How Business Leaders Can Help Solve the World’s Toughest Problems

Summary

HBR On Leadership – Episode Summary

Episode: How Business Leaders Can Help Solve the World’s Toughest Problems
Date: October 22, 2025
Host: Kurt Nickish (Harvard Business Review)
Guest: Rosabeth Moss Kanter, Professor at Harvard Business School, author of "Think Outside the Building"

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Overview

This episode focuses on the expanded role of business leaders in tackling complex, persistent global issues like climate change, political division, and social inequality. Rosabeth Moss Kanter argues that organizations and their leaders possess unique resources and platforms to drive meaningful change beyond traditional business boundaries. The conversation explores “advanced leadership,” highlighting practical skills, mindsets, and real-world examples of transformative corporate action.

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Key Discussion Points and Insights

1. The Urgency of Action from Business Leaders

• Persistent Problems: Many of today’s biggest challenges—climate change, political divides, social inequity—have existed for decades. Despite some improvements, entrenched obstacles demand new forms of intervention.
  • "People like to talk about the problems. They don't necessarily want to get up and do something about it." — Rosabeth Moss Kanter [01:44]
• Impatience with Passivity: Kanter’s call is motivated by frustration with inaction and impatience for progress, arguing that business has a responsibility to act, not just discuss.

2. Leadership Beyond the Building: Coalitions & Broader Influence

• Thinking Beyond Silos: Leaders need to operate “outside the building”—meaning beyond their boundaries, sectors, and comfort zones—to find innovative, scalable solutions.
  • "When you take action, you have to think beyond the silos and divides and walls, because you cannot take action all by yourself for a big problem." — Kanter [03:13]
• Examples: IBM works globally on educational initiatives, but succeeds through public-private partnerships, not solo efforts.

3. Why Business Has a Special Role

• Institutional Power & Resources:
  • Businesses have resources, influence, and networks that can be mobilized for societal good—often more nimbly than government or nonprofits alone.
  • "People do listen to business executives. And...should think about the automatic resources available...to tackle a problem like climate change." — Kanter [06:10]
• Restoring Trust:
  • With waning public trust, companies must demonstrate positive societal impact to win back legitimacy and attract talent.

4. Empowerment vs. Helplessness: Start with Small Steps

• Cycle of Action:
  • Taking even small steps toward change can generate energy, break a “losing streak,” and prove that progress is possible.
  • "If you find even one action and get started, you just have to get moving. Just try it. If it doesn't work, fix it. Try something else. And that is an enormous source of energy." — Kanter [07:38]
• Concrete Example:
  • In São Paulo, a bank’s commitment to becoming “green” began with cleaning up a neighboring alley, transforming it into a vibrant community space. Empowered employees then felt motivated to pursue further change. [09:00]

5. Lessons from Sesame Workshop: Outside Partnerships Fuel Innovation

• Adapt and Expand:
  • Citing Sesame Street’s evolution amid declining TV ratings, Kanter illustrates how partnering with new industry players (e.g., commercial cable, IBM’s AI, digital startups) helped create broader impact, including winning a $100 million prize to serve Syrian refugees. [10:20]
  • "What happens when you get successful is you start going inside...and you never really see change happening outside or you ignore it." — Kanter [10:28]

6. Characteristics of “Advanced Leaders”

• Shared Traits:
  • Deep curiosity, meaningful values, a sense of purpose, willingness to take risks, and habit of seeking new experiences.
  • Example: Verizon’s CEO asks executives to do something new every week and visit new places to expand their perspective. [13:45]
• Accessible to All:
  • Advanced leaders are not rare but under-recognized. Their broad interests and outside-the-building thinking are what set them apart.
  • "We have not honored enough the people who have much broader interests..." — Kanter [14:46]

7. Facing Discomfort and Risk

• Hustle and Resilience:
  • Real change is risky and requires perseverance through setbacks ("Kanter's Law": Everything can look like a failure in the middle). [18:10]
  • "You have to say, we're going a place where nobody's gone before. And sure, it's a little risky because of what I call Kanter's Law. Kanter's Law is that everything can look like a failure in the middle." — Kanter [18:32]
• Leadership Outside Authority:
  • Unlike traditional hierarchies, advanced leaders must influence and build coalitions among people they do not directly control, sustaining motivation through shared purpose.
  • "Change is all about not just persuading them so you can do your thing. It's about building a community of people who believe the same thing." — Kanter [19:50]

8. Organizational Examples: CVS and Haier

• CVS:
  • Transitioned from being “just” a pharmacy to a health company, establishing clinics in stores and banning tobacco, despite revenue loss—a bold move aligned with the larger purpose of promoting community health. [21:00]
• Haier:
  • The Chinese appliance giant empowers employees as entrepreneurs, building ecosystems around their products—e.g., shifting washing machines into the context of sustainable clothing and environmental initiatives. [22:14]
  • "They're starting to think much more imaginatively and that's a kind of thinking I think we need inside businesses as well as outside." — Kanter [23:17]

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Notable Quotes & Memorable Moments

• "I was irritated at the passivity...people like to talk about the problems. They don't necessarily want to get up and do something about it. And I'm impatient for action and solutions..." — Kanter [01:44]
• "Even the biggest company in the world can't do it by themselves." — Kanter [03:34]
• "Taking a small step outside the building... you see the world differently." — Kanter [08:44]
• Banking example in São Paulo: cleaning an alley as a first “small” step to larger organizational change. [09:00]
• On the trap of complacency: "What happens when you get successful is you start going inside...and you never really see change happening outside or you ignore it." — Kanter [10:28]
• On risk and leadership: "Everything can look like a failure in the middle." — Kanter [18:32]

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Timestamps for Key Segments

• 00:42 – 01:27 — Framing the episode: The global leadership challenge
• 01:27 – 03:13 — Kanter’s motivation: Irritation with passivity, the need for bold action
• 03:13 – 05:01 — Defining “thinking outside the building,” building coalitions
• 06:10 – 07:38 — The special responsibility/power of business
• 07:38 – 10:15 — Small steps, overcoming helplessness, São Paulo bank example
• 10:15 – 12:42 — Lessons from Sesame Workshop’s reinvention and partnerships
• 12:42 – 14:46 — What sets “advanced leaders” apart; developing broad interests
• 17:43 – 19:50 — Managing risk, leading without authority, sustaining communities
• 21:00 – 23:29 — Organizational examples: CVS and Haier
• 23:29 – 23:35 — Closing remarks

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Conclusion

This episode positions advanced leadership as a practical, actionable approach for business leaders at all levels to help solve society’s toughest problems. Through stories, strategies, and thoughtful analysis, Kanter makes a case for getting outside your comfort zone, building coalitions, and maintaining purpose through setbacks. The message: the world’s hardest problems need business to lead—with courage, creativity, and a willingness to strive for impact beyond quarterly reports.

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For further information:

• Book: "Think Outside the Building" by Rosabeth Moss Kanter
• More case studies and episodes: hbr.org

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Transcript

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[A]

Welcome to HBR on leadership case studies and conversations with the world's top business and management experts hand selected to help you unlock the best in those around you. I'm HBR Executive Editor Alison Beard. We're grappling with a host of big and complex global problems climate change, political division, and social inequality. Harvard Business School professor Rosabeth Moss Kantor believes that business leaders should step up and help tackle these issues, using their skills, networks and organizational power to pursue better Solutions. In this 2020 IdeaCast episode, Kantor speaks with host Kurt Nickish about how advanced leaders can make progress on specific challenges. Here's Kurt.

[B]

I was just reviewing the intro to the book where your first two words are irritation and impatience. And you call your book a manual for moving leadership to a whole new level, which is simple but also audacious, maybe. Why does there need to be a call to action like this?

[C]

We have such big problems in the world. Some things are clearly getting better, but they're getting better unevenly. And these problems are affecting the ability to do business. Forget about whether business has anything to do with the problems to begin with. And these are issues that come inside companies and they become things that everybody has to deal with. And of course, climate change, anybody who lives on or near a coast has to deal with that. And that risk is a big risk for businesses. So these are big problems. And when I said irritation, I was irritated at the passivity. That is, people like to talk about the problems. They don't necessarily want to get up and do something about it. And I'm impatient for action and solutions because in all the decades we've been talking about some of these things. And by the way, I did find that a famous change guru 50 years ago, an impossible time to even think about, 50 years ago was listing the same problems. Partisan divides, political conflicts, the environment. So with those problems around for such a long time, it's time to do something about them.

[B]

What you're hearing now is this chorus for businesses to take action, for CEOs to be activists. But I kind of get from the title of your book, Think Outside the Building, that you think that it takes more than what we've been hearing lately?

[C]

Well, I think CEOs certainly can take action. I think middle managers can take action. Professionals can take action. But when you take action, you have to think beyond the silos and divides and walls, because you can not take action all by yourself for a big problem. Even the biggest company in the world can't do it by themselves. So IBM wants to take on the problems of primary and secondary education, and they do it globally. They're a global company. They have various innovations that they deploy in just about every geography of the world, but they don't do it by themselves. They have to do it in partnership with the public officials, the governments. They do it in partnership with other companies that they need to join them. So this art of building coalitions outside the things you directly control are the art of solving problems in general. That's what innovation has always been about. When I started out my career and I was just looking at smaller innovations, modest innovations, now we need big innovations. Industries are being disrupted. They have to be transformed. And so when one thinks about these bigger change problems, you're always thinking beyond the boundaries. That's what I mean about outside the building. It's not literally whether it's outside the walls of your company, although it might be. I think going out for a fresh air from time to time and traveling and seeing new things becomes very important. But it's outside the boundaries of convention, the walls that restrict us from change, because they're the walls in our minds. They're the walls that make us say nothing could ever be different.

[B]

Do you think it's the job of business and business leaders to do this now?

[C]

I do think that business leaders have a special responsibility because they're under attack, because credibility and legitimacy are waning. I mean, it used to be that people were extremely proud to work for certain companies. And when that starts declining, some people don't want to go home and tell their neighbors what they do. So to win back trust, business has a big role, but so do elected officials. I talk about a mayor. I talk about many lawyers. Lawyers feel that acutely because many people went into law in the first place because they cared about justice. And then they started to work for a corporate law firm. And that isn't what they were doing. They were helping those businesses with their securities lawsuits or their mergers and acquisitions.

[B]

Or scientists nowadays who find the academic career pretty tough. And they end up working for companies that are building algorithms or systems. Right.

[C]

The other reason I think business, besides the fact that people like scientists are employed by them, it's that business has an awful lot of power. And I first became interested in business and in improving the quality of management and creating more leaders because of that power, that institutional power, people do listen to business executives. And I think everybody listening to this podcast who works in a company should think about the automatic resources available to them that aren't necessarily available out in the community and how they can take advantage of those resources to tackle a problem like climate change. Do an educational campaign, mount a little effort to create an innovative product that helps people with, say, keeping the lights off a little bit longer. I mean, there are so many things for which business can be a solution. And so even if a manager, an early career person, isn't necessarily the CEO, but can start attending meetings with, rallying the community, you can begin to have a voice and make a difference.

[B]

So just to put a point on this, at a time when people feel like they're helpless and they can't change these big things that are happening in the world, if you work at a company, you have a piece of that power.

[C]

I don't think we're helpless. I think it's easy to feel helpless. And when you feel helpless, you feel a little depressed. You don't do anything. You say the problems are so big. That's a typical sign of a losing streak. That's what happens when companies start declining. Everyone says, oh, it's somebody else's responsibility. We need a turnaround. But there's nothing I can do about it because it's inevitable. We're losing customers, and that's depressing. And so when you're depressed, you lose energy and then nothing happens. It's a vicious cycle. But if you find even one action and get started, you just have to get moving. Just try it. If it doesn't work, fix it. Try something else. And that is an enormous source of energy.

[B]

To use that action analogy, and of course, combine it with the image of thinking outside the building. Why is taking a small step outside the building important? What does that. What does that set in motion?

[C]

Oh, if you step outside, I mean, first of all, you see the world differently. There are many executives and managers who are insulated. They live in little bubbles. I went to Brazil once and I never saw the street because I was picked up at the airport in a helicopter. Helicopter to the top of a corporate headquarters, went down in an elevator. But I thought if you're insulated from the streets, if you're not out with the people, you often don't see possibilities. And in that same bank in Sao Paulo, by The way there was a leader that I talk about and think outside the building who pointed out to the bank, the bank was about to take a stance on climate change, on the environment. They were going to be known as a green bank. And this leader pointed out to them, that's all very good in theory, but right next door was an alley that was full of drug dealers and trash. And maybe they could start by cleaning up the alley, doing something about the alley next door. And they did. And that alley is now filled with artwork and people and street vendors. It's a very pleasant place to go. And it's a transformation. And the people that worked on that transformation felt so empowered and so positive, they began to feel that they could do even more. And the bank did very well with this reputation for being the green bank.

[B]

You used this example of Sesame street, which I love. How is that a good model for business leadership?

[C]

I love Sesame street too. Who in the world doesn't love Sesame street if you do your Oscar the Grouch if you don't love them? Sesame street took over the audience and had big audience share and then went into decline because of the rise of pay tv, cable tv, because of new media. And they were very complacent and didn't really see that, because what happens when you get successful is you start going inside, pulling down the shades, locking the doors, and you never really see change happening outside or you ignore it. You say, we're powerful, we're successful. And so companies get complacent. And they got complacent and they needed fresh thinking. And so they brought in a new CEO whose background was in commercial television, the money side. And so there was a little concern. The money side. We don't want to corrupt Big Bird. But he brought in fresh thinking. He got them to think outside the sector and create a partnership with a commercial cable system. He got them to think outside the industry. New partners for their educational material, including IBM and their Watson artificial intelligence work, small startups who had digital education of various kinds. So he opened up the thinking much more broadly. And he opened it up also to say, how do we solve some of the world's biggest problems? Just a little while ago, Sesame, now called Sesame Workshop, the parent organization, won a hundred million dollar contest for one organization that was going to have the highest impact on the world. MacArthur foundation and Sesame, in collaboration with the International Rescue Committee, won that prize. So by thinking even more broadly, and they're doing early childhood education now in the Middle east and for Syrian refugees. And they're Going to have a huge impact. Think about all the kids languishing who actually could be a source of talent for companies.

[B]

You've given a couple of examples there of a bank leader, of a leader, of Sesame Workshop, and these are the types of people you call advanced leaders. So I'm just curious, like, what was it that those people did that other leaders aren't doing?

[C]

Many of the leaders are people who, by their values, by their sense of purpose in life, and by the way, we know that companies that want to retain talent had better make the jobs more meaningful than they are now because they're losing a lot of talent. That's why this thinking outside the building becomes part of fixing many of the things that companies need to fix. But what these leaders have in common, sometimes they have experience in a career and they've had a chance to reflect, but not entirely. They are just reflective people. They're curious. They're interested in the world around them. They travel. They therefore get access to new ideas just because they see new things. Verizon, the big telecom company, has a new CEO. He's formerly CEO of Ericsson, and he now has his top executives tell him what they're doing differently every week. He wants them to do one new thing every week and go to one new place. Think about that. So these are all people willing to go to new places. They have curiosity. It helps to be at different ends of life either earlier in your career, before the demands of family are so great, or a little later in your career when you've already made it to high levels and your kids are grown. That helps to have the time. But really what they have in common is their values, their desire to make a difference, and the curiosity to learn about the world. Plus, I guess, a feeling that they can do it.

[B]

They seem rare, these advanced leaders.

[C]

I don't think advanced leaders are necessarily rare, but we haven't emphasized it. That is, we have not honored enough. The people who have much broader interests. They are getting honored now. If you want to get an award from a major business association, it helps to have done something important for the community. And many CEOs of major, major global companies will talk first and foremost about their company's efforts in the community. Ginny Rometti talks about what IBM is doing for education. Jamie Dimon talks about what JPMorgan Chase is doing in Detroit. So this has become a source of respect and reputation for established business leaders. But there are a lot of people who get a little narrowed by their career and their job. You know, they become accustomed to living in a bubble, to nobody disagreeing with them. They like problems that can be solved easily and quickly. I was struck by the fact that when Amazon was looking for its second headquarters and New York City, Queens in New York was selected as one of two locations. How quickly Amazon pulled out at the first sign that the community wasn't totally united behind the idea. And I thought, my God, if one of the richest people in the world and one of the most prominent companies can't stand a little community turmoil, then we're in trouble. Because they didn't even bother to try to convince them to try to win them over. And they would have done so much for New York had they done that. They would have had a whole set of loyal relationships. Uber also turned its back for a long time. It's changing now because but turned its back on the interests of government and regulators and taxi drivers. But those companies that really take into account these problems and say, we're gonna do something about them, they get credit. You know, Johnson Johnson got incredible credit when they had a scandal about tampering with Tylenol, one of their lead products. They immediately took it off the market. And what a difference that is from Johnson and Johnson having to pay big fines now because of the opioid crisis. And we don't value pharmaceutical companies as great corporate citizens anymore, even though they think they're trying to bring health. So we need people who see the larger consequences of their actions. And that's outside the building thinking. And as well as outside the building thinking is the only way you get innovation.

[B]

It sounds like while you want people who understand how to manage up and build coalitions and develop influence and use it in positive ways, there's also this element of hustle that you want from people like a good entrepreneur who's trying to be innovative or launch something new. People have to get out of kind of their regular comfortable job, career track and just put themselves at risk some more.

[C]

Well, change is always a risk, but that's where purpose and meaning having a big dream of which fixing some of these big problems plaguing the world certainly counts as a big dream, because it's got to be big and meaningful. Otherwise, why would you stick with it? And how would you ever convince anybody else? You can't go to them and say, oh, there seem to be some problems out there. Let's set up some committees. That's not inspiring. You have to say, we're going a place where nobody's gone before. And sure, it's a little risky because of what I call Cantor's Law. Cantor's Law is that everything can look like a failure in the middle. So, okay, you get started, whatever it is, you start out and you hit obstacles you didn't know were there because you had never been down that road before. So you get a coalition of backers and supporters, and they all say, sure, we'll invest in you a little, or we'll show up at a meeting. And then they don't, or they back off, or it turns out they don't all agree. So I say it's like crossing the desert looking for the next oasis, that it can be a long dry spell before you ever get to a place where there's an accomplishment and you can rest. And so what keeps you going during those times, what keeps you going is the sense of purpose and meaning. What keeps you going is that you do have some allies and you can't let them down. This kind of change, this kind of leadership, is all about people that you don't control. That's the difference between advanced leadership and typical corporate hierarchical leadership. You don't control any of those people. They're all volunteers. Even when people are working for a paycheck, they're still volunteers, because if they don't want to do it, they have all kinds of ways to slow you down. And so if they're volunteers, you have to keep making it worthwhile, making it meaningful, and you can't let them down. One of my lessons is we all need other people. And change is all about not just persuading them so you can do your thing. It's about building a community of people who believe the same thing. And after you build a big enough community, the whole ecosystem can start to change. That is, lots of other organizations look at what you're doing and say, hey, that's a cool idea. We could do this too. Soon you have an industry.

[B]

Are there companies out there that you see poised for this kind of change, where you look out and you think they have the potential, they should be doing something, they have the power. And you are just waiting for advanced leaders and advanced leader initiatives to come out of those companies?

[C]

The companies that are already doing have lots of advanced leaders inside. But I'll give you two examples. One is a US Company, cvs, that you could say, well, they're a pharmacy company, but they have been transforming themselves into a health company. And already they have projects and ventures that are so different, they're still within a company framework. I mean, I'm not saying you have to actually abandon being in a company, but they now have clinics. They use part of their retail space to be clinics. So they're kind of hospitals now, not just pharmacy companies. They do the insurance. They ban tobacco from the stores. That was a courageous move, right?

[B]

That had a effect on the bottom line.

[C]

Yeah, yeah. Because tobacco brings in a lot of money, but it wasn't part of health. So now the opportunities for people to think about how do they use stores differently, what else can they do that affects the health of communities and the nation? It's a big opportunity. The other example is a Chinese company called Haier.

[B]

That's Haier, spelled H A I E.

[C]

R H A I E R. Haier makes appliances. Haier bought General Electric Appliances in the United States. And Haier is trying to make everybody an entrepreneur. And to see that in Louisville, Kentucky, for a US Company bought by a Chinese company is really pretty dramatic. They're helping their employees and in fact, insisting that some employees start a business based on a higher platform and create an ecosystem around the business. These sound like technical words, but for example, they're not just selling refrigerators, they're creating a food ecosystem. They're not just selling washing machines. They're developing a clothing ecosystem in which they can partner with lots of other companies to make sure that the effects on the environment are benign, that they tie in types of clothing to what a washing machine can handle. Well, you know, they're starting to think much more imaginatively and that's a kind of thinking I think we need inside businesses as well as outside.

[B]

Rosabeth, thanks so much for coming in to talk about this and I hope you've inspired some people.

[C]

Thank you.

[B]

That's Rosabeth Moss Kantor. She's a professor at Harvard Business School and she wrote the new book Think Outside the How Advanced Leaders Can Change the World One Small Innovation at a Time.

[A]

HBR on Leadership will be back next Wednesday with another hand picked conversation from Harvard Business Review. If this episode helped you share it with your friends and colleagues and follow the show on Apple Podcasts, Spotify or wherever you listen while you're there, consider leaving us a review when you're ready for more podcasts, articles, case studies, books and videos with the world's top business and management experts, find it [e-mail] I'm Alison Beard. This episode was produced by Mary Dew. On Leadership's team includes Maureen Hoch, Rob Eckhart, Erica Truxler, Tina Toby Mack, Ramsey Kabaz, Nicole Smith, and Anne Bartholomew. Music by Comu Media. Thanks for listening.