, and their talent to whatever offers them the fastest reward. That’s a dangerous way to build a strategy.” – Clayton M. Christensen, How Will You Measure Your Life?
Wanting to research conducted by the renowned Harvard Business School Professor Clayton Christensen, more than $750 million people still live in extreme poverty today, surviving on less than $1 and ninety cents per day. So why does Clayton Christensen spend his time thinking about this problem? After all, this guy was on the cover of Forbes magazine in 2011. In fact, in the story Forbes wrote, every business leader calls makes the pilgrimage to his office in Boston, Massachusetts to get advice or to thank him for his ideas. Think about it. So why in the world with this choose to invest his time to focus on the people who can’t help themselves? It’s the same reason Clayton Christensen decided to mentor folks our job as one of his standout students in a cohort of his new bestselling book. The prosperity paradox. The professor believes that mentorship, helping others, Clayton Christensen, believes in being part of the solution and not just talking about the problem.
And now, after having conducted copious amounts of research, the professor now believes that he has power and practical strategies and solutions that will help to end the world’s poverty trauma. Today’s guest is not a delusional optimist. Today’s guest is a practical, real white, just the age of 58. Today’s guests beat a heart attack, cancer, and stroke to survive. To be here on today’s show, and I cannot tell you how honored I am to have him here on today’s show. Harvard is the world’s number one business school and he is the number one professor at the Harvard Business School. And I have no talent. Don’t have a degree.
All right. Thrive nation. Welcome back to another starting condition of the thrive time. I’m show on your radio and podcast download. And on today’s show, I am super excited to be interviewing today’s guests because a good friend of mine, by the name of Patel once started a company called digital tutors and that company became a massive online education company that he later sold and told me, he said, Clay Clark, the one book that you need to read, Mr Clayton Clark is a book written by Clayton Christianson called the innovator’s dilemma. And I thought to myself, what is that and who is that? And living in Tulsa, Oklahoma. I wasn’t super familiar with Mr. Christensen. Turns out he was on the cover of Forbes in 2011 and he’s sort of a big deal. So Ladies and gentlemen, it is my pleasure to introduce to you Mr Clayton Christianson and his good friend Efosa Ojomo, Professor Clayton, any Fossa? How are you
Now my understanding is that you met Mr Christiansen, um, while, uh, actually attending one of his classes on the campus of Harvard University. Tell us how you guys first met and how that course changed your life.
So I met Professor Clayton Christensen at hbs files, taking a second-year course called building and sustaining a successful enterprise. It’s the most popular course at the business school and an oversubscribed. I was fortunate to get into his section, uh, because they were about seven or eight sections of that course taught by different professors. Um, and as, as, as, uh, we started the course and we’ll go through the semester. Um, I just realized how that was easily the most impactful course I took. While I would ask why, why would that hbs, um, the course starts by having the students read through different management theories and they use that theory as a lens to assess a particular case, right? A management decision now that the CEO or a cfo or a manager has in an organization. Um, and the theory essentially,
It is a tool that allows you a see the issues more saliently. Um, and so in that course, professing Christians and lets us know that he doesn’t want to hear our opinions, but the theory’s always have an opinion. And as I started to think about that, I realized is that using in the course have significant impact on how the economy can grow and develop. Um, and so it was just a very fascinating experience taking the course, learning about management, but also thinking outside of class, how that could have an impact on whole economies and how they can grow.
Mr. Professor Christensen and you guys now are writing a book, how did this book come about and how did your relationship come about?
Um, so, so after the semester, uh, there’s, uh, an opportunity for students to do a fellowship, um, with, with one of professing Christian student organizations at the business school. Um, and it’s, it’s, um, it’s really a great opportunity. So I applied for that fellowship and I started working with them and I remember the first day I walked into his office, I walked in, they’re nervous it with my folder and things I wanted to talk about. And the first thing he said was, you know, um, you know, I’ve been thinking a lot about this and I think we should write a book about prosperity and innovation and how the different kinds of innovations can really ignite prosperity. It happiest days of my life. And so I, I, um, I mean, you, you jumped at that opportunity, you don’t, you don’t shy away from it. So
just add one thing. What are the things that I was learning at the same time since I was teaching, I’m always learning something too, is I didn’t realize that if we’re looking into the future, here’s a problem in if God doesn’t provide students or faculty any information about the future. And so when we teach the students about how to be managers and we teach them how to use theory that our data were, if you were, we’re taking them in the wrong direction. And we realized little by little bit rather than teaching them about data, we need to teach our students about what is a theory and how it built. Because, uh, in. So maybe you could talk about the impact that theories have about looking into the future if you could. But anyway, it was a great opportunity for me to come to class everyday and listen to my students and Efosa Ojomo was one of the smartest I’ve ever had.
Yeah. Thanks clay. Um, but yeah, it’s, it’s true, right? When you think about it, we don’t have data about the future. I mean, every piece of data we have is something that’s fabricated by an individual, um, and it talks about the past and so the way that we can plan for the future and predict the future is by using good theories. And so, you know, professor Christian has, it has essentially designed his career around coming up and developing good theories that can help us predict the future a lot better. Um, and so that’s one of the most fascinating things about that course, about the research we do and about the book that we’ve written, a because the theory is a statement of causality and all of us, right? Regardless of what profession in where we are in life, we used theories every single day, right? Because we believe if I do, x, y is going to happen or why is likely to happen, and so that’s really how that course is designed and you can see how powerful it can be when you arm yourself with theories that could help you minimize the mistakes you make as you go through life.
Clayton Christensen, I want to share with you a funny story about causality. I was reading the innovator’s dilemma, the legendary book that you wrote and in that book you wrote in a startup company where there are no processes in place to get things done. Did everything that is done must be done by individual people. Resources. In this circumstance it would be risky to draft someone with no experience to do the job because in the absence of processes that guide people experienced, people need to lead, put in established companies where much of the guidance to employees as provided by processes and is less dependent upon managers with detailed hands on experience. Then it makes sense to hire or promote someone who needs to learn from experience. That changed my life because up until that point, I had been trying to teach people who had never been a disc jockey before, how to become world class entertainers through Osmosis, through memorization entered, teaching them all of these different scripts and systems and it would take forever.
I mean it would take years for me to get somebody to be just decent at Dj, but once I realized that I could scale my company, Dj Connection Dot Com, if I would simply take the time to script out the jokes and to script out the playlists and to build checklists and processes. It changed my life. It allowed me to nail it and then scale it. By the way, if the whole Harvard professor thing doesn’t work out, that’s a good fall back position for you to become a wedding dj. But I found myself drawing this company with no processes, no systems, and no concept of causality. And I’m reading this. I highlighted it over and over and I go, I thought to myself, I need to build systems. And as a small business owner, I didn’t even know these kinds of things existed. So, uh, I know a professor, clayton Christensen, you have absolutely changed my life in that regard and I’m so excited about your book, the Prosperity Paradox because it seems as though you guys are stumbling upon a way to help people all over the world just like me who grew up poor but in parts of the world where their standard of poor is significantly lower than my standard of poor.
I mean, I would be wealthy in some of these nations. Can you talk about the prosperity Paradox Book and what this concept is all about?
One of the reasons I came to Harvard business school was, was to figure out how businesses could really help people alleviate people in poor country to alleviate and live a more prosperous life. Before hbs, I started an organization called poverty stuff here. Um, and, and in that organization now, one of the things we focused on was building wells in poor communities. So we built about five or so wells, raised tens of thousands of dollars, but we found out virtually all of them broke down. And I, I, I realized, you know, there’s something wrong with our equation here. And how we’re trying to solve this problem. And so when I came to to Harvard and took professor Christian students course and started working with him, that’s when I really learned about the importance of theories. And as we started writing this book, we learned something that was, that was just fascinating. We learned that, uh, you essentially don’t fix poverty or get to prosperity by trying to fix all the visible signs of poverty. And so in a poor community, uh, there’s no water. We build a well, uh, in a, in a poor country, there is no education. We build schools and so on and so forth, right? We do all these things. And in our language we say you push these solutions in these communities. And often times they, they, they really don’t work. They end up sort of temporarily solving a problem, but they’re not sustainable. Now one thing we found is that, okay,
Instead of pushing these solutions into these countries, um, you can actually invest in a type of innovation that can create a market in these countries that pools all these solutions in. And that’s what we, uh, we, we essentially found to be the prosperity paradox. It’s that you don’t get to fixing poverty by trying to push the illusions that, that, that, that are, that you think can actually fix the problem. Instead you have to create a new market and make products simple and affordable so that people, um, once they have access to these products, the new market that gets created a pools in all these resources into the economy. And so it was a huge insight that we had and it’s very counterintuitive, but we think it has a lot of potentials to help people make much better decisions.
Professor Clay and in chapter one of the prosperity paradox you to right, according to the World Bank, more than $750 million people still live in extreme poverty surviving and less than a dollar 90 per day. We all want to help, but a professor, clay, where do most people get it wrong when it comes to the approach to helping these struggling countries and, and what, what is, what kind of solutions do you suggest in your new book?
There are two. Build a little bit on a foster’s work here. Um, there are two ways to become, to learn about building companies. One is you need to have resources like people and technology and products and knowledge. Then you need to have processes which is ways of working together to collectively get things done at the beginning of building your company. You have a lot of resources possibly, but you don’t have processes and those processes have to be developed as you built a company and there are particular, there’s a particular type of innovation that allows a new company to learn what they need to know. We call it a market creating innovation. Uh, they’re, they’re a lot of things that a company has to do to be successful that this particular type of innovation that transforms a product that historically it’s been historically so complicated and expensive that only the rich have access to it. A successful innovation market-creating innovation and enables a much larger population of people to have progressive with more and more sophisticated technology. And, uh, for example, uh, it’s also maybe you could tell our students about the singer sewing machine inherited and transformed America and I happened in elsewhere around the country.
Yeah, absolutely. And so, you know, there’s this thinking that America has always been a prosperous country, right? But it turns out that if you go back to the 18 hundreds, 18, fifties, America was really impoverished, more impoverished and many of the poorest countries today, um, but it was through market creating innovations that America was able to get a grip on prosperity and start to start to grow. And so I think singer, which is the entrepreneur that professor Christians just mentioned was around in the 18th and he essentially made the sewing machine, uh, so affordable and accessible that millions of people, uh, in, in America and in Europe or Russia could actually afford it. So at the time most Americans were very poor and they had one or two pieces of clothing. Now we took the average person, which is mostly women at the time, about 12 to 14 hours a day to sew a shirt or a piece of clothing.
Right? And it was quite expensive, but Isaac singer made this so in machines were really simple and affordable, and he created a business model that made it accessible to many more people who had early, historically could not even dream about owning a sewing machine. And so he innovated things like I’m a sales branch offices. Um, he, he developed the ability for people to purchase the sewing machine on credit. Uh, he developed a training program to train people how to use it. Uh, he developed an after sales service, a section of his company that went out and service the machines after they were there, were purchased a, he did extensive advertising and so professional.
It was remarkable how many people got jobs because this particular type of innovation make things affordable and accessible so that many more people can make and by diabetes. And it happened over and over again in America, a warranty, then a camera affordable. And Henry Ford made a car affordable. Steve make a computer affordable. And when you make it affordable and accessible, you have to go out and hire more people. And that’s the type of intervention which we call market, creating innovation that transforms and nation into prosperity. And so that’s why we wrote the book.
Forbes magazine once wrote there, they said that every business leader calls him professor collect a, they call it, they call them, they make the pilgrimage to his office in Boston to get advice or to thank him for ideas. So you obviously know that a professor clay is not a write books with just anybody. So you guys, I mean, this is a neat partnership, uh, a divinely appointed in my opinion. I mean, you guys, this is so exciting to see you too, uh, working, working together in, in, in, in the book that you guys are putting together here. Uh, the advanced copy that you sent me, there’s one part of the book that really stuck out to me and I highlighted it and I wanted to read it to you. And at first I wanted to see if you could break it down for me. It says, instead of seeing roughly 600 million people in Africa who don’t have electricity as only a sign of their immense poverty, we should see them as a vast market creation opportunity waiting to be captured. It should be a call to innovate. Not a flag of caution, my friend. I’d love for you to break down what you to mean by this statement.
The best way to break that down is by giving you a very tangible example, um, in, in our language, we would call all those people non-consumers of electricity, right? We would call them non-consumers right now. The example I’ll give you happened about 20 years ago, right? A similar thing happened with the lack of mobile phones in Africa, right? There were about two or three percent penetration of mobile phones on the continent with close to a billion people right now, an entrepreneur by the name of Abraham. I saw this opportunity and said, oh my gosh, these people have no access to communication, right? At least the way people do in it, in the US or Europe and so on. And I think there’s a great opportunity here to go and create a market to make mobile phone simple and affordable all across Africa. Now, all the people he told at the time said, you’re crazy.
That’s never gonna work because there’s poverty, uh, HIV and just talked about all the issues that he would face in building this cell phone market in Africa. Now he instead focused on the non consumption of mobile phones, uh, he focused on the struggle that these people had in their daily lives. They wanted to communicate with a friend or a parent that lived in the village. They would actually have to go there and sometimes it would take days to get there. And so he actually created in 1998, uh, Celtel accompanied by the name of Celtel and it was one of the first Pan African mobile phone companies, uh, on, on the continent. He made access to mobile phones, simple and affordable. And in about six, seven years, he was able to sell the company for about three point $4, billion dollars. He created thousands of jobs and actually had a mobile phone service available for a five plus million people in Mali, in the chair, in Sudan and in Democratic Republic of Congo, in a, in about seven or so African countries.
But here’s the really interesting thing. If you fast forward till today, now the mobile phone industry in Africa is not worth about $220 billion dollars. It’s adding about 20 or so billion dollars in tax revenues to the government annually and supports about 4 million jobs and so when we talk about market creating innovation, this is the kind of potential that it had when you looked at at an economy that doesn’t seem like anything is going on that’s devoid of opportunity, but if you create a new market by investing in market, creating innovations that make it simple and affordable, this is the kind of potential that you can uncover.
I want to ask you my final two questions I have for you guys. I’ll let you go first Fossa and then I’ll let a professor clay one op. You okay. That way the, the mentor can one up the mentee mentorship. We talked about it on the show all the time. We always talk about mentorship and the power of having a great mentor in your life. He fossa what kind of indifference or impact has professor clay made on your life directly?
So I think it’s really unpredictable to say at the moment. I mean, he, he has changed the trajectory of my life. I mean never in a wildest in my wildest dreams did I think I would get the opportunity to partner with. I’m a professor at Harvard Business School, much less clay Christiansen who is essentially a professors professor. Um, but then to write a book and coauthor a something that’s so near and dear to my heart with him has, has fundamentally changed my life, but I think as, as brilliant as Christians and is, I think what really gets me about him, Mrs. Humility. Um, and how every single day he just thinks about what can I give to the people around me and to the world to make it a better place?
How can I make a better guy? I think for me that’s the one thing that I take from just working with him and learning from him that has impacted my life so much.
Professor Clay, I have five kids who now get to see me on a regular basis because you taught me how to scale a company through a book, you know, scaling a wedding Dj Company through through the book. It’s unbelievable the impact that your writing has made on my life. And I just want to thank you for mentoring me remotely. It’s like you send a message out in a bottle and I happened to find it and I appreciate you so much and I just like to ask you sir, why do you continue to so passionately mentor great people like you Fossa when you could be, you know, hanging out in the hammock somewhere.
Well, I decided, uh, in a, in a way that many people never think about before and that is by the people who I could become better people. And uh, he, he’s given me an opportunity to do that. And I believe that everybody has been given an opportunity by God to help each other. And, uh, I just tried to think about how God thinks and how he made us better every day. And every once in awhile I come upon somebody like a Fossa God is able to post to fall forum in a way that, uh, is a two way street because everything I’ve learned, he learns and it’s a wonderful experience. So I, I, all I can say is I’m grateful to God for this opportunity.
Thank you so much for impacting my life. I’m a boy from Oklahoma, have never met you in person, didn’t really know Harvard business school even existed frankly, until somebody recommended it to me. And I just, I cannot tell you that the impact you’ve made on so many people just like me, small business owners all over the world, and the fact that you guys would take time out of your schedule to be here with us. He posts that you guys have so much going on. I encourage every listener out there. If you’re listening today, pick up a copy of the prosperity paradox today. Buy a copy and then buy one more coffee for someone you care about. This book is a game changer. Thank you two so much for being on today’s show.
There’s just something about Clay Christiansen that that blows my mind. I mean, this is a guy who is the most iconic, most well known, the most respected professor at the world’s number one business school, and yet he just thanked me. He just thanked us for the opportunity. That is the kind of person that I would love to become someday. He is truly a business hero for me and I don’t want to take any of the thunder away or the focus away from his newest book, the Prosperity Paradox, but I do want to share a notable quotable from one of his previous books called, how will you measure your life? How will you measure your life, and in that book he writes in your life, there are going to be constant demands for your time and attention. How are you going to decide which of those demands gets resources, Aka time?
The trap many people fall into is to allocate their time to whoever screams the loudest and their talent to whatever offers them the fastest reward. That’s a dangerous way to build a strategy. So thrive nation is an action item today I would ask you, I would ask you to do, do, do two action items for me to take two action steps for me today. One, buy a copy of the prosperity paradox by Clayton Christianson. This guy is 100 percent sold out to helping people all over the world. His book is powerful and I promise you that you are going to have countless knowledge bombs and epiphany’s as you turn the pages of that book. And also I would encourage you to ask yourself today, how are you allocating your time? How are you utilizing your time? If time is truly our most important resource, I mean we can always make more money, but we can’t make more time.
So if time is truly our most precious and finite resource, I think the most profound question we can all ask ourselves today is how are we spending our hour time? And just because somebody sent you a facebook message or sent you a linkedin invite or a Youtube Ping of some kind or a tweet to doesn’t mean you have to spend your day responding to those things and this in this digital age, it’s very easy to get our priorities all, all turned around and misaligned and it’s easy to focus on the most important thing last and then spend our day focused on the least important things because we’re getting them urgently. We’re getting updates pushed to our phone and maybe we need to turn those, push notifications off. Maybe we need to focus on things that matter. Maybe you should turn off those push notifications and to schedule some time to sit down and to read a book, a book that will impart wisdom into your life and to help you become a proactive person.
Maybe you need to turn off the push notifications and to invest time into building that business you’ve been talking about. Maybe this is your season to write that book you’ve been dreaming about. Maybe it’s your time, maybe. Maybe this is your year to be the family man. You’ve always wanted to be the family woman you’ve always wanted to be, but don’t drift because by default, I’ve never met somebody who’s become successful by drifting, by default, by just living a life without intention, and it’s been my intention to book Clayton Christensen on this podcast for nearly four years and it finally happened. I almost just want to drop the mic and say done, but I will see you tomorrow. Now, if any further, I do free to put poop.