In “Pennies from Heaven: How Mormon economics shape the G.O.P.,” Harper Magazine’s Oct 2011 cover story, author Chris Lehmann writes that “the business side of Mormonism is a curious agent for the faith’s deliverance into the mainstream,” and argues that “the Mormon-style gospel of wealth” is essential to understanding many of our economic debates today.
On Faith asked Harvard Business School professor and one of On Faith’s Mormon panelists, Clayton Christensen, for insight into how Latter-day Saints view fiscal matters, and how a potential President Romney, also Mormon, may approach the economy.
Many of the major innovations in the Mormon Church were initiated by local leaders. Mitt Romney was president of his stake (archdiocese) in Boston.
Some wonder whether certain beliefs and practices in the Mormon Church help its members inordinately contribute entrepreneurship, innovation and management to the economy. Things like honesty and respect for others and their property are taught and practiced in most churches. A few other principles, however – though they can be followed by anyone and are not uniquely “Mormon” beliefs per se – might be followed more consistently in our church than in some others. I’ll summarize just two of these.
The first is a duality that is critical to successful innovation: On one side, the license to innovate must be broadly felt. And on the other side, the instinct to follow their leaders’ guidance is critical to implement or “scale” successful innovations. Few institutions balance this as well as the Mormon Church.
On the one side, we believe that the Lord told us, “For behold, it is not meet that I should command in all things. Men should be anxiously engaged in a good cause, and do many things of their own free will; for the power is in them. He that doeth not anything until he is commanded, the same is damned.” (Doctrine and Covenants, 58:26 – 29; which I have condensed). And on the other side, several times every year, we raise our hands in conference to signify that we will sustain and follow our leaders. We are an innovative but obedient people.
Many of the important programs and institutions in our church, as a result, were innovations developed by local leaders, to solve local problems. As our prophet and apostles have then learned of these innovations and their effectiveness, they have asked every congregation in the world to adopt the innovations – and almost everyone does. Our systems of welfare, teaching our children, missionary program, and our ability to help the unemployed to find work, are examples of this. Responsibility for innovation is dispersed and bottom-up. When a better way is discovered, top-down direction drives broad and uniform adoption.
This duality is rare in our economy. For example, in education many teachers and administrators don’t view innovation as their job. They do their job year after year with little change, even though they are surrounded by evidence that change is badly needed. A few have produced extraordinary innovations in teaching and learning – such as KIPP Schools and Hi-Tech High. But even the best of these innovations scale slowly. Educators instead question the innovations’ effectiveness; muster countervailing data; or hide behind regulation.
Certainly some don’t apply to their professional pursuits what they can observe at church about the importance of this duality of innovation and implementation. But for those who use their membership in the Mormon Church as a graduate school for robust principles, it pays off.
A second example: Two types of innovations affect employment. Efficiency innovations are important for our economy. But they typically get rid of jobs, as innovators find ways to produce more with less. Disruptive innovations, in contrast, are products and services that are so much more simple and affordable that many more people can own and use them. Nearly all of the net creation of new jobs in our economy are rooted in disruptive innovation – innovations that bring higher standards of living to the bottom of the market – and then move up.
Because we have no professional clergy, members care for each other, and there is no hierarchy amongst us. For a time, for example, Mitt Romney was president of the stake (archdiocese) in Boston. Two of his bishops (ministers) who were leaders of two congregations were a professor at MIT and a man who worked the night shift loading and unloading trucks for UPS. When Romney finished his term as president, a policeman took his place. Many of those who join the church are poor – but we all rally to help them improve. It is the job of everyone. Membership in the Mormon Church helps you build an instinct, based upon love and service, for disruption – enabling those at the low-income end of the market, to move up. Our missionary service reinforces this instinct.
Some of the most successful Mormon businessmen built their companies disruptively, by enabling those at the low end to enjoy access to things that previously were too expensive. Marriott didn’t start as a hotel, but as a drive-through restaurant. George Romney transformed American Motors with the Rambler – from the bottom. Dave Neeleman’s Jet Blue followed the same pattern. And this instinct drove former Utah Governor and HHS Secretary Mike Leavitt to create Western Governors University - a very successful online university helping students who otherwise could not get the training to get better jobs.
Again, Mormons don’t have a corner on disruption, by any measure. I simply offer in this essay my personal observation that some of the things that I and others have learned in our church actually are quite helpful in other spheres as well.
I am a member of the Church of Jesus Christ of Latter-day Saints, and am a professor at the Harvard Business School. The observations in this essay are his own, and are not positions of my church or my employer.