Could businesses benefit from a sense of humor? A.J. Jacobs and Peter McGraw say yes. Jacobs is the bestselling author of Drop Dead Healthy, The Year of Living Biblically and My Life as an Experiment. McGraw is a professor at the University of Colorado Boulder and co-author of The Humor Code: A Global Search for What Makes Things Funny, with journalist Joel Warner. Wharton management professor Adam M. Grant recently interviewed Jacobs and McGraw when they visited campus as guest lecturers in the Authors@Wharton series. In this interview, they discuss when humor can be a valuable skill at work, when humor is best avoided and how business leaders can use the very formula for creating a joke to create a blockbuster business idea.

An edited transcript of the conversation follows.

Adam Grant: How do you think about becoming funny at work? What makes a leader humorous?

A.J. Jacobs:  As my co-interviewee will tell us, analyzing humor can be terribly unfunny. But, that said, I will say that a lot of the humorous thinking has parallels to the way we should be thinking in business. It has a lot to do with creativity: taking disparate ideas and mashing them together, which I think is a way to [create] great businesses…. Chipotle took fast food and healthy food and mashed it together, and they got this super business, which is the same idea as humor. Humor is hard, and you’ve got to come up with a hundred ideas before you get one or two that really work.

That’s a crucial lesson for entrepreneurs. As you know, I read the encyclopedia so there are dozens of examples of this. Chester Carlson invented the Xerox machine. He pitched it to 43 companies before someone accepted it. I was just listening to a radio show about e.e. cummings, who acknowledged in one of his books the 15 publishers who had rejected his manuscript, which seemed a little petty to me, to be honest. I thought he was supposed to be such a joyful person. But anyway, that’s another lesson: taking ideas and working hard. There are plenty of other parallels.

Grant:  Peter, talk to us a little bit about what makes leaders or business people funny from your perspective.

Peter McGraw:  This is clearly a difficult topic. I definitely have had people tell me, “This is too hard to study. You should stick to easier subjects. But yet, as you think about it, humor’s this really important thing, whether it be at home or at work. There seems to be some good evidence that funny or humorous leaders are going to be more successful, at least within certain tasks.

Take the CEO, for example. The CEO doesn’t necessarily need to be humorous, but there are certain roles where having a good sense of humor is going to be useful. For instance, someone who has to deal with shareholders. How do you appease shareholders? How do you present the good and bad news in a meeting in a way that not only avoids being mind-numbingly boring, but also might ease the sting of a little bit of unsteady news along the way? Or how leaders have to push forth change in organizations…. People are really reluctant to make change. The losses can outweigh the gains. Having a sense of humor, being able to make fun, joke about [or] tease people [about their] reluctance to move forward can be a really valuable skill….

“Humorous thinking has parallels to the way we should be thinking in business … taking disparate ideas and mashing them together.” –A.J. Jacobs

Grant:  In a way, you have gone to some pretty extreme lengths to expose yourself to strange experiences that ultimately generate humor. What can we learn about how to become funny from the way that you wrote your books? Do leaders have to actually live their life as an experiment, to go to countries where people are not comfortable with their brand of humor and start pitching it and see what happens? Or do stand-up comedy as a professor wearing a sweater vest? Is that the key to becoming funny?

Jacobs:  When I lived by the Bible, I had this huge beard. It was a topiary. People would avoid me on the street – not necessarily a great way to go about business. But the idea of taking things to the extreme can be very helpful in coming up with business ideas. For instance… I had read [Thomas] Friedman’s book The World Is Flat about outsourcing. I loved the idea, but I was sort of a solo practitioner, a writer living at home. I thought, “How can I do this myself?”

So, I outsourced my life. I hired a team of people in Bangalore, India, to do everything for me. They answered my phone, and they answered my e-mail. They argued with my wife for me.

Grant:  Did they take naps for you?

Jacobs:  I wish they did. They did worry for me. I had all these worries. I said, “You worry about them,” and I felt a lot better. But that’s taking something and pushing it to the extreme, which I think is a great way to generate ideas…. But as a way of brainstorming ideas, take a phenomenon, push it to the edge and see where it goes. New ideas will bloom from that.

Grant:  Peter, you are now back from the extreme?

McGraw:  Yes…. Joel [Warner] and I went to Tanzania to investigate a laughter epidemic that allegedly happened in the 1960s. We went to Japan to try to figure out these crazy game shows. We even spent time in the West Bank in what many people consider a really dark place and a place that wouldn’t be very funny. Yet we found lots of hilarity in Palestine. One useful insight when it comes to humor is that it actually arises from potentially negative things. There’s a Mark Twain quote that I think is very nice. He said, “The secret source of humor [itself] is not joy [but] sorrow. There is no humor in heaven.” Because heaven is this perfect place. It’s a wonderful place to be. But there are just not many things to laugh at.

My tip is to look for the things that are wrong or amiss — what we call “violations” in the world — and seize on those moments and find a way to make them okay, acceptable or safe. There’s this delicate dance, and it’s why this is a really appealing skill. You have to find what’s wrong — a violation — and make it okay, make it benign…. You have to create a safe space. You have to create a culture in which it’s okay to fail — because if it’s not okay to fail, then that’s going to inhibit these risks.

Grant:  How do you stay on that tight rope without falling off? You call these “benign violations” in the book. How do you know when you’re not falling off one side or the other, that it’s either too much of a violation or perhaps not enough?

Jacobs:  I guess a lawsuit. That’s when you realize you’ve gone over the edge. But it certainly is a tight rope: the idea of taking something offensive and something inoffensive and mixing them together and finding just that right [balance]. It is a skill. Humor in business can be very dangerous. Just look at “The Office” with Steve Carell. That is an example of a boss who really wants to be funny, and it’s just sad. So, don’t try too hard. For me, it should be organic. Using humor is a good way to come up with ideas. I don’t necessarily think of myself as a humorist. I just try to be creative and come up with ideas. Some of them, just by their nature of being disjointed and unexpected and surprising, are going to hopefully be funny. But I don’t go into it saying, “Alright, this is going to be hilarious.”

McGraw:  I echo what A.J. says. There are a few things that I think you can do to maximize your chance to be funny and minimize the potential impact. One is take aim at yourself. The target of the joke matters a lot. Wherever possible, the humor should be inclusive, something that we can all laugh about together. As a manager, making fun of yourself is a great way to get things rolling.

“There seems to be some good evidence that funny or humorous leaders are going to be more successful, at least within certain tasks.” –Peter McGraw

That’s actually a trick that we learned in Los Angeles when we were hanging out with all these stand-ups. When a stand-up comedian gets on stage, he or she usually makes fun of the thing that’s just peculiar about them. So, when I got back on stage again at the end of the book to prove that we’ve learned something, my first joke was “I spend a lot of time with comedians, and I learned you need to get a laugh right away. Hence, the sweater vest.”

Wherever possible, keep it inclusive. Stay away from that list of things that your HR manager will send you an e-mail about. Be quick to apologize. I think that people are really willing to forgive if someone’s attempt at comedy was heartfelt and was meant to be positive but somehow failed. I like to say, “This is what happens when a humor researcher tries to be funny.”

Grant:  When you think about humor, one of the questions that comes up a lot has to do with gender, a hot-button issue. What do both the data, as well as experience, say about how men and women are funny in different ways?

Jacobs:  I interviewed Tina Fey for Esquire…. I thought she had an excellent point [on the] difference between men and women comedians. She said that the male writers on [“30 Rock”] had a jar where they would pee. They were too lazy to go to the bathroom. Women would never do that. But other than that, there was not a big difference. I thought that was a good answer — a little bit of a dodge. So, I’m going to take that, and do a little dodge. [Peter], as a scientist, tell us what is the data on men versus women?

McGraw:  What people like to argue is that men are funnier than women. If you ask them to make a case for it, they will point to professional comedy. That’s a fallacious argument. That would be like saying that men are better at medicine just because there are more male doctors. No one really believes that. The literature on regular, everyday people … is that men and women are more alike than different in both their production and appreciation of humor….

Grant:  Another dynamic that a lot of people think about when they try to take humor into the workplace is, “How do you direct it upward?” Can you make fun of your boss?

McGraw:  There is a long history of comedy speaking truth to power. You think about the trickster, the joker. I spent time in the Amazon with Patch Adams, probably the most famous clown today. He said that the joker was the only person who could tell the king he was [ridiculous]. I think that that can be true. You see this oftentimes with political satire and so on, where humor is used to get attention and ease the critique.

That takes some skill. It takes knowing that your boss is going to be a willing butt of a joke and also the audience there — who else might be laughing about that situation. What I often encourage people to do is not to joke about their grievances to their boss. But rather to use humor to complain. I have a project in the Humor Research Lab on humorous complaining and the great benefits of humorous complaining. One problem with complaining to try to change someone else’s behavior and using humor to do so is that you might be telling the person, “This is not really a problem” — because of humor’s association with non-serious situations.

In terms of coping with bad situations, humor seems to be very good. In terms of drawing attention to the problems in the world, seems to be very good. But if you want to right some wrong, you might want to complain about it in a serious way.