A-Rod on the cover of the New York Post today. He confessed later in the day.
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A-Rod the A-Hole in the New York Post
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Constructing a Civilized Guild: The World of Warcraft
The notion that online gaming communities enjoy and suffer from pretty much the same features as other human groups is something that social scientists are looking into pretty seriously these days. As I posted about a pretty long time ago, is something Joi Ito has been experimented with as well. So it was interesting to see this post on Constructing a Civilized Guild at The World of Matticus. "Matt" explains:
Every time we play WoW, we interact with various people. We interact
with people in parties. We interact with players in trade chat or out in
the world. And there is no place we interact more then in our own
guild. Whether you care to admit it or not, most guilds have an
asshole. I’m not talking about the jerk who likes to get on his fat
mount and block the quest turn in guy. Or the jackass who likes to hop
up and down on your fishing bobber.No, the assholes I’m talking about represent a type of cancer in
your guild. You might be aware of it but most of you might not be.This post is intended to be a wake up call.
I was especially intrigued by this comment (there were a lot), as it sounds almost exactly like challenge of dealing with star employees who are jerks, and they way that great bosses deal with them.
Assholes usually get away with it because they and their friends are
typically among the more skilled in the guild. If you react too
harshly, you risk your whole guild falling apart. But if you don’t do
anything, people will start to leave as well. The only real solution is
to confront the asshole’s behavior and give him a warning. If his bad
behavior has been mostly confined to private chat and some guild chat,
you can keep the rebuke and warning private. If it’s public (like a
venomous thread on the guild’s forums), you have to respond publicly.
If he fails to heed this warning, you have to act and gkick him. I’d
rather the guild dissolve or take a setback than deal with that kind of
behavior.The lesson, of course, is that no matter where we go, we are still human-beings!
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Bud Crystal Bashes Heads of HR
I wrote earlier in the week about research done by Charles O'Reilly and his colleagues on executive compensation. One of his collaborators is long-time compensation consultant Bud Crystal, who has a an interesting web site called The Crystal Report. Indeed, this is Bud's 50th year in the executive compensation field. Bud's site is pretty sparse at first glance, but once I started digging in and reading Bud's writings, I was quite taken with his strong point of view, experience, and great stories.
For example, Bud tells an old story in "Stephen O'Byrne: A Serious Thinker About Compensation" that, unfortunately, could happen again in many companies:
The Way Most H.R. Professionals Think
The thinking of so many HR professionals was never made more clear to me than on the day John F. Kennedy was assassinated. I was then a junior corporate compensation executive at General Dynamics Corp., the major aerospace firm, which at that time was headquartered in Manhattan.
A few minutes after the terrible news broke, I received a call from my boss’ boss, the corporate head of H.R. He said: “Quick, call 20 other major companies in New York and see if they are going to give their employees time to go to church this afternoon.” Why I was not fired for insubordination, I will never know, but I shot back: “Algie, I’m not going to do it. What difference does it make what other companies are doing? Make a decision.”HR people often get more abuse than they deserve because they are so
often put in a position where no one notices them when they do
something right, but they get blamed out of proportion when things go
wrong. A classic fate of people who have responsibility, but not
enough authority. So they often are very timid about taking action
because they get punished for doing even the most obviously right
things. Not all companies create this difficult situation for HR
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Jeff Pfeffer at BNET: When Will We Ever Learn?
My colleague and close friend Jeff Pfeffer is now writing some stuff at BNET. You might not always agree with Jeff (I sure don't, our motto when we write together is "when two people always agree, one of them is unnecessary" or "the more we fight, the better we write"), but Jeff is deeply smart and loves being irreverent. I will try to figure out how to link to the set of columns, but I really liked this one called "When Will We Ever Learn." Jeff describes three (evidence-based) reasons that people are so bad at learning from past mistakes: Lack of focus on understanding failure, over-reliance on compensation as a management tool, and hubris. I might add confirmation bias (people see, remember, and believe evidence that fits their biases much better than evidence that clashes) and "rosy retrospection," the tendency to forget the bad and remember the good about the past (even good things that didn't ever really happen).
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Companies that Have Never Laid-Off Employees
Check out this interesting Fortune story — it talks about 9 of their 100 Best Places to Work that have never done layoffs. I know it is a tough thing to do, but it is worth knowing that when companies do it last and least, there is evidence to suggest that they bounce back faster when things turnaround. Something worth keeping in mind, although I know how tough it is and that many companies have no choice.
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Nuts, Bolts, & Jolts
Diego over at Metacool told me about Nuts, Bolts, & Jolts, by Richard Moran. which is essentially a list of hundreds and hundreds of little bits of advice and observations about how to survive in organizational life — especially in a Dilbert kind of company. It doesn't have a plot, but groups the little gems into themes.A few of my favorites:
Never answer your cell phone when you are in the bathroom.
If you work at home a lot, don't talk about Oprah or General Hospital when you do show up.
Self-directed teams require a lot of direction.
The grapevine is usually about 90% right.
The more time the company spends on budget preparation, the less useful it will be. Just learn how to do it, and get it in.
Worry more about implementation that strategy, it is harder to do.
Don't put your company's name on a vanity license plate. You'll have to re-register your car when you get laid-off.
Go to the company holiday party, but don't stay too long.
Don't talk about your boss, clients, or projects in elevators or taxi's.
There are hundreds more, and most of them are pretty fun — even if you disagree with some. I disagree with, "Don't tell people there ideas are bad unless you have a better one," at least in healthy organizations and groups, I think that challenging and critiquing ideas –without being a jerk — is part of the process.
It is a fun and quick read. Moran is pretty clever and funny, although I think the book is more aimed at individual survival than building a creative company — but survival is pretty damn important these days!
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The 100 Best Business Books of All Time Is Published Today
I blogged earlier about Jack and Todd's new book, The Best 100 Business Books of All Time. Today is the publication date, so it is shipping from both Amazon and Jack and Todd's own company, 1800CEOread. We had a great little gathering last night at the d.school to celebrate the book, which was led by Todd (and organized by Kate from CEOread). There were about 50 people, and Todd led a little panel composed of authors of three of the books on the list: Randy Komisar of Monk and the Riddle fame, Chip Heath for Made to Stick, and Jeff Pfeffer and me for The Knowing-Doing Gap.It was really fun, and I just loved hearing all the great stories, such as how Randy — who is an amazing blend of charming, self-deprecating, and brilliant — explained that when he agreed to do the book, he didn't know what it would be about and didn't know how to write a book — and expressed some confusion because it is not really a business book, even though it now has been honored as being among the 100 best! Chip was entrancing as usual, that guy can really tells stories. And he is scary smart. My favorite one was about how his mother gently intervened to help Chip and Dan deal with some brotherly tension during the writing process. Jeff and I teased each other as usual, and enjoyed telling the group how we fought so hard with our publisher against the title they wanted instead of The Knowing-Doing Gap — Louder Than Words. I sure am glad we fought for that one.
The book is fun and useful, and when you are done with it, you will feel as if you have read 100 books! The endless argument, of course, is about why some books were put on and others were left off. Hardy Green over at BusinessWeek write a pointed column, and the responses are fun — I added one too.
So, to ask the question, what is your favorite business book of all time? For me, it is Orbiting the Giant Hairball. My second favorite is Made to Stick, both of which Jack and Todd did pick.
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How to Survive in New York On a Lousy $500,000 a Year
I am not the right person to write this book, but I bet there is a market for it!
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CEO Compensation Research: Why You Want Rich People to Set Your Pay
All this talk about executive compensation reminded me of one of my favorite academic studies of CEO compensation. It was published in the late 1980's by my Stanford colleague Charles O'Reilly and two co-authors, one of whom — Bud Crystal — was a consultant who specialized in executive compensation.
They tracked 105 large firms and compared numerous predictors of how much the CEO was paid — I am looking at the key tables in the article, and see these included number of employees, sales, return on equity, and assets. The interesting twist, however, was they hypothesized — regardless of a firm's performance and size — that the amount that outside directors on the compensation committee were paid on their own jobs would be a strong predictor of CEO pay. This is based on research on social comparison and anchoring — the idea is that members of the compensation committee would use their own pay as a guide to help determine how much to pay the CEO — and would be excessively swayed by this vivid information.
The results still amaze me: After controlling for traditional size and performance measures, the amount of money made outside directors, especially those on the compensation committee, had a huge effect on CEO pay. O'Reilly and his colleagues report that for every $100,000 that the average member of the compensation committee is paid, the CEO's pay goes up another $51,000 per year. Remember, these effects are independent of firm performance and size!
There are two lessons here. The first, as is well-documented, that there is little relationship between what CEOs get paid and firm performance, other — less rational — factors overwhelm it. See Pay Without Performance for the gory details. The second is that, if you want to make a lot of money, pick the richest and most highly paid people you can find to set your salary.
This is part of the problem that all those financial services CEO's now face. Obama's $400,000 salary is being bandied-about as the anchor, rather than the pay of the often stunningly wealthy people who have been sitting on their compensation committees for so long. Not only have their reputations suffered, the basic group dynamics and psychological principles they have to deal with are against them too – they got merely well-to-do rather than fabulously wealthy people setting their pay now.
The reference to the article is:
O’Reilly, C.A. III, B.G. Main, & G.S. Crystal. 1988. CEO Compensation as
Tournament and Social Comparison: A Tale of Two Theories. Administrative
Science Quarterly. 33: 257-274.P.S. Charles also has a more recent study that seems to show that the more a firm pays the people on the compensation committee, the more the CEO gets paid! I quote "On the average,for every $1,000 more in fees that is given to the chair of the compensation committee,the cash compensation of the CEO is $1,746 higher." How is that for a rate of return? Talk about pay for play, or I guess it is pay for pay. This is from: O’Reilly, C.A. III and B.G. Main. 2007. Setting the CEO's Pay: It's More Than Simple Economics. Organizational Dynamics. 36(1):1-22
