Leading in Uncertain Times

Harvard “Lectures that Last” Series
Burden Auditorium, Harvard Business School
Boston, MA
February 23, 2017

Karen G. Mills
Senior Fellow, Harvard Business School and Former Administrator of the U.S. Small Business Administration

Good evening, and thank you so much for having me. I am Karen Mills and prior to my time at Harvard Business School, I had the honor of working for President Obama in his cabinet and running the U.S. Small Business Administration. I am now delighted to be teaching entrepreneurship here at HBS to Section J, some of whom I believe are here this afternoon.

Here at HBS, we teach using the case method. Each case is a story and last week, the case was about Gabriella Gomez-Mont, who ran an innovation lab within the Mexico City government. It was her job to solve large, difficult public problems using new thinking – something we call public entrepreneurship. One of the problems she faced was that Mexico City had 30,000 buses that took people around the city, but there was no route map and no schedule – no way to know which bus went where, or when one was coming. So Gabriella Gomez-Mont did something pretty interesting – she crowdsourced the solution. She got over 3,000 people to ride the buses and document their routes, and in 2 weeks, she had a map of almost half the routes in the city. It was a bold solution that carried some political risk. But she was an entrepreneur.

One lesson you can take from this case is that entrepreneurship is not just a way to create a multi-billion dollar company in Silicon Valley – it’s also a way to solve some of society’s most pressing problems, and contribute to the public good. But entrepreneurship is about something else as well. It’s about taking risk. It’s about imagining an outcome that is big – larger than the resources that you have – and figuring out how to get there. It’s about leading when the outcome is uncertain.

For me, entrepreneurship is personal. My Grandpa Jack came to America at the turn of the century from Russia, with nothing, and he built a business that provided for him and his family, and eventually created hundreds of jobs. Grandpa Jack’s story is the story of the American Dream. He used to tell me, “Karen, our family does not work for other people, we work for ourselves.”

But when I graduated from HBS in 1977, I was not interested in entrepreneurship – for one reason. I wasn’t ready to take the risk. For many of you, there’s a certain appeal to the idea of actually getting a job with a salary that pays the student loans, and for good reason. But as you go forward in your careers as researchers, lawyers, doctors, and other professionals, new opportunities will present themselves, and some of them will feel risky. Watch for those moments, prepare for them, because even though they present challenges, they might be the ones that offer the greatest chance to have an impact.

I eventually I found a way to follow Grandpa Jack’s advice. I became a venture capitalist, and for 25 years I bought and grew companies, like Annie’s Macaroni and Cheese, which I hope all of you have eaten. We bought that company when it was just 8 people and Annie.

Venture capital can be magical, but it’s also a risky business. In fact, life is risky. So how do you navigate in a risky and uncertain world? The secret lies in figuring out early on who you are and what matters to you. Life will throw a lot of things at you – both opportunities and challenges – but what separates successful people is that they understand, at every turn, what their values are. How do you balance your work, your family, and your community? How do you treat others each day? If you are confident in your values and what you think is important – you will stay level-headed. I call it being balanced on your own two feet.

As I mentioned, I had the honor of spending 5 years in Washington D.C. working for President Obama as his Small Business Administrator and a member of his cabinet. It was an incredible job – I got to travel with the President on Air Force One and I brought to the West Wing the perspective of a risk-taker and entrepreneur to help America’s small businesses survive one of the most difficult credit crises in our history. It was a great job.

And students often ask me, “How did you get that job? And how do I get on that path?” Well, the truth is, there was no path. There was no plan. In hindsight, the key turning point was when, after 20 years in venture capital in New York City, I followed my husband to Maine. He got the chance to be President of Bowdoin College, so we picked up our 3 kids and moved them from Manhattan to a small town on the coast of Maine. Then, one day, something surprising happened. The naval air station in our town went on the base closure list. We were about to lose 3,000 jobs. The Governor called me and said, “Karen, I need you to do something. You’re a venture capitalist – you need to help.” I had no idea what he was talking about or where to begin, but this was my home. I could see the naval air station from my house. And I knew my town faced an uncertain future. If I didn’t step up, who would?

This started a long chain of events that landed me on President Obama’s transition team in Washington D.C. and eventually as the President’s appointee to run the Small Business Administration. In December 2008, I flew out to Chicago for a press conference at the Drake Hotel where the President-elect was going to announce my nomination, along with several other cabinet members. Now, they had all been politicians, so while this was a huge day for all of us, they were a little more used to these things. We stepped out onto the stage and there were about 100 cameras crews. The lights were blazing. It was hot. I was nervous. And I immediately thought, “I’m gonna pass out.” Even my husband who was watching on TV from Maine later told me, “I thought for sure you were going down.”

We took our positions behind the President-elect and – you’ve seen this – it’s what they call the “potted plant” position. You stand there for about 20 minutes while the President-elect speaks, and you can’t move because you’re in the shot. So I was standing there, and the President-elect opened his remarks with a “topper” – something new that’s added just before you go on stage. That day, it was about the auto industry. Now, you have to remember it was a very uncertain time. We were already in a deep recession and there was a real fear that the auto industry would fail and the entire economy would crumble. But when the President-elect talked about the small businesses and suppliers and the surrounding communities that relied on the auto industry, I thought to myself, “You need to get a grip. This is not about you. This is about the jobs and livelihoods of millions of hard-working people. You know what needs to be done to help fix this.

This is your time to contribute. You’ve prepared for this during your time at HBS and in the private sector and in Maine, and it’s time to step up and do the work this nation needs.”

Today, we are again living in an uncertain time. So I have a challenge for all of you, just the way that Grandpa Jack and the Governor and this last job challenged me. You are Harvard graduate students, trained at an extraordinary university with the power, the intelligence, and the responsibility to make a difference. So find your values and find your balance, because it is up to each of you in your own way to be leaders in this demanding world. Your path may not always be linear or risk-free, but sometimes there is a moment where you have to step up and do the work that your community, your nation, or the world needs. It is by stepping up in uncertain times that you will provide the leadership that makes a difference in the world. Thank you.