Loonshots

Introduction

“What can we learn about human nature and world history from a glass of water?” – Safi Bahcall

LEDx 3.0

In March of this year, in what seems like ages ago in the pre-COVID era, I had the opportunity to attend LEDx 3.0. The Leadership Education and Development Experience (LEDx) is an annual leadership event sponsored by the Air Force, designed to hear and engage with leaders from a variety of backgrounds. Looking at the schedule prior to arrival at Maxwell AFB, I was intrigued by many of the session titles and descriptions: The Hidden Purpose of Leadership, Emerging Leadership Methodology, and The Creative Mindset — just to name a few. The final keynote address of the first day stood out in particular.

What do you get when you cross physics & business?

Both a physicist and an entrepreneur, Safi Bahcall’s approach towards innovation is unique to say the least. With degrees from Harvard, Stanford and UC Berkeley, Safi went on to work for several years as a consultant for McKinsey. Later founding his own biotech company, Safi pioneered development on cutting-edge cancer research. In 2008, he was named E&Y New England Biotechnology Entrepreneur of the Year. Safi was later called upon to work with President Obama’s council of science advisors (PCAST) on the future of national research.

In his recent book, Loonshots, the author draws upon the science of phase transitions to understand the success and failures of innovation across industries. He demonstrates how teams, companies, and squadrons change from welcoming innovation to silencing new ideas – just as water in its liquid form will change to solid ice. Instead of highlighting the importance of organizational culture, Bahcall identifies how changes in structure lead to this transition, the same way that temperature controls the change from water to ice.

What are Loonshots?

One of the things I appreciate most about Loonshots is the straightforward nature of its content. Rather than dragging the reader through several layers of narrative, the author presents his argument directly:

  1. The most important breakthroughs come from loonshots, widely dismissed ideas whose champions are often written off as crazy.
  1. Large groups of people are needed to translate those breakthroughs into technologies that win wars, products that save lives, or strategies that change industries.
  1. Applying the science of phase transitions to the behavior of teams, companies, or any group with a mission provides practical rules for nurturing loonshots faster and better.

Put another way, loonshots are crazy ideas that can change the world — and, in order for them to actually change the world, they require a certain environment to foster their growth and implementation.

Loonshots Hall of Fame

What are some examples of these “crazy ideas that win wars, cure diseases, and transform industries”? Although the book describes a dozen or so examples – each one fascinating in it’s own way – I’ve selected several that I think stand out above the rest.

Radar

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Hyland & Young’s Loonshot is covered in Chapter 1

In September of 1922, two American engineers tinkering with radio equipment made a discovery that would eventually change warfare “more than any single development since the airplane”. In an attempt to improve radio communications between ships at sea, they had discovered the use for radio as a form of detection. Almost a decade later, the team also discovered similar results with aircraft. Realizing the significance of their newfound technology, Hyland and Young submitted proposal after proposal for the implementation of their advanced early warning system. To their disappointment, nothing happened.

The team continued to develop and vouch for their project through the 1940s — but weren’t able to get their loonshot implemented prior to the attack on Pearl Harbor. Only three years later however, their invention proved effective in May of 1943, when Allied planes and ships used radar technology to sink a U-boat attack on a convey headed from Canada to England.

Fungi

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Endo’s Loonshot is found in Chapter 2

Heart disease has been, and continues to be one of the leading causes of death in the world today. For most of the 20th century, the mortality rate for those with heart disease seemingly continued to rise with no end in site. That is, until the world met a fun guy.

Akira Endo, a Japanese biochemist who started his career analyzing fungal enzymes used to make fruit juice, began exploring potential candidates for combating heart disease. What he ended up discover changed the world.

After testing thousands of different fungi, Endo was finally able to extract a naturally occurring molecule found in the Penicillium citrinum (not the same species of mold as penicillin, but close) that proved to lower cholesterol. Although a brilliant find, Endo’s journey from discovery to production of the drug we know today as mevastatin was a rollercoaster to say the least. His findings were met with countless opposition and failures across the process of testing. Unfortunately, the pharmaceutical giant Merck produced a similar compound (which differed only slightly from Endo’s) all the way to production in 1987.

Pie in the Sky

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Probably one of the most interesting loonshots discussed in the book has to do with pie. Not actual pie mind you, but the metaphorical pie that Bahcall uses to illustrate the service changes American Airlines implemented during deregulation in the airline industry. The illustration is really quite helpful in understanding some of the more nuanced economic impacts of the loonshots mentioned below, but you’ll have to purchase the book to enjoy them!

Crandall’s loonshots and the author’s pie metaphor are detailed in Chapter 3

Two major loonshots that CEO Bob Crandall helped institute, saved American Airlines and transformed forever the way customers interacted with airlines.

  1. In order to deal with deregulation’s impact on employment, Crandall developed a two-tier pay system – the first of its kind in American business. This innovative strategy introduced a small change in the salary structure, but helped AA stay in business while other airlines shuddered.
  2. By implementing a functional computerized ticket reservation system, and distributing it for free to other competitors and customers, American Airlines was able to secure its sales through placement and efficiency of purchase.

“So what?” – Cultivating Loonshots in the Military

With the examples of the loonshots above, you may be asking, “how can the military, particularly the Air Force, ensure that new ideas (loonshots) are listened to and appreciated?” Coming back to the quote at the beginning of this article, the author of Loonshots would tell you that you can get your answer from a glass of water.

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In addition to having great ideas, we need to develop environments at the lowest levels (flights, squadrons, etc) that nurture and cultivate said ideas. Otherwise, you end up with half-baked radar technology that could otherwise prevent a military attack – or a new medicine that doesn’t make its way into the hands of those who need it because of failures along the way. The simple way to care for loonshots on the operational and strategic level, is through the science of phase transitions.

Phase transitions occur when a substance changes from a solid, liquid, or gas state to a different state. Every substance known to man can transition from one phase to another, when certain combinations of temperature and pressure are achieved. It is the authors belief that organizations go through similar transitions between “solid” state (a state better for getting things done) and “liquid” (a state better for innovating new ideas). Both states are equally important and required to devleop loonshots into technologies that changes the world. Its the balancing act of maintaining organizational structure between the two states of “solid” and “liquid” that is the secret formula.

The below quote from Safi Bahcall is an answer given during an interview with innovationmatrix.com from earlier last year:

The bad news about the changes in organizations is that phase transitions are inevitable. All liquids freeze. The good news is that understanding the forces that cause a transition allows us to manage it. Water freezes at 32 Fahrenheit. On snowy days, we toss salt on our sidewalks to lower that freezing temperature. We want the snow to melt rather than harden into ice.

We use the same principle to engineer better materials. Adding a small amount of carbon to iron creates a much stronger material: steel. Adding nickel to steel creates some of the strongest alloys we know: the steels used inside jet engines and nuclear reactors.

Loonshots identifies the four control parameters that allow us to engineer more innovative teams and companies. Those are the equivalent of the carbon we add to iron, or the temperature we adjust for water. Those are the small changes in structure, rather than culture, that can transform a rigid team.

Leaders spend so much time preaching innovation. But it doesn’t matter if CEOs yell through bullhorns to innovate, innovate, innovate. One desperate molecule can’t prevent ice from crystallizing around it as the temperature drops. Small changes in structure, however, can melt steel.

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