Richard Tedlow is the Class of 1949 Professor of Business Administration at the Harvard Business School, where he is a specialist in the history of business. He received his BA from Yale and his MA and PhD in history from Columbia. He came to the Harvard Business School on a fellowship in 1978 and joined the faculty in 1979. From 1979 through 1982, he taught First Year Marketing. His involvement in marketing has continued, and he has been a member of the faculty of the “Strategic Retail Management Seminar,” the “Top Management Seminar for Retailers and Suppliers,” “Managing Brand Meaning,” and the “Strategic Marketing Management” executive education programs.

From 1978 to the present, he has been involved in the HBS’ Business History program. In 1992 and 1993, he taught a course entitled “Business, Government, and the International Economy.” He has also taught in numerous executive programs at the Harvard Business School as well as at corporations, including programs in marketing strategy and general management. His published works include Giants of Enterprise: Seven Business Innovators and the Empires They Built, The Watson Dynasty: The Fiery Reign and Troubled Legacy of IBM’s Founding Father and Son, and more recently, Andy Grove: The Life and Times of an American. His latest book, Denial: Why Business Leaders Fail to Look the Facts in the Face — and What to Do About It, was published by Portfolio/The Penguin Group (2010).

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Morris: Throughout the last, let’s say, 20-25 years, which business developments do you consider to be most significant and why do you think so?

Tedlow: There are two business developments which I think are of particular importance. One is the decline of the mainframe era in computing and the rise of computers everywhere as well as handheld devices which can provide access to the Internet. Business is all about communication. The Internet and the new ways to reach it constitute one key development.

The second important development I would mention is the decline of the US automobile industry. This decline is the result of exceptionally tough competition from abroad, poor management at home, and, in general, the globablization of this and other businesses.

Morris: In your opinion, which CEOs have had the greatest impact on the organizations with which they were (or are) associated? How so?

Tedlow: I believe the most important CEO of recent years is Andy Grove. He took an industry which used to be sloppy and populated by “cowboys” and whipped it into shape. More than any other man, Andy Grove created Intel. Intel is the dominant supplier of microprocessors to the world. The microprocessor is a device without which the 21st century would be unimaginable.

Morris: Which leaders outside of the business world (e.g. heads of government, in the military) do you admire most? Why?

Tedlow: I most admire Nelson Mandela. Without him, the peaceful development of South Africa is hard to imagine. Life is about the overcoming of adversity, and he certainly overcame his share.

Morris: What prompted you to write Giants of Enterprise? Was there an especially important business question which intrigued you?

Tedlow: I started off Giants of Enterprise with one assumption, and that assumption was turned on its head by the time the book was completed. My assumption was that a look at a variety of business leaders in different industries and in different time periods would illustrate the variety of paths to success in business in American history. What I discovered was that the business leaders I studied, despite coming from different backgrounds and working in different industries, had much more in common than I had expected.

Morris: By which criteria did you select the seven “giants”?

Tedlow: I wanted to find leaders who spanned the continent and who also encompassed America’s industrial and its service eras. The seven men that I chose made that goal possible.

Morris: When completing your research, were there any head-snapping revelations about any of the “giants”?

Tedlow: To me, there were revelations on every page of that book. I never fully appreciated the relationship between strategic insight and business execution before studying in depth men such as Sam Walton.

Morris: Here are two separate but related questions. First, what did Henry Ford and Thomas Watson Sr. have in common?

Tedlow: Both Ford and Watson ran key companies at key moments in history. Ford ran Ford for decades, but the key era was that of the Model T – which lasted from 1908 to 1927. Like Ford, Watson also ran his company, IBM, for decades. The key period for him was probably the New Deal and the growth of government contracts for information processing.

Morris: How did they differ?

Tedlow: Henry Ford was, in my view, an evil man. I would not say that about Watson.

Morris: It seems that Watson’s leadership style was appropriate to what IBM needed during his tenure as its CEO. Do you agree?

Tedlow: Yes, I do. His leadership style was extraordinarily effective in binding literally thousands of people to IBM, holding the company together, and moving it forward.

Morris: Now let’s discuss your most recently published book, Andy Grove. The subtitle refers to “the life and times of an American.” To what extent is Grove an exemplary American?

Tedlow: In some ways, Grove is the classic American success story. He was a refugee from oppression. Born in Hungary in 1936, he first had to survive the Nazis and then the Communists. He arrived in the United States at the age of 20 and discovered it to be a true meritocracy. It is the meritocratic element of his story which makes Grove an exemplar of America at its best.

Morris: Grove has frequently used the term “inflection point.” In a business context, what is it?

Tedlow: For Grove, an inflection point is a turning point in the history of a business. It is a moment of truth. If you make the right decision, you put your company on the path to future growth. If you make the wrong decision, you face decline.

Morris: In your opinion, what was the most significant “inflection point” for Intel?

Tedlow: My choice is the decision to serve as the sole source for the 80386 microprocessor in 1985 and 1986. Up until that time, it had been mandatory in the computer industry that component suppliers to the dominant firm (which was IBM at the time) licensed their technology to competing manufacturers. This process allowed IBM to play one supplier off against another and to control prices. When Grove took the leap of informing IBM and the rest of the industry that Intel was not going to license the technology for its 80386 microprocessor, this was a genuine inflection point. It was a “bet the company” decision. Because Grove made it and made it work, Intel became one of the leading firms in computing.

Morris: Grove is often identified as being one of the most effective corporate CEOs in the 20th century. Why?

Tedlow: Andy Grove became the CEO of Intel in 1987. At the end of that year Intel had a market capitalization of $4.3 billion. Grove stepped down as CEO of Intel in 1998. At the end of that year, the company had a market capitalization of $197.6 billion. This increase in value represents a compound annual growth rate of 42 percent over an eleven-year period. Few if any other CEOs can point to such a record.

Morris: Of all that you learned about Grove during your extensive research on his life and times, what do you consider to be most revealing of the man?

Tedlow: It was very interesting for me to discover that although he drove the people who worked for him very hard, he drove himself harder. He well understood the old saying that the speed of the boss is the speed of the gang.

Morris: To those who are preparing for or are only recently embarked on a business career, what lessons in leadership and management can be learned from Andy Grove?

Tedlow: Grove’s method of decision-making combines both discipline and creativity. He makes “data-driven gut decisions.” I believe that combining those two facets of decision-making is more than merely valuable. I believe it is essential.

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Richard cordially invites you to check out the resources at these websites:

Here’s link to Richard’s faculty page at Harvard Business School.

Here’s a link to his HBS “Working Knowledge” video.

Here’s a link to his Amazon page.