Author: supermoxie

I have written about research on superstars
by Harvard  Business School’s Boris
Groysberg before, both here and in Hard
Facts. He has complied compelling evidence from both investment analysts and
GE senior executives suggesting that star employees are less “portable” than
many executive search firms might lead you to believe. BUT as I’ve blogged
about, if you are going to hire a star from another firm, their odds of success
go up substantially if you take
both the star and his or her team. Boris tells me that he is currently
finishing a book on the topic, which I look forward to reading.

But this post is about The No Asshole Rule. Boris wrote me a pair of detailed notes about
a series of case studies that he has done that track Lehman Brothers’ research department
over a 20 year period.  Boris reports
that “the rule” helped fuel the rise of the research department there, and then
when it was abandoned, was linked to performance problems, and when it was
reinstated, performance again improved.

You can buy these case studies at www.hbsp.com.  Here is a link to all of Boris’
Harvard Business School Press writings (his HBR articles are very thoughtful
too).  I will order and read the cases. But here
is his summary of the power of the no asshole rule from the four cases that
Boris and his collagues wrote:

Ashish Nanda and I wrote a
series of cases on the Lehman Brother research department, and its initial rise
under Jack Rivkin who implemented the "no asshole" rule (although we
had to rephrase it in the case to the "no jerks" rule to adhere to
the HBS standards even though everyone still described it as the "no
asshole" rule). The no asshole rule at Lehman really helped to create a
culture of teamwork, collaboration and many believed it drove the strong
performance of the department.  Under Rivkin’s rule, Lehman’s research
department became number 1 on Wall Street during 1990-1992, but the department
fell in ranking shortly after Rivkin got fired. Later, the department got
reinvented, which led to its subsequent rise again (with the "no
asshole" rule reinstated).  In fact, we tracked this research
department over a 20 year period, documenting HR polices and culture through
its different transitions.

In the “Lehman Brothers: Rise of
the equity research Department” case (the A case), Rivkin was emphatic about
who he would not hire. “I have a ‘no jerk’ policy,” he declared. “No matter how
good an analyst may be, given the structure we are trying to create here I am
not going to bring a jerk into the department. To me, a jerk is someone
difficult to manage, marching to his own drummer, not interested in what was
going on within the department and within the firm. We are just not going to
have people like that here.”  Recalled
Balog, former star analyst and associate research head, “Jack was very clear in
telling us that life’s too short to have prima donnas in the department even if
they were number one ranked people. We wanted people that were well rounded and
could have fun with others.”

 As one after another analysts attested,
they loved working there under Jack Rivkin and Fred Fraenkel, and many passed
up attractive offers to stay at a firm where their performance was supported in
every conceivable way, and to be part of something they valued. “The research
directors of other Wall Street firms were flabbergasted,” Fraenkel recalled.
“Our people . . . were better analysts than they would be somewhere else
because of the people in their team helping them and giving them insights into
their industry. Our competitors were offering them jobs with hundreds of
thousands of dollars more salary, yet they didn’t find it worthwhile to
dislodge from what they had here.”

Under Rifkin and Fraenkel, Lehman’s
research department achieved high performance with a budget considerably
smaller than that of Merrill Lynch and Goldman Sachs. (In 1992, Lehman’s
research department budget was about $70 million, compared with Goldman’s $105
million and Merrill’s $125 million.) This is a phenomenon known in the department
as “the Jack Rivkin discount.” Also, the Lehman A case tracks the turnover
statistics which are significantly lower than the industry. The quotes and
numbers are from the Lehman Brothers A-D cases.

Boris wrote me a second email that further documents the
power of the no asshole rule in another firm:

In our study of research departments, a
number of firms had “no-asshole” rule as an important organizational practice.
So you are capturing something that more and more managers are explicitly
thinking about and advocating. Let me offer you another example. In our study
of research departments between 1988 and 1996, Ashish Nanda and I found that
star analysts had 11.8 percent turnover rate, however, there were big
differences by firms. More remarkably, Schroeder Wertheim lost only two ranked
analysts over the course of nine years, for a total star turnover rate of about
2 percent (the lowest turnover rate).

Attached is an excerpt from my interview
with Barry Tarasoff, research director at Schroder Wertheim, who elaborated on
the strategy that he took, which resulted in the lowest star turnover rate in
the industry from 1988 to 1996. “There isn’t any one magic potion. But the
number-one thing—I called it Tarasoff’s First Principle—was ‘no assholes.’ When
we recruited, we made an enormous attempt to bring in reasonable people. So we
had a group of people that liked each other a great deal. Number two, we had a
distinctive culture that you could never export to another firm.” The
“no-asshole rule” was able to contain turnover.

Thank you Boris! This is great stuff.  I continue to be surprised how many firms have
explicit “No Asshole” rules. In fact, I visited SuccessFactors
last week and will be writing more about their “no assholes” rule and how it is
woven together with 12 other “rules of engagement” such as transparency and
teamwork. CEO Lars Dalgaard has built an impressive culture – energetic,
performance-driven, and refreshingly free of bullshit. I especially love has
last rule for all employees (including himself) ‘I
will be a good person to work with – Not territorial, not be a jerk, and as
Lars says often “it’s OK to have an asshole – just don’t be one”’ Now
that is my kind of workplace!

I’ve enjoyed the thoughtful reactions, additions, and suggested edits to my post a few days ago on 10 Things I Believe.   I posted my 10 things without explaining why I believed them, which led to people come up with creative explanations that never occurred to me.  In particular, Ann Michael over at manage to change had some great ideas about why "Indifference is as important as passion." Ann suggested:

Passion can make you too
close to something.  

We all need to be able to
step back and disconnect. In order to
see flaws in the plan, respect the input of others, and maintain an open mind,
a little indifference can go a long way. 

One other thing, too many
disrespectful actions are explained away by passion. It’s as if passion can be the get-out-of-being-called-a-jerk-free card.  

Passion is NOT a license
to steam roll everyone in your path!

I think Ann’s ideas are great, as I said, ideas that never occurred to me. For the record, here are my original two reasons, but some of you likely have others as well.

The first reason stems from human cognitive limits.  As we all know, and as modern psychology has shown in gory detail, human beings can do a limited number of things at once, and even the best "multi-taskers" in the world are doomed to fail if they try to do too many things at once. So if you try to put all your emotional and physical effort into everything you do, you will end do everything badly.  Indifference is a key survival skill as there are some things you may need to do, but are so unimportant (or so badly done, like Stanford’s sexual harassment training) that not caring as you travel through them is the best answer. And indifference can also help you sidestep things that seem important, but really aren’t, allowing you to focus on the few things that really matter.

I talk a lot about the second reason in The No Asshole Rule. A hallmark of strong organizational cultures and effective work teams — and effective leaders and other organization members — is that they devote great passion and great emotional energy to what they do.  A people in such places really CARE about the people around them. Passion is a wonderful if your organization and your colleagues care about you.  BUT it is recipe for self-destruction if you are trapped in a job with a demeaning boss, or worse yet, knee-deep in an workplace where asshole poisoning runs rampant.  If you face constant abuse, then (until you can get out) going through the motions and "not letting it touch your soul" is one tactic that can help you survive with your self-esteem intact. In my view, when organizations and bosses treat their people badly, they get what they deserve when their people respond by becoming emotionally detached and doing as little as possible without getting fired.  In this imperfect world,  there are times when learning "not to give a shit" is the best short-term solution available.

Also, to return to Ann’s point, I agree that people who are too passionate about what they are doing run the  risk of becoming assholes who steam-roll others (I love her point that passion can give them a "get-out-of-being-a-jerk-free card"). Ann’s point reminded me of David Maister’s insightful list of "I’ve been an asshole when,"  seven points that he started with "I
got overexcited and over enthused on a topic (I lose my sense of proportion ,
just keep trying to make my point and don’t let people finish their sentences)."  I plead guilty: when I think of the times when I’ve been a temporary asshole, it has often been when I am "overexcited and over enthused" as David put it. One solution is to find a way — or have someone else help you — to turn down your passion and turn up your indifference. (The rest of his list is fantastic, they all struck home with me.)

In closing, let me emphasize that, on average, it is likely wiser to err on the side of caring too much rather than caring to little.  Passion leads people to do great things and to travel through life caring about their work and each other — it often makes the world a better place. But indifference is worth talking about because it is something that management and workplace writers rarely consider.

The publishing business is sufficiently strange that, although The No Asshole Rule doesn’t come out until February in the US  and  the UK,  my publisher Hanser has been selling the German language version since October.  I was in Germany in early October for a book tour and I had the remarkable experience of going to the Frankfurt Book Fair, which is largest and most famous book fair in the world — and is stunning in sheer physical size and number of books. All the big and famous publishing houses were at Frankfurt.  But I was most struck by the thousands of publishers in the world that scrape along selling remarkably few books each year, yet they make th trek to Frankfurt each year. 

Der Arschloch-Faktor ("The Asshole Factor") is doing well.  We got press coverage in everything from the respectable German-language version of the Financial Times to the tabloid Bild (which Wikipedia claims is the best selling newspaper in Europe),  where they ran three articles on the book including a "self-test" to help determine if you are, and asshole (or I guess an "Arschloch"). My editor, the enthusiastic and relentless Martin Janik, reports that the book has gone into the third printing already and is currently #4  on Focus magazine’s business books best-seller list. Der Arschloch-Faktor has been in the top 50 books on Amazon in Germany, and currently was ranked  29th among all books last time checked.  As I say in my headline, thank you Germany!

I am getting quite a few emails from German readers about workplace assholes,  I got an especially interesting one from a fellow who asked about the problem of dealing with his demeaning and cruel professor.   He is in an especially difficult predicament victims because of the power differences between faculty and students.  Der Arschloch-Faktor does offer ideas about how to deal with assholes you can’t get away from, including looking for small victories and learning how to practice indifference.  But I didn’t have any instant or easy answers for that oppressed student  — life isn’t always so simple.  But it did remind me about the power differences between Stanford students and faculty members like me, which is something that is all too easy to forget, and something to remember at all times because we can — often unwittingly — make their lives miserable. 

I am curious to hear from more German readers about "asshole management" problems and solutions in their workplaces , especially about the tactics that people use to battle back against oppressive superiors and peers.

P.S. Der Arschloch-Faktor sold very well over the holiday break and is now the the top selling business book on German Amazon.  Thank you again Germany! 

Gretchen
over at The Happiness Project had a lovely and thoughtful post yesterday called
smile,
smile, smile.  She ended the post by saying: ‘And
apart from its effect on my dealings with other people, smiling makes me feel
happier. Actions trigger feelings, so by going through the motions of feeling
happier, I change my mood. Thich Nhat Hanh wrote, “Sometimes your joy is the
source of your smile, but sometimes your smile can be the source of your joy.”’

There
are some very important ideas in this post, and in fact, they are backed by
some rigorous research. The first is that, as Gretchen implies, if others see
you smiling and experience you as warm, they are more likely to believe you are
a nice person and more likely to comply with your requests.  That is an
old finding, and there are interesting studies of tipping that show, as you
would expect, a friendly waiter or waitress hauls in bigger tips. So if you
want to signal to others that you aren’t an asshole, a little smiling and
warmth will go a long way.  My colleague Anat Rafaeli and I did a bit of
research and writing on the expression of emotion in organizational life in the
1980s and 1990s, and this theme can be found throughout the behavioral
sciences.  We wrote a couple papers reviewing the literature that are
especially relevant:

Rafaeli & Sutton (1989) The expression of emotion in organizational life. In L.L. Cummings &
B.M. Staw (Eds.), Research in Organizational Behavior, Vol. 11: 1-42.

Rafaeli & Sutton (1987) Expression of emotion as part of the work role. Academy of Management Review.  12:23-27 

Gretchen’s
other point is the especially interesting one: her claim that smiling makes her
feel happy. This may sound like one of those wacky theories, but it turns out
that a series of rigoruous studies by Robert Zajonc and
his colleagues show that, in fact, smiling brings about physiological changes
that make you feel happy, and frowning bring about changes that can make you
feel sad and grumpy.  The upshot of all this, from an asshole management
standpoint, is that if you feel like an asshole, smile or (as I explain below)
start saying the letter "e" over and over again.  And if other
people are getting nasty, try to get them to smile or say the letter
"e," and to stop frowning and saying the letter U.

I
know it sounds crazy, but Zajonc is one of the most creative and influential
psychologists in history.  Here is the research as I summarized it in Weird
Ideas That Work.

‘“There
is now compelling evidence that smiling causes people to feel happy. Requiring
people to smile, no matter how they really feel at first, results in increased
positive feelings; frowning conversely decreases positive feelings. Robert
Zajonc and his colleagues show that smiling leads to physiological changes in
the brain that cool the blood, which in turn makes people feel happy. [A series
of experiments] show that positive emotion and cooler facial temperatures result
when people saying the letter “e” or the sound “ah” over and over again,
apparently because making these sounds requires a smile-like expression. These
[experiments] also show that negative emotion (and hotter facial temperatures)
result from repeating sounds like the letter O or the German vowel ü,
apparently because making these sounds require a frown-like expression to
pronounce. This effect was found to be equally strong in both German and
American research subjects. These researchers also found direct effects of
temperature on emotion, demonstrating that people who have had cold air blown
up their noses are happier than those who have had hot air blown up their
noses. Hundreds of other studies show that hot temperatures are a powerful and
reliable cause of foul moods and interpersonal conflict (especially aggression
and violence).

So,
if you want to be really weird, try increasing happiness (and thus creativity)
by having your people say “ah, ah, ah,” “e, e ,e, e,” or perhaps saying
“cheese” over and over again, blowing cold air up their noses, or just keeping
the buildings cold where creative people work. Or as Jane Dutton at The
University of Michigan told me after she heard Robert Zajonc talk about these
ideas: “When I want to get in a good mood, I’ll just go home and stick my head
in the refrigerator.”’

Here are key
references for those of you who want to dig into this issue. Note that this
research is published the very best peer reviewed journals in psychology – and
of course Science is an equally serious publication that reaches a wider
audience.

Anderson, C.A. “Temperature and Aggression: Ubiquitous
Effects of Heat on the Occurrence of Human Violence”, Psychological Bulletin
106 (1989): 74-96.

Baron, R., Human Aggression (New York:
Plenum, 1977)

Griffitt, W., “Environmental Effects On
Interpersonal Affective Behavior: Ambient-Effective Temperature And
Attraction”, Journal of Personality and Social Psychology 15 (1970):
240-244.

Zajonc, R.B. “Emotion and Facial Efference: An
Ignored Theory Reclaimed”, Science 228 (April 5, 1985): 15-21

Zajonc, R. B., S. T. Murphy, & M. Inglehart,
“Feeling and Facial Efference: Implications of the Vascular Theory of Emotion” Psychological
Review 96 (1989): 395-416.”

This research has some pretty weird
implications for effective “asshole management.”   A German study
that followed from this research showed that people reported being in better
moods when they put a pencil between their teeth (creating a smile-like
expression) and they reported being worse moods when they put a pencil between
their lips (creating a frown like gesture). The effects uncovered in these
studies on mood are not huge, but they are consistent and statistically
significant. 

So, I am not sure I am joking or not, but next time
you enter a den of assholes, you might use this research to “cool them out:”
turn down the heat or crank up the air conditioning, give them cold drinks,
show them funny movies, ask them to keep smiling, get them to say “e e e e e”
over and over again, and pass out some pencils and ask them to bite down on
them during the meeting. [I invite other equally weird ideas… in fact Zajonc
tells me that putting those band-aid things on your nose as some athletes do
might also facilitate positive emotion because it helps cool air get to the
brain more efficiently, so you might have people put those things on).

Of course, if you act this weird, it may turn a
group of uptight assholes against you — but they are evidence-based practices!

I wrote a post last week asking readers for ideas about what to call The No Asshole Rule in Spanish.  I offered free books (in Spanish and English) to the first 5 people who made suggestions, and I was delighted with the range and thought that people devoted to the question (including some suggestions for the French version, which will be coming out).  The last suggestion I received was especially amazing. It came from Diego at Metacool, but resulted from a long conversation among Diego, Diego’s father, and Diego’s uncle Valentin Sama.   Valentin Sama is a professor in Madrid and he runs a very cool web photography magazine called DSLR — check it out.  The comment is so good that and complex that it is well worth repeating as a post for those of you who did not dig into the comments:

Bob,

I think you should be able to find a Spanish version of the title,
but I think you have a challenge in terms of getting the idiomatic fit.
I asked a Spanish friend of mine (my uncle), and he said the following:

"Desde luego, absolutamente, para España, no sirve lo de "pendejo".

Si no se quiere utilizar gilipollas, podría usarse la palabra
tradicional de "idiota" o "imbécil".

Curiosamentes, estás palabras, que al igual que gilipollas son ahora
insultos, vienen de una degradación del uso de la palabra médica
"idiocia", de donde se deriva "idiota".

Ahora me entra la duda añadida de si "Rule" se emplea no como "regla" o
"norma", sino como "ruling" o sea, del hecho de "gobernar", "dominar"?

El autor del libro debe asumir, pienso, distintos títulos para américa
latina y para España. En España no sirve "pendejo" que es más bien el
aficionado a irse de juerga, pero sirve "idiota", "estúpido", "imbécil",
y desde luego, si se es más valiente, "gilipollas".
Desde luego, "polla" viene de "cock", y en ocasiones, cuando no se
quiere decir "gilipollas" se tiene a decir "gilipuertas", pero eso ya es
muy, muy idiomático.

He leido algunos de los ejemplos, y lo que definen ahí como asshole, más
que un gilipollas es un "hijo de puta", "son of a bitch", pero eso ya es
muy fuerte."

So, something like "pendejo" won’t work in Spain, but might work for
Latin America. He suggested "gilipollas" as the term in lieu of
asshole, but it’s stronger, maybe too strong. If you can localize (and
there’s a strong argument for that move), you could put pendejo for the
Americas and gilipollas for Europe.

Are you open to changing the cover art? A great suggestion from a
wise person I know (of Cuban and Venezuelan extraction) would be to put
"gilipollas" or whatever the word is on the cover with the
international "no" symbol (as in Ghostbusters) over it.

The No Asshole Rule: Building a Civilized Workplace and Surviving One That Isn’t Sutton, Robert I. (Author) ISBN: 0446526568 Warner Business Published 2007-02 Hardcover, $22.99 (224p) Business & Economics | Business Etiquette; Business & Economics | Business Life – General Reviewed 2006-12-18 PW

This
meticulously researched book, which grew from a much buzzed-about
article in the Harvard Business Review, puts into plain language an
undeniable fact: the modern workplace is beset with assholes. Sutton
(Weird Ideas that Work), a professor of management science at Stanford
University, argues that assholes-those who deliberately make co-workers
feel bad about themselves and who focus their aggression on the less
powerful-poison the work environment, decrease productivity, induce
qualified employees to quit and therefore are detrimental to
businesses, regardless of their individual effectiveness. He also makes
the solution plain: they have to go. Direct and punchy, Sutton uses
accessible language and a bevy of examples to make his case, providing
tests to determine if you are an asshole (and if so, advice for how to
self-correct), a how-to guide to surviving environments where assholes
freely roam and a carefully calibrated measure, the "Total Cost of
Assholes," by which corporations can assess the damage. Although
occasionally campy and glib, Sutton’s work is sure to generate
discussions at watercoolers around the country and deserves influence
in corporate hiring and firing strategies. (Feb.)
                                       

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