Loonshots – Page 1 LOONSHOTS How to Nurture the Crazy Ideas That Win Wars, Cure Diseases, and Transform Industries SAFI BAHCALL SAFI BAHCALL is a physicist and biotech entrepreneur. He is a graduate of Harvard University and Stanford University. He worked for three years as a McKinsey consultant and then co-founded Synta Pharmaceutical Corp., a biotechnology company developing new drugs for cancer treatment. After taking Synta public, Safi Bahcall served for thirteen years as its CEO until 2014. He now works as a consultant and author. He has won several awards in the biotechnology field and at one time worked with the council of science advisors formed by the Obama administration. The author's website is at: www.bahcall.com. ISBN 978-1-77544-967-6 SUMMARIES.COM is a lifetime learning company specializing in business smarts. We provide concise information and tools for salespeople, business owners and managers and entrepreneurs to get ahead. Read less, do more. www.summaries.com Loonshots – Page 1 MAIN IDEA How do you consistently come up with "loonshots" – Four rules for nurturing loonshots the crazy big ideas that change the world but which 1 Separate the phases most scientific and/or business leaders think won't work at first? 2 Create a dynamic equilibrium 3 Spread a system mindset 4 Create critical mass What exactly is a loonshot? ....................................... Page 2 The most important breakthroughs never come fully formed. Instead, they are typically fragile ideas which readily get dismissed as crazy. If you're not careful, you can bury them and forget them which can be a big mistake. Loonshots can change the world. Rule #1 – Separate the phases The most important breakthroughs in any field are ...................................... Page 3 almost always the ideas which challenge People who are responsible for developing your high-risk early-stage ideas are like conventional wisdom and therefore are most likely artists. You have to separate them from the soldiers who are responsible for the to be shot down at first. That's because they often already-successful steady-growth parts of your organization. You have to create a start on the lunatic fringe before they reach nursery where loonshots can grow, flourish and shed their warts. mainstream credibility. They challenge conventional wisdom and have effects that are Rule #2 – Create a dynamic equilibrium................................. Page 4 impossible to predict or forecast. Loonshots are You have to maintain a healthy balance between your artists and your soldiers. Both are disruptive but that usually only becomes obvious in important to the long-term future of your firm. Have equal-opportunity respect and provide hindsight. both with the tools and resources they need to win. Focus on managing the transfer of So how do you spark more loonshots? Set up a new ideas between loonshots and franchises. nursery and let lots of loonshots take seed and grow. Then let the best ideas take on a life of their Rule #3 – Spread a system mindset ................................... Page 5 own rather than deliberately trying to pick the winners yourself. Act more like a gardener and less Keep asking why your organization makes the choices it does. Analyze both your like judge and jury. Also never lose sight of the fact success and your failures and ask how your decision-making process can be improved in loonshots can change the world for the better so get the future. Analyze the quality of decisions, not just the quality of eventual outcomes. onboard for the ride. Rule #4 – Create critical mass "A loonshot challenges conventional wisdom. ...................................... Page 6 Whether a change is “disruptive” or not, on the other You have to make it possible for loonshots to attract enough resources to reach critical hand, refers to the effects of an invention on a mass. That often means getting more people involved. To bring more people onto market. Loonshots flourish in loonshot nurseries, projects successfully, you have to reduce the return on politics and increase the fit of not in empires devoted to franchises. Being good at incentives. If you can do this, you then are in position to bring a gun to a knife fight. loonshots and good at franchises are phases of an organization. That’s what the science of How to champion a loonshot .................................... Pages7-8 emergence tells us." – Safi Bahcall If you are called on to champion a loonshot, take heart from the fact loonshots always flourish in a loonshot nursery and not in empires dedicated to established franchises. Nurture your loonshots and use them to test established beliefs. Use disruptive innovation to move forward boldly into the future. It can be done. Loonshots – Page 2 As they did their research, they discovered the US Navy So how did Bush and the OSRD manage to nurture so had in fact been sitting on an idea first discovered in many loonshots? It was widely acknowledged at the end What exactly is a loonshot? 1922 for "radio wave interference" which provided a of the war the OSRD had certainly shortened the war working model for how a microwave radar could and made victory for the Allies possible. There was operate. The Navy had never progressed the idea considerable pressure to come up with a national plan because it would take too long to develop and there was for supporting science and the OSRD would morphed not any funding available for untried ideas. into DARPA (Defense Advanced Research Projects The most important breakthroughs never come fully Agency ). DARPA would eventually give to the world formed. Instead, they are typically fragile ideas which By 1943 Loomis and his team of scientists had a technologies like GPS, personal computers, the readily get dismissed as crazy. If you're not careful, you microwave radar installed in an Air Force B-24 bomber biotechnology industry, carbon nanotubes, drones, the can bury them and forget them which can be a big for testing. When a convoy of ships crossing the Atlantic internet, pacemakers, artificial hearts, magnetic mistake. Loonshots can change the world. were attacked by German submarines, the B-24 crew using the new microwave radar prototype were quickly resonance imaging, chemotherapy and more. It has able to locate the subs and attack them with depth been conservatively estimated that DARPA has At the outbreak of the Second World War, the odds charges and guns. In May 1943 alone the Allies sunk 41 generated roughly half of the trillions of dollars which would have favored Nazi Germany by a substantial German U-boats using the new radar which was more have been added to the GDP of the United States of margin. As the war progressed, Germany was unable to than had been sunk in the first three years of the war America since the end of World War II. bomb Britain into submission so it was decided U-boats combined. Within three months, Allied shipping losses Vannevar Bush would later team up with Theodore Vail would be used to cut off supplies flowing into Britain from decreased by 95 percent and the German High who had been appointed as CEO of AT&T in 1907 when the United States. In 1941, 4.3 million tons of cargo were Command withdrew the U-boats from the Atlantic. That, a banking group led by J.P. Morgan took control of the sunk and Allied shipping losses reached 7.8 million tons in turn, meant the United States could then send enough company. Vail established Bell Telephone Laboratories in 1942. Radar had been developed and used in the equipment to Britain for the Allies to ultimately launch to work on fundamental research. It was essentially a Battle of Britain by that time but it was still too big and the invasion of Europe. department where loonshots run by loons were allowed bulky to install on ships or planes. to explore radical ideas that were not necessarily related Fortunately just before World War II had broken out, "Radar had a far greater impact on the course of the war to current products. Over the next 50 years, Bell Labs Vannevar Bush, dean of engineering at MIT, had than is usually appreciated, extending well beyond the would produce the transistor, solar cells, CCD chips approached President Franklin Roosevelt and pointed battle with the U-boats. Radar sighting from planes (now used in digital cameras), lasers, the C out the US military's approach was always to make more allowed the Allies to destroy enemy supplies, bridges, programming language and eight Nobel Prizes. Bush guns rather than to try and figure out how to make better and transport with targeted bombing raids day and night, also worked closely with Frank Jewett who was a Vail weapons. Bush proposed setting up a science and regardless of weather. Radar-controlled antiaircraft protege and president of Bell Labs. technology group within the federal government to guns were essential to defending aircraft carriers, which explore new technologies that would be critical to created a decisive advantage in the Pacific War." "Although neither Bush nor FDR could have foreseen winning the coming war. Roosevelt agreed and the – Safi Bahcall the growth that would be created from “profitably Office of Scientific Research and Development (OSRD) employing” Bush’s ideas in times of peace, both did As impressive as its success with radar was, Bush's have practical business experience. Bush’s system, in was established. Vannebar Bush headed up the OSRD OSRD also pioneered blood plasma transmissions and he set about exploring all the longshot ideas and fact, came from the business world. Bush recognized which saved thousands of lives in the battlefield. The that the big ideas—the breakthroughs that change the unproven technologies which the military were unwilling OSRD also did work on penicillin, malaria and tetanus to fund.