Why So Many CEOs Are Engineers

Summary

The script discusses the rising trend of engineers leading successful companies, challenging the traditional preference for MBAs. It highlights that in 2018, more CEOs had engineering degrees than MBAs, with notable examples like Jeff Bezos and Elon Musk. The script argues that engineers' technical expertise and problem-solving skills are crucial for innovation and product development. It also features stories of engineers like Satya Nadella and James Dyson, emphasizing their hands-on approach and dedication to detail. The video concludes by suggesting that a strong foundation in math and computer science is essential for aspiring engineers and problem-solvers.

Takeaways

• 👨‍💼 The trend of CEOs with engineering backgrounds is increasing, with more engineering degree holders leading top companies compared to those with MBAs.
• 🏫 MBAs, traditionally considered a pathway to CEO positions, are now being questioned for their value, especially with high costs and a shift in focus towards product innovation.
• 💡 Elon Musk advocates for less MBA influence in companies, suggesting that business degrees may lead to excessive focus on board meetings and finances rather than product development.
• 🚀 Musk's success at Tesla and SpaceX is attributed to his self-taught engineering skills and his focus on creating high-quality products that drive profits.
• 🤖 Engineering CEOs like Satya Nadella at Microsoft have demonstrated the ability to innovate and adapt their companies to changing market conditions, emphasizing the importance of technical knowledge.
• 💼 The background in math, science, and technology of engineers is beneficial for designing, building, and improving products, as well as solving technical challenges.
• 💡 Technical know-how is highly valued in the business world, as seen in the praise for Musk's deep understanding of his products by Sandy Munro, an engineering consultant.
• 💡 The innovative spirit of engineering has been credited with saving companies like Microsoft, which needed to adapt and innovate to remain competitive.
• 🛠️ Engineers are known for their problem-solving skills, which are applicable across industries, from building bridges to designing rockets for Mars.
• 💡 Persistence and attention to detail are key traits of successful engineers, exemplified by James Dyson's 15-year journey to perfect his vacuum cleaner design.
• 🔍 The hiring process at companies like Amazon, led by Jeff Bezos, emphasizes the importance of analytical thinking and problem-solving, qualities often associated with engineers.

Q & A

What commonality do Jeff Bezos, Tim Cook, Sundar Pichai, Lisa Su, Mary Barra, and Jensen Huang share?

They are all engineers and are currently or have been the heads of some of the most successful companies in the world.

What was traditionally considered the best educational path for aspiring CEOs?

Getting a Master of Business Administration (MBA) degree was traditionally considered the best path for aspiring CEOs.

According to the Harvard Business Review's 2018 findings, which type of degree was more common among top-performing CEOs?

In 2018, there were more CEOs with an engineering degree than an MBA, with 34 having engineering degrees compared to 32 with MBAs.

What is Elon Musk's opinion on MBAs running companies?

Elon Musk believes there might be too many MBAs running companies, as they tend to focus too much on board meetings and finances rather than on product development.

What is the advantage of having an engineering background for a CEO according to the script?

An engineering background allows CEOs to design, build, create, and improve their products and solve challenging technical problems due to their knowledge in math, science, and technology.

What degree does Elon Musk actually hold, and how did he learn about rocket science?

Elon Musk holds a degree in physics and economics, and he is a self-taught engineer who learned about rocket science by reading books.

What significant change did Satya Nadella make when he became the CEO of Microsoft?

Satya Nadella transformed Microsoft by moving its software to non-Windows devices and expanding its cloud business Azure, making it a major competitor to Amazon's AWS.

How did James Dyson demonstrate his perseverance and attention to detail?

James Dyson spent 15 years and created over 5,000 prototypes to develop the perfect bagless vacuum design, which led to the creation of the multi-billion dollar company that bears his name.

What is Amazon's approach to hiring according to the script?

Amazon is known for its tough interviews, and Jeff Bezos used to meet every candidate himself during the company's early days, asking analytical questions to assess their problem-solving skills.

What is the significance of a good foundation in math and computer science for those interested in engineering or learning more about the world?

A good foundation in math and computer science is crucial for problem-solving and is essential for anyone aspiring to become an engineer or wanting to understand the world better.

What resource is mentioned in the script for those looking to improve their skills in math, science, and computer science?

The script mentions Brilliant, a problem-solving website offering over 60 interactive courses in math, science, and computer science, as a resource for skill improvement.

Outlines

00:00

🔧 The Rise of Engineer CEOs

This paragraph discusses the increasing trend of engineers leading successful companies, contrasting the traditional path of obtaining an MBA. It highlights that in 2018, more CEOs had engineering degrees than MBAs, as reported by Harvard Business Review. The paragraph also touches on the high cost of MBA programs and notable figures like Elon Musk, who criticizes the overemphasis on business degrees. Musk advocates for a focus on product development, which is a strength of engineers due to their technical background. The narrative includes examples of engineers who have become CEOs and their contributions to innovation and problem-solving within their companies.

05:05

🎓 Emphasizing the Importance of Math and Computer Science

The second paragraph shifts focus to the importance of a strong foundation in math and computer science for aspiring engineers or anyone interested in the world of technology. It promotes a problem-solving website called Brilliant, which offers over 60 interactive courses in relevant fields. The platform is described as a valuable resource for learning at one's own pace without the pressure of exams, providing personalized feedback on mistakes. The paragraph concludes with a call to action for viewers to sign up through a provided link, with an incentive for the first 200 users to receive a discount on a Premium subscription.

Keywords

💡Engineers

Engineers are professionals who apply scientific principles to design, build, and maintain structures, machines, systems, and processes. In the context of the video, the theme revolves around the increasing prevalence of engineers in leadership roles, particularly as CEOs of major companies. The script mentions several examples, such as Jeff Bezos, Elon Musk, and Satya Nadella, who leverage their engineering backgrounds to drive innovation and solve complex problems within their respective companies.

💡MBA

An MBA, or Master of Business Administration, is a graduate degree that emphasizes business and management skills. Traditionally, it was considered a key qualification for aspiring CEOs. However, the video script points out that the trend is shifting, with more CEOs having engineering degrees than MBAs, suggesting that technical expertise is becoming more valued than business administration in top corporate leadership roles.

💡Product Focus

Product focus refers to the emphasis on creating and improving products as the central strategy for a company's success. The script highlights that CEOs with engineering backgrounds, like Elon Musk, prioritize product development over other business activities. Musk's approach at Tesla and SpaceX is cited as an example, where the focus is on building high-quality electric cars and reusable rockets, respectively.

💡Innovation

Innovation is the process of translating an idea or invention into a good or service that creates value or for which customers will pay. The video emphasizes the importance of innovation in the success of companies, particularly when led by engineers. Satya Nadella's transformation of Microsoft is mentioned as an example of innovation in action, where he expanded the company's cloud business and adapted its software for non-Windows devices.

💡Technical Know-How

Technical know-how refers to the practical knowledge and skills required to perform a job or activity that involves technical processes or machinery. The script praises the technical expertise of engineers-turned-CEOs, such as Elon Musk, who have a deep understanding of their products and can contribute significantly to their design and improvement.

💡Problem-Solving

Problem-solving is the process of finding solutions to problems or challenges. The video script suggests that engineers are particularly adept at problem-solving due to their training in logic, analysis, and critical thinking. This skill is highlighted as a key attribute that helps engineers excel in leadership roles, as they can tackle complex issues that arise in business.

💡Risk-Taking

Risk-taking involves making decisions that could lead to significant gains or losses. The script implies that successful engineering CEOs are not afraid to take risks, as seen in the example of James Dyson, who spent 15 years and created over 5,000 prototypes before perfecting his bagless vacuum design.

💡Hiring Standards

Hiring standards refer to the criteria or requirements set by a company for selecting new employees. The video mentions Jeff Bezos's approach to hiring at Amazon, where he used to meet every candidate and ask analytical questions to assess their problem-solving skills, emphasizing the importance of setting high hiring standards for company success.

💡Discipline

Discipline in this context refers to the systematic and organized approach to learning and applying knowledge, often associated with the study of engineering. The script points out that the discipline engineers acquire through their education, such as problem-solving and analytical thinking, is applicable not only to technical tasks but also to broader business challenges.

💡Brilliant

Brilliant is a problem-solving website mentioned in the script that offers over 60 interactive courses in math, science, and computer science. It is presented as a resource for those interested in engineering or who want to improve their problem-solving skills, with a focus on learning at one's own pace without the pressure of exams.

💡Premier Subscription

A Premier Subscription, as mentioned in the script, is a type of membership that provides unlimited access to all courses on the Brilliant platform. The script promotes a special offer for the first 200 people who sign up using a provided link, which includes a 20% discount on this subscription.

Highlights

Many successful CEOs like Jeff Bezos, Tim Cook, and Sundar Pichai have engineering backgrounds.

Harvard Business Review found more CEOs with engineering degrees than MBAs in 2018.

Elon Musk believes MBAs may focus too much on business aspects rather than product development.

Engineering background is beneficial for designing, building, and improving products.

Sandy Munro commends Elon Musk's deep technical knowledge about his products.

Satya Nadella, an engineer, transformed Microsoft under his leadership.

Nadella made Microsoft relevant by expanding its software to non-Windows devices.

James Dyson's perseverance led to the creation of a multi-billion dollar company.

Engineers are known for their problem-solving skills, which is crucial in business.

Jeff Bezos used to personally interview candidates in Amazon's early days.

Bezos emphasized the importance of hiring candidates with an analytical approach.

Engineers excel in both tech and non-tech industries due to their problem-solving abilities.

A strong foundation in math and computer science is essential for aspiring engineers.

Brilliant offers over 60 interactive courses in math, science, and computer science for free.

Brilliant's courses are designed for self-paced learning with no exams.

The first 200 people to use the provided link get 20% off the Premium subscription.

Transcripts

There's one similarity between Amazon and Blue  Origin CEO Jeff Bezos, Apple's Tim Cook, Alphabet's   

Sundar Pichai, AMD's Lisa Su, General Motors'  Mary Barra and NVIDIA's Jensen Huang. These  

days, the heads of some of the most successful  companies in the world have one thing in common.

They're engineers. For those who aspire to be  CEO of a company one day, getting an MBA - a Master  

of Business Administration degree - used to be  the way to go. But that's not so true anymore. 

Harvard Business Review used to publish an annual  list of the top 100 best-performing CEOs. In 2018,  

they found that for a second year in a row, there  were more CEOs with an engineering degree than  

an MBA. 34 compared to 32. Some had both. Getting an  MBA can come with a hefty price tag. Top graduate  

schools such as the University of Pennsylvania's  Wharton or Harvard Business School will set you  

back over $200,000. Now, some CEOs are telling you to save your money.  

Elon Musk went so far as to say, "I think there  might be too many MBAs running companies" in an  

interview with the Wall Street Journal. He thinks  those with business degrees spend too much time  

in board meetings pouring over power points and  finances when their focus should be on the product.  

The thinking being that if the product is good the  profits will follow. In the case of Musk that means  

building great electric cars at Tesla or great  reusable rockets at SpaceX. That's where being  

an engineer is helpful. Engineers can design, build, create, and improve their product because of their  

background in math, science, and technology. And they  can help solve challenging technical problems that  

might otherwise scuttle their dreams. Technically,  Musk has a degree in physics and economics not  

engineering. He's a self-taught engineer who  read books to learn about rocket science.

When engineering consultant Sandy Munro interviewed him for his YouTube channel 

Munro Live, he said it's Musk's knowledge that  stands out. I was blown away. I've seen dozens  

of CEOs. I've never seen a CEO ever or a president  that knew more about the product. That technical  

know-how that comes with an engineering background  goes a long way toward building better products.  

Just ask Satya Nadella, the engineer  at Microsoft who rose to become CEO.  

When he took over the top job in 2014, he had to  figure out a way to make Microsoft relevant as it  

faced an onslaught from Apple. We now need to make  Microsoft thrive. The software company struggled to  

thrive under the leadership of his predecessor  Steve Ballmer. Its products were far from  

revolutionary. The Surface was a response to the  iPad, the Windows phone and answer to the iPhone.  

Ballmer has a degree in mathematics and economics  from Harvard which helped balance the books but

didn't do much when it comes to innovation. When  Nadella took over, he transformed Microsoft - moving  

its software to non-Windows devices. For example,  bringing Microsoft Word to the iPad and the iPhone.  

He also expanded its cloud business Azure which  has become the biggest rival to Amazon's AWS.  

In his first email to employees as CEO, Nadella  wrote: "Our industry does not respect tradition - it  

only respects innovation." That innovative spirit  of engineering saved Microsoft. But it's not easy.  

It requires risky moves and not accepting failure.  As American inventor Thomas Edison famously said: 

"I have not failed. I've only found 10,000 ways that  won't work." James Dyson, the British engineer, knows  

a thing or two about not giving up. He became  frustrated when a vacuum he had at home kept  

losing suction. So he decided to build a better  vacuum himself. He spent 15 years tinkering with  

over 5,000 different prototypes to come up with  the perfect bagless design. I'd like to give  

you a little demonstration. The payoff for his  perseverance was a multi-billion dollar company  

that bears his name. In order to be successful,  Dyson was invested in the fine details of his  

company. Engineers aren't afraid to get involved in  the day-to-day business - especially when it comes  

to hiring. Amazon is notorious for tough interviews.  Bezos, who has a degree in electrical engineering  

and computer science, used to meet every candidate  himself during Amazon's early days. He would ask  

quirky questions like: How many gas stations are  there in America? He wasn't after the right answer  

but wanted to see whether the candidate had an  analytical approach in order to come up with an  

informed response. Bezos once said setting the bar  high for hiring was the most important factor for  

the online retailer's success. It's no surprise that  engineers make it to the top of the tech industry  

which has seen explosive growth over the years.  But they're also doing well at non-tech companies.  

Like Jeffrey Sprecher, the CEO of the holding  company that owns the New York Stock Exchange.  

He has a degree in chemical engineering. I've never  had a job that had anything to do with chemistry  

but the discipline that I went through there  taught me about problem-solving and business  

is really just that. Engineers are very good at  solving problems and that's the key to doing  

everything from building a bridge across a  river to designing a rocket to get to Mars.

If you've been inspired to become an engineer  or simply want to learn more about the world,

a good foundation in math and computer science is  crucial. A problem-solving website called Brilliant  

can help put you on the path to success. And it's  free to sign up. Whether you want to practice  

programming, you're struggling with calculus, or  you're hoping to brush up on your algorithms, my  

sponsor Brilliant offers over 60 interactive  courses in math, science, and computer science.  

You can learn at your own pace, there are no  exams. If you make mistakes while practicing,  

Brilliant explains exactly where you went wrong.  You can sign up with the link in my description.  

And the first 200 people to use my link will  get 20% off the Premium subscription which  

gives you unlimited access to all the courses. 

Thanks for watching Newsthink.

I'm Cindy Pom.