Perspectives on Innovation from Gary Hoover, Entrepreneur and Business Scholar
This is part of my series on thought leaders in the innovation space.
Gary Hoover is an incredibly successful businessman, scholar of business history, and the force behind at least six start-ups (“Maybe eight if you count the ones I started in college,” he says). His successes include the founding of BOOKSTOP, the first chain of giant book superstores, which was later purchased by Barnes & Noble. He also founded Hoover’s, the world’s largest Internet-based provider of information about enterprises, which went public and was eventually purchased for $117 million. Today, Gary Hoover mentors entrepreneurs, speaks to corporate and government leaders around the world, and writes on business history, retail, and other subjects on his website Hoovers World. (I definitely recommend checking out his site.)
We had a fascinating conversation over the phone, with Gary talking to me from his home in Flatonia, Texas where he has a personal library of over 57,000 books. We spoke about his successes and his thoughts on the secret ingredients for innovation. And, he shared a ton of great examples and stories with me from the history of business. While it’s hard to choose just a few nuggets from our chat, here are some my favorites…
Innovation Can Be ‘Tiny’
One thing I enjoyed about Gary’s perspective is that his definition of innovation is not narrow. When he talks innovation, he’s not only thinking about the things that might jump to mind when we hear that word — things like apps or digital technology. He takes a broader view, naming everything from the factory farming of chickens, the airline’s “hub and spoke” model, and FedEx’s modern delivery system as some of the major, impactful innovations in recent history. “In my mind, all of those are technologies, they are new innovative techniques, a new way of delivering or making a new technology or service,” he said.
He also talked about the usually-unnoticed ways that companies innovate on a daily basis: “It’s equally important that companies innovate in small ways. I’m willing to bet that UPS and FedEx are both looking at ways to improve themselves every day and ways to tweak the system.”
“I think innovation can be tiny things or big things.” — Gary Hoover
Obsess About Your Customers
Just as Gary takes a different view on what constitutes innovation, he also believes that innovation is not simply about who has the better technology or science. He cited Apple, which he calls one of the two greatest technology companies in American history. (IBM is the second company.) He talked about Apple’s famed CEO Steve Jobs and his relentless focus on his customers: “Did he really have better science than Dell or HP or Microsoft? I’m sure he had great science, but he had this obsession with design and with the user experience. So even in the great technology companies, it’s not really about the technology. It is about knowing and loving your customer.”
The customer is always top of mind for Gary: “Coming out of retail, I have this obsession with: Who is my customer? What do they want and what can I do for them today?” It was the customer that was at the heart of his third start-up, Travelfest, which was a travel superstore that he started in the mid-90s. “The travel agency industry was kind of a racket with the airlines giving the travel agency bonuses if they booked customers on their airline. Travelfest had nothing to do with that. We booked based on what was best for the customer, not just the big carriers…We played by a whole different set of rules. We put the customer first which was rare.” While the stores ultimately closed, the story really illustrates how Gary thinks and the primacy of the customer in all he does.
“Coming out of retail, I have this obsession with: Who is my customer? What do they want and what can I do for them today?” -Gary Hoover
Look for the Oddballs
I asked Gary to tell me about his essential ingredients for success in business. He talked a lot about the importance of having a different perspective, of thinking about things differently. He told me a story about Sam Walton, the founder of Walmart: “When he opened a new store, he always put one person on the management team who made other people uncomfortable, who just wasn’t like anyone else. He always tried to find somebody who just thought differently.”
“Get different minds in the room. At least hear them out. Look for the oddballs.” — Gary Hoover
For Gary, the concept of thinking differently is closely related to having the mental space to let your mind wander and come up with new ideas. He links his tendency to daydream to his creativity: “When I was in school, I did a lot of daydreaming. I spent a lot of my life doodling. I still go driving the back country roads and let the mind flow and turn the music up.” (It’s also why he infrequently uses a telephone. “The ringing annoys me and breaks my train of thought,” he says.)
He also talked about how some companies have encouraged this kind of free thought and how it can be directly tied to innovation: “3M would give their people one day a week off to go study whatever they wanted to and look into other things. Through that, and processes like that, they came up with Post-It notes and all kinds of other innovations.”
Mash Up Two Great Ideas
When asked Gary about his innovation “silver bullet”, he said: “I think the most important thing is combining two things that everybody sees every day.” This comes from his experience with creating BOOKSTOP: “I had this idea of a book superstore. The idea of the superstore was created by Charles Lazarus with Toys “R” Us in the late 1950s. By the time I did BOOKSTOP, everybody had been to a Toys “R” Us and everybody had been to a book store, but no one thought to put the ideas together.”
“By the time I did BOOKSTOP, everybody had been to a Toys “R” Us and everybody had been to a book store, but no one thought to put the ideas together.” — Gary Hoover
Gary continues to use this method of combining two seemingly disparate ideas as a way to play around with new and novel business concepts: “Sometimes I make a grid with ten columns and rows and throw [stuff] on each side — books, music, flowers, movies and, on the other side, ways to distribute it: brick and mortar , online selling, memberships, subscriptions, library loaning… Then I look at each box in that grid. Is there an opportunity there? Is there something that someone isn’t doing? With any new idea you have to give it a chance. You can’t take five seconds and say it will never work. Let it sink in, play with it, let it marinate, talk to people about it.” (I don’t know about you, but I love this 10 x 10 grid idea and can’t wait to try it.)
Follow Your Gut & Be Brave
Finally, I want to end with some wise words from Gary on what we need more of in American business and innovation right now: “What I think is lacking in big corporations today in America is imagination and courage.” He used Dollar Shave Club as an example of bravery, as they took on a giant like Gillette, which had owned the industry for a century. Another company he admires is CVS, especially for their move to stop selling cigarettes: “That cost real money as that is a lucrative field. But they didn’t really see it right being a health oriented store to do that. They just had the guts…”
“What I think is lacking in big corporations today in America is imagination and courage.” — Gary Hoover
