Business Innovation Science

Loonshots: How to Nurture the Crazy Ideas That Win Wars, Cure Diseases, and Transform Industries (Summary)

by Safi Bahcall

In the 1930s, the US Navy dismissed radar as a 'toy' and filed the patent away. Across the Atlantic, a small, sheltered group of British scientists turned the exact same 'toy' into the weapon that won the Battle of Britain and saved the West. Why did one group kill a world-changing idea while the other nurtured it? The answer isn't about smarter people; it's about the physics of group structure.

Separate Your Artists from Your Soldiers

Fragile, early-stage ideas (loonshots) and established, successful products (franchises) must be managed differently. Loonshot groups ('artists') need to be sheltered from the metrics and pressures of the mainstream organization ('soldiers'), but not totally isolated. The key is to manage the exchange between them.

The legendary Bell Labs was intentionally created by AT&T president Theodore Vail as a separate entity. This structure protected eccentric geniuses like Claude Shannon from the rigid operational demands of the main telephone company, allowing them the freedom to invent the transistor, the laser, and information theory itself.

Beware the 'Magic Number' 150

As organizations grow past roughly 150 people, the dominant incentive shifts. Perks of rank and politics begin to outweigh the rewards of contributing to successful projects. This 'phase transition' is what causes established companies to suddenly lose their innovative edge.

W. L. Gore & Associates, the makers of Gore-Tex, combat this by capping their facilities at 150-200 employees. Once a plant reaches that size, they build a new one nearby, ensuring that a small-team, project-focused culture is always maintained over a political, rank-focused one.

Manage the Hand-Off, Not the Idea

The most important job of a leader isn't to champion the ideas, but to manage the delicate transfer of loonshots from the 'artists' to the 'soldiers'. This requires creating a dynamic equilibrium where both groups respect each other and ideas flow freely, a skill Bahcall calls 'leading as a gardener'.

Juan Trippe, the visionary leader of Pan Am, didn't just fund the development of the jet engine for commercial flight. He acted as a bridge, personally working with Boeing engineers ('artists') and his own pilots and executives ('soldiers') to ensure the radical new technology was smoothly and successfully integrated into his airline's operations.

Distinguish P-Type and S-Type Loonshots

There are two types of breakthroughs. P-type (product) loonshots are new technologies. S-type (strategy) loonshots are new ways of using existing tech. Both are vital, and the biggest successes often happen when they are combined.

Apple's iPod wasn't just a P-type loonshot (a better MP3 player). Its true genius was the S-type loonshot it was paired with: the iTunes store. The new strategy of selling songs for 99 cents made the new product unstoppable and completely transformed the music industry.

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